Page 10 - AfrElec Week 49 2021

AfrElec REGUL ATION AfrElec

Uganda tops AfDB Electricity

Regulatory Index for fourth

consecutive year

AFRICA UGANDA’S electricity sector has been judged According to the report, the average perfor-
Africa’s best regulated across a number of key mance on economic regulation has continued to
metrics for the fourth consecutive year, the Afri- decline since 2018. A third of countries surveyed
can Development Bank (AfDB) said as it pub- indicated they lack methodologies to determine
lished its 2021 Electricity Regulatory Index. tariffs; another 40% rely on tariff methodolo-
Other strong performers include East Afri- gies that do not include key attributes such as
can neighbours Kenya and Tanzania, as well as automatic tariff adjustment and tariff indexa-
Namibia and Egypt. tion mechanisms and schedule for major tariff
The 2021 Electricity Regulatory Index cov- reviews.
ered 43 countries, up from 36 in the previous Wale Shonibare, AfDB director for Energy
edition, and assessed their impact on the perfor- Financial Solutions, Policy and Regulation, com-
mance of their electricity sectors. mended the top-performing country. “Uganda
It found that there was still too much gov- topping the rankings consecutively for four years
ernment control of regulation, and that tariff comes as no surprise to many, as the regulator
setting was still too opaque and open to political spends significant time on consultation and
interference. analysis, including regulatory impact assess-
The index covered 3 countries in the North ments of key interventions and follow-through
Africa region; 14 in West Africa; 6 in Central to ensure full implementation,” he said.
Africa; 7 in East Africa; and 13 in the Southern Outside stakeholders also viewed the report’s
Africa region. results positively. Abel Didier Tella, direc-
“The unprecedented participation of so many tor-general of the Association of Power Utilities
countries shows the commitment to strengthen of Africa, said: “It is interesting that the utilities
the countries’ regulatory environment with in most of the top-performing countries in the
a view to improving the performance of the Electricity Regulatory Index are listed on their
respective electricity sectors,” said Dr. Kevin national stock exchanges, which requires com-
Kariuki, the AfDB’s vice-president for Power, pliance with transparency in information shar-
Energy, Climate and Green Growth. ing and good governance practice.”
Among the 2021 report’s key highlights are Since its launch in 2018, the Electricity Regu-
that regulatory independence is one sub-in- latory Index has highlighted aspects of electricity
dicator where African countries have room to regulation that need reform, identified appropri-
improve: in 93% of sampled countries, govern- ate areas for intervention, and encouraged stake-
ments and stakeholders exercise influence over holders to be proactive in addressing challenges.
regulatory authorities. Since then, the index has been widely adopted
In terms of regulatory substance, participat- by regulators and other stakeholders across the
ing countries scored lowest on the adequacy of continent as a benchmark for the regulatory
their tariff setting and frameworks, as well as environment as well as for ongoing reforms.™
licensing frameworks when compared with best
practice.

P10 www. NEWSBASE .com Week 49 09•December•2021