Energy in Senegal

Following institutional reform in 1998, Senegal’s electricity sector was split into three entities: Senelec, the national utility, the Agency for Rural Electrification (ASER) and the Electricity Regulatory Board. [http://www.buyusa.gov/westafrica/en/senegal_ccg.pdf Senegal Country Commercial Guide 2008] . U.S. Commercial Service (2008). PD-notice] Senelec holds the monopoly for transmission and distribution of electricity. Electricity generation, mainly on a Build-Own-Operate (BOO) basis, is open to the private sector, and Senelec, the sole buyer, signs power purchase contracts with independent power producers (IPPs). The General Electric/GTI Dakar IPP, which supplies approximately 20 percent of Senelec’s electrical needs, was commissioned in 1998. It has an installed capacity of 56 MW. On-line since January 2008, the second IPP Kounoune 1 – 67.5 MW - was partially funded by the International Finance Corporation., with Mitsubishi and Matelec S.A.L, a division of the Doumet group from Lebanon, as strategic partners. Senegal’s major source of electricity is mostly diesel and gas, with an installed capacity of 633 MW. Some hydroelectricity generated from the Manantali Dam in Mali is split between Senegal, Mali and Mauritania. Manantali has an installed capacity of 200 MW dispatched as follows: 52 percent for Mali, 15 percent for Mauritania and 33 percent for Senegal (66MW). Senegal is committed to shifting from a diesel-based power generation to cheaper energy sources. Senegal has thus put and option on the coal technology. The recent bid to Build-Own and Operate a 125 MW coal-fired plant was awarded to a consortium of companies headed by the Swedish operator Nykomb Synergetics.

Senelec is dealing with a chronic production gap, which has worsened due to an increased demand – the average demand increase during 2005-2009 is estimated at 7 percent, representing an electricity consumption of 1,933 Gigawatt hours in 2005 to an estimated 2,660 Gigawatt hours in 2009. Senelec is experiencing declining reliability of aging power plants. Senegal’s GDP growth was hindered in 2007 by frequent electricity outages, which caused a slowdown of the economic and manufacturing activities. The GDP growth rate decreased to 2.1 percent in 2006 from 5.5 percent in 2005. According to local reports, the outages have contributed to the closure of many small and medium-sized enterprises (SMEs) in the food processing, textile and tourism sectors. Larger companies are reporting declines in output averaging 30 percent. Senegal has embarked on an aggressive effort to produce significant quantities of biofuels, initially to run electricity generation units, and has a pilot project using sugarcane-based ethanol.

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