GDPE0679ICR-Cameroon-Power Market Outlook Sample 1,2,4 …cameroon power market outlook to 2030 - market trends, regulations and competitive landscape reference code gdpe0679icr |

CAMEROON POWER MARKET OUTLOOK TO 2030 - MARKET TRENDS, REGULATIONS AND COMPETITIVE

LANDSCAPE

REFERENCE CODE GDPE0679ICR | PUBLICATION DATE JULY 2013

Cameroon Power Market Outlook to 2030 – Market Trends, Regulations and Competitive Landscape 2 © GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form.

CAMEROON POWER MARKET OUTLOOK TO 2030 - MARKET TRENDS, REGULATIONS AND

COMPETITIVE LANDSCAPE

Executive Summary

Hydropower Capacity Dominates Power Mix

The power generation capacity in Cameroon is led

by hydropower, which is estimated to have

accounted for XX% of its cumulative installed

capacity in 2012. Hydro capacity increased from

XX Megawatts (MW) in 2000 to an estimated XX

MW in 2012, at a Compound Annual Growth Rate

(CAGR) of XX%. Cameroon’s hydropower potential

is the third-largest in Sub-Saharan Africa.

However, the availability of hydro resources is

highly unpredictable and completely dependent on

rainfall. Excessive dependence on hydropower has

led to blackouts and power shortages.

Nevertheless, the dominance of hydropower in

Cameroon’s power mix is expected to continue.

Power Market, Cameroon, Hydropower Installed Capacity (MW), 2000–2012

2000 2006 2012

Hyd

ropo

wer

inst

alle

d ca

paci

ty (M

W)

Source: GlobalData, Power eTrack, Capacity and Generation Database [Accessed on June 24, 2013]

Continued Growth in Power Generation

Power generation in Cameroon increased from XX

Gigawatt hours (GWh) in 2000 to XX GWh in 2012.

Although the government has been aggressively

pursuing economic development, the increase in

power generation has been modest. However,

generation is expected to increase during the

2013–2020 forecast period due to the upcoming

thermal power and hydropower plants that have

been commissioned in order to satisfy the

increasing electricity demand.

Power Market, Cameroon, Annual Power Generation (GWh), 2000–2012

2000 2006 2012

Annu

al p

ower

gen

erat

ion

(GW

h)

Source: GlobalData, Power eTrack, Capacity and Generation Database [Accessed on June 24, 2013]




Table of Contents

1 Table of Contents

1 Table of Contents ....................................................................................................................... 4

1.1 List of Tables .......................................................................................................................... 6

1.2 List of Figures ......................................................................................................................... 7

2 Introduction ................................................................................................................................. 8

2.1 GlobalData Report Guidance .................................................................................................. 9

3 Cameroon, Snapshot of Power Market ..................................................................................... 10

3.1 Macro-economic Factors ...................................................................................................... 10

3.2 Supply Security .................................................................................................................... 12

3.3 Generation Infrastructure ...................................................................................................... 13

3.4 Transmission Infrastructure .................................................................................................. 13

3.5 Opportunities ........................................................................................................................ 14

3.6 Challenges ........................................................................................................................... 14

4 Cameroon, Power Market, Market Analysis .............................................................................. 15

4.1 Cameroon, Power Market, Supply Structure ......................................................................... 15

4.1.1 Agence de Régulation du Secteur de l’Electricité ............................................................ 15

4.1.2 Electricity Development Corporation ............................................................................... 16

4.1.3 Agency for Rural Electrification ....................................................................................... 16

4.2 Cameroon, Power Market, Key Players ................................................................................ 16

4.3 Cameroon, Power Market, Demand Structure ...................................................................... 17

4.3.1 Cameroon, Power Market, Electricity Consumption by Sector, 2012............................... 19

5 Cameroon, Power Market, Regulatory Overview ...................................................................... 20

5.1 Power Sector Reforms ......................................................................................................... 20

5.2 Long-Term Energy Sector Development Plans ..................................................................... 21

5.3 Cameroon’s Rural Electrification Master Plan ....................................................................... 21

