The Democratic Republic of the Congo (DRC) has plans to pass a new energy law that will help increase the development of the energy sector over the next five years.
The new law will serve as the driver for investments needed to tackle the Grand Inga hydroelectric project, which could dwarf China’s Three Gorges Dam, and generate as much as 40,000 MW to ease power shortages both in the DRC and the region. The Grand Inga project could be a long term solution to Africa’s power problems, but investors have held back due to political risk and its $80 billion price tag.
Vika di Panzu, a senior advisor to state-owned utility (SNEL), said on Thursday to achieve this goal the DRC hopes
to have the law ratified and enacted before the end of 2009 to liberalize a sector controlled by SNEL. Panzu said the DRC was following Nigeria’s example and in April Congo signed a law to transform 20 state-owned entities, including SNEL, into profit driven companies.
"They are now commercial enterprises with the state as the sole shareholder… in the future we envision they could have other shareholders as well," he said.
The electricity act, already drafted, will set out the reforms to be taken over the next five years to provide legal, regulatory, and fiscal incentives for private investors to come into the energy sector.
"It’s a long process because you have to take into account the social impacts of any tariff increases you will need to implement to attract investors," Di Panzu said.