By Soren Kirk Jensen, Strategic Adviser at CoST

Join our free webinar to dive further into this topic on Tuesday 23rd June: https://us02web.zoom.us/meeting/register/L3Y7z1HcQjW6C_XAaJ2aDw#/registration

When I lived in Angola, shortly after the end of the country’s long civil war, electricity supply was affected by frequent outages. When the lights went out, people in the more affluent parts of Luanda would rush to their petrol-powered generators, switch them on, and carry on as if nothing had happened – apart from the noise and fumes.

That experience stayed with me because electricity is one of the few systems modern societies depend on almost constantly, yet often notice only when it fails. Its importance is only increasing as economies electrify, and electricity becomes central to the transition away from fossil fuels.

Yet as investment in electricity infrastructure accelerates, an important question is emerging: are our approaches to transparency and accountability keeping pace with the evolving complexity of electricity sectors?

Traditional infrastructure transparency efforts have focused heavily on procurement and construction. Those remain important.

Yet an efficient and reliable power supply relies on a different set of governance and integrity challenges that go well beyond the infrastructure assets.

Electricity is an essential infrastructure service, often provided through markets while remaining part of a country’s critical national infrastructure and, increasingly, a cornerstone of climate policy. Transparency therefore needs to follow the infrastructure lifecycle, the service provided and the flow of money: who gets licences and market access to generate, trade or supply electricity; how grid access is managed, and at what cost; how tariffs and payment obligations are set; how revenue is generated and what integrity and performance risks are involved?

These questions matter because opaque arrangements can create integrity risks with real consequences. Power purchase agreements, contingent liabilities, capacity payments, grid access arrangements and tariff structures can all shape who gets commercial opportunities, who bears the costs and whether investment and service delivery deliver value for money.

The scale of what is at stake is extraordinary. Global electricity demand continues to grow rapidly, while massive investments are being made in new generation capacity, including renewable energy, and in expanded transmission networks. At the same time, electricity systems are becoming more exposed to climate risks, transmission bottlenecks, market pressures and governance issues.

This context led CoST- the Infrastructure Transparency Initiative, the UK’s Green Cities Infrastructure and Energy Programme (GCIEP), and Zambia’s Centre for Policy, Trade and Development (CTPD) to explore the link between integrity and performance risks, and transparency and accountability gaps in Zambia’s electricity sector.

Zambia provides a compelling case study. The country’s electricity system relies heavily on hydropower, with around 85 per cent of installed generation capacity coming from this source[1]. Recent droughts, linked in part to El Niño, have significantly reduced reservoir levels and electricity generation. At the same time, demand continues to grow, particularly from the mining sector. Zambia has responded with market-oriented measures to diversify and increase supply, making it a useful case for understanding electricity-sector reform challenges that other emerging and developing economies may also face.

The point of departure for our research was to understand whether electricity-sector infrastructure has a distinctive risk profile compared with other infrastructure sectors. While many challenges are familiar, including weak planning, procurement risks, delivery delays and cost overruns, we found that electricity brings these risks together in a more complex way because generation, transmission, grid access, offtake arrangements, tariffs and fiscal exposure are tightly connected.

In Zambia, this reflects the interdependence between generation, transmission and offtake, exposure to hydrological and climate risks, complex PPA and tariff arrangements, grid connection and wheeling issues, and fiscal risks linked to guarantees, contingent liabilities and payment obligations.

This pointed to a wider transparency challenge.

In the electricity sector, it is not enough to understand how infrastructure assets are planned, procured and delivered. It is also necessary to understand how electricity is provided as a service, how market access is governed and how revenue, payment obligations and financial risks move through the system.

The follow-up research therefore narrows the focus from the full infrastructure lifecycle to market-access and revenue-side transparency, while expanding the lens from electricity assets to the market arrangements and money flows that shape performance, integrity and fair competition.

Several findings are emerging, including a wide range of market and financially relevant datapoints that could strengthen transparency in Zambia’s electricity sector. A central challenge is often not the absence of data. In many cases, regulators, utilities, financiers and other market actors already generate relevant information. The real issue is that this information is not always published in a structured, standardised and timely manner that informs decision-making and oversight.

The most critical gaps appear to relate to the cost of supply, supplier-side market access, grid access, financial viability and cost recovery. In a market under pressure, shaped by hydropower volatility, mining demand, growing reliance on imports and Electricity Open Access reforms[2], these are not abstract transparency issues. They go directly to questions of who can participate in the market, who can access the grid, on what terms, at what cost, how revenue and payment obligations flow, and whether the sector can ultimately provide reliable electricity supply.

More broadly, it points to a larger conclusion beyond Zambia.

As countries invest billions in the infrastructure needed for the energy transition, existing transparency and accountability frameworks need to evolve to shed light on the performance and governance of electricity sectors that are becoming increasingly exposed to climate risks, more financially complex and subject to market arrangements that are not automatically transparent, competitive or efficient.

These issues will be explored more fully in CoST’s upcoming webinar on Tuesday 23 June at 12.00 BST, where we will share findings from the Zambia research and start a global conversation on what meaningful electricity-sector transparency should look like in practice. Using Zambia as a starting point, the discussion will consider how transparency can support transitions towards electricity sectors that are greener, more resilient, investable and accountable, with fair competition, market confidence and public oversight at their core.

Join our webinar to hear more, register at:  https://us02web.zoom.us/meeting/register/L3Y7z1HcQjW6C_XAaJ2aDw#/registration

[1] Energy Regulation Board (ERB), 2025 Mid-Year Statistical Bulletin (PDF): ERB Mid‑Year Statistical Bulletin 2025

[2] Open Access is Zambia’s formal reform framework for the electricity sector.

Soren supports CoST mainly with analytical and research work which links to the broader infrastructure governance and public investment management agenda. His background is in public financial management and international development and he has worked extensively supporting overseas governments progress integrity initiatives.