5.4 Cameroon Energy Sector Development Project (2008–2013) .............................................. 21

6 Cameroon, Power Market, Capacity and Generation Overview, 2000–2030 ............................. 22




Table of Contents

6.1 Installed Capacity, Breakdown by Type of Power Plant, 2012 .............................................. 22

6.2 Cumulative Installed Capacity and Annual Generation, 2000–2030 ...................................... 22

6.3 Installed Thermal Capacity and Generation, 2000–2030 ...................................................... 25

6.4 Installed Hydropower Capacity and Generation, 2000–2030 ................................................ 28

6.5 Installed Renewable Power Capacity and Generation, 2000–2030 ....................................... 31

7 Cameroon, Power Market, Transmission and Distribution Overview ......................................... 32

7.1 Benin, Power Market, Transmission Network Overview ........................................................ 32

7.2 Cameroon, Power Market, Transmission Network Development Plans ................................ 32

7.3 Cameroon, Power Market, Distribution Network Overview .................................................... 33

7.4 Cameroon Power Market: Grid Interconnection .................................................................... 33

8 Cameroon, Power Market, Snapshot of Leading Power Generating Companies ....................... 34

8.1 Cameroon, Power Market, Key Company: AES Sonel .......................................................... 34

8.1.1 AES Sonel, Business Description ................................................................................... 34

8.1.2 AES Sonel, SWOT Analysis ........................................................................................... 35

9 Appendix................................................................................................................................... 39

9.1 Market Definitions ................................................................................................................. 39

9.1.1 Power ............................................................................................................................. 39

9.1.2 Installed Capacity ........................................................................................................... 39

9.1.3 Active Installed Capacity ................................................................................................. 39

9.1.4 Electricity Generation ...................................................................................................... 39

9.1.5 Electricity Consumption .................................................................................................. 39

9.1.6 Thermal Power Plant ...................................................................................................... 39

9.1.7 Hydropower Plant ........................................................................................................... 40

9.1.8 Nuclear Power ................................................................................................................ 40

9.1.9 Renewable Energy Resources........................................................................................ 40

9.2 Abbreviations........................................................................................................................ 40

9.3 Bibliography.......................................................................................................................... 41




Table of Contents

9.4 GlobalData’s Methodology .................................................................................................... 42

9.4.1 Coverage ........................................................................................................................ 42

9.4.2 Secondary Research and Analysis ................................................................................. 42

9.4.3 Primary Research and Analysis ...................................................................................... 43

9.5 Disclaimer ............................................................................................................................ 44

1.1 List of Tables

Table 1: Power Market, Cameroon, Trends in GDP (constant price)($bn), Population (million) and Annual

Power Consumption (GWh), 2007–2017..................................................................................... 12

Table 2: Power Market, Cameroon, Annual Power Consumption (GWh), 2000–2030 ............................... 18

Table 3: Power Market, Cameroon, Electricity Consumption Breakup by Sector (%), 2012 ....................... 19

Table 4: Power Market, Cameroon, Cumulative Installed Capacity by Type of Power Plant (%), 2012 ...... 22

Table 5: Power Market, Cameroon, Cumulative Installed Capacity (MW) and Annual Power Generation

(GWh), 2000–2030 ..................................................................................................................... 24

Table 6: Power Market, Cameroon, Leading Active Thermal Power Plants (MW), 2012 ............................ 25

Table 7: Power Market, Cameroon, Cumulative Installed Thermal Capacity (MW) and Annual Power

Generation (GWh), 2000–2030 ................................................................................................... 27

Table 8: Power Market, Cameroon, Leading Hydropower Plants (MW), 2012 ........................................... 28

Table 9: Power Market, Cameroon, Cumulative Installed Hydropower Capacity (MW) and Annual Power

Generation (GWh), 2000–2030 ................................................................................................... 30

Table 10: AES Sonel, SWOT Analysis ....................................................................................................... 35

Table 11: Abbreviations ............................................................................................................................. 40




Table of Contents

1.2 List of Figures

Figure 1: Power Market, Cameroon, Trends in GDP (constant price) ($bn), Population (million) and Annual

