Abstract
• Infrastructure deficiencies in sub-Saharan Africa are typically framed in terms of a “financing gap” in need of private capital. • This paper explores how the associated policy paradigm has unfolded in the specific context of Zambia using the Systems of Provision approach. • Private investment has in part led to high-cost, dollar-denominated liabilities that risk compromising development objectives in the long term. • Conventional narratives of cost-recovery and efficiency are not neutral and their full distributional implications need to be unpicked. • Greater attention is needed to social equity and to the specific challenges faced. Sub-Saharan Africa lags behind the rest of the world in electricity access and consumption. Infrastructure deficiencies are framed in terms of a “financing gap”, with policy oriented around attracting global private capital. Recent calls for increased private infrastructure investment follow three decades of market-oriented sector reforms. This paper explores the way that this standard policy paradigm has unfolded in Zambia. Drawing on the Systems of Provision approach we focus on three core interconnected segments of the electricity system: the performance of the state utility, Zesco; private sector participation and cost-recovery pricing. The paper shows that Zesco has run into major difficulties since 2015 due to a crisis in hydro resources and adverse currency movements. In line with the policy paradigm, the utility has signed up to a number of agreements with international independent power producers (IPPs) to diversify power sources, and tariffs have been raised to improve Zesco’s financial situation. However, closer inspection reveals contradictions, biases and inconsistencies in this standard policy package when applied in practice. Zesco’s acutely debilitating financial position is a relatively recent occurrence. Short-term fluctuations in hydro power, for which intermittent back-up is needed, have instead been addressed with new decades-long contracts for fossil fuel generation. IPPs have provided generous returns for foreign investors but have created long-term, dollar-denominated liabilities for Zesco, contributing to a weakening financial position. Tariffs have been raised but households cannot afford to pay a price that covers Zesco’s increased costs. The proliferation of IPPs appears to have worsened the situation.The paper shows that energy sector policies organised around the entry of private capital are problematic and likely to contribute to a dynamic of unequal global capital accumulation. Greater attention is needed to social equity, with policies oriented around domestic circumstances and the specific challenges faced.
Highlights
Sustainable Development Goal (SDG) 7 calls for ‘‘access to affordable and sustainable modern energy for all” but the electricity sector in sub-Saharan Africa (SSA) continues to lag behind other regions
This paper considers the political economy of electricity sector reform in Zambia through the lens of the Systems of Provision (SoP) approach which views consumption as inherently connected to production, rooted in a specific context (Fine & Leopold, 1993; Fine et al, 2018)
By connecting the elements of the SoP, we show how these seemingly technocratic policies within the global paradigm have promoted the interests of international capital in ways which are supported by Zambian taxpayers and electricity consumers
Summary
Sustainable Development Goal (SDG) 7 calls for ‘‘access to affordable and sustainable modern energy for all” but the electricity sector in sub-Saharan Africa (SSA) continues to lag behind other regions. This paper considers the political economy of electricity sector reform in Zambia through the lens of the Systems of Provision (SoP) approach which views consumption as inherently connected to production, rooted in a specific context (Fine & Leopold, 1993; Fine et al, 2018) This approach provides a useful framework for locating sector reforms within global structures, linking end users with international capital. Rather than depoliticising the power sector, the reform paradigm is consistent with a global political transition that is promoting some international vested interests over others This understanding of development resonates with the critical literature on Africa’s apparent recent economic success (for example, Khisa, 2019; Beresford, 2016; Taylor, 2016). The long-term funding comes only from public (donor or government) resources or user fees
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.