Private Participation in Electricity : The Challenge of Achieving Commercial Viability and Improving Services

This document is about the private participation in electricity. Private activity in electricity in developing countries has stabilized at a modest level since 2001. Private activity also became more evenly distributed between International Develop...

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Main Authors:	Tenenbaum, Bernard, Izaguirre, Ada Karina
Format:	Brief
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ARBITRATION AVERAGE TARIFF LEVELS BALANCE BANK GUARANTEE BUYERS CONSUMER CONSUMER PRICE INDEX CONSUMERS CONTRIBUTIONS COST RECOVERY CREDIT ENHANCEMENTS DEVELOPING COUNTRIES DEVELOPING COUNTRY DISTRIBUTION NETWORK ELECTRICITY ELECTRICITY DISTRIBUTION ELECTRIFICATION EMERGING MARKET EMERGING MARKET FIRMS ENTERPRISE OPERATIONS ESCROW ESCROW ACCOUNTS FUTURE PRICES GENERATION INFRASTRUCTURE INVESTMENT INTERNATIONAL DEVELOPMENT LATIN AMERICAN LEGAL RIGHTS LETTERS OF CREDIT LIQUIDITY LIQUIDITY FACILITIES LOCAL INVESTORS NEW INVESTORS PARTIAL RISK PAYMENT GUARANTEES POLITICAL ECONOMY POWER POWER PLANTS POWER PURCHASE AGREEMENTS POWER SECTOR PRIVATE INFRASTRUCTURE PRIVATE INVESTMENT PRIVATE INVESTORS PRIVATE SECTOR INVESTMENT PUBLIC-PRIVATE PARTNERSHIP PUBLIC-PRIVATE PARTNERSHIPS REGULATORS REGULATORY REGIME REGULATORY REGIMES REGULATORY SYSTEMS RETURN RISK EXPOSURE SHARE OF INVESTMENT SUB-SAHARAN AFRICA SUSTAINABLE DEVELOPMENT TARIFF LEVELS TAX TECHNICAL ASSISTANCE TERM CONTRACTS TERMINATIONS URBAN DEVELOPMENT UTILITIES WEB SITE
Online Access:	http://documents.worldbank.org/curated/en/2007/05/8333675/private-participation-electricity-challenge-achieving-commercial-viability-improving-services http://hdl.handle.net/10986/10686

