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  • June 27, 2014 SREP Sub-Committee Meeting

    Montego Bay, Jamaica

    Readiness for Investment in Sustainable Energy (RISE)

  • Table of Contents

    I. Setting the Context

    II. Developing the Indicators

    III. Moving Forward to a Global Rollout

    Readiness for Investment in Sustainable Energy 2

  • RISE Pilot Results Summary

    Readiness for Investment in Sustainable Energy 3

    98

    91

    84

    84

    82

    80

    79

    74

    66

    51

    42

    28

    0 20 40 60 80 100

    Tanzania

    India

    Mongolia

    Kenya

    Mali

    Ethiopia

    Nepal

    Honduras

    Solomon Islands

    Yemen

    Vanuatu

    Liberia

    Energy Access

    83

    75

    65

    54

    35

    35

    34

    29

    27

    26

    24

    24

    23

    23

    22

    21

    14

    0 20 40 60 80 100

    Denmark

    US

    India

    Chile

    Kenya

    Mongolia

    Armenia

    Ethiopia

    Liberia

    Honduras

    Vanuatu

    Tanzania

    Nepal

    Mali

    Solomon Islands

    Maldives

    Yemen

    Energy Efficiency

    88

    87

    74

    65

    51

    47

    46

    42

    39

    37

    37

    29

    20

    15

    11

    9

    7

    0 20 40 60 80 100

    Denmark

    US

    India

    Chile

    Armenia

    Mongolia

    Honduras

    Kenya

    Ethiopia

    Maldives

    Nepal

    Tanzania

    Liberia

    Solomon Islands

    Mali

    Yemen

    Vanuatu

    Renewable Energy

    Planning

    Policies and Mandates

    Pricing and Subsidies

    Procedural Efficiency

    Cross-cutting Indicators

    Countries are measured on 28 indicators and 85 sub-indicators

  • I. Setting the Context

  • What is RISE?

    Readiness for Investment in Sustainable Energy 5

    Global initiative

    Policy indicators

    Quality of the energy investment

    climate

    Develops

    Measures

    RISE

    Global Tracking Framework

    •USD 600-800 Billion required annually

    SE4ALL Goals

    SREP

    Measuring outputs

  • What does RISE want to achieve?

    Readiness for Investment in Sustainable Energy 6

    Multi-faceted view Global scale

    Primary data produce &

    update

    Actionable energy sector

    policies

    Contribute to achieving SE4ALL

    goals

    Contribute to domestic policy

    debate

    Benchmark performance

    Fe at

    ur es

    O

    bj ec

    tiv es

  • Long List of Indicators (over 100)

    Guiding Principles

    Multiple Consultations Internal WBG experts / External Advisory Group / Private sector

    28 Indicators

    How were the indicators selected?

    Comparable Objective Actionable Context Neutral

    Available Cost Effective Consensus

    Readiness for Investment in Sustainable Energy 7

    St ag

    e 2

    St ag

    e 1

  • How are indicators structured?

    Readiness for Investment in Sustainable Energy 8

    Cross- cutting

    Energy Access

    Energy Efficiency

    Planning

    Policies and Mandates

    Pricing and Subsidies

    Procedural Efficiency

    1 indicator (3 sub-indicators)

    2 indicators (7 sub-indicators)

    2 indicators (4 sub-indicators)

    2 indicators (5 sub-indicators)

    2 indicators (4 sub-indicators)

    7 indicators (33 sub-indicators)

    1 indicator (2 sub-indicators)

    1 indicator (4 sub-indicators)

    2 indicators (3 sub-indicators)

    3 indicators (10 sub-indicators)

    4 indicators (7 sub-indicators)

    1 indicator (3 sub-indicator)

    Renewable Energy

    28 indicators and 85 sub-indicators are classified into 4 pillars and 4 frameworks

  • Which are the pilot countries?

    Readiness for Investment in Sustainable Energy 9

  • How is the implementation process?

