Energy’s Role in the Future of East African Countries

Posted on October 19, 2013 08:19 am

The energy sector in Africa and specifically the East African region needs policy reforms as much as it needs investments. There is need to take stock of the existing status of renewable energy in the region and develop a policy roadmap for sustainable growth in the sector. One of the key ingredient of attracting investments in the energy sector is for East African Community countries to encourage commercial banks to lend or finance energy projects in order to reduce dependency hydro power that consist of more than half the capacity of installed electricity in the region. In my opinion, the solar projects should be prioritized by the economic bloc for banks to allocate funds specifically to solar plants. East Africa’s energy sector is facing major challenges and that is why efforts by the member states should focus on renewable energies and not just give priority to certain hydropower generating projects. Research concluded few months ago showed that demand for energy will expand three times the current need in the next ten years due to economic and population growth and greater urbanization that has seen cities of Kampala, Kigali, Nairobi, Bujumbura and Dar es Salaam housing more than ten million residents compared to less than five million twenty years ago.

Projections is that region will be home to more than 220 million people come 2050 and more than half that population will live in cities. To ensure adequate energy supplies now and in the future the governments of the East African Community should embark on initiatives aimed at addressing the energy deficits that has made the region less competitive in attracting manufacturers and heavy energy consuming industries. Individually, Tanzania is moving towards diversifying its energy mix away from traditional fossil fuels and relying more on natural gas that will see the country become a net energy exporter by 2016 if all goes on as planned and this will come in handy for energy hungry neighboring country of Kenya. Tanzania government that two years grappled with load shedding is now set to begin exporting liquefied natural gas in the next two to three years. There is no doubt the home of one of the greatest African leaders of 20th century Julius Nyerere is among the emerging new LNG exporters and that is potentially going to turn Mtwara and Dar es Salaam into a trading hubs for the East African region although it has to compete with Mozambique that has equally enormous gas reserves.

I strongly believe that East African countries should ensure that they fully optimize the region’s energy resources and should strive toward smooth implementation of their energy projects starting with oil findings in western Uganda and Gas discoveries in Mtwara region in Southern Tanzania. Despite the new discoveries, there is need for the five governments to promote renewable energy growth in the region. For example regulations that can make or break the sector such as tariff and non-tariff barriers that have impacted intra-region investment in new energy sources should also be dismantled and replaced with 21st century regulations that will encourage and attract investments in renewable energy sector. Many would be glad to see an East African Community led Power Grid and lets say Trans-East African Gas Pipeline from Tanzania to other member states that would be crucial in addressing the imbalance in the power-generating resources in the region. A well-supported project would connect a future Tanzania with surplus power generation capacity to those who face a deficit like Kenya and Uganda. With goodwill and transparency in harmonizing energy regulations, and technical standards and systems, that impact the interconnection of national power grids would be a good starting point in realizing such a dream. I don’t dispute that each government in East African Community has diverse and national priorities but the regional dream should come first as noted on http://www.contadorharrison.com/regionalization-strategy-for-east-african-community/.

Currently, all five countries are net importers of oil and gas products but to secure the region’s energy security and economic connectivity there must be a collaboration and strategic plan that would see complementation rather than competition. The other thing the regional member states must address to guarantee energy surpluses is to tackle the existing challenges to cross-border development projects. The filthy animals heightening nationalist sentiments with calls for individual governments to consider domestic market and not bother with regional markets should be ignored. Why would for example Tanzania fail to sell gas to Kenya just because some few noisemakers look at their northern neighbors as an economic rival or why would Uganda not set up a refinery and sell refined and by products to their eastern neighbors Kenya. The expected rise of energy demand across East Africa would inevitably lead to inter-state competition for available resources and that is not healthy for Africa’s most successful and well structured economic bloc as I wrote some few weeks back http://www.contadorharrison.com/east-african-community-a-rising-regional-economic-%E2%80%A8power/. Overlapping claims in several disputed issues like the proposed single East African VISA, use of National Identities as a travel document and the so called “three brothers plans” meaning Kenya, Uganda and Rwanda plans for joint infrastructures http://www.contadorharrison.com/kenyarwanda-and-uganda-plans-to-achieve-efficiency-by-curbing-bureaucracy-at-port-of-mombasa/  within the region pose a threat to unimpeded cross-border energy supply.

Due to uneven economic development, funding and integrating the East African region’s infrastructure continues to be an issue and that is what led to Uganda, Rwanda and Kenya plans http://www.contadorharrison.com/kenyarwanda-and-uganda-plans-to-achieve-efficiency-by-curbing-bureaucracy-at-port-of-mombasa/. East African countries members need to work together towards developing relevant regulatory, legal and frameworks to facilitate growth and development and that is why I supported the single VISA plans http://www.contadorharrison.com/east-africa-single-tourist-visa-will-unleash-regions-tourism-potential/ but my preference is to see Tanzania and Burundi being part of the deal. Their exclusion should be at their will and not the other way round. Diplomats should make efforts to sort out the challenges or differences that could have led Tanzania go slow in regional frameworks and the so-called “three brother” should engage the southern brother.  Regional policies that encourage development of renewable energy should be high on the policy agenda for the East African countries energy framework for the mid and long run plans. They should work towards enhancing the role of renewable energy sources. I imagine a scenario where the five countries scraps tariff and non-tariff barriers and harmonization of standards to facilitate intra-East African investment in renewable energy the impact would be beneficial to the current and future generations. Both local and foreign innovations in the energy sector should be supported through joint East African Community cooperation on the development of renewable energy. The region’s energy outlook mirrors regional developments sandwiched between economic developments and much needed security for the prosperity of the region that is home to 135 million plus people. Contador Harrison thinks that East African countries should leverage their existing and long-standing cooperation that dates back to cold war era to ensure certainty in regional energy security otherwise any hope for the most developed region in Africa would come to nothing.

Contador Harrison