The Republic of the Congo has launched a study to assess electricity supply needs for its special economic zones (SEZs) and industrial facilities, as rising demand and supply constraints put pressure on manufacturing operations.
Michel Djombo, minister of industrial development, SEZs and private sector promotion, launched the initiative earlier this week. It will be supervised by the Ministry of Energy and Hydraulics, implemented by the National Agency for Rural Electrification and supported technically by the United Nations Development Programme.
Four supply options under review
The study will compare four potential approaches to meeting industrial electricity demand: solar generation paired with battery storage; biomass and cogeneration using agricultural, forestry and agro-industrial residues; connections to the national grid where available; and hybrid energy systems.
It is also expected to establish a pricing benchmark for energy solutions in the Congolese industrial market. The scope covers the technical supply options as well as the commercial arrangements used to deliver power to industrial customers.
Pricing debate
At the launch event, Djombo questioned solar electricity offers priced at between XAF 130 ($0.22) and XAF 150/kWh, describing some as opportunistic. He said international comparisons would help establish fair and sustainable pricing.
The minister also highlighted the cost of relying on diesel generators when electricity supply is disrupted, saying the price of generated electricity can reach almost XAF 200/kWh.
Supply constraints are affecting industrial operators, according to the minister, with some companies reportedly having to suspend production lines. Despite the high cost of diesel, he said some industrial operators remain reluctant to commit to alternative energy solutions and are waiting for market conditions to become clearer.
Commercial models and investment
The initiative plans to examine different commercial arrangements for supplying industrial customers. These include turnkey installations financed directly by businesses, financing services for equipment purchases and the introduction of independent power producers.
It is also expected to identify bankable projects capable of attracting public and private investment. The study therefore extends beyond a technical comparison of generation options to consider how projects could be structured and financed.
The initiative is intended to assess suitable supply solutions as electricity demand rises. Its launch brings the industrial development ministry, the energy ministry, the rural electrification agency and the UNDP into a single review, with the energy ministry supervising and the rural electrification agency implementing the work.
According to figures in the Africa Solar Industry Association's project database, the Republic of the Congo has 35.6 MW of operational solar to date. Of that total, 27 MW is listed as unidentified commercial and industrial projects. Those figures cover operational capacity; the new study is separate and focuses on supply arrangements for SEZs and industry.