Cotonou, Benin
African governments need to accelerate electricity-market reforms, attract more private capital and deepen regional power trading if the continent is to overcome persistent supply gaps and financially weak utilities, speakers at the Africa Think Tank Summit said on Thursday.
The discussion took place during the high-level panel, “Political Leadership for Power Sector Reform – Challenges, Trade-Offs, and Accountability,” which examined how governments can balance political control, private-sector participation, regional integration and accountability while expanding electricity access.
Convened by the African Capacity Building Foundation, the 12th Africa Think Tank Summit, taking place Oct. 28-30 in Cotonou, Benin, brings together ministers, policymakers, think tanks and development partners. The summit is being held under the theme, “From Energy Access to Economic Transformation: Practical Policy Pathways for Power Sector Viability, Growth and Reform in Africa.”
Panelists said fragmented national approaches have raised costs, discouraged investment and left many state-owned utilities unable to finance the infrastructure needed to meet growing demand. They called for stronger political leadership, tariffs that better reflect the cost of electricity and greater transparency in the management of utilities and regulators.
Tanzania was cited as an example of a country gradually opening its electricity industry. Reforms introduced in 2015 allowed greater private participation in generation and distribution, while transmission remains under state control because of its strategic importance.
Private producers now include large companies generating more than 189 megawatts, medium-sized operators producing more than 59 megawatts and smaller producers contributing about 2.21 megawatts, according to figures presented during the panel. More than 100 companies are licensed to participate in distribution.
Tanzania’s installed capacity has risen to about 4,650 megawatts from 2,461 megawatts following completion of the Julius Nyerere Hydropower Project. Peak demand is about 2,271 megawatts, leaving surplus capacity that the country is seeking to sell to neighboring markets through regional power pools.
That surplus illustrates the case for deeper regional integration, speakers said. Excess electricity in one market could offset shortages elsewhere, lowering the need for countries to build costly reserve capacity independently.
The Sovereignty Question
National sovereignty remains a major obstacle to regional integration, panelists said, as governments often prioritize domestic control even when cross-border infrastructure and pooled generation could reduce costs and improve reliability.
Benin continues to depend heavily on electricity imports, including supplies from Nigeria and Ghana, while the Communauté Électrique du Bénin, which manages transmission infrastructure for Benin and Togo, is undergoing restructuring.
Senegal has pursued regional cooperation through shared hydropower projects and an agreement with Mauritania on offshore gas resources spanning their maritime border.
The panel also highlighted the risks of poorly structured private-sector participation. Ghana’s electricity-distribution concession collapsed in 2019 after problems involving payment guarantees, resulting in losses of more than $190 million, speakers said.
Nigeria, meanwhile, has moved toward more cost-reflective pricing. In 2024, the government introduced its Band A tariff for customers receiving at least 20 hours of electricity a day.
Panelists said politically suppressed tariffs are among the biggest threats to utility finances. When prices fail to cover costs, governments absorb the gap through subsidies, guarantees and debt, while consumers often turn to expensive diesel generation.
Speakers also proposed an independently verified annual scorecard to assess utilities and regulators, saying stronger accountability could reduce policy reversals and improve investor confidence.
The broader message was that Africa’s power challenge is no longer only about adding generation. Governments must also build financially viable utilities, stronger regional markets and credible regulatory systems capable of attracting private investment while protecting the public interest.
