Mauritania Power Performance Improvement Plan Tender, Mauritania - 61023248

Procurement Summary

Country : Mauritania

Summary : Mauritania Power Performance Improvement Plan

Deadline : 27 Dec 2021

Other Information

Notice Type : Tender

TOT Ref.No.: 61023248

Document Ref. No. : 1278171

Financier : World Bank (WB)

Purchaser Ownership : -

Tender Value : Refer Document

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Tender Details

Expression of Interest are invited for Mauritania Power Performance Improvement Plan.

The electrification strategy in Mauritania is embedded in the SCAPP with an ambitious target to reach universal access in urban areas and 50 percent access rate in rural areas by 2030. Further, a Sectoral Note prepared by the Ministry of Petroleum, Energy and Mines (MPEM) outlines four areas of interventions in the energy sector including: (i) development of new generation capacities from domestic resources, mainly natural gas; (ii) expansion of the transmission network and interconnection with neighboring countries; (iii) increasing the share of renewable energy in the energy mix and (iv) implementing off-grid solutions in remote rural areas.

Mauritania's electricity and gas market is based on a single buyer system, with the state-owned national power utility at its center. As a vertically integrated utility, the Société Mauritanienne d'Electricité (SOMELEC) is responsible for the key electricity service functions, including generation, systems operation, transmission, and distribution. The electricity sector in Mauritania has benefited from significant investments in power infrastructure, particularly in generation and transmission systems, with an increasing share of renewables. The total installed power capacity is 549 MW, out of which 505 MW is available. In addition, there is installed a 188 MW captive generation by mining industries. Mauritania has surplus capacity to export to Senegal and Mali (up to 60 MW in 2017). Exports represent a sizeable share of the national utility's revenues (up to 25 percent of SOMELEC's revenue in 2018). The growing share of renewable energy in the energy mix has had a beneficial effect on SOMELEC's cash flow thanks to the reduction on fuel costs. Renewables generation includes (i) a 30 MW wind power plant in Nouakchott (2017), (ii) two solar plants of 15 MWp and 50 MWp in Nouakchott commissioned in 2013 and 2017 respectively, (iii) a 100 MW wind power plant under construction to be commissioned in 2021 in Nouadhibou, and (iv) the shares of Mauritania in the Manantali hydro plant (30 MW) and Felou hydro plant (18 MW). Mauritania has an important transmission network program under implementation aimed at increasing export (225 kV line Nouakchott-Saint-Louis) and supplying mining industries (225 kV line Nouakchott to Nouadhibou)

Despite these investments in generation and transmission, Mauritania continues to face significant challenges in terms of electricity access. The electricity access rate in Mauritania at 46 percent is low and comparable to the average in Sub-Saharan Africa. In addition, significant disparities exist between urban and rural areas: While 85 percent of urban households have access to electricity, only 5 percent of rural households benefits from electricity in 2018. In terms of coverage, out of 828 localities with more than 500 inhabitants, only 95 localities have access to electricity.

So far, the private sector plays only a marginal role in the sector through the Delegations of Public Service of Electricity operating in rural areas. The Government has been hesitant to involve the private sector in the financing and the management of the sector. Developments are underway, like the passing of the Public Private Partnership (PPP) Act, Law 2017-06, that could change the course of events. The electricity sector could benefit from this major reform to attract private capital, particularly through the use of independent power generation (IPP).

However, improving the performance of SOMELEC and the organizational and institutional framework of the electricity sector are crucial to ensure the sector will benefit from these developments. Specifically, reforms and capacity building actions will need to be undertaken in the short to medium term to meet these challenges.

The Mauritanian power sector is faced with significant financial challenges due to the subsidized energy tariffs, deteriorating technical and commercial performance (technical and commercial losses reached 25 percent in 2017), increased fraud, low collection rate (approximately 65 percent in 2017) and difficulties to recover unpaid bills, and is in need of stronger utility performance.

The Government is considering developing a performance contract with SOMELEC, in which the company would commit itself to improving its technical, commercial, and financial performance, and more importantly, to sustain the achievements over time to ensure its financial viability. The improvement of SOMELEC performance will not only reduce costs but also enhance its credibility as a potential future buyer of electricity generated by the private sector. The performance improvement of SOMELC will also need to be placed in the broader sector reform agenda resting on three pillars: (i) security of supply; (ii) sustainable sector development; and (iii) improved equity and good governance, including the introduction of a regulatory authority for the power sector.

Publication Date: 10-Dec-2021

Expression of Interest Deadline: 27-Dec-2021

Documents

 Tender Notice