Nigeria Is at the Center of West Africa's Future Energy Plans

Aug 19, 2014 | 16:06 GMT

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Nigeria is the Center of Africa's Future Energy Plans

West African prospects for electricity production are shaped in large part by Nigeria's potential to develop fossil fuels. Because it holds Africa's greatest volume of oil and natural gas reserves within its borders, Nigeria has optimal access to natural gas. These reserves could be used for electricity production assuming Abuja is able maintain security and political control of the resources. As a result, regional connections between national power grids have spread west and inland from Nigeria. The main cluster is based around the Coastal Transmission Backbone running through Benin, Togo and Ghana and eventually reaching Ivory Coast along the Gulf of Guinea. While some inland connections link Burkina Faso and Niger to this transmission backbone, connectivity with the rest of West Africa is still in the earliest stages of development. Eventually the network could reach as far west as Senegal.

Under the leadership of President Goodluck Jonathan, Abuja aims to at least triple domestic power output and expand the transmission grid throughout the country. However, political wrangling in Nigeria has limited the expansion of domestic electricity generation, and power generation in the country still falls short of demand, resulting in load shedding and blackouts. Nigeria recently privatized the Power Holding Company of Nigeria, hoping the move would generate greater investment in infrastructure development and, as a result, increase domestic power production. Facing its own shortfalls, Nigeria is not able to translate its large natural gas-fired electricity production base into a regional abundance of electricity, leaving much of West Africa to rely on fuel oils for electricity generation.

As development moves forward, increasing transmission capabilities will likely be the main focus when securing investment and building infrastructure. Countries will also seek to increase their own power generation capacity, and ongoing privatization efforts may lead to higher cost efficiency over time. Apart from Nigeria, other countries in West Africa will also push to develop their offshore oil and natural gas deposits. This will lead to some of the natural gas being fed back inland for power generation. West Africa is probably still far from having an effective, regionwide electricity trading pool, and serious infrastructure challenges will need to be resolved before a physical transmission grid could enable the development of trading mechanisms.