The African Development Bank has started conducting a feasibility study to explore the potential of electricity cooperative business models in Ethiopia and Nigeria.

The study is in accordance with the Bank’s goal of achieving universal electricity access across Africa by 2025. According to AfDB, power shortages diminish the region’s GDP growth by 2-4% per year, holding back job creation and poverty reduction efforts.

Ethiopia and Nigeria were selected as they “expressed their governments’ commitment to improve rural access through established models,” said Batchi Baldeh, AfDB’s Director of Power Systems Development, speaking at the kick-off meeting. This, he explained, is pursuant of a dialogue with the two countries’ respective ministers of energy during the Bank’s Africa Energy Market Place event, held in July 2018.

The study, funded by the South-South Cooperation Trust Fund, will be conducted by the National Rural Electric Cooperative Association (NRECA) International over three months. NRECA will consider regulatory, legal, technical and socio-economic factors that impact the creation of electric cooperatives in the two nations, AfDB disclosed in a statement.

Mr. Baldeh thanked the South-South Cooperation Trust Fund for financing the initiative. “This study is timely and aligned with the Bank’s New Deal for Energy in Africa. We look forward to working with NRECA International to execute the study, and to leverage its extensive experience in electricity cooperative business models to pave the way for the implementation of transformational projects across Africa,” he said.

Underscoring the importance of Government cooperation and commitment, he added that the cooperatives rely on strong partnerships among governments, rural/local communities and development partners for implementation and success.

AfDB noted that the findings of the study will be delivered in May this year, and they will inform the viability of plans to pilot the model in the selected countries.

Source: African Development Bank