Sierra Leone was one of Africa’s fastest growing economies since its civil war ended in 2002, but was slowed by the recent Ebola outbreak. Sierra Leone remains one of the poorest countries, with Gross Domestic Product of $868 per capita in 2014. The country’s electrification rate, estimated at 9%, is one of the lowest in the world. Average electricity tariffs are high ($0.27 per kWh), but were considerably higher in 2008 ($0.41 per kWh) before the rehabilitation of the Bumbuna hydro power plant.
Much of Sierra Leone’s infrastructure, including its power network, was destroyed during the war and is being rebuilt slowly. At the end of 2014, total installed capacity on the national grid around the capital Freetown was 98MW, comprising small hydro (56MW), thermal (27MW) and biomass (15MW). However, hydro generation decreases drastically during the three-month dry season. Captive thermal generation by industry – predominantly owned by mining companies – is estimated at around 90MW. Transmission and distribution infrastructure is in poor condition resulting in power losses of up to 40%.
Access to electricity is largely confined to the capital, Freetown, and the surrounding area. In 2011, the National Electricity Act mandated the separation of the National Power Authority, the state-owned utility, into separate companies for generation and transmission, on the one hand, and distribution on the other. This unbundling took effect on 1 January 2015, with the creation of the Electricity Generation and Transmission Company and the Electricity Distribution and Supply Authority. The government has announced that it will put the utilities under management contracts with support from the World Bank, and proposed introducing digital payments through mobile money to improve revenue collection.
The National Electricity Act opened the door to investment by independent power producers. At the same time, the Electricity and Water Regulatory Commission Act 2011 mandated the establishment of an independent regulatory agency that is expected to start operations in 2015.
Despite a lack of specific policy incentives, Sierra Leone has been relatively successful in attracting private investment to the power sector in recent years, driven by its ambition to reach 1GW by 2017. The Bumbuna hydro power plant (50MW), funded by development partners, was commissioned in 2011. In 2013 the government responded to an unsolicited proposal from Joule Africa, which later included Endeavor Energy, and negotiated to add an additional 200MW to the Bumbuna site. The project was estimated to cost $750m, with financial close mooted for the end of 2015, though doubts remain over whether the project will go ahead.
In May 2014, the 32MW Addax biomass plant, running on bagasse feedstock and adding 15MW to the national grid, was commissioned. More recently, the company is understood to have faced financial and technical difficulties. In 2014, the government announced it had awarded a contract to build a 6MW PV plant in Freetown. The project is expected to cost $18m and to be funded with 50% debt. More solar projects are expected to be announced over 2015.
A transmission project to interconnect the West African Power Pool countries of Sierra Leone, Guinea, Liberia and Ivory Coast was approved in 2013 and is expected to be completed by 2017.
Score Summary
Sierra Leone scored 0.79 in Climatescope 2015, placing it 40th on the list of countries overall. The country’s highest score was on Clean Energy Investment and Climate Financing Parameter II.
On Enabling Framework Parameter I, Sierra Leone gained five places to rank 28th. Its score was supported by an increase in the volume of installed clean energy capacity, relatively high diesel and kerosene prices and growing demand for power.
The country was also positioned quite high on Parameter II. Although it slipped one place to 27th, the score was underpinned by investment to date – particularly in the Addax plant – and a modest recent increase.
On Low-Carbon Business & Clean Energy Value Chains Parameter III, Sierra Leone was placed 44th, a decline of two places. This reflected the small number of service providers and value chains.
On Greenhouse Gas Management Activities Parameter IV, the country sat in 51st position.