Power Consumption (GWh), 2007–2017..................................................................................... 11

Figure 2: Power Market, Cameroon, Annual Power Consumption (GWh), 2000–2030 ............................... 17

Figure 3: Power Market, Cameroon, Electricity Consumption Breakup by Sector (%), 2012 ....................... 19

Figure 4: Power Market, Cameroon, Cumulative Installed Capacity (MW) and Annual Power Generation

(GWh), 2000–2030 ..................................................................................................................... 23

Figure 5: Power Market, Cameroon, Cumulative Installed Thermal Capacity (MW) and Annual Thermal

Power Generation (GWh), 2000–2030 ........................................................................................ 26

Figure 6: Power Market, Cameroon, Cumulative Installed Hydropower Capacity (MW) and Annual Power

Generation (GWh), 2000–2030 ................................................................................................... 29




Introduction

2 Introduction

Cameroon is rich in natural resources and ecological diversities. It is a developing country, whose

economy is mainly based on its oil resources and agricultural products. Cameroon has a republican

government and is a member of international organizations such as the Central African State

Development Bank, the United Nations, and the United Nations Industrial Development

Organization. It is also a member of a number of African organizations, including the African,

Caribbean, and Pacific Group of States, the African Development Bank Group, the African Union,

the Economic and Monetary Community of Central Africa, and the Development Bank of Central

African States. It is also a member of certain organizations that are composed of former French

colonies in the African continent, such as the Conférence des Ministres des Finances des Pays de

la Zone Franc.

Cameroon had an estimated Gross Domestic Product (GDP) of $XX billion (at current prices), in

2012, and is estimated to have registered a GDP growth rate of about XX% in the same year. The

services sector is estimated to have contributed the majority share towards GDP, with XX%,

followed by the industrial sector, with XX% and the agricultural sector, with XX%. In Cameroon, the

economy is mainly driven by agriculture and the export of cocoa and oil. However, petroleum

production is falling in Cameroon due to depleting reserves.

The government is heavily involved in the country’s overall economy, which is a barrier to private-

sector investment. The lack of transparency and rampant corruption has made Cameroon non-

conducive to foreign direct investment. Progress in socio-economic structural reforms has been

marginal in the past decade. New investment remains subject to government approval.

The Ministry of Energy and Water Resources is the highest policy-making body in the power

sector. The Agence de Régulation du Secteur de l’Electricité (ARSEL) regulates the power sector

according to the ministry’s guidance, while another government agency, the Electricity

Development Corporation (EDC), owns and manages all government power generation assets,

including hydropower assets. Cameroon’s electricity sector has been privatized, but not

deregulated or unbundled. The government-owned utility Sonel was privatized and acquired by

AES Corp. (AES) in 2001. AES Sonel, through a concession awarded for a period of 20 years, has

a mandate to own and operate power generation assets in Cameroon up to XX Gigawatt (GW). It

also has exclusive rights to operate the transmission and distribution network.




Introduction

2.1 GlobalData Report Guidance

The report opens with an executive summary capturing key growth trends in Cameroon’s

power market.

Chapter three provides a snapshot of Cameroon’s power market.

Chapter four provides a market analysis, including the supply and demand structure of

Cameroon’s power market.

Chapter five provides a brief description of the prominent policies influencing the future of the

power market.

Chapter six provides cumulative capacity and power generation information, as well as

segmentation according to source of energy from 2000 to 2012, with forecasts to 2030. It also

includes details of leading active and upcoming power plants, differentiated according to

source of energy.

Chapter seven provides information on the power infrastructure in Cameroon, as well as

existing and planned developments in transmission and distribution infrastructure, and cross-

country interconnections.

Chapter eight provides complete descriptions and SWOT analyses of the leading power

generating companies.

Note: From 2012 onwards this report provides actual or estimated data depending upon

information available at the time of writing the report.




