São Tomé and Príncipe, believed to have been originally uninhabited, were explored by Portuguese navigators in 1471 and settled by the end of the century. Intensive cultivation by slave labor made the islands a major producer of sugar during the 17th century, but output declined until the introduction of coffee and cocoa in the 19th century brought new prosperity. The island of São Tomé was the world’s largest producer of cocoa in 1908, and the crop is still its most important. Working conditions for laborers, however, were horrendous, and in 1909 British and German chocolate manufacturers boycotted São Tomé cocoa in protest. An exile liberation movement was formed in 1953 after Portuguese landowners quelled labor riots by killing several hundred African workers.
The Portuguese revolution of 1974 brought the end of the overseas empire, and on July 12, 1975, Lisbon granted São Tomé independence. Manuel Pinto da Costa, leader of the only legal political party (Movement for the Liberation of São Tomé and Príncipe [MLSTP]), became president and Miguel Trovoada served as prime minister. After a 1978 coup attempt failed, Trovoada was accused of participating in the conspiracy and exiled. In 1990 a new constitution instituted multiparty rule. Trovoada returned and in March 1991 was voted president in the country’s first free elections. Príncipe became autonomous in 1995.
Protests and unrest erupted throughout the 1990s over unemployment and soaring inflation. One of Africa’s poorest countries, São Tomé has what are believed to be enormous untapped off-shore oil reserves—an estimated 6 billion barrels that are expected to begin flowing by 2007 or 2008. Businessman Fradique de Menezes won the presidential election in 2001. In July 2003, a military coup deposed Menezes while he was out of the country. International pressure resulted in Menezes’s restoration to the presidency a week later. In 2006, Menezes won reelection with 60% of the vote, but the governing MDFM-PCD coalition did not win a majority of votes in parliamentary elections. In February 2008, the coalition agreed to a power-sharing deal with the opposition Independent Democratic Action (ADI) party. The party’s leader, Patrice Trovoada, was appointed prime minister. He was named prime minister again in 2010, after his ADI won parliamentary elections, taking 26 of 55 seats. Trovoada will again lead a minority government.
São Tomé and Príncipe, officially the Democratic Republic of São Tomé and Príncipe, is a Portuguese-speaking island nation in the Gulf of Guinea, off the western equatorial coast of Central Africa. It consists of two islands: São Tomé and Príncipe, located about 140 kilometres (87 mi) apart and about 250 and 225 kilometres (155 and 140 mi), respectively, off the northwestern coast of Gabon. Both islands are part of an extinct volcanic mountain range.
São Tomé, the sizable southern island, is situated just north of the equator. It was named in honour of Saint Thomas by Portuguese explorers who happened to arrive at the island on his feast day. With a population of 163,000 (2010), São Tomé and Príncipe is the second-smallest African country (the Seychelles being the smallest). It is the smallest country in the world in terms of population that is not a former British overseas territory, a former United States trusteeship, or one of the European microstates. It is also the smallest Portuguese-speaking country.
Total installed electricity capacity (2007): 15.6 MW
Petroleum products: 42%
Total primary energy supply (2007): 44.5 ktoe
Biomass (firewood and charcoal) is used heavily for cooking purposes.
Oil consumption and imports are 1,000 barrels a day. There is no oil refinery. As a result, all petroleum products including jet fuel, gasoline and kerosene have to be imported. The fuel comes mostly from an Angolan supplier that has an effective monopoly. There are no indigenous sources of oil, coal, natural gas or hydropower.
Electricity supply in STP is unreliable and coverage extends to only about half the population, so many households rely on candlelight and kerosene lighting, and biomass for cooking.
The main distribution system covers the north-west part of São Tomé Island (where the capital city is). Thus about 80,000 people (out of a total population of about 150,000) are supplied with electricity from EMAE, the national utility, on São Tomé e Príncipe. There is also a privately owned micro-hydro system on the Augustino Neto plantation.
