Assessing the costs of contributing to climate change targets in sub-Saharan Africa: The case of the Ghanaian electricity system

Ghana is one of the few countries within the sub-Saharan region which has been successful in reducing energy poverty. However, ensuring energy security, affordability, and environmental sustainability remains a significant challenge for the future development of the sub-region. Here, we examine how the electricity supply can evolve into the future tomeet potential emission obligations for the period of 2020-2040. A generation expansion planning model which is able to incorporate the reality of fuel shortages and fuel switching typical of a developing country's power system is used. In doing so, we generate a range of emission reduction costs that provide important benchmarks for the relatively under-studied sub-Saharan region and identify drivers of these costs specific to developing countries. Results indicate that the total discounted cost in expanding generation to meet the demand for all scenarios range from 13-17 billion US$, while the expected emission ranges from 99-189 mtCO(2). Subsequently, the cost ofmeeting different emission targets up to 2040 was quantified for each scenario ranging from 11-39 US$/tonne, which could be used as a benchmark for comparison in developed countries. We find that discount rates, representing Ghana's access to capital, are a particularly important variable for developing countries. We find that lower discount rates can lead to more investment in capital intensive renewable energy in the long run but can also lock in an additional conventional generation investment in the short term. Sensitivity analysis of demand growth reduction shows that with a 1% growth rate, the requirement of generation capacity could be reduced by 84%, providing initial evidence for the benefits of investing in demand-side measures. The study provides data and policy recommendations needed to inform decision-makers in developing countries as well as a comparison point for identifying decarbonization costs internationally. (c) 2020 International Energy Initiative. Published by Elsevier Inc. All rights reserved.