Snapshot of Power Market

3 Cameroon, Snapshot of Power Market

3.1 Macro-economic Factors

In 2012, Cameroon ranked 161 out of 185 countries in terms of ease of doing business. The

business environment is not favorable for private and foreign investment. Investors face

considerable challenges enforcing contracts and the payment of taxes. Cameroon lacks the

measures to protect its investors and provide credit related information to them. Trading across its

borders and dealing with construction permits are also poorly managed (World Bank, 2013a).

Cameroon ranked 176 out of 210 countries in terms of overall risk. In order to attract major private

and foreign investment it should focus on improving its political stability, voice and accountability,

and rule of law. Political stability and government effectiveness also need to be improved (World

Bank, 2013b).

In 2012, Cameroon’s estimated GDP at current prices stood at $25 billion. Cameroon lags behind

its regional counterparts, such as Ghana and Sudan, in terms of economic growth. Its GDP (at

constant prices) is estimated to have grown at a Compound Annual Growth Rate (CAGR) of 4.1%

over the period of 2007–2012.

From 2007 to 2012, Cameroon’s population grew from 18.5 million to 21.5 million, at a CAGR of

2.16. From 2013 to 2017 the population is expected to grow at a CAGR of 2.5% to reach about

24.3 million in 2017. Its power consumption follows its GDP growth and population trends. An

increase in industrial activity and growing residential electricity demand has led to an increase in

Cameroon’s power consumption over the years. Therefore, the power consumption in Cameroon is

estimated to have grown at a CAGR of 4.7% during the 2007–2012 period.




Regulatory Overview

5 Cameroon, Power Market, Regulatory Overview

5.1 Power Sector Reforms

The existing electricity law, which was passed in 1998, was not able to bring in the expected

benefits of privatization to Cameroon’s power sector. With an eye to encouraging further

investment, as well as augmenting the development of Cameroon’s hydropower division through

the involvement of the private sector, a new electricity law was proposed in Cameroon’s parliament

(the National Assembly), in April 2011. The law sought to unbundle the power sector of Cameroon.

Though the law was passed in parliament, it was not promulgated. The World Bank is working with

the government of Cameroon to further modify the law to make the reforms more effective. The law

was reintroduced to parliament in November 2011 for a second reading and was adopted before

the end of 2011.

Changes that the new law seeks to make are listed below.

The law works towards the unbundling of the power sector to facilitate competition in the

market.

The law contains clauses for a transition period to offer a seamless change in the concession

granted to AES Sonel.

The new law contains provisions to ensure that an agreed amount of power produced by

industrial power producers from future generation assets is made available for public

consumers.

The tariff levied by the industrial power producers must be on a cost-of-service basis, and must

be approved by ARSEL.

Power generation and related transmission facilities procured by the industrial power producers

must be through a competitive tendering process.

Industrial power producers who are awarded concessions for hydropower facilities will need to

optimally operate the facilities so that the full benefit of running such facilities can be passed on

to public consumers.




Appendix

9.1.7 Hydropower Plant

A plant in which turbine generators are driven by falling water.

9.1.8 Nuclear Power

The electricity generated by the use of the thermal energy released from the fission of nuclear fuel

in a reactor.

9.1.9 Renewable Energy Resources

These are naturally replenishing energy resources that are limited in the amount of energy that is

available per unit of time. For example, biomass, geothermal, solar and wind energy are all

renewable resources.

9.2 Abbreviations

Table 11: Abbreviations Full form Abbreviations

Agence de Régulation du Secteur de l’Electricité ARSEL

Compound Annual Growth Rate CAGR

Gross Domestic Product GDP

Gigawatt GW

Gigawatt Hour GWh

Electricity Development Corporation EDC

Kilovolt kV

Megawatt MW

Source: GlobalData




Appendix

9.3 Bibliography

IEA (2012) via FUAS. Cameroon-Overview. Federation of University of Applied Sciences.

Available from:

http://www.laurea.fi/en/connect/results/Documents/Cameroon%20Country%20Report.pdf.

