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DEMOCRATIC REPUBLIC OF CONGO: Mobilizing the private sector for renewable-based electrification of DRC’s unserved and underserved cities

The Democratic Republic of Congo (DRC) is one of the least electrified countries in the world. Disparities between urban and rural areas are significant—only 1 percent of the rural population has power.

The government wants to boost renewable energy generation, particularly through hydropower, to address this critical situation. Estimates of its hydropower potential exceed 100 gigawatts, but less than 3 percent of this potential has been realized to date. Almost half of its installed hydropower capacity—estimated at 2,500 megawatts—is not operational. Demand, however, is high, with peak power demands exceeding 4,000 megawatts.

The DRC’s energy sector is characterized by low access, weak regulatory and institutional environments, and limited investment. In response, the government of DRC is looking to close the supply-demand gap in power while also building the resilience of the energy sector, a critical part of its response to climate change.

Société Nationale d’Electricité (SNEL), the stateowned utility, suffers from poor technical and financial performance. Tariffs are below cost-recovery levels in urban areas, power purchase agreements are opaque, and billing and collection rates are low. Power transmission and distribution problems are compounded by poor financial and technical performance. Consequently, SNEL has been unable to make the capital and operational investments necessary to maintain, improve, or expand the power system to unserved and underserved communities.

The World Bank has been a significant development partner in the DRC’s power sector, with investments targeting generation, transmission, utility reform assistance, and, more recently, access to electricity. It supports the DRC Electricity Access & Services Expansion (EASE) project, which aims to increase electricity access in the country. The Bank also supports the DRC National Mini-Grids program, which brings renewable-based mini-grid solutions to unserved or underserved urban areas in partnership with the private sector. In addition, the World Bank is preparing the DRC Electricity and Water Access and Governance project to enhance the climate resilience of energy infrastructure.

The government requested support from PPIAF to complement World Bank Group initiatives to provide electricity to selected provincial capital cities. This $350,000 PPIAF activity, co-funded by ESMAP, identifies critical gaps in the current legal, regulatory, and institutional environment. It provides recommendations identifying viable business models for attracting private sector participation and builds the capacity of key stakeholders—provincial governments and the central Ministry of Energy—to execute their respective PPP-related functions.

Complementing this work, PPIAF deployed additional resources through a special-purpose CREST funding window to finance a climate vulnerability assessment that will provide recommendations for strengthening electricity and water infrastructure through PPPs to increase adaptability to climate change. PPIAF is providing this support in partnership with AFRI-RES Trust Fund.

PPIAF support will enable the government to develop climate resilience and environmental sustainability strategies that better protect electricity and water infrastructure in partnership with the private sector. The recommended model will define the terms and necessary processes to secure the financing, development, construction, operation, and maintenance of three mini-grids by the private sector.

Approved date2019-06-27
RegionSub-Saharan Africa