Playbook of Solutions

mobile image

Creation of an Electricity Market Regulator

Challenges to investment 

Botswana has significant, unexploited renewable energy potential, especially for solar, wind, and bioenergy. The Electricity Supply Act, amended in 2007, allowed private companies to participate in power generation and sign power purchase agreements (PPAs) with the state-owned utility company, Botswana Power Corporation (BPC). However, the BPC maintained an effective monopoly over the transmission and distribution of electricity, meaning generators could not access the grid without a PPA. Moreover, independent power producers (IPP) projects faced challenges due to unfavorable pricing terms in PPAs, the high cost of commercially financed capital, and the lack of an effective regulatory framework. To address these challenges and create a favorable environment for private investment and renewable energy development, Botswana needed to establish an institution to regulate energy. 


Approach 

The Botswana Energy Regulatory Act of 2016 established the Botswana Energy Regulatory Authority (BERA), which commenced operations on 1 September 2017. BERA's responsibilities, as outlined in the Act, include setting and maintaining service standards, ensuring sustainable and secure energy supplies, protecting the environment, and adhering to international regulatory practices. BERA is tasked with providing an efficient regulatory framework for electricity, gas, coal, petroleum products, solar, and all forms of renewable energy. Its primary mandate is to economically regulate these sectors, allowing the private sector to actively participate in power generation asset formation and ensure the delivery of reliable, affordable, and high-quality services while also ensuring environmental protection. 


Key Enabling Conditions 

Since its inception, BERA has benefitted from a number of enabling conditions. First, BERA had firm legal backing under the 2016 Act, which granted credibility and ensured clarity in BERA’s roles and objectives. This credibility was bolstered by the government’s commitment to follow international regulatory best practices and supported by technical assistance and advice from the U.S. government-led public-private partnership Power Africa together with BPC and Botswana’s Department of Energy. Per their guidance, BERA also placed great importance on stakeholder consultation, mandating participation by regulated utility companies in public hearings and ad-hoc meetings. The input and responses gathered from these engagements were considered in the energy planning process, further enhancing transparency and credibility.


Impact / Outcomes

In 2021, BERA saw substantial progress in its operationalization after it was allocated a guaranteed, sustainable, and independent budget, human capital, and sufficient political independence. In 2022, BERA approved five PPAs between BPC as the off-taker and five medium sized solar power plants, amounting up to 16 MW. In the same year, the actual contribution of renewable energy to total installed capacity reached 1.6%, short of the target 2.5% but a significant advancement from around 1% in 2017. Due in part to increased scale, Botswana’s energy efficiency –measured by energy supply per unit GDP – has steadily improved from 1,849 to 1,561 MJ per thousand 2015 US dollars from 2017 to 2021. More broadly, BERA has helped oversee an expansion in access to electricity, with an additional 6% of Botswana’s population gaining access over the same period. From an institutional perspective, BERA successfully established and continues to maintain a positive reputation.


Additional Sources

Locations
Africa, Botswana
Year published
01 January 2016
Policy type
Energy policy
Policy lever
Power market governance
Risk category
Political risk, Policy and regulatory risk, Grid/transmission risk, Permits risk, Power market risk

Playbook of Solutions

A World Economic Forum Initiative
© 2026 All rights reserved
Privacy Policy & Terms of Service