Why electricity costs so much in Somalia

Where Xidig members may contribute

These are learning opportunities first. The proposals are institutional and early-stage.

• Learning: how the Electricity Act 2023 structures the sector: the National Electricity Authority, licensing and a national company.
• Research: up-to-date tariff data by town. The public figures are old, so members who pay electricity bills can help build a better picture, carefully and with consent.
• Skills (general): power-system planning, grid operations and utility management. These are needed whichever generation mix is chosen.

Possible services, research, supplier or collaboration roles

• Independent tariff surveys and cost-of-supply analysis.
• Legal and translation work on the Electricity Act. The only text published online is in Somali and is headed as a draft bill; no official English version was found (see Somalia's Electricity Act 2023, explained).
• Grid-integration and planning studies, if and when commissioned.

Who may find this useful

• Engineers and energy economists.
• Staff of electricity service providers.
• Business owners whose costs depend on power prices.
• Students of public policy and law.

Prices, providers and where policy is heading

Fur cabbirka buuxa

The government's US$0.61/kWh baseline matches a World Bank average built on 2017 data. City tariffs are several years old.

How the market works today. The World Bank's 2021 appraisal found that private electricity service providers "supply more than 90 percent of the electricity in the country". It also found that "nearly 100 percent of the generation is derived from" high-speed diesel generators. The Ministry of Energy and Water Resources' 2025 plan describes each provider as "vertically integrated as an autonomous parallel electricity provider". That fragmentation is what SONEC is meant to address.

The price. The World Bank wrote that "based on field data collected in 2017, the cost per kWh in Somalia, excluding Somaliland, ranges from US$0.25–US$1.30 per kWh, with a weighted average of about US$0.61 per kWh". The ministry's 2025 plan repeats the US$0.61 average. The US government's 2024 commercial guide gives a range of "50-125 cents/kWh". In November 2025 the Energy Minister set a public target of prices "below 20 cents per kilowatt-hour within the next five years" (SONNA). That is lower than the US$0.30 target in the SONEC proposal.

Where policy is heading. The ministry's 2025 generation and transmission plan says Somalia "should prioritize the large-scale deployment of renewable energy technologies—particularly solar PV and wind". The plan's cost comparisons do include heavy-fuel-oil generators as a candidate technology, but its conclusion prioritises solar and wind.

According to an African Development Bank press release (16 December 2025), its African Development Fund approved US$23M for Bosaso to fund work that "will introduce new solar generation, expand the distribution network and install modern meters". Bosaso is one of the four proposed HFO sites.

Geographic context

Fur cabbirka buuxa

Sites named for the HFO proposal. The sheet's tick box says feasibility has started.

SONEC is national. The HFO plants are named for four coastal towns, three of which have ports: Mogadishu, Kismayo and Bosaso. Garacad also has a port, opened in 2022. The proposal does not describe how 100 MW plants would connect to each town's existing private networks. The 2021 World Bank table gives installed capacity of 47 MW for Mogadishu and 14 MW for Bosaso.

Dependencies and implementation constraints

• Law and institutions: SONEC depends on the Electricity Act. As of June 2026, government plans for state stakes in power and water firms were still waiting on "the draft law" (Dawan Africa, 1 Jun 2026). That article does not name SONEC.
• Existing providers: unifying networks means agreements with private companies that own them. The World Bank's ASCENT project reports a pending merger of three Mogadishu providers.
• Fuel supply for HFO: import, storage and price exposure.
• Finance: no funding or partner is named on either sheet.

Risks and unknowns

• Which article? The booklet cites "Article 44 of the 2023 Electricity Act". In the Somali text of the Act published on the ministry's website (headed as a 2022 draft bill), Article 44 ("Qodobka 44aad") deals with revoking licences, and Article 47 ("Qodobka 47aad: Shirkadda Korontada Qaran") concerns the national electricity company. The reference may reflect an earlier draft or a different translation.
• Engine brand. Rolls-Royce sold Bergen Engines to Langley Holdings in January 2022, so the "Rolls Royce Bergen Engines" wording on the government's HFO sheet (see More about the source) is out of date. Naming a supplier in a promotion document also raises procurement questions.
• Emissions. The IPCC's default CO₂ factor for residual fuel oil (77,400 kg/TJ) is higher than for diesel (74,100) or natural gas (56,100). Four 100 MW HFO plants would run against the government's own renewable-first plan.
• Cost basis: it is unclear whether US$450M covers one plant or four.
• Tariff target: no calculation behind US$0.30/kWh is given.

Questions members should verify before acting

1. Has SONEC been legally established? Under which article of the Electricity Act?
2. Who is carrying out the HFO feasibility study the tick box refers to (see More about the source)? Has the ministry confirmed it?
3. Is the US$450M for one plant or four?
4. How do the HFO proposals fit the ministry's 2025 renewable-first plan?
5. What tariffs do providers in your town charge today, and who regulates them?

What is confirmed, and what isn't

Confirmed

• The two proposals, their printed costs (US$11.7M; US$450M) and their status ticks.
• The World Bank's US$0.61/kWh average is based on 2017 data.
• More than 90% of electricity comes from private providers, with generation nearly all diesel (2021).
• The Electricity Act was signed on 8 March 2023 and created a National Electricity Authority. In the published Somali text (headed as a draft bill), Article 47 concerns the national electricity company and Article 44 deals with licence revocation; the signed Act's numbering may differ.
• Rolls-Royce sold Bergen Engines in 2022.
• The minister's "below 20 cents" target (Nov 2025).

Our interpretation

• SONEC is the only proposal on the government's list aimed at market structure rather than new capacity.
• HFO plants would sit uneasily with the ministry's 2025 plan.

Not yet verified

• Why the government's proposal cites Article 44.
• Whether any HFO feasibility work has started.
• Whether US$450M is per plant.
• Current tariffs after 2017 by town.
• Any SONEC establishment since 2023.
• Whether Article 20 of the 2020 Petroleum Law provides for SONOC, and whether there is proven commercial gas for the gas plant.

Relevant next steps

• Read the Electricity Act (Somali) on the ministry's site and the 2025 generation plan.
• Track National Electricity Authority licensing announcements.
• If you work for an electricity provider, share how consolidation is affecting your area, through Xidig and within your employer's rules.