Name of the Report :
Changing Dynamics of the Sub Sahara Africa Power Sector - Increasing
Investments by Foreign Players to Drive Growth in the Region

Table of contents

1 Table of contents... 2
1.1 List of Tables... 4
1.2 List of Figures... 5
2 Introduction... 6
3 Sub Saharan Africa Power Market Overview... 7
4 Crisis in the Power Sector – Understanding the Situation... 8
4.1 Inadequate Financial Adequacy of State Utilities... 9
4.2 Abundant Natural Resources but Limited Power Generation... 10
4.3 High Electricity Costs Acts as Impediment to Power Market Development... 11
5 Major investments needed, but from where?... 12
6 IPP Investments in Sub Saharan Africa – On a Growth Trajectory... 14
6.1 2008 – 2009 Witnessed a Decline in FDI flows due to the Contraction of Global
Demand and a fall in Commodity Prices... 17
6.2 Regional Analysis of IPP Investments in Africa - Northern and Southern Africa
Attracts the Largest Investment due to Abundant Natural Resources... 19
6.3 IPP Market in Sub Saharan Africa – The Road Ahead is Dotted with Challenges... 21
6.3.1 Need for Reform Legislation and Sector Restructuring to Pick Up Pace... 21
6.3.2 Incentives and Increased Electricity Tariffs Must for IPP Growth... 21
6.3.3 Strong Local Knowledge and Strategic Relationships with Host Governments Key
to Success of IPPs in Sub Saharan Africa... 22
6.3.4 Secure Source of Low-cost Feedstock and Expertise in New Power Technology
Must for Sustainable Development of IPP... 22
6.3.5 Mutually Beneficial PPAs Critical to Development of IPP’s... 22
7 Key To Sustainable Development of the Sub Saharan African Power Sector... 23
7.1 Negative Perceptions of IPPs need to be addressed to create a Conducive Environment
for IPP Investment... 23
7.2 Unfavorable Power Purchase Agreements (PPAs) and Perceived High Investment Risks
Inhibit Development of IPP’s... 23
7.3 Corruption, Poor Infrastructure Development and Shortage of Skilled Identified as Key
Detriments to IPP Development... 23
7.4 Regulatory and Fiscal Environment... 24
7.4.1 Legislation... 24
7.5 Licensing Procedures... 24
7.6 Power Purchase Agreements (PPA)... 24
8 Investment Analysis in Sub-Saharan Power Generation Sector... 25
8.1 Regional Funding Analysis – Asian Involvement in the Sub-Saharan African Electricity
Market to Grow... 25
8.2 Asian Involvement in Sub-Saharan Africa Power Sector – Investment Trends... 27
8.3 Investment Value per Project Financier in Sub Saharan Africa Power Sector, 2010... 30
8.4 Project Value per Country in Sub-Saharan Africa Power Sector, 2010... 32
8.5 European Union to Continue to Play an Important Role in Sub Saharan Africa... 34
8.6 China leading the new wave of FDI in Sub Saharan Africa... 35
8.7 Criticism Regarding China’s Investment in Sub Saharan Africa... 37
8.7.1 Angola Mode of Operation... 37
8.7.2 Complicated Terms of Contracts... 37
8.8 Chinese Model of Success – Key to Differentiated Propositioning... 38
8.8.1 Chinese Government Support... 38
8.8.2 Expertise in Hydropower... 38
8.8.3 Strategic Relationship with Host Governments... 39
8.8.4 Low-cost Equipment... 39
8.9 Key IPP Sponsored Energy Projects in Sub-Saharan Africa... 39
8.10 Country Analysis for Sponsored Power Projects... 39
8.10.1 Angola... 39
8.10.2 Botswana... 41
8.10.3 Ethiopia... 42
8.10.4 Gabon... 43
8.10.5 Ghana... 45
8.10.6 Kenya... 47
8.10.7 Mozambique... 49
8.10.8 Nigeria... 50
8.10.9 Sudan... 52
8.10.10 Zambia... 52
8.11 Conclusion... 54
9 Financing Power Projects in Sub Saharan Africa... 55
9.1 Private Sector Funding... 55
9.2 Public Sector Funding... 55
9.3 Growing Contractual Savings Industry... 55
9.4 Project Financing... 56
9.4.1 Project Finance – How it Works... 56
9.5 Selecting a Finance Provider... 56
9.6 Project Selection for DFIs... 58
9.6.1 Project Selection for Commercial Banks... 58
9.7 Role of Carbon Finance... 59
9.7.1 Carbon Finance Challenges... 59
9.8 Case Study of Key Financing Projects and Structures... 60
9.8.1 Case Study: DBSA Hydropower Project... 60
9.8.2 Case Study: DBSA Wind Power Project... 61
9.9 Involvement of Asian Financial Institutions is Expected to Remain Strong in the
Foreseeable Future... 62
10 Market Attractiveness for IPP is Sub-Saharan Africa, 2010... 63
10.1 Kenya and Uganda... 63
10.2 Tanzania... 63
10.3 Ethiopia... 63
10.4 Other Regional Countries... 63
10.5 Nigeria... 64
10.6 Ghana... 64
10.7 Ivory Coast... 64
10.8 Cameroon and Senegal... 64
10.9 Others... 64
11 Conclusions and Future Market Predictions... 65
11.1 Public Private Partnership to Evolve Driving Investments in Sub-Saharan Africa
Power Sector... 65
11.2 Emerging Trend of Asian-based Project Developers to be seen in the Future... 65
11.3 Growing Export Market to Augur Well for IPP’s in Sub Saharan Africa... 66
12 Appendix... 67
12.1 Abbreviations... 67
12.2 Methodology... 67
12.2.1 Coverage... 67
12.2.2 Secondary Research... 68
12.2.3 Primary Research... 68

