West Africa Power Trade Outlook

The study aimed to identify potential power trades between countries in the region, based on analysis and engagements with leaders and regional institutions. The projections presented in the Outlook are based on the most accurate inputs available at the time and do not reflect subsequent developments. The study focused on the regional power market, which is expected to have a transformative impact on the economies in the region. The establishment of a fully functional regional power market is already underway, with extensive coordination amongst ECOWAS member states in areas such as investment, regulation, and system operations. The market is likely to have a significant impact on the cost of energy and its reliability. The study identified potential power trades between countries in the region, which would deliver almost immediate mutual benefits to trading countries. These trades would significantly lower the overall cost of power supply and increase its availability. The study also highlighted the importance of a transactions-driven approach, where actual cross-border power trades are pursued directly. The West Africa Power Pool Masterplan sets out a long-term vision for integrating the power systems of the region. The plan aims to reduce the cost of energy and increase its reliability by integrating the power systems of the region. The plan also aims to increase investment at regional scale, with a vision of around 16 GW of solar power from as yet unidentified projects coming onstream, balanced by the vast hydro resources, particularly in the north of the region. The study also highlighted the need for increased investment in the regional transmission system to get power where it's needed, including across borders and to reduce costs by tapping into regional resources. The study identified priority cross-border infrastructure and mapped out a way forward for addressing specific policy and financing gaps. The West Africa Power Outlook is intended to support political leaders and decision makers in identifying and reaching the opportunities made possible through regional power system integration. The study reaffirms Power Africa's commitment to enabling effective, low-cost power systems that can drive economic growth and create the large-scale markets needed to open-up fresh investment opportunities on the continent. The study was the result of extensive consultations with partner Governments across West Africa and ECOWAS agencies, as well as in-depth data collection and analysis conducted with the Tony Blair Institute for Global Change. The study provides leading examples of developing power markets at scale for the continent more widely. The regional picture of power trade in West Africa is complex, with some countries experiencing power surpluses while others face deficits. Figure 1 illustrates the regional picture, showing the anticipated off-peak surpluses and deficits in 2022, as well as the long-run production costs. The study highlights the need for a regional approach to power trade, where countries can trade power to meet their needs and reduce costs. The study also highlights the importance of addressing the barriers to trade, including non-cost reflective country-to-country trade agreements, non-payment, and the development of costly domestic generation plants when cheaper imports are available. West African decision makers must have both a regional and national perspective in order to reap the benefits of increased regional interconnectivity, including the potential for an estimated $30 billion in savings through mutually beneficial power trade. The study provides a comprehensive analysis of the regional power market in West Africa, highlighting the opportunities and challenges facing the region. The study provides a roadmap for regional power system integration, highlighting the need for increased investment in the regional transmission system and the importance of addressing the barriers to trade. The study is intended to support political leaders and decision makers in identifying and reaching the opportunities made possible through regional power system integration.