    Data collection •Carried out by consultants in countries to count on

    local capacity • Spent 26 man-month through •Primary data collected from official documents • Interview with developers and customers

    General Scoring Principles • Score out of 100 for each indicator •Use traffic light to indicate scores •Equal weight to indicators when aggregate •Traffic light also used at aggregated levels

    Readiness for Investment in Sustainable Energy 10

  • II. Developing the Indicators Cross-cutting

  • Indicators

    Readiness for Investment in Sustainable Energy 12

    Indicators Definition Source*

    Retail Price of Electricity

    A unit price per kWh at an average consumption level of residential and industrial customers C

    Fossil Fuel Subsidy Percentage of electricity generated by fossil fuel that is subsidized (based on IMF data on fossil fuel subsidy and IEA data on fuel mix of electricity generation)

    C

    Utility Performance

    Examine the availability and audit of the financial statements of the utility; assess key financial metrics including (i) EBITDA ratio, (ii) current ratio, (iii) debt service coverage ratio, (iv) days receivable outstanding, and (v) days payable outstanding

    C

    Carbon Pricing Mechanism

    Assess the existence of GHG emission reduction target and carbon pricing mechanism P

    * Type of sources P : Primary data collected by reviewing laws/regulations/policies C : Calculated based on statistics from primary data and other sources I : Interview with customers or developers

  • Retail Price of Electricity • Retail price for residential customers ranges US$ 0.02 – 1.04/kWh • Retail price for industrial customers ranges US$ 0.02 – 1.28/kWh

    Readiness for Investment in Sustainable Energy 13

    2 6 3

    10 7 6 7 8 13

    19

    32 25

    37 31

    57

    78

    104

    2 8

    15 8

    16 19 21 22 18 22 15

    23

    34

    46

    57

    84

    128

    -

    20

    40

    60

    80

    100

    120

    140

    U S

    ce nt

    s/ kW

    h

    Residential

    Industrial

  • Fossil Fuel Subsidy • 6 out of 17 countries generate electricity from subsidized fossil fuel

    Readiness for Investment in Sustainable Energy 14

    100%

    78%

    55% 44%

    11% 1% 0%

    20%

    40%

    60%

    80%

    100%

    Electricity generation by fuel type – subsidized fossil fuel and others

    By subsidized fossil fuel By other fuel

  • Utility Performance • 7 countries indicate that their largest utility’s financial statements are available to

    public and audited by third party • Except Mali, Nepal and Tanzania, the largest utility of all countries exceeds the

    threshold for at least one of the five key financial ratios.

    Readiness for Investment in Sustainable Energy 15

    100

    90 90 90

    80 80

    60

    40 40 35

    30 30 25

    20

    10

    - - -

    10

    20

    30

    40

    50

    60

    70

    80

    90

    100

    Score of Utility Performance Indicator Financial Performance

    Financial Reporting

  • Carbon Pricing Mechanism • Among SREP countries, Ethiopia, Liberia, Maldives, and Mongolia have a

    GHG emission reduction target which is a basis of carbon pricing

    Readiness for Investment in Sustainable Energy 16

    100 100

    50 50 50 50 50

    - - - - - - - - - - -

    20

    40

    60

    80

    100

    Score of Carbon Pricing Mechanism Indicator

    Carbon Pricing Mechanism

    GHG Emission Reduction Target

  • II. Developing the Indicators Energy Access

  • Indicators

    Readiness for Investment in Sustainable Energy 18

    Framework Indicators Definition Source*

    Planning Electrification Plan Existence of a national plan; coverage of the plan on both grid and off-grid; the latest updated year P

    Policies and Mandates

    Enabling Environment for RE Developers to Invest in Mini-grids

    Existence of a regulation outlining rights and duties of mini-grid operators; some key attributes of the regulation, including the right of tariff level decision, the requirement of prior regulatory approval, standards, and subsidies or duty exemptions

    P

    Enabling Environment for Standalone Home Systems (SHS)

    Existence of a national program for SHS; performance standards; subsidies or duty exemptions P

    Pricing and

    Subsidies

    Funding Support to Electrification Existence of a

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