Cote d’Ivoire: Enabling Electricity Access for All

Speeches Shim

In 2014, the government of Cote d'Ivoire launched the Electricity for All program (“Programme Electricité Pour Tous, PEPT”), an ambitious plan aiming to improve the country’s low connectivity rate by subsidizing upfront grid connection costs for low-income households. The five-year PEPT program intends to facilitate the connections of one million households to the grid, raising the electricity penetration rate to approximately 53percent from the estimated 2015 rate of 29 percent. An interim PEPT program has already made significant strides towards this end, facilitating more than 300,000 connections since its inception in 2015. The Government of Cote d'Ivoire, supported by USAID and other international donors, is currently considering various financial innovations and program implementation schemes to enable greater access through facilitated connections. The SRUC team is working to support the PEPT program through targeted research, technical assistance, and financial analysis.

Research and Stakeholder Consultation

SRUC Team members, Valentin Villalbi (far left) and Eric McCartney (far right) with local representative from CIE, the Ivoirian transmission and distribution concessionaire
SRUC Team members, Valentin Villalbi (far left) and Eric McCartney (far right) with local representative from CIE, the Ivoirian transmission and distribution concessionaire.
Deiotte

The SRUC team proposed and evaluated various financial structures and tools to assist on-grid, rural electrification efforts. The team’s activities included conducting research and analysis to advise Power Africa on how to advance on-grid electrification goals in Cote d'Ivoire. The SRUC team conducted various in-country meetings for research-gathering with USAID counterparts, commercial banks, government officials, including the Minister of Energy, CIE (the private concessionaire handling transmission and distribution), CI-Energies (the national utility), and l’Autorité Nationale de Régulation du Secteur de l’Electricité (“Anaré” or the national regulatory authority). Additionally, the SRUC team executed a broad review of leading practices, focusing on grid-based rural electrification efforts through revolving funds and other financial structures in similar environments. The team examined cases in Bangladesh, Laos, and Kenya. All these inputs collectively enabled the SRUC team, in partnership with other key stakeholders, to develop a broad suite of potential solutions to catalyze the implementation of the high-impact PEPT program and to recommend ways in which to leverage private sector funds for its sustainability.

Analysis of Financing Options

The SRUC team developed both long and near-term recommendations for financing the rural electrification program. The long-term financing options considered securitization, use of local capital markets, sovereign risk guarantees, concessional lending, bridge financing, and commercial bank-financing techniques. The team analyzed not only the requirements needed to leverage each option, but also considered its feasibility according to contextual and political factors in Cote d’Ivoire.

The SRUC team also evaluated five different short-term financing options to utilize Power Africa’s available funding, while the government of Cote d’Ivoire is establishing the official PEPT. Two options involved subsidizing the upfront connection costs to varying degrees, two options involved an interest buy-down scheme, and the last option leveraged a scheme previously suggested by the European Union and the French Agency for International Development (“AFD”). Based on these findings, the SRUC team developed a report on potential financing solutions to USAID and presented several key findings to public authorities in Cote d’Ivoire.

Willingness to Pay Survey

Surveyors huddle for a briefing
Surveyors huddle for a briefing before the Willingness to Pay survey pilot outside Abidjan, Cote d’Ivoire to discuss the sampling approach, script, and potential responses to the questionnaire.
Deloitte

Following the delivery of the initial report, Anaré and USAID/Cote d’Ivoire solicited the assistance of the SRUC team to design and implement a nationally-representative Willingness to Pay survey for electricity services to gather more granular data on the purchasing power of specific customer segments. Along with a team of French economists and tariff experts, the SRUC team is leveraging a specialized market research firm based in Cote d’Ivoire, Axes Marketing, to carry out the survey.  

Over the course of survey research effort, the SRUC team will gather information that provides a broad understanding on electricity usage, alternative sources, perception of the quality of public electricity services, along with the range of willingness and ability to pay based on different household characteristics (e.g. income level, location, previous connection history, etc.).

The survey instrument targets customers on the low voltage network and differentiates between businesses and residences. It was based on similar surveys carried out in West Africa, but tailored to the Ivorian context through a pilot survey and input by Axes Marketing. The sampling methodology, vetted by an international survey specialist and veteran of the U.S. Census, will measure results at the 95 percent confidence level.

This information will help the public electricity sector regulator, Anaré, better understand both the upfront and ongoing energy costs in the country, inform the development of an electricity tariff proposal to the Government of Cote d’Ivoire, and improve their capacity for oversight of the electricity sector. The project will also build the capacity of Anaré to undertake, utilize, and analyze similar studies in the future to ensure their regulation of the sector is fair and balanced.

Finally, the results of the study will support the ambitious and important mission of the government of Cote d’Ivoire to expand and facilitate electricity access to all residents as it will help them to tailor their programming efforts to payment challenges in the sector.

Last updated: April 11, 2018

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