Evaluating power trading in selected countries of the Southern African development community

Abstract

The research explores an evaluation of cross-border electricity trading among countries of the Southern African Development Community (SADC). Understanding this trading achieve through an analysis of various global electricity markets. The research disclose that in the electricity markets in Europe, North America, South America and Asia analysed in this thesis, none managed to successful eliminate power shortages. Their situation, however, is different from that of the Southern Africa Power Pool (SAPP). The apparent poor design of the SAPP as a regional power pool impacts negatively on power trading within its region. A strategic public management model was used to analyse the organisational dynamics of the electricity companies of the three countries selected for this research (Democratic Republic of Congo, South Africa and Zimbabwe). A Strength Weakness Opportunities and Threats (SWOT) analysis carried out on these markets indicated that there are problems among different electricity companies, each requiring a solution. Each country's evaluation highlighted a need for an accountable government to implement a goal-directed policy to militate against any dysfunctional operations by the electricity companies. The quantitative and qualitative data analyses of the fieldwork results showed the SAPP had struggled hard to increase the capacity of members' power trading. The study indicated internal problems in terms of increasing trading volumes. The time series analysis showed power trading in the short-term electricity market had decreased annually. Linear regression analysis also indicated a decline in the capacity of the SAPP. A number of factors could explain the reduction of capacity in the SAPP, but the research results suggested a strong probability that electricity capacity would decrease further, as the countries, trading in the power pool have experienced decreased electricity volume annually because of internal demand. In addition to a number of. recommendations, the research proposes a normative model that could be used by nations to manage and assess the electricity market. An understanding of the input as adapted from Easton inpuUoutput normative 11 transformational systems model, in terms of different governments, should assist policy-makers to transform the power trading generating distribution industry. Global experience shows the need to establish a normative transformation of the electricity industry in the SADC region. It is clear from the results of this study that the SADC electricity markets have been poorly transformed in terms of a particular normative guideline. The situation has also disadvantaged the SAPP, which, in recent times, had less electricity capacity with which to trade. Implementation of the normative model in the context of this study sought to analyse all aspects that might influence the transformation of the electricity sector, and to grow a currently dysfunctional state to that of functionality and reliability. While each country faced its own reality in terms of the transformation of its public enterprises, the study recommends the normative model be implemented in the same way in each selected country.