The Gambia’s National Water and Electricity Conundrum: The Search for Answers

Thursday, October 05, 2017

Dear Editor:

Please allow us some space in your prestigious and informative newspaper to join the voices of the multitude of Gambians in weighing in on the debate of the National Water and Electricity Company, hereafter referred to as NAWEC, inefficiency to meet the high need and demand for electricity and water by Gambians. Allow us to state upfront that the contributors are not experts in the scientific field of energy generation or even have a specialization in the efficient distribution of such services.  However, as Gambians, we would like to join the current national discussions of NAWEC in the hopes that our perspective will be added to the voices of other Gambians for engendering, further, the productive discussions needed to find a suitable, effective, efficient and sustainable cure to The Gambia’s half-a-decade old electricity problem.

Our goal in this piece is threefold: (1) to discuss our current understanding of some of the issues that challenge the capability of NAWEC to be efficient in its provision of services to Gambians; (2) to analyze the social and economic cost of lack of consistent supply of water and electricity to Gambian families, and (3) to opine on some alternative measures that NAWEC should consider in its attempt to revamp its operational practices for more efficiency.

The Contextual Background

Throughout The Gambia and on Social Media platforms where many Gambians converge for a national debate on issues, NAWEC, water and electricity rank high in the public’s discourses about the country’s national development- an issue that affects not only basic living conditions but livelihoods strategies and means. The problem of ensuring efficient and sustainable water and electricity supply through the nationally-owned institution- NAWEC and formerly known as The Gambia Utilities Corporation (GUC)- is a historical problem. Since as early as 1985 and perhaps, before that, The Gambia has been seeking the assistance of the World Bank and other development partners to address its electricity problem. In one of the documents that report on such activities, it was noted that the issue that affects the efficiency of Gambia’s power supply was its over-reliance on “imported petroleum to meet all its commercial energy needs, including electricity (and  further)  “... the country has encountered energy problems which, in large part, can be attributed to difficulties in servicing the import bill for petroleum and subsequent disruptions in petroleum supply.” (p.1) .The problem of petroleum as the primary hindrance to a constant electricity supply was, arguably, before the expansion of services in projects such as the Rural Electrification of The Gambia, which might have further added the problems of generation of energy and other operating costs to the gigantic petroleum issue.

Based on the recently approved World Bank loan (May 2016, project ID P152659) for $18 million for the project to restructure NAWEC, it appears that the current problem of NAWEC surpasses the issue of high cost of petroleum. Issues such as the limited generation capacity at Kotu and Brikama, two of the central power stations in The Gambia, technical and commercial losses in the Greater Banjul Area (GBA) from transmission and distribution and institutional management issues all combined are major factors affecting the productivity of NAWEC. Consequently, the goal of  the $18 million project is for addressing those very highlighted issues with solutions such as replacing and fixing old generators on the table.

It should be noted here that the renewed interest in the topic concerning NAWEC’s  insufficient electricity and water supply capability by Gambians coincided with a change of government that has ushered in the feeling of a “new Gambia.” The notion of “new Gambia “  conceived of loosely, implies a paradigm shift in the public administration and one that would ensure a search for viable pathways in providing quick but sustainable fixes to the old development issues that Gambians have struggled with for the past fifty years and within the administration of two governments.

The current national debate about NAWEC and the exasperation of Gambians in continuing to bear the social and economic cost to their lives and livelihoods from NAWEC inefficiency exist at the convergence of the feeling of ‘new Gambia’ and the sense of enormous possibilities for a radical overhaul in the functioning of government. 

The Social and Economic Cost from Unstable Electricity and Water Supply

Disadvantaged people in The Gambia arguably represent an outsized percentage of the population who rely on water and electricity from NAWEC for their consumption needs and thus their lives and living conditions are the most affected by the excessive power and water shortage issues from NAWEC’s  inefficiencies in meeting the high consumer demand for such goods. The reason being their lack of access to private generators and water tanks, luxuries that could be found only in the household of well-to-do Gambians.

The lack of adequate supply of energy is adversely affecting the growth and development of the country, and  also equally stifling investment both within and into the country by Gambians and non-Gambians. It is hard to put a cost, quantitatively, to the economy as no public figures are available for aggregating the total loss of productivity in private businesses and government institutions. However, the amount even if estimated conservatively, is no doubt of horrendous loss to the efforts that seek to develop lives and livelihood opportunities in The Gambia. There is no doubt the The Gambia’s electricity problem is a huge hindrance to the country’s development.

Infact:

“According to the World Bank Investment Climate Assessment for The Gambia, the lack of a stable and extended electricity system represented the most serious obstacle to business in the country in 2006 . Considering the continuing instability and fragility state of the energy sector, it is likely that the unreliable provision of electricity remains a major obstacle to economic expansion. Lack of access to electricity also hinders social development and constrains the delivery of healthcare and education services in the country” (p.19).

