Umair Gaines
Ghana and Nigeria have a history of exchanging energy resources. While Ghana supplied Nigeria with electricity in the 1970s, 80s, and 90s, in 2019, Nigeria agreed to supply 80 megawatts of electricity to Ghana to address its energy crisis. This agreement was made between Ghana, Nigeria, and the Ivory Coast, allowing them to combine their electricity generation as a safeguard for energy shortfalls. Ghana sources 25% of the gas used for electricity from Nigeria, delivered through the West African Gas Pipeline.
| Characteristics | Values |
|---|---|
| Year | 2007 onwards |
| Nature of the agreement | Nigeria agreed to supply 80 megawatts of electricity to Ghana as part of a deal to help the country address its energy crisis. |
| Other countries involved | Benin, Togo, and the Ivory Coast |
| Companies involved | N-Gaz, Nigerian National Petroleum Company, Shell, Chevron |
| Payment issues | Ghana owed $170 million to Nigeria in 2015, which it agreed to pay by February 2016. |
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What You'll Learn
Ghana's energy crisis
Ghana has long been facing an energy crisis, with frequent power outages and an unstable power supply. The term "dumsor", coined in 2013, describes the country's precarious power situation, with "off-on" denoting the recurring electricity cuts. This issue has led to social protests and negatively impacted Ghana's economy, industry, residences, and agriculture, resulting in an average daily loss of $2.1 million USD.
To address this crisis, Ghana has explored various solutions, including the construction of the 400 MW capacity Bui Dam, which was completed in 2013, and the planned 400-megawatt capacity Bui Dam. The country has also turned to fossil fuel-based power plants as a primary response to energy insecurity, with 30% of electricity generated from domestically produced gas and 23% from oil. However, this has raised concerns about the country's transition to a sustainable energy future. Additionally, Ghana has sought international support, with Nigeria agreeing to supply 80 MW of electricity through the West African Power Pool agreement in 2024.
While Ghana works towards resolving its energy crisis, the country has also offered to sell its excess electricity to Nigeria, which faces its own challenges in providing universal energy access to its citizens. This offer highlights the complex dynamics of energy supply and demand in the region, where neighbouring countries collaborate and support each other in addressing their respective energy needs.
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Ghana's energy sources
Ghana's energy sector is diverse, with the government involved in energy production, distribution, and trade. The country sources its energy from both renewables and fossil fuels, including natural gas, hydropower, solar, wind, geothermal, biomass, and fossil fuels. Ghana has set ambitious goals to increase its renewable energy sources, aiming for 10% of its energy mix to come from renewables by 2020, not including large-scale hydropower.
Ghana's total installed capacity for existing plants is 4,132-5,134 Megawatt (MW), with a dependable capacity of 4,710 MW. The country's energy requirement is estimated at 2,000 MW, and its total generation output is 1,200 MW. 69% of this energy is generated from hydroelectric sources, with the Akosombo dam producing 912 MW and the Kpong dam generating 160 MW. 30.4% of the energy is produced from fossil fuels. Thermal generation, fuelled by natural gas, crude oil, and diesel, accounts for the largest share of Ghana's power generation at 66%, while hydropower contributes 33%.
Ghana is actively working to boost its energy generation through various projects. The country is exploring solar power and bio-diesel as alternative sources and plans to construct the 400 MW capacity Bui Dam to increase electricity production. Additionally, Ghana has discovered three offshore producing fields, Jubilee, Tweneboa, Enyera and Ntomme (TEN), and Sankofa and Gye Nyame Field, which will contribute to its energy resources.
Ghana also exports power to neighbouring countries such as Togo, Benin, and Burkina Faso, and is exploring wind power and solar parks to further enhance its renewable energy sources.
While there have been claims that Nigeria supplies electricity to Ghana, this information is disputed. Ghana purchases gas from Nigeria, which is converted to electricity by Ghana's power plants, contributing to 25% of its power source. In 2019, Nigeria agreed to supply 80 MW of electricity to Ghana to address its energy crisis. However, Ghana has also offered to sell electricity to Nigeria to meet its energy requirements.
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Nigeria's energy exports
It is ironic that Nigeria supplies electricity to Ghana, as Nigeria itself struggles to satisfy its own energy needs. Ghana sources 25% of the gas used in electricity generation from Nigeria. This supply is contractual, with Ghana paying for the gas through the joint venture company N-Gaz, which is owned by the Nigerian National Petroleum Company, Shell, and Chevron. The gas is delivered to Ghana through the West African Gas Pipeline (WAGP).