List of Tables

Table 1: Electricity Consumption, Regional Analysis (TWh), 2000 – 2009... 9
Table 2: Electricity Potential Versus Utilization, Key Countries, Sub-Saharan Africa... 10
Table 3: Financing Gap, Sub-Saharan Africa, 2009... 12
Table 4: Foreign Direct Investments, Africa ($m), 2003 – 2008... 14
Table 5: IPP Investments in Sub Saharan Africa, Top 10 Countries by Investments,
2000 – 2010... 15
Table 6: Investment Commitments to Energy Projects with Private Participation in
Sub-Saharan Africa, by Sub-sector ($ billion), 1990–2009... 18
Table 7: FDI Inflows by Region as a Percentage of Gross Fixed Capital Formation,
2000–2009... 20
Table 8: Annual Commitments by Countries to Infrastructure Projects in Sub-Saharan Africa,
2006 – 2009... 26
Table 9: Investment Value Per Country (%) in Sub-Sahara Africa Power Sector, 2010... 27
Table 10: Absolute Investment Value in Sub-Saharan Africa Power Sector, 2010... 29
Table 11: Investment Value Per Project Financier in Sub-Saharan Africa Power Sector,
2010... 30
Table 12: China Exim Bank Investments in Sub-Saharan Africa Power Sector, Top 5
Countries, 2010... 31
Table 13: Project Value Per Country in Sub-Saharan Africa Power Sector,
2010... 33
Table 14: China’s Annual Commitments, Power Sector, Sub Saharan Africa ($m),
2001 – 2009... 36
Table 15: Sponsored Power Projects, Angola, 2000 – 2010... 40
Table 16: Sponsored Power Projects, Botswana, 2000 – 2010... 41
Table 17: Sponsored Power Projects, Ethiopia, 2000 – 2010... 42
Table 18: Sponsored Power Projects, Gabon, 2000 – 2010... 43
Table 19: Sponsored Power Projects, Ghana, 2000 – 2010... 45
Table 20: Sponsored Power Projects By PPI Type, Ghana, 2000 – 2010... 46
Table 21: Sponsored Power Projects, Kenya, 2000 – 2010... 47
Table 22: Sponsored Power Projects By PPI Type, Kenya, 2000 – 2010... 48
Table 23: Sponsored Power Projects, Mozambique, 2000 – 2010... 49
Table 24: Sponsored Power Projects, Nigeria, 2000 – 2010... 50
Table 25: Sponsored Power Projects By PPI Type, Nigeria, 2000 – 2010... 51
Table 26: Sponsored Power Projects, Zambia, 2000 – 2010... 53
Table 27: Sponsored Power Projects By PPI Type, Zambia, 2000 – 2010... 53
Table 28: Abbreviations 67

