ABSTRACT
Energy security became critical in the past few decades when governments and inter- governmental organisations saw it prudent to ensure constant supply of energy for domestic and industrial consumption. This became pertinent after the devastating effect of global wars on energy supplies. With increased awareness of the significance of energy to the socio- economic development of nations, the Economic Community of West African States (ECOWAS) formed the West African Power Pool (WAPP) to integrate the electricity market of Member States. The ECOWAS Renewable Energy Policy (EREP) was also introduced to facilitate the exploration of the renewable energy potentials of the sub-region. Under the WAPP and the EREP policy, Member States are required to harmonize their energy policies with regional energy frameworks. The study employed qualitative methods, using interviews and secondary data, to examine the extent to which Ghana’s national energy policies reflect that of the WAPP and the EREP, and evaluate their implementation, attendant challenges and implications for energy security. The study reveals that Ghana’s energy policies are consistent with regional energy frameworks. However, the implementation process is hindered by some challenges, chiefly financial and technical, affecting its ability to generate and export power at a competitive cost. As a result, the EREP’s target of increasing renewable energy in the overall energy mix, excluding large hydro, to 10% by 2020 will be missed. In addition, the target to increase LPG for cooking to 36% by 2020 will be missed in rural communities but attainable in urban communities, where factors facilitating its usage are high. The study, therefore, recommends that Ghanaian authorities should adopt cost recovery and cost reduction measures, among others, to deal with the financial challenges of the power sector, explore alternative sources of funding for renewable energy projects due its high upfront cost and subsidise the cost of LPG for rural communities.
CHAPTER ONE
INTRODUCTION
Background to the Study
The International Energy Agency (IEA) defines Energy Security as “the uninterrupted availability of energy sources at an affordable price”1. Energy, especially electrical energy, is central to nearly every major challenge and opportunity the world faces today, including job creation, security and food production. The Global Energy Security Conference of 2015 estimated that nearly 1.1 billion people worldwide lacked access to electricity2. A country cannot be considered developed if it lacks access to affordable, reliable and sufficient energy which is critical to the attainment of basic human needs. This is stressed in the United Nations Sustainable Development Goal(SDG)on energy, goal number seven, which calls for clean, affordable and sustainable energy for all3.
Africa is confronted with inadequate energy supply, particularly electricity, with an average 10-15% electricity demand growth against declining supply4.Cognisant of Africa’s challenges in the energy sector, the African Union, in collaboration with the New Partnership for Africa’s Development (NEPAD) Secretariat and the African Development Bank (AfDB) Group, launched an infrastructural initiativedubbed “Programme for Infrastructure Development in Africa (PIDA)” in 2010 5, with energy high on the agenda.
The energy situation in the West African sub-region is nothing to write home about as it remains one of the most energy-poor regions of the world with per capita electricity consumption estimatedat 88kWh against continental and global rates of 563 and 2596 kWh respectively6. Also, electricity access rate varies from below 20 % in countries like Liberia, Sierra Leone, and Niger to more than 50 % in countries like Senegal, Ghana and Cape Verde.
Householdaccess rate for LPG/Kerosene is estimated at of 5%7.Mindful of the indispensable role of electricity in the socio-economic development of every country, leaders of the Economic Community of West Africa States (ECOWAS) developed an ambitious regional energy agenda, the West African Power Pool (WAPP) in 1999,to integrate the operations of the national electricity networks of Member States into a unified regional market to ensure affordable and reliable supply of electricity8. In 2003, the ECOWAS Energy Protocol was promulgated to increase complementarity and attract investments to promote regional energy trade.
The agenda was further extended to cover the establishment of the West African Gas Pipeline (WAGP) in 2005 and the ECOWAS Centre for Renewable Energy and Energy Efficiency (ECREEE), in 2010, to deepen energy sector integration. In addition to ECREEE, the ECOWAS Regional Electricity Regulatory Authority (ERERA) was also institutionalised in 2008, to regulate cross-border electricity trading in the sub-region. Similarly, the ECOWAS Renewable Energy Policy (EREP) was established in 2014, in line with the objectives of the UN sustainable Energy for All (SE4ALL) programme, to increase the share of renewable energy sources in the overall generation mix9.
Whilst significant investments have been made to boost energy production through these regional energy initiatives, almost all ECOWAS Member States have experienced major challenges in the form of repeated nationwide power outages and load shedding of which Ghana is not an exception.The phenomenon of rural-urban migration is on the ascendancy and projected that by 2050, 63% of the population will reside in urban areas, boosting demand for electricity and other energy resources in the process10.
