AFREPREN/FWD - Energy, Environment and Development Network for Africa Website
Energy Sector Reform Theme Group
The Energy Sector Theme Group
meeting was held on the 9th - 11th of October, 1999.
The aim of this meeting was to review country research proposals received
from members of the Theme Group from various Eastern and Southern Africa
countries and to assess the relevance of the issues they intend to address to
the region's energy sector. To
assist in reviewing the proposed research issues raised in the proposals, Senior
Policy Makers from various institutions in the region were invited.
The participants to the Energy Sector Reform Theme Group
meeting were drawn from six countries, namely: Ethiopia, Kenya, South Africa,
Tanzania, Uganda and Zimbabwe, and comprised senior policy makers in government
( two Commissioners of Energy and a Director in the Department of Energy), two
senior officials in electricity regulatory agencies and energy researchers
(members of AFREPREN/FWD's Energy Sector Reform Theme Group).
The meeting's main objectives included:
The objective of the Energy Sector Reform Theme Group is to assess the impact of reforms on the region's power sector. To achieve this, the group intends, in the short-term (1st year), to review the existing legal and regulatory frameworks with regard to the following issue:
the above issues are studied, the group will, in the medium-term, address the
impact of power sector reform on rural electrification and electricity supply to
the urban poor as well as mobilization of financial resource (external financing
- both domestic and international sourcing).
Areas of Focus for Country Research Studies
country proposals were refined in response to suggestions and recommendations
raised by invited policy makers. As
a result of discussions with invited Policy Makers, the theme group members from
the six countries represented decided to focus on the following issues:
South Africa: An audit of available research studies on power sector reform in South Africa will be undertaken to determine the added value of AFREPREN/FWD research. Initial indications show that emphasis should be placed on the distribution end of the electricity industry. Two municipalities (the main players in distribution) will be studied in depth to fully appreciate their operations and propose suitable changes to the legal and regulatory framework that would address their shortfalls. The study will select two municipalities at opposite ends in terms of performance (excellent and very poor) to enrich the comparative basis of the analysis.
Kenya: The autonomy of the regulator will be examined under the prevailing legal and regulatory framework to identify options that will enhance the autonomy of the national regulatory agency as well as attract local and foreign investment in the country's power sector.
Uganda: The adequacy of the newly instituted legal and regulatory framework will be assessed with regard to issues such as licensing arrangements and the unbundling of the Uganda Electricity Board (UEB). The regulatory frameworks of other countries (such as Kenya and South Africa) with relatively longer track records in power sector reform will be examined for comparative lessons.
Zimbabwe: The existing legal and regulatory framework will be reviewed to determine its impact on tariff levels as well as tariff adjustment procedures. The study will then recommend how the regulatory framework can be enhanced to ensure that appropriate tariffs are consistently realized.
Ethiopia: Local participation in the electricity sector (in distribution as well as generation) will be the focus of the Ethiopian study. An initial feasibility study will be carried out to evaluate the viability of local participation in the sector. The current Government proclamation (the equivalent of the Electricity Act in other African countries) will also be studied to investigate existing shortfalls in enhancing local participation. In the medium term, options for encouraging local participation through shareholding and concessions by groups such as co-generators will be examined.
Tanzania: The proposed amendments to the new power sector regulatory framework will be reviewed to determine its effect on new IPP investment. The proposed framework (a multi-sectoral regulatory framework) will be examined and its effectiveness evaluated in addressing the tariff question and ability to attract new IPP investment.
Malawi: The study will review the existing legal and regulatory framework with reference to the national regulatory agency. It will also review, in depth, the structure and operations of the regulatory agency. In addition, the study will examine the effects of the proposed sale of distribution to an individual on Malawi's power sector's performance.
The AFREPREN/FWD Secretariat: The Secretariat will compile a regional comparative report bringing together findings of the country studies and focusing on regional power generation and supply in a reformed sector by reviewing power trading agreements (such as the South Africa - Zimbabwe connection) and existing power pools. On the basis of this initial examination, the options of regional power regulation will be assessed. In addition, the Secretariat will compile a regional annotated bibliography.
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