Cameroon’s Power Crisis Exposes the Financial Fault Lines of the Electricity Sector

Cameroon’s electricity sector has entered a new period of turbulence after two major power plants suspended their output from the Southern Interconnected Grid (RIS), exposing the financial vulnerabilities that continue to threaten the country’s power supply.

In a statement issued on June 2, 2026, the Ministry of Water and Energy said Kribi Power Development Company (KPDC) and Dibamba Power Development Company (DPDC), both subsidiaries of Globeleq, withdrew their generating capacity from the grid on June 1 at 9 a.m.

The two facilities play a critical role in Cameroon’s power system. The Kribi gas-fired plant has an installed capacity of 216 MW, while the Dibamba heavy-fuel-oil plant provides 88 MW, particularly during periods of peak demand. Together, they account for 304 MW of installed capacity.

A Tax Dispute Becomes a Power Crisis

According to the ministry, the shutdown followed the freezing of Globeleq’s bank accounts by tax authorities as part of a forced collection procedure tied to unpaid tax obligations.

However, the ministry also pointed to a broader issue: persistent payment delays by the electricity distribution concessionaire. That detail suggests the crisis extends well beyond a tax dispute between the government and a private power producer.

Instead, it reflects a chain of financial pressures across the sector. Delayed payments by the distributor weaken power producers, which must still meet their operational, financial, contractual, and tax obligations. When cash flow breaks down at one point in the chain, the consequences can quickly spread throughout the system.

In other words, while tax authorities acted over fiscal compliance issues, those issues emerged within a sector where operators depend heavily on timely payments from the distributor. Once that flow of funds is disrupted, financial stress can quickly turn into a supply crisis.

40% of Customers Affected

The impact on electricity supply was immediate. The ministry said the loss of generation capacity caused a significant reduction in available power on the Southern Interconnected Grid, leading to outages and load shedding affecting around 40% of customers in the Littoral and West regions.

Those regions are especially sensitive to supply disruptions because they host a large share of Cameroon’s economic activity, including Douala and its industrial hub. A sudden loss of generation capacity can therefore translate into production losses for businesses and deteriorating service for households.

Government Steps In

In response, Water and Energy Minister Gaston Eloundou Essomba has opened discussions with Finance Minister Louis-Paul Motaze. The government hopes consultations among the relevant ministries and stakeholders will lead to a rapid resolution of the dispute and allow the affected plants to return to service.

According to the ministry, the objective is to restore the withdrawn generation capacity and stabilize electricity supply on the Southern Interconnected Grid as quickly as possible.

Socadel Emerges as the Weak Link

Beyond the immediate crisis, the episode has brought renewed attention to the financial health of Cameroon’s electricity distribution business. The ministry explicitly referred to cash-flow pressures linked to persistent unpaid bills by the distribution concessionaire. That concessionaire is now the Cameroon Electricity Distribution Company (Socadel), which took over distribution activities as the government increased its control over the sector.

The scale of the problem is significant. According to the Eneo-Socadel restructuring plan, the distributor faces an average monthly financial deficit of around CFA13 billion. The company reportedly collects about CFA31 billion per month while its cash operating expenses reach roughly CFA44 billion.

That imbalance helps explain how financial stress spreads through the sector. When the distributor cannot meet its obligations, independent power producers face payment delays. Those producers must nevertheless continue funding operations, debt service, contractual commitments, and taxes.

The KPDC-DPDC dispute illustrates exactly how that process works. In a highly interconnected sector, a liquidity shortage at the distribution level can eventually affect generation and, ultimately, electricity consumers.

A Familiar Crisis

The current situation echoes events in 2024 and 2025, when the Kribi and Dibamba plants also reduced or suspended operations because of unpaid bills owed by the distributor to Globeleq.

At the time, Kribi’s gas-fired plant returned to service only after months of disruption linked to CFA137 billion in unpaid invoices claimed by Globeleq from Eneo. The amount covered payments due to both KPDC and DPDC.

The difference today lies in the immediate trigger. While previous disruptions stemmed directly from unpaid bills, the current crisis began after tax authorities froze Globeleq’s accounts. Yet the underlying problem remains unchanged: the financial structure of Cameroon’s electricity sector remains too fragile to absorb payment shocks without threatening service continuity.

When Tax Enforcement Meets Energy Security

The KPDC-DPDC dispute also exposes a difficult balancing act for the government. On one side, tax authorities must enforce compliance with fiscal obligations. On the other, the Ministry of Water and Energy must safeguard electricity supply.

When the accounts of a strategic power producer are frozen in a sector already burdened by payment delays, a tax enforcement measure can have consequences far beyond government revenues. The impact can quickly extend to energy security, industrial activity, and social stability.

That reality explains the urgency behind the consultations now underway between the ministries and affected stakeholders.

Nachtigal Has Not Eliminated Every Risk

The crisis has also revived debate over the role of the 420-MW Nachtigal hydropower project in strengthening Cameroon’s electricity supply. Nachtigal Hydro Power Company announced on March 18, 2025, that the facility had reached its full capacity after the final generating unit entered service.

But additional capacity alone does not guarantee system stability. Electricity supply still depends on several factors, including plant availability, regional grid balance, seasonal hydrological conditions, transmission infrastructure, power-purchase agreements, and the financial health of sector participants.

Nachtigal has strengthened the country’s generation base, but it has not resolved the governance and liquidity issues that continue to undermine the sector. The withdrawal of KPDC and DPDC demonstrates that energy security depends not only on available megawatts but also on the ability of the system to pay suppliers, operate infrastructure, dispatch power, and maintain assets.

Globeleq’s Exit Adds Another Layer of Uncertainty

The episode comes at a sensitive moment for Globeleq, which is preparing to exit Cameroon after more than a decade of operating the Kribi and Dibamba plants.

According to local reports, discussions have begun over a potential acquisition of the two assets, which have capacities of 216 MW and 88 MW, respectively.

Any transfer of ownership could trigger a broader review of the contracts governing both facilities. One objective reportedly under consideration is reducing the financial burden on the distributor and restoring balance across the sector.

That context makes the current dispute particularly significant. The issue is no longer just about reconnecting two power plants to the grid. It is also about determining the future ownership of strategic assets, the sustainability of power-purchase agreements, and the government’s ability to stabilize a sector that still requires substantial investment.

A Liquidity Crisis With Public-Service Consequences

The withdrawal of KPDC and DPDC is more than an operational incident. It is a warning about the financial sustainability of Cameroon’s electricity system.

The sector remains trapped in a difficult cycle: the distributor collects less than it spends, payment delays accumulate, producers come under financial pressure, and tax obligations become harder to meet. When that cycle breaks down, the consequences extend far beyond company balance sheets.

The result is fewer megawatts available to the grid and more consumers facing power cuts. Restoring the withdrawn generation capacity remains the immediate priority. The larger challenge is determining how Cameroon can secure reliable electricity supply while producers, distributors, and public authorities continue to operate within a system marked by payment arrears, fiscal pressures, and recurring contract disputes.

Socadel’s reported CFA13 billion monthly cash deficit illustrates the scale of the challenge. The issue is no longer limited to a dispute involving Globeleq. It has become a test of whether Cameroon can restore the financial foundations of a sector that underpins the entire economy.

Amina Malloum and Brice R. Mbodiam