Summary

“Changing Dynamics of the Sub Sahara Africa Power Sector - Increasing Investments by
Foreign Players to Drive Growth in the Region” gives detailed information on the Africa
power market and provides an overview of the key factors driving investment in the sector.
The research analyzes investment trends in the regions power sector and also detailed
analysis of the leading countries in this region. This, coupled with funding analysis,
power finance structures provides a comprehensive understanding of the market’s scenario.

Africa continues to suffer from perceptions of being a high-risk and difficult market even
though it has enormous prospects for future growth in the energy sector. Its wealth of
natural resources is spread across 54 independent states, which hold a combined
population of 700 million. Historically, FDI inflows in Africa have been much smaller
compared to the other developing regions. However, the economic growth and political
stability witnessed by this region has greatly increased Africa’s ability to attract more FDI
over the last decade. On the economic front, the growth in the economy at 5% per annum
since 2001 coupled with high prices and strong global demand for commodities attracted
strong investments in the region. Additionally, governments are actively introducing policies,
fiscal measures and reforms and creating improved business environments to actively court
foreign investor groups. Growing political stability in the region, with over 20 countries
embarking on democratic transitions in the continent and a rapid decline in civil wars, has
also helped in creating an optimum environment for FDI.

Scope

The scope of the report includes -
- Data on the investment trends in Sub Sahara Africa and for the leading countries of the region
- Power finance structure within the power industry in Sub Sahara Africa
- Funding analysis for power sector in Sub Sahara Africa
- Country analysis for Asian sponsored energy projects
- Data sourced from proprietary databases and primary interviews with key participants across
the value chain.
- The study covers Sub Sahara Africa along with the data and analysis for the region.

Reasons to buy

The report will enhance your decision making capability in a more rapid and time sensitive manner.
It will allow you to -
- Facilitate decision-making based on strong historic and forecast data for IPP investments in
Sub Sahara Africa.
- Develop strategies based on the latest regulatory events
- Position yourself to gain the maximum advantage of the industry’s growth potential
- Identify key partners and business development avenues
- Respond to your competitors’ business structure, strategy and prospects

To order this report, please send an email to mail@worldoils.com

Disclaimer
All Rights Reserved.

No part of this publication may be reproduced, stored in a retrieval system or transmitted
in any form by any means, electronic, mechanical, photocopying, recording or otherwise,
without the prior permission of the publisher.

The facts of this report are believed to be correct at the time of publication but cannot be
guaranteed. Please note that the findings, conclusions and recommendations that the
publisher delivers will be based on information gathered in good faith from both primary
and secondary sources, whose accuracy we are not always in a position to guarantee.
As such the publisher accept no liability whatever for actions taken based on any
information that may subsequently prove to be incorrect.

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Search words (for official use only) :
Electricity Consumption, Regional Analysis (TWh), 2000 – 2009
China’s Annual Commitments, Power Sector, Sub Saharan Africa ($m), 2001 – 2009
Financing Gap, Sub-Saharan Africa,2009
Chinese Model of Success – Key to Differentiated Propositioning
Power Purchase Agreements (PPA)
Annual Commitments by Countries to Infrastructure Projects in Sub-Saharan Africa
Project Value Per Country in Sub-Saharan Africa Power Sector, 2010
Sponsored Power Projects
Market Attractiveness for IPP is Sub-Saharan Africa, 2010
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