The Common Market for Eastern and Southern Africa (COMESA), in collaboration with the African Development Bank (AfDB), has launched a regional initiative aimed at enhancing the sustainability of the electricity sector in Eastern and Southern Africa through harmonized regulatory frameworks.
The initiative, themed "Regional Harmonization of Regulatory Frameworks and Tools for Improved Electricity Regulation in COMESA," seeks to establish effective, transparent, uniform, and enforceable regulatory frameworks across the region. The ultimate goal is to stimulate cross-border electricity trade and improve energy access within the COMESA region.
The project consists of three main components: the development and adoption of regional electricity regulatory principles and key performance indicators for regulators and utilities, based on the AfDB’s flagship Electricity Regulatory Index for Africa; the creation of a harmonized comparison of electricity tariffs and a cost reflectivity assessment framework tool; and the development of an information and database management system.
COMESA is currently the executing agency for the project, with the Regional Association of Energy Regulators for Eastern and Southern Africa (RAERESA) acting as the implementing agency. The Energy Regulators Association of East Africa (EREA) is also assisting in this effort. The AfDB has provided a USD 1.5 million grant for the project through the African Development Fund, the Bank's concessional financing window.
CRISIL Limited of India was engaged as a consultant to implement components of the project, including developing a framework for the cost reflectivity assessment of tariffs and harmonizing tariff comparisons across the region.
A validation workshop on the Framework and Maiden Reports on Harmonized Comparison of Electricity Tariffs and Cost Reflectivity Assessment in the COMESA Region is currently taking place in Addis Ababa, Ethiopia, from September 18 to 20, 2024.
At the workshop, Saharla Abdullahi, Director General of Ethiopia's Petroleum and Energy Authority (PEA), emphasized the pivotal role COMESA has played in fostering economic integration and development among its member states. She highlighted that energy is the lifeblood of COMESA economies and societies, making the harmonization of regulatory frameworks essential.
"By aligning our approaches, we can unlock the full potential of regional energy trade, enhance energy security, and ultimately improve the lives of our citizens," Abdullahi stated. She also underscored that despite Africa's abundant energy resources, the continent faces a severe energy crisis. “The stark reality is that 75% of the world’s population without access to electricity resides in Africa," she added.
Echoing this sentiment, Bahru Olijra, Director of Electricity Sector Regulation at the Petroleum and Energy Authority, noted that Ethiopia, which boasts the best energy resources among COMESA member countries, is playing a leading role in connecting the region to reliable energy supplies. "Ethiopia is fully committed to adhering to legal frameworks, tariff conditions, and infrastructure development to help connect COMESA member countries with electricity," Olijra remarked.
James Karari Wahogo, Secretary General of the East African Power Pool (EAPP), highlighted the importance of electricity supply for achieving rapid economic growth in the COMESA region. He stressed that while Africa has abundant energy resources, the lack of infrastructure and coordination between countries has hindered their full utilization. "A legal framework for energy development and connectivity must be prepared and implemented," Wahogo asserted.
The validation workshop serves as a platform for regional energy stakeholders to review the consultant's deliverables. Representatives from COMESA member countries, including Ethiopia, and various stakeholders are participating in the event.