With over 30 years of instability and a lack of economy and proper infrastructure in Somalia, privately owned electricity companies have emerged to provide power in urban areas, primarily using diesel generators. In some regions, these local providers have collaborated to form larger companies that supply electricity to broader city areas. However, tariffs are often unregulated and can fluctuate significantly, particularly as diesel prices rise. It is normal to experience frequent electricity blackouts, sometimes lasting for hours, highlighting the ongoing challenges in the energy sector.
This also significantly hampers the growth and competitiveness of the local manufacturing sector, which depends on these energy supplies or dedicated diesel generators during blackouts.
Electricity tariffs in Somalia are among the highest in Africa, ranging from USD 0.50 to 1.00 per kWh. In comparison, neighboring countries have significantly lower rates: USD 0.10–0.12 in Burundi, USD 0.50–0.55 in Liberia (Monrovia), USD 0.18 in Kenya, USD 0.40 in Uganda, and just USD 0.04 – 0.06 in Ethiopia. Although Ethiopia boasts one of the lowest tariffs in sub-Saharan Africa, approximately 45% of its population still lacks access to grid electricity due to insufficient infrastructure.
Despite the vast potential for renewable energy sources, such as solar and wind power, progress has been limited due to security and funding challenges. While small-scale solar and wind projects have been initiated, a comprehensive evaluation of these resources is necessary to design large-scale power generation solutions.

Widespread corruption and nepotism in Somalia are significantly impacting international donor funding. For instance, the World Bank has paused a promised $150 million in funding for Somalia’s energy sector due to concerns about governance and the allocation of resources.
These challenges hinder not only financial support but also the overall progress in improving Somalia’s energy infrastructure, which is crucial for economic development and stability.