id	okr-10986-10686
recordtype	oai_dc
spelling	okr-10986-106862021-04-23T14:02:51Z Private Participation in Electricity : The Challenge of Achieving Commercial Viability and Improving Services Tenenbaum, Bernard Izaguirre, Ada Karina ARBITRATION AVERAGE TARIFF LEVELS BALANCE BANK GUARANTEE BUYERS CONSUMER CONSUMER PRICE INDEX CONSUMERS CONTRIBUTIONS COST RECOVERY CREDIT ENHANCEMENTS DEVELOPING COUNTRIES DEVELOPING COUNTRY DISTRIBUTION NETWORK ELECTRICITY ELECTRICITY DISTRIBUTION ELECTRIFICATION EMERGING MARKET EMERGING MARKET FIRMS ENTERPRISE OPERATIONS ESCROW ESCROW ACCOUNTS FUTURE PRICES GENERATION INFRASTRUCTURE INVESTMENT INTERNATIONAL DEVELOPMENT LATIN AMERICAN LEGAL RIGHTS LETTERS OF CREDIT LIQUIDITY LIQUIDITY FACILITIES LOCAL INVESTORS NEW INVESTORS PARTIAL RISK PAYMENT GUARANTEES POLITICAL ECONOMY POWER POWER PLANTS POWER PURCHASE AGREEMENTS POWER SECTOR PRIVATE INFRASTRUCTURE PRIVATE INVESTMENT PRIVATE INVESTORS PRIVATE SECTOR INVESTMENT PUBLIC-PRIVATE PARTNERSHIP PUBLIC-PRIVATE PARTNERSHIPS REGULATORS REGULATORY REGIME REGULATORY REGIMES REGULATORY SYSTEMS RETURN RISK EXPOSURE SHARE OF INVESTMENT SUB-SAHARAN AFRICA SUSTAINABLE DEVELOPMENT TARIFF LEVELS TAX TECHNICAL ASSISTANCE TERM CONTRACTS TERMINATIONS URBAN DEVELOPMENT UTILITIES WEB SITE This document is about the private participation in electricity. Private activity in electricity in developing countries has stabilized at a modest level since 2001. Private activity also became more evenly distributed between International Development Association (IDA) countries and non IDA countries. Private activity in electricity remained concentrated in a few countries. Investors generally prefer greenfield projects structured as enclave projects, protected from many sector risks. Electricity is not the only infrastructure sector where this type of private investment predominates. Similar arrangements have emerged in water and sanitation, where greenfield water and sewage treatment plants sell to a single customer through government-supported take or pay agreements. Distribution is inherently riskier for investors because it involves selling to thousands of customers who purchase at prices that are highly visible and politically contentious. To attract investment in distribution, a new guarantee mechanism has been adopted. In overview, these projects usually provide protection from major risks through long-term contracts and often come with government payment guarantees. If there is to be significant and sustained private investment beyond greenfield generation projects, it will need to be built on a platform of commercially viable electricity distribution entities. If private participation can establish such entities, it will create the best foundation for future upstream private investment in generation. 2012-08-13T12:43:31Z 2012-08-13T12:43:31Z 2007-05 http://documents.worldbank.org/curated/en/2007/05/8333675/private-participation-electricity-challenge-achieving-commercial-viability-improving-services http://hdl.handle.net/10986/10686 English Gridlines; No. 21 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Brief Publications & Research
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	ARBITRATION AVERAGE TARIFF LEVELS BALANCE BANK GUARANTEE BUYERS CONSUMER CONSUMER PRICE INDEX CONSUMERS CONTRIBUTIONS COST RECOVERY CREDIT ENHANCEMENTS DEVELOPING COUNTRIES DEVELOPING COUNTRY DISTRIBUTION NETWORK ELECTRICITY ELECTRICITY DISTRIBUTION ELECTRIFICATION EMERGING MARKET EMERGING MARKET FIRMS ENTERPRISE OPERATIONS ESCROW ESCROW ACCOUNTS FUTURE PRICES GENERATION INFRASTRUCTURE INVESTMENT INTERNATIONAL DEVELOPMENT LATIN AMERICAN LEGAL RIGHTS LETTERS OF CREDIT LIQUIDITY LIQUIDITY FACILITIES LOCAL INVESTORS NEW INVESTORS PARTIAL RISK PAYMENT GUARANTEES POLITICAL ECONOMY POWER POWER PLANTS POWER PURCHASE AGREEMENTS POWER SECTOR PRIVATE INFRASTRUCTURE PRIVATE INVESTMENT PRIVATE INVESTORS PRIVATE SECTOR INVESTMENT PUBLIC-PRIVATE PARTNERSHIP PUBLIC-PRIVATE PARTNERSHIPS REGULATORS REGULATORY REGIME REGULATORY REGIMES REGULATORY SYSTEMS RETURN RISK EXPOSURE SHARE OF INVESTMENT SUB-SAHARAN AFRICA SUSTAINABLE DEVELOPMENT TARIFF LEVELS TAX TECHNICAL ASSISTANCE TERM CONTRACTS TERMINATIONS URBAN DEVELOPMENT UTILITIES WEB SITE