One critical aspect of livelihood that the lack of stable electricity is affecting the most is the ability of Gambian families to be able to prudently manage their meagre household available resources for food and thus contributing to the existing situation of dire food poverty in The Gambia. Findings from a field research conducted on the recent trend of economic survival strategies of low socioeconomic households in urban Gambia by one of the authors (see: Njie, 2016)  revealed a situation of a heightened poverty in urban Gambia but also, women’s  resilience in navigating through the current economic slump.The freezing of food, cooked for large servings with the goal of portioning it out for family lunches across some days during the week has become a common practice adopted by women with families in many households to deal with rising cost of food. Gambians are, for the most part, accustomed to the culture of cooking meals daily, and some Gambian women do, in fact, cook meals up to three times in the day. Eating fresh food is socially-construed by many Gambians as  “eating well.” 

The recent and widespread consumption of frozen food among a vast majority of Gambians in urban households speak volumes about daily livelihood survival challenges. It is a clear manifestation of a population engulfed by daily economic problems from soaring food prices, stagnant wages within the public sector, low earning capacity in informal employment and very low job prospect for the youth population, a vast majority of whom are school dropouts. These problems are further exacerbated by the high economic dependency of unemployed family members on the incomes of employed family members.The lack of stable electricity supply, therefore, adds to the gamut of  challenges of daily life in The Gambia and affects the possibility for breadwinners, mostly women, to manage their small allocations and earnings spent for food effectively.

Also, since many women cannot preserve food for consumption during multiple days in the week, the free time from not having to cook meals daily the women can enjoy and invest in income generating activities when electricity supply is stable is once again lost to labor-intensive activities associated with daily food preparations. 

NAWEC’s inefficiency in managing its transmission and distribution network as well as its over-reliance on expensive Heavy Fuel Oil (HFO) has resulted in NAWEC having some of the most expensive tariffs in the subregion, comparable to or even higher than some parts of the developed world. The Gambia has a higher tariff for electricity than many neighboring West African countries such as Senegal, Ghana, Burkina Faso and Côte d’Ivoire.  Power tariffs in most parts of the developing world are within the range of US$0.04 to US$0.08 per kilowatt-hour. However, in Sub-Saharan Africa, the average tariff is US$0.13 per kilowatt-hour.

In The  Gambia, the tariff is $0.16.  In countries dependent on diesel-based systems, tariffs are obviously much higher. Evidently and given poor reliability, many small businesses operate their diesel generators, thus doubling the cost of energy expenses for them and that practice too has a  harmful impact on our environment. This higher tariff  means that Gambians are paying more for their electricity than what some of their neighboring countries are having to pay.

For The Gambia to be able to improve the standard of living of its citizens, reliable supply of water and electricity are imperative, and for the country to also benefit immensely from the opportunities for trade and FDI investment that economic globalization allows, the country’s economy would have to be integrated with the world economy. Electricity and water are critical resources, imperative in the factors that foreign direct investors do heavily weigh in on in making decisions about where to invest their big bucks.

The Huge Financial Investments in NAWEC but Low Return!

Over the past fifty-two years the government of The Gambia, along with its development partners have invested heavily in The Gambian energy sector. NAWEC under its various incarnations has primarily benefitted to the tune of billions of dalasis to improve both its generating capacity and transmission and distribution network.

This investment has resulted in the accessibility of electricity to a greater number of the population, both in the urban and semi-urban areas. However, NAWEC has not been able to match demand with the supply of electricity to meet the ever-increasing need of a developing nation. This failure can be attributed to the inability of the company to forecast demand and plan for the necessary investment in the supply side of its business, before embarking on an expansion exercise to cater to the need of more customers. That discrepancy between supply and demand has resulted in demand outstripping supply, leaving the company playing catchup while at the same time trying to replace existing capacity that has come to its natural obsolescence.

Apart from dealing with old obsolete machines, NAWEC also has a problem with operating cost. This issue was highlighted in a recent interview by the managing director  of NAWEC in which he said 50 percent of the company’s operating cost goes to the purchase of heavy fuel and lubricant. In a recent interview on Foroyaa, the deputy managing director of NAWEC asserted that NAWEC is spending D200 million a month on fuel  from a  monthly revenue of D160 million. This situation is not sustainable for any business let alone NAWEC who already has a significant amount of debt in its books.