The challenges underpinning the low access to electricity are linked to interplay of factors such as financial,regulatory, social, economic, and technical constraints. In Ghana, there is a cyclic
powercrisis that hasbecome a perennial development challenge, with cumulative severity that threatens the country’s socio-economic growth and transformation. The power crisis mainly manifests itself in the form of a power rationing system, which slows downindustrial activities, leading to job and income losses and social disruptions11. The Institute of Statistical, Social and Economic Research (ISSER) in 2014 estimated that Ghana lost between $320 million and
$924 million per annum in productivity and economic growth due to the power crises of 2012- 201412.
Statement of The Research Problem
The West African Power Pool (WAPP) policy’s overarching objective is an inter-connected electricity network in the sub-region through the promotion and development of energy infrastructure for electricity generation and transmission. Also, it is to guarantee the coordination of electric power exchanges between ECOWAS Member States. On the other hand, the purpose of the ECOWAS Regional Renewable Energy Policy (EREP) is to “ensure the increasing use of renewable energy sources such as solar, wind, small-scale hydro and bio- energy for grid electricity supply and for the provision of access to energy services in rural areas”13.
The relevance of the WAPP and the EREP polices are unquestionable because they serve as an overall regional framework to address the precarious state of energy security in West Africa. Although there have been a lot of studies carried out on energy security in West Africa, not enough academic work has focused on studying how Ghana is integrating its national power system into the WAPP, including how much of its generation mix reflects the targets of the EREP and the challenges thereof. This study, therefore, seeks to assess Ghana’s
implementation of the WAPP and the EREP to determine whether the policies have improved energy security in the country against the backdrop of recurring power outages.
Research Questions
- To what extent does Ghana’s national energy policies reflect the WAPP and the EREP?
- What have been the implications of the implementation of the WAPPand the EREP in Ghana towards ensuring energy security?
- What are the challenges/prospects to implementing the WAPP and the EREP in Ghana?
Objectives of the Study
The study seeks:
- To determine the extent to which Ghana’s national energy policies reflect the WAPP and the EREP;
- To evaluate the implementation of the WAPP and the EREP in Ghana and their implications to ensure energy security;
- To ascertain the challenges militating against the implementation the WAPP and the EREP in Ghana.
Hypothesis
Though Ghana’s energy policies are consistent with the WAPP and the EREP, their implementation is fraught with challenges.
Scope of Study
The West African Power Pool Policy has eight specific objectives. This study focuses on objective number two which seeks to “improve the reliability of power system and quality of
power supply in the region as a whole” by ascertaining how Ghana’s production and transmission of electricity is integrated into the WAPP.
The ECOWAS Renewable Energy Policy sets three clear targets to be achieved by Member States by 2020. This study places emphasis on targets number one and three, which mandate Member States to:”increase the share of renewable energy in their overall electricity mix, including large hydro, to 35% by 2020 and 48% by 2030;increase the share of renewable energy in the overall energy mix, excluding large hydro to 10% by 2020 and 19% by 2030; increase the share of the population served with modern fuel alternatives, including LPG for cooking, to 36% by 2020 and ensure 100% universal access to improved cook-stoves by 2020″14.
Rationale of the Study
Power outages cost West African countries an estimated 1-2% of their GDP annually15. Energy security is therefore, critical to the socio-economic development of West African states, given the fact that the economies of some countries in the sub-region are amongthe fastest growing on the continenet16. Furthermore, the West African sub-region is currently experiencing rapid urbanisation and high population growth.In 2013, the region surpassed North Africa in Foreign Direct Investment (FDI) inflows, becoming the second most attractive sub-region on the continenet17. This trend has continued and in 2017, FDI inflows to Ghana increased significantly during the first three (3) quarters of the year, amounting to US$ 4.37 billion18. These modest economic gains, risk been derailed by unreliable and expensive power supply.
This research looks at a very significant but undiscussed aspect of Ghana’s energy architecture with the hope that the findings of this study will be useful to policy makers and stakeholders. The anticipation of this work is to bring to the appreciation of all stakeholders the importance
of Ghana’s participation in the implementation of regional power projects; and its bearings on her social-economic development. This study adds to the growing body of literature on energy security, which has become a critical subject in energy studies. It is also expected that other Member States would learn from Ghana through the findings of the study.