spellingShingle	ARBITRATION AVERAGE TARIFF LEVELS BALANCE BANK GUARANTEE BUYERS CONSUMER CONSUMER PRICE INDEX CONSUMERS CONTRIBUTIONS COST RECOVERY CREDIT ENHANCEMENTS DEVELOPING COUNTRIES DEVELOPING COUNTRY DISTRIBUTION NETWORK ELECTRICITY ELECTRICITY DISTRIBUTION ELECTRIFICATION EMERGING MARKET EMERGING MARKET FIRMS ENTERPRISE OPERATIONS ESCROW ESCROW ACCOUNTS FUTURE PRICES GENERATION INFRASTRUCTURE INVESTMENT INTERNATIONAL DEVELOPMENT LATIN AMERICAN LEGAL RIGHTS LETTERS OF CREDIT LIQUIDITY LIQUIDITY FACILITIES LOCAL INVESTORS NEW INVESTORS PARTIAL RISK PAYMENT GUARANTEES POLITICAL ECONOMY POWER POWER PLANTS POWER PURCHASE AGREEMENTS POWER SECTOR PRIVATE INFRASTRUCTURE PRIVATE INVESTMENT PRIVATE INVESTORS PRIVATE SECTOR INVESTMENT PUBLIC-PRIVATE PARTNERSHIP PUBLIC-PRIVATE PARTNERSHIPS REGULATORS REGULATORY REGIME REGULATORY REGIMES REGULATORY SYSTEMS RETURN RISK EXPOSURE SHARE OF INVESTMENT SUB-SAHARAN AFRICA SUSTAINABLE DEVELOPMENT TARIFF LEVELS TAX TECHNICAL ASSISTANCE TERM CONTRACTS TERMINATIONS URBAN DEVELOPMENT UTILITIES WEB SITE Tenenbaum, Bernard Izaguirre, Ada Karina Private Participation in Electricity : The Challenge of Achieving Commercial Viability and Improving Services
relation	Gridlines; No. 21
description	This document is about the private participation in electricity. Private activity in electricity in developing countries has stabilized at a modest level since 2001. Private activity also became more evenly distributed between International Development Association (IDA) countries and non IDA countries. Private activity in electricity remained concentrated in a few countries. Investors generally prefer greenfield projects structured as enclave projects, protected from many sector risks. Electricity is not the only infrastructure sector where this type of private investment predominates. Similar arrangements have emerged in water and sanitation, where greenfield water and sewage treatment plants sell to a single customer through government-supported take or pay agreements. Distribution is inherently riskier for investors because it involves selling to thousands of customers who purchase at prices that are highly visible and politically contentious. To attract investment in distribution, a new guarantee mechanism has been adopted. In overview, these projects usually provide protection from major risks through long-term contracts and often come with government payment guarantees. If there is to be significant and sustained private investment beyond greenfield generation projects, it will need to be built on a platform of commercially viable electricity distribution entities. If private participation can establish such entities, it will create the best foundation for future upstream private investment in generation.
format	Publications & Research :: Brief
author	Tenenbaum, Bernard Izaguirre, Ada Karina
author_facet	Tenenbaum, Bernard Izaguirre, Ada Karina
author_sort	Tenenbaum, Bernard
title	Private Participation in Electricity : The Challenge of Achieving Commercial Viability and Improving Services
title_short	Private Participation in Electricity : The Challenge of Achieving Commercial Viability and Improving Services
title_full	Private Participation in Electricity : The Challenge of Achieving Commercial Viability and Improving Services
title_fullStr	Private Participation in Electricity : The Challenge of Achieving Commercial Viability and Improving Services
title_full_unstemmed	Private Participation in Electricity : The Challenge of Achieving Commercial Viability and Improving Services
title_sort	private participation in electricity : the challenge of achieving commercial viability and improving services
publisher	World Bank, Washington, DC
publishDate	2012
url	http://documents.worldbank.org/curated/en/2007/05/8333675/private-participation-electricity-challenge-achieving-commercial-viability-improving-services http://hdl.handle.net/10986/10686
_version_	1764414006049636352

Private Participation in Electricity : The Challenge of Achieving Commercial Viability and Improving Services

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