Somaliland: Berbera city's growth is being held back by a power supply monopoly
Over the years, these revenues have mostly gone into the central state coffers, while the development of Berbera has been neglected.
- Over the years, these revenues have mostly gone into the central state coffers, while the development of Berbera has been neglected.
- When we visited the city for our research project on port infrastructure, international politics, and everyday life, this neglect was immediately visible.
- Physical and social infrastructure – ranging from roads, water and electricity to health and schooling – were lacking.
- Lack of regulation, and collaboration between the government and private businesses have spawned a monopoly of energy provision in Berbera.
Berbera port and development
- The neglect of Berbera city stands in stark contrast to the modern technologies and equipment at its port.
- Since 2017 the port has been managed by the Dubai-based logistics giant DP World.
- And a transport corridor that links the port with Ethiopia is nearly complete.
- So far, only limited investments have been made into the generation of clean energy, among them a solar mini grid in Berbera, funded by the Abu Dhabi Fund for Development.
The privatisation of energy
- The energy sector, for example, started with private business people who initially used generators for their own consumption.
- The businesses eventually provided their neighbourhoods with excess energy.
- At least four major energy suppliers are competing for customers in Somaliland’s capital city, Hargeisa.
Mini grid solar power plant
- The Abu Dhabi Fund for Development, for example, provides financial and technical support for the transport corridor from Berbera to Ethiopia.
- It has also initiated social projects for the urban poor in Berbera, like building schools and providing green and affordable energy.
- It financed a 7MW solar power plant which was inaugurated in January 2021.
- But immediately after the launch of the project, the Somaliland Ministry of Mines and Energy handed over the solar facility to Berbera Power House.
- During the inauguration of the mini grid solar power plant, the finance minister proposed that electricity prices in Berbera would be reduced to US$0.1 per unit compared to US$0.6 per unit before the investment.