Although 60% of households have access to electricity, only 48% use electricity for lighting, while 49% uses kerosene lamps. Close to 85% of households use firewood or coal for cooking.
São Tomé e Príncipe’s energy sector faces substantial challenges. Firstly, a shortfall in capacity and insufficient resources to pay for fuel translate into frequent blackouts, which disrupt the economy. Secondly, as is the case in many other island economies, energy production is very costly. Thirdly, technical and commercial inefficiencies exacerbate financial losses. Finally, the tariff structure is not cost reflective..
Generation costs are high, as most of EMAE’s generation is from diesel-fired plants and the cost of imported fuel is high. Power transmission is subject to illegal tapping. So far, government efforts to increase generating capacity have proved unsuccessful, and a generator remains a necessity for businesses, diplomatic missions and tourism sites.
Demand has risen to 15MW and will continue to rise with economic growth. The frequency of electricity cuts, ranging from a couple of hours in the city centre to a couple of weeks in more remote rural areas, rose sharply in 2009 after a major fire destroyed two generators at EMAE. A short term solution uses the capacity from the power station at Bobo-Forro. Chinese Taipei has provided funds to build two new generators in Santo Amaro, which should produce 30 MW by 2011. The Portuguese group Soares da Costa is building a new generator to produce 6 MW at Bobo-Forro.
With an average daily insolation of 5.2 kWh/m2, the country is well-placed to utilise solar energy. However, little progress has been made, short of pilot projects in public buildings, such as schools.
Meteorological measurements in the mid-1990s indicated that the country does not have significant wind potential, but that topographical conditions mean the potential for the technology cannot be ruled out. There are no current projects in wind energy in the country.
An estimated 30 GWh/year are available from biomass utilisation. Sustainable use of forestry resources is a paramount concern, given the degree of reliance on traditional biomass fuels for basic energy needs.
No study has currently been conducted as to the geothermal potential of the country. However, the islands’ geographical location, on the Cameroon volcanic mountain line, indicates the possibility of a geothermal resource.
Studies conducted by EMAE conclude that the country has potential for additional hydro power generation, but that more analysis needs to be done. Preliminary feasibility studies for 14 sites suggest investment costs ranging from US$3,000 to US$10,000 per installed kW.
There is a lack of government or utility-driven programs for energy efficiency and demand side management. Energy consumption per capita stood at 0.278 toe in 2007. Technical efficiency in the power generation system is low, with high distribution losses. In conjunction with high commercial losses through inadequate billing procedures, the potential for efficiency in the electricity sector is high.
The state-owned Empresa de Agua e Electricidad (EMAE) has an installed capacity of 15.6 MW. However, actual generation is approximately 7.5 MW, due to frequent breakdown of generation units. As a consequence, large clients such as international hotels rely on their own generators and are not connected to the electric grid.
The Empresa Nacional De Combustiveis e Oleos (ENCO) is responsible for the international oil market in the country, whilst development rights for the offshore regions of the country are handled by a variety of international companies, including Chevron-Texaco and Esso.
Electricity is provided by the EMAE, a 100% vertically-integrated company which falls under the jurisdiction of the Ministry of the Environment, Infrastructure and Natural Resources. ENCO is also a parastatal, and is responsible for the wholesale of oil and petroleum products in the country.
Program of Action
The Program of Action of the government made it a priority for the energy sector to improve energy supply capacity, diversify sources of electricity and improve medium voltage lines. The installation of additional capacity to improve energy supply in order to revive economic activity increased power capacity by 2,000 kW and allowed for the maintenance of generators. Although some efforts were made, the energy supply to the population, as well as the generator maintenance activities continue to need improvement.
The Oil Revenue law governs the allocation of funds from oil-related activities.