IMF (2013). World Economic Outlook Database-October 2012-Cameroon. International

Monetary Fund. Available from:

http://www.imf.org/external/pubs/ft/weo/2012/02/weodata/index.aspx. [Accessed on June 24,

2013]

Reuters (2013). ‘‘AES plant in Cameroon to start operations in March’’, Reuters, February 26,

2013. Available from: http://www.reuters.com/article/2013/02/26/cameroon-aes-

idUSL6N0BQEYU20130226. [Accessed on June 24, 2013]

Nfor M. (2012) via IPS. ‘‘The Sun Rescues Rural Cameroonians from Incessant Darkness’’,

Inter Press Service, November 8, 2012. Available from: http://www.ipsnews.net/2012/11/the-

sun-rescues-rural-cameroonians-from-incessant-darkness/. [Accessed on June 24, 2013].

World Bank (2012). The Worldwide Governance Indicators, 2012 Update. The World Bank

Group. Available from: http://info.worldbank.org/governance/wgi/pdf/wgidataset.xlsx. [Accessed

on June 24, 2013].

World Bank (2013a). Doing Business–Economy Rankings. The World Bank Group. Available

from: http://www.doingbusiness.org/data/exploreeconomies/poland/. [Accessed on June 24,

2013].

World Bank (2013b). World Bank Approves Cameroon’s Lom Pangar Dam Project to Boost

Economic Growth and Provide More Reliable Power for Up to Five Million People. The World

Bank Group. Available from:

http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/AFRICAEXT/0,,contentMDK:2315

3690~menuPK:2246551~pagePK:2865106~piPK:2865128~theSitePK:258644,00.html.

[Accessed on June 24, 2013].




Appendix

9.4 GlobalData’s Methodology

GlobalData’s dedicated research and analysis teams consist of experienced professionals with

backgrounds in marketing, market research and consulting in the power industry, and advanced

statistical expertise.

GlobalData adheres to the codes of practice of the Market Research Society (www.mrs.org.uk) and

the Strategic and Competitive Intelligence Professionals (www.scip.org).

The following research methodology is followed for all country outlook reports.

9.4.1 Coverage

This report gives detailed information on Cameroon’s power market. It examines Cameroon’s

power market structure and provides historical and forecast numbers for generation, capacity and

consumption, up to 2030. The report provides insights on the market’s regulatory structure, import

and export trends, competitive landscape and leading active and upcoming power projects. The

report also provides a snapshot of Cameroon’s power sector by analyzing the power sector of

Cameroon on broad parameters of macro-economics, supply security, generation infrastructure,

transmission infrastructure, degree of competition, regulatory scenario and future potential

9.4.2 Secondary Research and Analysis

The capacity, generation and consumption data is collected and validated using a number of

secondary resources, including, but not limited to:

Government agencies, ministerial websites, industry associations, the World Bank, statistical

databases

Company websites, annual reports, financial reports, broker reports and investor presentations

Industry trade journals, market reports and other literature

GlobalData’s proprietary databases the Capacity and Generation Database, the Power Plant

Database and the Transmission and Distribution Database.




Appendix

Further to this, the following secondary information is collected and analyzed to project Cameroon’s

power market scenario through to 2030, analyzing factors such as the following:

Cameroon’s macro-economic scenario

Government regulations, policies and targets

Government and private sector investments

Contract and deal announcements

Utility expansion plans

The sector’s historic track record

Other qualitative insights built through secondary research and analysis of company websites,

annual reports, investor presentations, industry and trade journals, and data from industry

associations.

9.4.3 Primary Research and Analysis

Secondary research is further complemented through primary interviews with industry participants

to verify and fine-tune the market numbers obtained through secondary research and get first-hand

information on industry trends.

The participants are drawn from a diverse set of backgrounds, including equipment manufacturers,

industry associations, government bodies, utilities, distributors, and academia. The participants

include, but are not limited to, C-level executives, industry consultants, academic experts, business

development and sales managers, purchasing managers, plant managers, government officials,

and industry spokespeople.




Appendix

9.5 Disclaimer

All Rights Reserved.

No part of this publication may be reproduced, stored in a retrieval system or transmitted in any

form by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior

permission of the publisher, GlobalData.