Total Energies Tightens Grip on Electricity in Africa

TotalEnergies has announced a strategic agreement with Scatec, a Norwegian renewable energy company, to acquire its subsidiary SN Power. The acquired energy company  holds interests in renewable hydroelectric projects in Zambia and Uganda. This acquisition sets the stage for a joint venture with Norfund and British International Investment (BII), expanding TotalEnergies’ footprint in Africa.

With TotalEnergies’ increasing stakes in key hydroelectric projects, concerns arise about the potential for profit repatriation and decision-making being driven by foreign interests rather than national priorities.

One of the most notable aspects of this transaction is the 28.3% stake TotalEnergies will acquire in the Bujagali hydroelectric power plant in Uganda. With a capacity of 250 MW, the Bujagali plant is a critical asset, supplying over 25% of Uganda’s peak electricity demand. Ultimately, TotalEnergies will wield significant control over Uganda’s energy infrastructure. Additionally, TotalEnergies will gain minority stakes in two substantial projects under development in Rwanda and Malawi, with capacities of 260 MW and 360 MW, respectively.

While these projects promise to enhance the renewable energy capacity in these countries but also raise questions about the extent of foreign influence over their energy sectors. Critics argue that such acquisitions by multinational corporations can undermine the energy sovereignty of African nations. Energy sovereignty refers to a nation’s control over its own energy resources and infrastructure, ensuring that the benefits of these resources are retained within the country and serve the local population.

Proponents of the deal, however, highlight the potential benefits, including increased investment in renewable energy infrastructure, job creation, and technological transfer. They argue that partnerships with established energy companies like TotalEnergies can accelerate the development of vital energy projects, contributing to economic growth and sustainability goals.

Furthermore, the joint venture with Norfund and BII is expected to bring substantial financial and technical resources to the table, potentially fast-tracking the completion of these projects and enhancing their operational efficiency. However, the balance between foreign investment and national control remains a delicate one, with each country needing to navigate these partnerships to ensure their long-term energy security and sovereignty.