Mining companies can end erratic power supply in Sub-Saharan Africa- World Bank

Mining companies can play a key role in harnessing Africa's abundant clean sources of energy to overcome the lack of electricity that affects at least one in three Africans, says the World Bank (WB).

In a report released here late Monday, the bank called on the mining industry to work more closely with electricity companies in Sub-Saharan Africa (SSA) to meet their growing energy demands.

The report, titled "Power of the Mine: A Transformative Opportunity for Sub-Saharan Africa (SSA)", said rather than supplying their own energy on site, the mines could become major and reliable customers for electricity utilities or independent power producers (IPPs).

It said by becoming anchor customers for electricity utilities, mines could save hundreds of millions of dollars in supplying their own power.

Sub-Saharan Africa generates 80 gig watts of power each year for 48 countries with a population of 1.1 billion people, the report said.

It said two-thirds of people in the sub-region lived entirely without electricity while those with power connection suffered constant disruptions in supply.

The bank is predicting that "without new investment and with current rates of population growth, there will be more Africans without power by 2030 than there are now".

The report said mining demand for power in SSA would likely triple between 2000 and 2020 to over 23,000 MW.

"This could be higher than non-mining demand for power in some countries; yet many mining companies are still opting to supply their own electricity with diesel generators rather than buy power from the grid often because of shortcomings in national power systems in the region."

The report said another 10 gig watts of electricity would be added to meet mining power demand by 2020 from 2012 levels and a part of this was projected to come from self-supply arrangements costing mining companies up to 3.3 billion dollars.

But new models of power supply for mines are emerging across SSA, including mines self-supplying and selling to the grid or serving as anchor consumers for IPPs.

The bank said though there were risks associated with power- mining integration from falling commodity prices or shortage of transmission links, regulatory and financial solutions could help mitigate such risks.

It therefore urged countries across SSA to continue with their power sector reforms and create an attractive operating environment for IPPs, including renewable energy developers. Endi