The NAWEC conundrum then begs the question: why is NAWEC still investing in HFO generators rather than other renewable energy alternatives? In April 2017,NAWEC signed a contract with a Chinese company for the supply and installation of a new 60 MW generator to the tune of $165 million. Earlier and in July of 2016, The Gambia was approved by the World Bank for a $18 million dollar loan for the restructuring of NAWEC and the interventions outlined in that contract are far from decisions to invest in renewable energy sources. Rather, a part of the restructuring involves the fixing and replacing of old machines. It does not appear that NAWEC is on the path towards gaining control over its inefficiency issues. Aren’t there  alternatives that are more reliable and cost effective to experiment? Has NAWEC looked into modern solutions that are being employed in the subregion and around the world ? Is a large scale renewable energy program something that NAWEC cannot secure a loan or a grant for from its development partners? Is the problem a classic case in The Gambia of “we have always done it this way, and therefore we can’t  try anything different”? These questions among others are quite relevant in the effort to identify the specific  issues NAWEC face for investment in efficient restructuring.

The Search of Alternative Measures

There are numerous alternative available for NAWEC to tap into like: natural gas, wind energy, solar power, thermal energy using domestic household waste . It would be a sound investment for NAWEC to learn and engage the Scandinavian countries in learning from their energy mix .

The current idea circulating among Gambians as possible solutions to the NAWEC problem- that is, to outsource electricity from Senegal- calls for an in-depth analysis into the current endeavors of SENELEC and the particular sources of their capability to supply power to nearby neighboring villages with The Gambia. Senegal has been experimenting with modern renewable energy sources to overcome the challenges of power shortage.

Solar Energy:

In October 2016,  Senegal inaugurated the BokHol solar farm at a cost of $28 million with a generating capacity of 20mw,designed to operate for 25 years, by this measure Senegal is spending $1.4 million per Megawatt for solar  while NAWEC signs a contract to invest $165 million for 60mw paying $2.75 million per megawatt for HFO generated power . All other things being equal, solar energy would have provided 60mw for NAWEC at a cost of $78 million and a balance of $87 million to buy additional 60mw capacity of solar power and still leaving NAWEC with some surplus. The Gambia is a prime location for solar investment compared to the heavily solar invested  western and Northern European countries. Typically the United Kingdom  gets 1493 hours of sunshine annually on average  . The Gambia gets on average 3600 hours of sun a year.  The United Kingdom generates 3% of its energy from solar- that means up to a million homes get  their energy from solar. NAWEC could, perhaps, achieve a greater capacity for the use of solar energy without making the capital investment. NAWEC can achieve that through the introduction of a feed-in tariff- a situation where household are encouraged to install solar panels on their roofs and sell the electricity to NAWEC at a price that allows NAWEC  to sell it to its consumers .

Thermal Energy :

Currently, NAWEC generates most of its energy from thermal power using HFO.This practice is expensive and inefficient. NAWEC could perhapsretrofit its current machines to use other forms of fuel than HFO. This could include natural gas or biomass, which will use locally generated products or byproduct as fuel, e.g., groundnut shell generated by Gambia Groundnut Corporation (GGC) and dumped at Denton bridge. The Gambia is surrounded by tons of garbage which could be used to power machines that generates useful power, thereby killing two birds with one stone- solving the country’s waste and electricity problems at the same time .

Privatization :

If the government chooses to privatize NAWEC, perhaps it should consider dividing the institution up into two companies with the energy generating aspect of production privatized while the government could manage the transmission and distribution side of business and still maintain control over the critical infrastructure as part of its investments over time. Once this private ownership opportunity becomes available, more companies may consider investing in the energy generating sector. Further, the Gambia government can earn money from private investors through the charging of fees for the use of its transmission and distribution system. NAWEC’s  monopoly over the generating, transmission and distribution network of the company is not sustainable. Inviting private investors to buy out the aspect of NAWEC’s  productive capability that challenges the institution the most is, perhaps, the smartest way to go! This  way, partnering companies will focus on their key competence to maximize their performance output.

In closing, it is entirely unfair to blame President Borrow for a problem he inherited and particularly with regards to NAWEC, a half a century old problem. However, his actions or inaction to begin the crucial work of laying the foundation stones for the effective restructuring NAWEC in the coming two or three years is one of the mega-issues against which Gambians will judge him in his favor or not. Addressing the NAWEC problem is just one of the slew of development concerns President Barrow could champion to restore the public confidence in the political leadership in The Gambia. Gambians, like never before in the history of the country, are asking questions geared towards the identification of real national challenges our nation is grappling with and are anticipating for sustainable solutions and not a patch of sparse fixes here and there.

The search for answers continues; in the spirit of collective resilience, we say Aluta Continua!

Sincerely Yours,

Haddy Njie ( Raleigh, NC) & Malick Njie (Seattle, Washington State)

USA

Author: Haddy Njie & Malick Njie Diaspora Gambians USA