The African Union Commission (AUC) and the Association of Power Utilities of Africa (APUA) jointly convened a virtual meeting of CEOs of African Power Utilities to discuss the impact of Covid-19 on the energy sector in Africa and in particular on power utility companies.
The meeting was co-chaired by H.E. Dr. Amani ABOU-ZEID, AUC Commissioner for Infrastructure and Energy and Mr. Patrick MWILA representing the President of the Association of Power utilities of Africa.
The main objective of the meeting was to share experiences on COVID-19 induced impacts on power utilities, identify actions being taken by companies and to make appropriate recommendations in response of this pandemic.
At the start of her remarks, H.E. Dr. Amani ABOU-ZEID thanked APUA and the CEOs of African power utilities for holding this meeting and recommended that these consultations should be sustained beyond the pandemic. aU Commissioner started her address by presenting thanks to african utilities and power companies for ensuring power supply to our population with reduced workforce and under challenging conditions. She commended the safety and health precautionary measures taken to protect employees as their work continues to support health facilities, homes and businesses continuity.
The AU Commissioner underscored the importance of power utilities as the centre piece of the electricity sector in any economy. “All the players in the electricity sector depend on the successful operation of the power utility – generators, consumers, governments and even regulators”.
The Commissioner also emphasized the role that power utilities are expected to play in the recovery of the economy after the pandemic while at the same time, they have a major responsibility in the fight against the spread of the coronavirus.
She said, “The power utilities in Africa find themselves fighting two battles – one for their own survival and the other against the virus – and both battles are very important and ones that they must win”.
She reminded that as the continent moves towards an integrated electricity market, the role of power utilities will be even more significant and having them on board will be essential.
On his part, the President of the Association of Power utilities of Africa representing member utilities presented the challenges and threats facing African electricity companies following the outbreak of Covid-19. The President of the Association of Power utilities of Africa, Mr. Victor MUNDENDE, through a statement read by Mr. Patrick MWILA highlighted decline in electricity demand owing to Covid-19 as the main challenge that electricity utilities across Africa are facing, consequently resulting into serious reduction of revenues.
Other than decline in electricity demand, the CEOs also listed other challenges caused by Covid-19 such as:
o Difficulties related to network maintenance, customer service and managerial management, impacted by travel restrictions, social distance and working remotely;
o Difficulties for teams to intervene in the preventive maintenance of the network;
o Difficulties in honouring royalties to independent producers, especially for the payment of fixed charges;
o The pace of projects implementation has slowed due to compliance with health measures on construction sites as well as difficulties in securing supply chains.
The meeting came up with some recommendations to mitigate the effects of Covid-19 in the electricity sector, which include:
1. The provisions adopted by the governments for Covid-19 economic recovery measures should also consider electricity and water sectors as priority.
2. Electricity companies must negotiate with governments, regulators and independent power producers (IPPs) to support electricity companies in the face of declining demand and declining revenues;
3. Introduce temporary measures that will cushion low income electricity consumers through special arrangements such as lifeline tariffs, longer credit periods or temporary payment waivers.
It is noteworthy to mention that the AU Commission is preparing to hold the meeting of the Bureau of Energy Ministers which will be informed by the outcomes of meeting with african electricity utilities with a view to safeguard the business soundness of power utilities to continue to effectively play their part in african economies and well being of All Africans.
About the African Union
The African Union (AU) is a continental body consisting of the 55 Member States that make up the countries of the African Continent. It was officially launched in 2002 as a successor to the Organisation of African Unity (OAU, 1963-1999). The Department of Infrastructure and Energy is responsible for coordinating and promoting the development energy, transport, tourism and ICT sectors in Africa. The department coordinates the harmonisation and promotion of sound policies, strategies and programmes for the development of the infrastructure and energy sectors at the continental level in support of social, economic and human development. Learn more at: http://www.au.int
About Association of Power Utilities of Africa (APUA)
The Association of Power Utilities of Africa (APUA) is an international non-governmental association formed in 1970 with its headquarters in Abidjan, Ivory Coast.
APUA has 56 active members in 46 African countries, 20 affiliate members and some associate and observer members in Africa and Europe.
APUA’s purpose is to promote the development and integration of the African electrical sector, the dissemination of best practices of management, the exchange of experience and know-how, mutualised training of staff, as well as joint exploitation of the energy resources based on a ‘win-win’ approach for all members. Learn more at: http://www.apua-asea.org
For further information: Directorate of Information and Communication | African Union Commission I E-mail: DIC@africa-union.org I Web Site: www.au.int I Addis Ababa | Ethiopia