Nigeria is Africa's largest economy and the continent's richest oil resource centre. The country is a top producer of crude oil and natural gas in Africa, with oil reserves of about 37 billion barrels and gas reserves of about 206 Tcf. Nigeria's production in 2022 averaged 1.2 million barrels of oil per day and 300 barrels per day of condensate. The country is a member of the Organization of Petroleum Exporting Countries (OPEC) and is subject to production quotas.
Coal, petroleum reserves, natural gas, peat, hydroelectricity, solar, and wind are major energy resources in Nigeria. The country also has the largest coal reserves in West Africa, with 379,194,640 tons. Since gas well drilling began in the 1950s, significant reserves of Associated Gas (AG) and Non-Associated Gas (NAG) have been discovered, leading to the export of gas as liquid natural gas (LNG).
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Power supply to Benin and Togo
Nigeria has long been facing an electricity crisis, with 90 million people lacking access to electricity. Despite this, Nigeria has been supplying electricity to some of its smaller neighbours, including Ghana, Togo, and Benin.
In 2019, Ghana made a deal with Nigeria to help solve its energy crisis. Nigeria agreed to supply Ghana with 80 megawatts of electricity and take over responsibility for supplying Benin and Togo with electricity. This was to be done through the West African Power Pool, which was to come into operation in February 2007. The Power Pool Agreement, between Ghana, Nigeria, and the Ivory Coast, combines these countries' electricity generation into a pool, giving them a safeguard to fall back on in the event of an energy shortfall.
In 2021, the Nigerian Electricity Regulatory Commission (NERC) reported that the Republic of Benin, Niger Republic, and Togo had made no payment for the electricity supplied to them from Nigeria in the second quarter of that year. The power firms of these countries were issued a total bill of N770 million by the Nigerian Bulk Electricity Trading Company and the Market Operator of the Transmission Company of Nigeria (TCN), but no payment was made.
In May 2024, the NERC ordered the System Operator, a department within the TCN, to cap power supply to cross-border customers in Benin, Niger, and Togo. The directive stipulated that power delivery to Nigeria's neighbours must not exceed six per cent of the total grid electricity at any given time. This order was to be in effect for an initial six months, subject to review.
Despite these developments, it was reported in October 2024 that Nigeria still supplies 24-hour electricity to Togo and Benin, with the Managing Director and CEO of the TCN, Sule Abdulaziz, confirming this on Channels TV's Politics Tonight program. Abdulaziz stated that these countries "are paying for it", despite earlier reports of non-payment.
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West African Power Pool
It is unclear which year Nigeria started providing electricity to Ghana. However, in 2019, it was reported that Nigeria had agreed to supply 80 megawatts of electricity to Ghana to help the country address its ongoing energy crisis. This agreement was made by President John Agyekum Kufuor, who stated that the supply would be facilitated through the West African Power Pool (WAPP).
The WAPP, also known as the West African Power Pool, is a cooperative of national electricity companies in Western Africa. It was founded under the Economic Community of West African States (ECOWAS) in 2010, with its headquarters in Cotonou, Benin. The WAPP aims to establish a reliable power grid and a common market for electricity in the region. By integrating the national power systems of its member countries, the WAPP promotes the trade of electricity among ECOWAS member states.
The WAPP includes 14 member countries: Benin, Burkina Faso, Ghana, Guinea, Guinea-Bissau, Ivory Coast, Liberia, Mali, Niger, Nigeria, The Gambia, Togo, Senegal, and Sierra Leone. These countries work together to pool their electricity generation, providing a safeguard for each other in the event of an energy shortfall. This mechanism is expected to ensure a more reliable supply of electricity for the region in the medium to long term.
The establishment of the WAPP is an important step towards ensuring a stable power supply in West Africa. By combining their resources and infrastructure, the member countries can better manage their energy needs and provide a more consistent supply of electricity to their citizens. This cooperation also allows for the exploration of alternative energy sources, such as solar power and bio-diesel, and the implementation of best practices in power systems operations and management.
While Nigeria has agreed to supply electricity to Ghana through the WAPP, it is worth noting that Ghana also has an abundant supply of electricity for export. In fact, Ghana has achieved between 80 to 85 percent universal energy access in the country and is exploring various options to achieve universal access by 2024. This includes grid energy, mini-grids, and renewable energy sources such as solar power.
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Frequently asked questions
2024.
80 megawatts.
The Power Pool Agreement.
To combine the electricity generation of Ghana, Nigeria and the Ivory Coast into a pool, giving them a safeguard to fall back on in the event of an energy shortfall.
25%.
