March 15, 2011 – Ms. Pan is a widow and she makes her living by weaving fishing nets and mats. To add to their meager earnings, she and her daughter work by the dim glow of a kerosene lamp at night. But things changed when electricity came to their village in southern Laos.
"My life is normal now, not like in the past when we couldn’t see well," she said. "Since we've had electricity, we can earn 40,000 to 50,000 Kip (around US$5-6) a month from making more mats and fishing nets. Before, we couldn't make any more money. But now we can do whatever we want whenever we want."
Similarly, in Nong Buang village, Kantoeun, a wood carver, says he is able to sell more handicrafts. "We started using electric tools, which means we can work faster, and do better quality finishing. In the past, when there was no electricity, people wouldn't order from us. Now that customers can see we can work faster, big orders have come in. Our living standard has improved. We're better off and happier," Kantoeun said.
Electricity for all
National electrification has been rapid. In 1995 only 15% of homes in Lao PDR had electricity; by 2010, 71% were covered. More importantly, electricity is reaching even the most remote areas of a country where 68 percent of the population live in rural areas.
"The government realizes that the most effective way of helping people in rural areas is to bring them electricity. That's why we started to invest in it," said Director General Viraphone Virawong of the Ministry of Energy and Mines.
The World Bank is supporting the government of Lao PDR as it moves toward its target of providing electricity to 90% of the population by 2020. So far, the Bank has supported several projects under a rural electrification program started in 1987, and through it 200,000 households now have access to electricity.
The Bank is also supporting Electricite du Laos (EdL), a state-owned power utility. EdL is driving the rural electrification project throughout the country, making energy cheap and accessible. The government subsidizes 20-30% of electricity charges to rural homes so that they do not have to spend more than what they would normally pay for kerosene or rechargeable batteries. Areas with low populations are not considered viable enough to be included in the power grid. In these cases, "off-grid electrification" options–biomass, solar, or hydropower–are provided.
Focus on Women
The poor also have a better chance at accessing energy because the projects include social and economic development components. For example, Power to the Poor (P2P) is a program that provides interest-free credits for electricity connection charges. This is especially valuable to families who live in villages already in the power grid but who cannot afford connection costs.
Women-headed households, such as that of Ms. Pan and her daughter, are usually the poorest and most vulnerable in rural areas. P2P helps them as it includes gender-sensitive eligibility criteria.
"P2P is designed especially for women-headed households or for women who are divorced or widowed and have lots of children," says EdL project manager Gnanhkham Douangsavanh.
Helene Carlsson-Rex, a World Bank senior gender specialist, adds "Money in the hands of women has a bigger impact on children’s health and education. So we want to make sure we give women this opportunity."