The World Bank’s assessment in September 2009 confirmed the government’s views that the power sector needs a major turn-around. Key issues to be addressed include:
A high connection fee (US$130 per household), even for poor households, which stimulates illegal connections and impedes targeting of subsidies;
lack of programs for energy efficiency and demand side management;
poor maintenance of the existing thermal generators.; and
the lack of resources within EMAE to invest in new generation capacity, maintain existing generators, or expand the distribution system. An estimated US$48 million is required to modernise commercial operations.
As a result, the government of STP has requested assistance through the World Bank to conduct a Study on the Revitalization of the Power Sector and Private Sector Participation. The aim of this is study is to identify priorities and encourage private sector participation, in order to achieve the sector’s technical and financial sustainability.
The Ministry of Natural Resources, Energy and Environment
The Ministry is the responsible body for natural resources management, biodiversity, conservation and the environment. The mandates are shared by two different institutions:
The Directorate (Department) of Natural Resources
The Directorate is responsible for the management of plans and execution of government policy on natural resources. The Directorate is also responsible for permits related to the use of resources, such as minerals, sand and gravel, industrial licensing, and intellectual property.
The Directorate of Environment
This Directorate is focused on environment issues, such as conservation, biodiversity and natural resources preservation. Its main function involves: the execution of the government policy for the environment, information concerning carbon dioxide emissions, adaptation for climate change and the National Biodiversity Strategy Action Plan.
National Petroleum Agency
The National Petroleum Agency is an independent public agency in charge of oil resources management, The Agency assists the government with petroleum issues, giving regulatory and policy recommendations to promote investment and sustainable development in this sector.
No government agency is currently involved with the promotion of, or research into, the use of sustainable energy in the country.
Up to 2010, under the United Nations Framework Convention on Climate Change, the following projects on energy have been submitted by STP:
Introduction of the new technology for use firewood and to make charcoal
Introduction of renewable energy (solar, wind and biomass)
Construction of two hydropower stations at Claudino Faro and Bernardo Faro.
STP’s government is considering private sector participation in the energy sector, according to the following factors:
whether it is best to initially keep EMAE in public hands and have private sector participation increase over time or to sell EMAE;
whether it is best to sell EMAE as an integrated electric and water utility company or as separate business lines; and
whether or not to unbundle the power sector and sell the generation, transmission, and distribution business lines separately.
The government also wishes to assess the viability of improving EMAE’s efficiency and foster the emergence of private capital for new investments (e.g. generation).
A multi-sector regulatory agency, the Autoridade General de Regulação (AGER, http://www.ager-stp.org/), is currently developing capabilities in the power business.
Degree of independence
Whilst AGER is, in ownership, a subsidiary of the Ministry of Telecommunications, the organisation is endowed with legal autonomy, and the capacity to distribute its own resources. The board consists of 3 members, the President and two Administrators. Members of the board are free to act on an individual basis in their roles in the company.
No regulatory framework for sustainable energy currently exists in the country. AGER has prepared a Bill of Law to be submitted to the National Assembly in the upcoming months. This Law defines the rights and obligations of concessionaires and licensees in power generation, transmission, and distribution, as well as the marketing of energy. It also enables the marketing of energy at regulated wire tariffs to enable the emergence of the private sector, including IPPs and self-generators. In addition, AGER has drafted a separate Bill of Law dealing with the rights and responsibilities of customers in order to improve enforcement of utility contracts, combat fraud, and collect due bills, all of which are aimed at strengthening commercial discipline. Funding is set by the government upon a funding request being made.
AGER is currently primarily responsible for the telecommunications sector, however, the organisation is active in licensing and registering electrical service providers, including IPPs, and the supervision of regulated entities. More responsibility for the sector will be afforded to the organisation with the acceptance of the Bill of Law.
Energy regulation role
The Ministry of Telecommunications is responsible for the activities of AGER, although the extent to which the Ministry affects the energy sector is unclear. The Ministry for Natural Resources and the Environment is responsible for the development of the energy sector, including capacity-building measures.
Major constraints on the continued development of the sector include institutional framework, and legal framework for the energy sector.