COVID-19 on the Energy Sector: ERERA Chairman Says Oil Increment Affects Costs of Energy Supply for Electricity Companies
By Patience Loum
The Chairperson of the ECOWAS Regional Electricity Regulatory Forum (ERERA) Mr Laurent Kocou Rodrigue Tossou has highlighted the impact of rising oil prices creating an increase in the costs of energy supplies for ECOWAS states and production costs of electricity companies.
“We are faced with rising commodity supply costs and inflation, which affects the competitiveness and growth of our economies. We are also facing strong growth in energy demand with infrastructure and supply that do not always meet the requirements in terms of availability and quality”.
Speaking at the 7th ECOWAS Regional Electricity Regulatory Forum at the Sir Dawda Kairaba Jawara conference in Banjul on 9th November 2022, the chairman said these factors show the inherent and structural difficulties of the current design and development of the electricity sector and power market.
“Providing sufficient energy to meet the requirements of a growing population with rising living standards will require strong commitments by policymakers to energy supply and energy efficiency,” he said.
He said the issue of mobilizing financing for the development of these infrastructures remains insufficient and crucial for States.
“The structural choices implemented in the various countries limit the development of the regional electricity market (disparities in the organization of the sector and the diversity of regulations). Therefore, there is a strong need for harmonization (institutions and regulations) in order to create a coherent, stable and attractive investment framework in the region.
Chairman Tossou added that some member states are still far from the free trade provided for in the Energy Protocol with uncertainties as to the appropriate degree of opening to competition at the national level.
This, he says, raises the question: how can policies address the current difficulties of the power market while simultaneously achieving the structural targets of security, affordability, and sustainability of supply in the context of de-carbonization?
“The issue of energy security and independence of our countries remains a critical concern at the national level but also at the regional level. In a difficult energy context such as at present, some actors may be tempted by a logic of isolation or sovereign individual initiatives to guarantee the security of supply for their populations.”
He said the worrying energy situation could be addressed by a concerted regional approach supported by strong political will and commitment from all stakeholders.
Mr Tossou highlighted the need for solidarity and cooperation in addressing the issue of energy security.
“We are interdependent on energy supply, and we are interdependent in our actions to address future global challenges and conditions. We are condemned to act together to build infrastructure and electricity systems adapted to all our needs, to find innovative sources of financing for our energy projects, to define together development objectives and policies for our countries and more particularly the energy sector, to build together institutional and legislative frameworks adapted to its common objectives, to build together a unified, prosperous and competitive regional electricity market to provide our 350 million peoples in the community with clean, reliable and affordable electricity.”