Published: October 6, 2015
Guinea and donors kick-start hydropower development
Following US$50mn funding from the World Bank, Guinea’s hydropower fortunes could be on course to change. The contract is part of a multi-donor supported power sector investment plan of over US$700mn.
Summer 2015 may go down in the books as a turning point for hydropower in Guinea. While the country has vast hydropower resources, it has historically failed to exploit the potential on its doorstep, which is estimated at more than 6,000MW.
Even compared with neighboring countries, the energy gap in Guinea seems stark. In a country of 10.63 million people, only around 15% of the population has reliable access to electricity. Compare this to the rest of sub-Saharan Africa – in which total electricity access averages around a third – and it is clear that the time is ripe for change.
Luckily, some progress has been made. In June 2015, the government of Guinea signed a four-year management contract with Veolia Africa-Seureca consortium, which combines two experienced utilities management firms. This contract, funded by the World Bank’s Power Sector Recovery Project, has been widely touted as a first step towards enhancing the national power utility and expanding electricity services across the country. The contract is part of a multi-donor supported power sector priority investment plan of over US$700mn.
As well as improving overall access to electricity, it will also ensure a more reliable power supply for customers who are already grid-connected. This in turn may pave the way for further resource development in the hydropower sector.
“The Guinea Power Sector Recovery Project is a $50mn International Development Association funded project, which aims at helping to improve the technical and commercial performance of the power utility of Guinea, Electricité de Guinée (EDG),” explains Moëz Cherif, a senior energy economist at the World Bank. “This is through a management contract with an international utility management company, investments in the distribution network of EDG and its commercial management software, and technical assistance to the Ministry of Energy and Hydraulics.”
The funding – structured into a grant of $27.4mn along with credit of $22.6mn – comes as part of a larger, multi-donor investment programme for the power sector in Guinea. The World Bank’s affiliate organisation, the International Finance Corporation (IFC) also played a role by acting as Transaction Advisor to the government on the project.
The contract is part of a multi-donor supported power sector investment plan of over US$700mn.