Regulation of the electricity industry in Africa: In search of an optimal model – where and when the next model?

Regulatory and institutional changes, restructuring and/or privatization of the erstwhile vertically integrated electricity networks have been adopted by all Sub-Saharan African (SSA) countries in their pursuit of rural and urban electrification, poverty reduction and economic growth. But advances with the reforms remain limited and the results are at best debatable. The purpose of this paper is to examine the reasons for the unsuccessful implementation of deregulation in Sub-Sahara electricity markets. The paper finds that the current trend to the regionalization of the electricity markets in SSA and the creation of regional power pools make possible the creation of a genuine regional electricity market which would provide new opportunities for the adoption and adaptation of more advanced models of regulation (2-G and/or 3-G) similar to the ones currently employed by some developed economies in Europe and North America. To do so, regulators in SSA need to adopt a more dynamic approach to regulation.