The power market in the East Africa region is expected to grow at a CAGR of more than 3% in the forecast period of 2021-2026. The COVID-19 pandemic pandemic severely impacted on economies of African countries, because of their dependence economy of other countries, even though the impact of COVID-19 was less in the region than foreign nations. Factors such as increasing power demand due to the increasing population and the rapidly increasing share of renewable and gas-based thermal power plants are likely to drive the market. The degree of urbanization and electrification is also expected to drive power consumption. On the other hand, the lack of huge investments for setting up and modernizing power generation, transmission, or distribution networks is restraining the growth of the market.
- Hydro and Non-Hydro Renewables are expected to witness significant growth in the region, owing to factors like increasing investments in the sector combined with increasing focus on producing clean energy.
- The formation of organizations like East Africa Power Pool, which are focused on the development of power infrastructure in the region has helped the market grow in the past and are expected to continue to do so during the forecast period too.
- Ethiopia is expected to witness significant growth in terms of power generation capacity among the nations in the forecast period due to its significant consumption of electricity and government focus to decrease dependence on imported fossil fuel. The country is also expected to invest in renewable energy projects, which is likely to aid in the growth of the market.
Key Market Trends
Hydro and Non-Hydro Renewables are Expected to Witness Significant Growth
- The Hydro and Non-Hydro Renewable segment includes the different sized reservoir dams that can be used to provide renewable energy and other renewable energies like wind and solar energy. Hydropower is the most used renewable energy in East Africa.
- Hydropower (including mixed plants) constitute almost 78% of the total renewable energy generated in the region, in 2019. It is expected to remain the single largest renewable energy contributing segment in the forecast period.
- In 2018, an upgrade project began by the Kenya Electricity Generating Co. and Voith GmbH to increase the Wanjii hydropower project's output capacity by about 20%. Modernization is expected to take place by changing the electrical equipment like turbines, generators, and control systems.
- The geographical features of the countries in the region aid in the creation of energy from hydropower. Due to the presence of physical structures like the Nile River, Mountains, and the great lakes.
- In recent years, the declining costs of solar panels and batteries have also helped solar energy sector to grow significnalty in the region, and is expected to continue to grow during the forecast period too.
- The aforementioned factors are expected thelp the Hydro and Non-Hydro Renewables segment to witness significant grwoth during the forecast period.
Ethiopia Expected to Witness Significant Growth
- The largest river in the world starts in the mountains of Ethiopia. Numerous dams have been conceived and built on the river, which has provided for renewable energy. However, water scarcity in the area has caused diplomatic differences between Egypt and Ethiopia and may cause some delays in the execution of the projects.
- Hydropower projects produce a significant share of power in the country. In 2020, the country had 4071 MW of installed capacity produced through these projects. Hydropower constitutes around 90% of all power generation capacity in the country.
- In 2019, Ethiopia's Ministry of Finance announced a tender for the construction of six solar plants, which are expected to have a combined 798 MW capacity. It is expected to be a public-private enterprise and is likely to decrease the country's energy deficit. Large-scale projects such as these also provide growth to the market.
- In 2020, the Grand Ethiopian Renaissance Dam is in construction. It is expected to have a capacity to generate 6000 MW when fully built. It is expected to become the largest operational dam in Africa, in turn driving the market during the forecast period.
- Hence, Ethiopia is expected to dominate the market due to its large increase in the installed renewable energy capacity in the forecast period.
The East Africa Power market is moderately consolidated, due to a few companies holding a major share of the market. The key players in this market include Kenya Electricity Generating Company PLC, Ethiopian Electric Power, Tanzania Electric Supply Company Limited, Kenya Power and Lighting Company PLC, and Kenya Electricity Transmission Company.
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Table of Contents
1.2 Market Definition
1.3 Study Assumptions
4.2 Power Generation Installed Capacity and Forecast, in GW, till 2026
4.3 Recent Trends and Developments
4.4 Government Policies and Regulations
4.5 Market Dynamics
4.6 Supply Chain Analysis
4.7 Porter's Five Forces Analysis
4.7.1 Bargaining Power of Suppliers
4.7.2 Bargaining Power of Consumers
4.7.3 Threat of New Entrants
4.7.4 Threat of Substitutes Products and Services
4.7.5 Intensity of Competitive Rivalry
4.8 Assesment of Impact of COVID-19 on the Market
5.1.1 Power Generation
188.8.131.52 Hydro and Non-Hydro Renewables
5.1.2 Power Transmission and Distribution
5.2.5 Rest of East Africa
6.2 Strategies Adopted by Leading Players
6.3 Company Profiles
6.3.1 Power Generation Companies
184.108.40.206 Kenya Electricity Generating Company Plc
220.127.116.11 Ethiopian Electric Company
18.104.22.168 Tanzania Electric Supply Company
22.214.171.124 Uganda Electricity Generation Company Limited
6.3.2 Tower Transmission and Distribution Companies
126.96.36.199 Kenya Power and Lightinh Company PLC
188.8.131.52 Kenya Electricty Transmission Company
184.108.40.206 Uganda Electricity Transmission Company Limited
A selection of companies mentioned in this report includes:
- Kenya Electricity Generating Company Plc
- Ethiopian Electric Company
- Tanzania Electric Supply Company
- Uganda Electricity Generation Company Limited
- Kenya Power and Lightinh Company PLC
- Kenya Electricty Transmission Company
- Uganda Electricity Transmission Company Limited