SADC’S INFRASTRUCTURE: A REGIONAL PERSPECTIVE percent on average (versus 50 percent in ECOWAS). Utilities in southern Africa perform relatively well: system losses are only 12 percent of generation, and hidden costs are relatively low. The overall collection rate in the SADC, though relatively good at 89 percent, trails most other regional economic communities but by a small margin. Utilities in southern Africa, however, have to focus on cost recovery, which at only 68 percent is lower than most other regional economic communities (table 3.1).

Strikingly, the SADC has historically had the lowest-cost power in Africa, at $0.14 per kilowatt-hour on average. Moreover, the region’s long-run marginal cost of power, at $0.07 per kilowatt-hour, is less than half the equivalent figure for ECOWAS. In this sense, southern Africa has a competitive advantage vis-à-vis other regions of Africa for energy-intensive industry.

**Table 3.1 Benchmarking power infrastructure and capacity, access, and utility performance**

||ECOWAS|CEMAC|COMESA|EAC|SADC|Low-<br>income<br>countries|Middle-<br>income<br>countries|
|---|---|---|---|---|---|---|---|
|Installed generation capacity (MW)|**3,912**|583|1,085|774|9,855|2,110|36,971|
|Generation, net, per capita, annual<br>(KWh/capita/year)|**171**|147|114|82|1,214|165|4,479|
|Outages, number, annually (number/year)|**165**|152|119|132|91|134|71|
|Outages, value lost, annually (% of sales)|**7**|5|7|8|2|5|2|
|Firms with own generator (% of firms)|**54**|51|43|56|19|33|18|
|Access (urban, % of population)|**50**|31|34|23|35|43|50|
|Growth in access of population to electricity,<br>annual (%)|**2**|1|1|1|1|3|2|
|System losses (% of generation)|**29**|31|32|23|12||10|
|Cost-recovery ratio, historical (%)|**79**|45|73|69|68|100|87|
|Total hidden costs (% of revenue)|**159**|107|102|65|4|544|0|
|Collection rate, reported by utility, electricity (%<br>of billing)|**71**|93|93|94|89||91|
|Prices ($/kWh)|**WAP**|**P**|**CAPP**||**EAPP**||**SAPP**|
|Average historic cost||0.21||0.49|0.1|9|0.14|
|Long-run marginal cost||0.18||0.09|0.1|2|0.07|

_Source:_ Eberhard and others 2008.

_Note:_ CEMAC = Economic and Monetary Community of Central Africa; COMESA = Common Market for Eastern and Southern Africa; EAC = East African Community; ECOWAS = Economic Community of West African States; kWh = kilowatt-hour; MW = megawatt; WAPP = West African Power Pool; EAPP = East African Power Pool (EAPP is expanded to include key Nile Basin trading partners Egypt, Ethiopia, and Sudan); CAPP = Central Africa Power Pool; SAPP = Southern African Power Pool.

For the remainder of this section, attention will focus on the SAPP countries. This is because power sector issues in southern Africa can only really be analyzed in the context of this regional trading arrangement. The analysis necessarily excludes the island nations Madagascar, Mauritius, and Seychelles. Also, for the purposes of this analysis, Tanzania is considered part of the East African Power Pool (EAPP) as opposed to the Southern African Power Pool (SAPP). Similarly, the benchmarks will be the other regional power pools: namely, the Central African Power Pool (CAPP); the EAPP—expanded to include important trading partners in the Nile Basin (notably Egypt); Ethiopia; Sudan (EAPP–Nile Basin); and the West African Power Pool (WAPP).

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