A $60 million credit is approved to help the country improve the performance of its power distribution utility and expand electricity access in targeted peri-urban areas
WASHINGTON, June 23, 2017 - The World Bank today approved a $60 million IDA* Scale-Up Facility credit to help the Republic of Benin improve energy services through the improvement of the operational performance of its national distribution utility, SBEE, the expansion of electricity access to peri-urban areas of Cotonou, Porto-Novo, Parakou and Natitingou, and the promotion of community-based management of forest resources.
“The new project responds to the government’s pressing needs to improve the reliability of electricity services and to its longer-term goal to develop the energy sector in a sustainable manner,” said Pierre Laporte, World Bank Country Director for Benin. While past and ongoing projects funded by the World Bank have placed a greater emphasis on expanding the transmission network and rehabilitating the medium voltage distribution network, the new ESIP will focus on improving the performance of the distribution network and its critical importance for the financial viability of the overall power sector.
Most specifically, the ESIP will help (i) improve SBEE’s operational performance by contributing to reduced commercial and technical losses, (ii) maintain positive momentum on the biomass subsector, and (iii) provide a roadmap for gradual and sustainable power sector development, while strengthening the capacity of key stakeholders.
Households and small businesses in the targeted areas will receive additional daily hours of electricity and a better voltage that will enable adequate running of their electrical equipment. Men and women living in the communes of Bassila, Bantè and Djidja will implement community-based forest management plans covering 300,000 hectares, while the communes of Djougou, Ndali and Pèrèrè will develop new plans covering 150,000 hectares. This will help the beneficiary communities engage in income generating activities from their forestry resources. SBEE will be able to reduce losses in the electricity distribution, collect increased revenues resulting from the implementation of a revenue protection program and the regularization of informal electricity users. And other key power sector stakeholders will benefit from technical assistance and capacity-building activities; these include: (i) the ministry of energy, water and mines; (ii) the rural electrification agency (ABERME – Agence béninoise d’électrification rurale et de la maîtrise d’énergie); (iii) the national power sector regulation authority (ARE - Agence nationale de regulation du secteur de l’électricité); and (iv) the renewable energy agency (ANADER – Agence nationale de développement des énergies renouvelables).
The ESIP is fully aligned with the Government Action Plan adopted in December 2016, highlighting the strong need to improve the performance of power distribution operations and SBEE’s governance and operational performance. It is also consistent with the World Bank’s Country Partnership Strategy for Benin which focuses, inter alia, on sustainable growth, competitiveness and employment. The project complements interventions from other development partners, including the Millenium Challenge Corporation (MCC) and the Agence Française de Développement (AFD).
* The World Bank’s International Development Association (IDA), established in 1960, helps the world’s poorest countries by providing grants and low to zero-interest loans for projects and programs that boost economic growth, reduce poverty, and improve poor people’s lives. IDA is one of the largest sources of assistance for the world’s 77 poorest countries, 39 of which are in Africa. Resources from IDA bring positive change to the 1.3 billion people who live in IDA countries. Since 1960, IDA has supported development work in 112 countries. Annual commitments have averaged about $19 billion over the last three years, with about 50 percent going to Africa.