29 Dec
INDUSTRY TRENDS

Why do Somalis pay more for electricity than Americans? Is solar energy the solution?

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In Somalia, citizens pay three times what their counterparts in Washington, D.C. pay per kilowatt-hour, and 15 times more than the average Egyptian citizen. This high cost affects all aspects of life in Somalia, directly leading to an increase in personal consumption bills, as well as indirectly impacting the cost of goods and services. The repercussions ripple further as the absence of feasible energy-dependent industries contributes to the scarcity of job opportunities.

 

In contrast, Somalia possesses advantages in renewable energy resources, particularly solar and wind power, along with water currents in the Indian Ocean. Could renewable energy be the solution to Somalia’s electricity crisis? And why is investing in it less costly than investing in fossil fuel-dependent power stations?

 

Electricity production and its needs

Following the collapse of the central state in Somalia in 1991, the country entered an era without a government providing public services, with the population coping by meeting their needs through individual efforts. With improved security following the end of the warlord era and the formation of the transitional government and its entry into the capital in 2007, businessmen assumed the role of the state in various sectors, including the energy sector.

 

In the capital, Mogadishu, there are three private sector-owned companies that produce, transmit, and distribute electricity, and own all the facilities for production, distribution, and transmission. This pattern repeats in other regions of the Federal Republic of Somalia and the independent region of Somaliland.

 

These companies primarily rely on generating electricity from the fuel they import from Gulf countries, priced according to global rates. They also play the role of the state in establishing the infrastructure for electricity transmission and distribution. However, these constructions are modest compared to facilities for electricity generation, transmission, and distribution around the world. It increases the costs, not to mention the environmental impacts of relying on fossil fuels for electricity generation and relying on coal for cooking in wide areas.