Electricity policy changes in South Africa gain momentum

Welcome back to the Vault.

This week, we look at the South African government’s attempts to address the power supply situation. We also highlight the newly introduced AI Act of the European Union and the possibility of African countries adopting similar measures to establish their own national AI regulatory frameworks.

Feel free to share your thoughts with us, check out our website for the latest policies, and let us know if you need any insight on public policies, regulations, and guidelines in Africa.

Electricity policy changes in South Africa gain momentum

South Africa’s electricity problem has been unending, with outages becoming commonplace in recent years. Eskom, the state-owned electricity company supplying roughly 80% of the country’s electricity, suffers from various problems including dilapidated power plants and insufficient investment in new infrastructure to meet demand. One major issue that is often highlighted is the lack of liberalization in the energy sector, with Eskom monopolizing the market and failing to satisfy demand.

In a bid to liberalize the electricity sector and encourage participation by the relevant stakeholders, the South African parliament has approved a bill to revise the electricity law. The Electricity Regulation Act Amendment Bill seeks to open the electricity market to private players and enable them to engage in the business of transmission, generation, and distribution of power. The bill also seeks to tackle other persistent issues plaguing the industry, such as theft and vandalism of power infrastructure.

The bill aims to tackle a few key issue areas:

• Engendering competition in the electricity market by opening the national power grid to private power generating and distribution companies, as well as creating an independent transmission system operator
• Creating an open market platform, thereby enabling competitive electricity trading;
• Strengthening the role of the National Energy Regulator of South Africa (NERSA), granting it powers to license entities for the competitive market and oversee the transition
• Introducing penalties to combat theft and vandalism of electricity infrastructure

The bill signifies a pivotal moment in diminishing the reliance on Eskom and fostering private sector involvement in the electricity market.

It’s not quite law though, and still requires approval of the legislature’s other house (i.e. the national council of provinces) before presentation to the South African President. Notwithstanding opposition of some parties, including the National Union of Miners, who have alleged that consultation in the policy-making process was inadequate, approval of the bill by the National Council of Provinces is expected.

While these developments signal progress, it is imperative that the South African authorities learn from the way electricity sector liberalisation was conducted in Nigeria. Over a decade ago, the Nigerian government unbundled the electricity sector and licensed both power generating and distribution companies. Just as South Africa is set to do, the Nigerian government retained control of the sole transmission company but has been largely unsuccessful in the attempt to ramp up the transmission capabilities across the country, resulting in grid shutdowns and blackouts.

New EU AI Act as potential blueprint for Africa’s AI Policy Framework

On March 13th, the European parliament passed the Artificial Intelligence (“AI”) Act becoming the first comprehensive law on AI. The law serves as a uniform legal framework of harmonized rules on AI aiming to achieve the right balance between uptake of AI and meeting a high level of protection for the public. Key highlights of the law are:

• Prohibition of the use of AI systems to create or expand facial recognition databases through untargeted scraping of facial images from the internet or CCTV footage. It also bans the use of AI for emotion recognition at workplace and school
• Enforcement of strict regulatory oversight by creating AI regulatory sandboxes at national level to facilitate the development and testing of innovative AI systems. It also mandates online platform owners to identify and mitigate systemic risks that may arise from the dissemination of AI generated content with foreseeable negative effects on democratic processes
• Promotion of innovation and competitiveness by giving small medium enterprises (SMEs), especially startups that are providers of AI systems priority access to the AI regulatory sandboxes. This is to promote innovation, attract investment and remove barriers for SMEs as well as ensure compliance with AI regulations
• Enforcement of risk mitigation by setting transparency requirements for high-risk AI systems

As more African countries plan to develop their own AI policies, the EU AI Act offers insights and standard practices to guide the formulation of country-level policies. By embracing key principles outlined in the EU AI Act, African countries can collectively harness the transformation potential of AI technologies, while safeguarding its citizens against potential risks and maximizing benefits for development.

Countries like Egypt and Rwanda have already made strides in adopting AI and establishing regulatory frameworks. Though the specifics of the AI policies vary, they share a common goal of fostering innovation, addressing ethical concerns, advancing AI research and development and supporting the growth of AI-based industries.

Here is a quick look at related developments across the continent:

• Rwanda National AI policy: This AI policy aligns with the nation’s Vision 2050 and Smart Rwanda Master Plan, serving as a roadmap for the country to leverage AI for sustainable and inclusive growth across sectors of the economy.
• Egypt National AI strategy: This strategy was designed with an overarching goal to create an AI Industry by focusing on developing skills, technology, ecosystem, infrastructure, and governance mechanisms to ensure its sustainability and competitiveness. The strategy cuts across governance, data, ecosystem and Infrastructure. In 2023, the country also released a Charter for Responsible AI, offering guidelines for both deployers and users of AI systems.  This charter aims to safeguard all Egyptians especially vulnerable and marginalized groups.
• At least 15 other countries have also made changes to the regulatory space by establishing government agencies and task forces to regulate AI.

Challenges to AI adoption and policy implementation in Africa

While some countries have made significant strides forward, many African nations still do not have an AI policy and regulatory framework. Additionally, challenges like ill-equipped policy frameworks, ethical concerns, and absence of structured data ecosystem remain major setbacks for adoption of AI on the continent.

In some cases, countries have had to suspend AI project implementation due to ethical concerns and data privacy related issues. An example is the Kenyan government’s suspension of the WorldCoin AI project due to data protection concerns. These challenges highlight the need for comprehensive and adaptable strategies like Europe’s newly signed AI law, since many existing policies do not appear to be robust enough to address the potential unknown impact of AI technologies.

You can dive into various country-level AI policies on our website.

Data Vault: Africa’s 2024 Elections

Bassirou Diomaye Faye emerged victorious this week in Senegal’s presidential election, only days after the country managed to navigate a crucial period in which the will of the people and strength of institutions were tested. At 44 years of age, Faye will be West Africa’s youngest-ever democratically-elected president.

Here is a quick reminder of African countries in which elections are expected this year.

What policy and insight do you seek?

Whether you are a government official, civil society organization, or researcher, our repository provides comprehensive access to public policies, regulations, and guidelines across Africa. We provide insights and intelligence on these regional policies and regulations for research, advocacy, policymaking, and investing.

Get in touch with us here: <mailto:team@policyvault.africa>.

What we are tracking

We’re also tracking the latest current events in the news, and how they may affect the decisions of policymakers. Below are some of the latest developments.

Niger | Niger finally opens border with Nigeria

Last Friday, the Niger Republic opened its border with Nigeria. This decision came a week after the Nigerian government opened its land border between both countries that was closed following the July 2023 coup d’etat in Niger.

The Ilela border between both countries serves as a major transport route for exports to Niger, as well as to other neighboring countries. The opening of their respective ends of the border by both Nigeria and Niger will come as a relief to exporters and traders.

Senegal | Bassirou Diomaye Faye wins presidential election

Bassirou Diomaye Faye has won the keenly contested presidential election held on Sunday with votes that presently exceed more than half of total votes cast.

The 44-year-old president-elect defeated nineteen other candidates and will be replacing President Macky Sall, who is stepping down after a second term marred by controversy. The country recorded a voter turnout of about 70 percent.

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