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ZM
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Overview

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These funds supported research to develop the project-related documentation for the eventual subsidy. 

The grant supported project preparation activities to subsidize (W3) the OBA  Electricity Access for Low- income Households in Zambia. The Panel of Experts endorsed the project for commitment in April 2014 and the project team processed the Grant Agreement for signature. 

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The aim of this rapid study was to present the findings and framework for output-based aid/results-based financing (OBA/RBF) options in the municipal solid waste sector in Zambia. For maximum impact, the rapid study focuses on Kabwe, as the municipality presents a microcosm of issues faced across the country.

The study comprised of the following main activities: (i) a rapid assessment of the municipal solid waste (MSW) current legal and regulatory framework, sector policy and financing to  propose reform recommendations for improving the solid waste management system in Zambia; (ii) an assessment of the current design and performance of municipal solid waste service in  Kabwe; (iii)  an initial development of a customized OBA/RBF  project  design which takes into account  households  willingness to pay (WTP) and improves access and outcomes of MSW management in Kabwe municipality; and (iv)  presentation to discuss the findings and the proposed MSW options in Kabwe.

The rapid assessment study identified regulatory, technical, and financial challenges that constrained the management of Kabwe’s solid waste system. Particularly, the study and the dialogue with the government and other sector stakeholders noted a lack of by-laws to enforce waste regulation including discarding, sorting at source, disposing, and administering fines.

Among the technical challenges, capacity of Kabwe Municipal Council and waste haulers would need to be improved, including staffing, waste collection and transportation equipment (trucks and bins), etc.

As to financing challenges, the fee structure needed to be revised to allow cost recovery, and an efficient fee collection mechanism was to be put in place.

Lastly, a gap analysis needed to be completed to allow for an informed decision on the applicability of an RBF operation in Kabwe. This included, among others, an assessment of the capacity of private contractors, a market sounding and a survey on households’ willingness and ability to pay.

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Overview

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This activity consists of four tasks:  

1. Lessons from the ongoing Electricity Access for Low-Income Households Project and recommendation on the scaling-up of the activities using similar approaches.  

2. Review of the connection fee subsidy.  

3. Needs assessment for complementary network reinforcement.  

4. Recommendation for OBA/RBF mechanisms for scaling up. This work will include a review of the current Rural Electrification Master Plan (2008-2030) and Strategic Plan (2014-2018), network planning capability, recommendations related to a geospatial-based electrification planning framework, a National Electrification Strategy/ Implementation Roadmap, and Investments Prospectus that will allow Rural Electrification AgencyZESCO to increase the access to electrification for rural households. 

The activity achieved its the deliverables as planned and the joint IDA-GPOBA scaleup project with the Rural Electrification Agency has been design, building on the World Bank and GPOBA work with ZESCO. The review of the Rural Electrification Master Plan, supported by this activity, has been helpful not only for the new project but also rural electrification overall. 

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The objective it to increase access to sanitation services in selected areas of Lusaka and to strengthen Lusaka Water and Sewerage Company’s capacity to manage sanitation services.

The activity has been completed under the auspicious of the IDA credit that supports the Lusaka Water and Sewerage Company. Recommendations for including an RBF component have been prepared for the IDA credit Mid-Term Review that took place in November 2018 and recommended restructuring options to the government. The GPRBA recommendations will be part of the restructuring discussions in the next reporting periods. The activity has been extended from August to December 2018 to allow more time for the dissemination of results. 

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The objective of the Electricity Service Access Project is to increase electricity access in Zambia's targeted rural areas. There are three components to the project, the first component being on-grid electricity access expansion. This component will provide financing for on-grid connections in rural areas using the approaches under the OBA/connection fee subsidy program. To support the ‘last mile’ connections, the project will also finance critical distribution network reinforcements and extensions through applying low-cost technologies where appropriate that will enable ZESCO to add new connections to the grid, complementing ongoing access expansion efforts by CPs in other parts of the country. The second component is the off-grid electricity access expansion.

This component will initially fund required upstream activities to enable the private sector participation in rural off-grid electrification, including identifying and scoping off-grid sites, helping the Government of Zambia address the existing regulatory impediments, building the needed capacity at key institutions, and designing financial mechanisms. Finally, the third component is the capacity building and project implementation support. This component will finance technical assistance (TA) to the Gpvernment of Zambia to ensure that the project reaches its objective of enhancing and improving the enabling environment needed for a substantially scaled-up electrification effort.

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This activity was to demonstrate cleaner-cooking options to schools and school families, and undertake a gender assessment to ensure effective communication of the benefits and risks of cleaner-cooking to women and children.

The objective is to (i) promote the use of clean cooking fuels and efficient stoves, (ii) support the dissemination of advanced stoves and efficient charcoal stoves; and (iii) reduce forest pressure from charcoal consumption

The gender assessments and the cookstove testing were carried out in FY22. The gender assessment will include the analysis of options for potential gender interventions in the clean cooking sector.

• The testing of cookstove use and the preparation of a service contract will feed into the development of a component of the IDA investment project, Transforming Energy Access Matters.

• The summary report with the initial findings from these interviews and data analysis has been prepared and is currently being reviewed by the WB team.

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LUSAKA, June 11, 2019. The World Bank, acting as administrator for the Global Partnership for Results-Based Approaches (GPRBA), signed a Grant Agreement on May 1, 2019 for US$3 million with Zambia’s Ministry of Finance to extend electricity to rural areas.

This GPRBA grant is the first tranche of the US$7 million commitment from Sweden to fill the financing gap of a US$26.5 million IDA operation to improve rural energy access in Zambia, by using a combination of grid and off-grid technologies to connect rural households and micro and small enterprises (MSEs). The GPRBA funds will be used to fund the connection fee subsidy program and connect approximately 22,000 rural households and 1,000 MSEs and to fund various parts of the technical assistance program for off-grid electrification.

Ms. Karin Sverkén of the embassy of Sweden to Zambia, said:  

“While access to electricity is vital for development and improved livelihoods, the cost of the initial connection is a big barrier for most low-income households and small businesses. We hope that the Swedish support for connection subsidies can bridge this gap, and consequently contribute to enhancing the quality of life for low-income households and improve business prospects for small businesses.”

This agreement builds on a previous five-year project in which the World Bank and GPRBA successfully implemented a pilot to provide low-income households with electricity through an output-based aid (OBA) program, by significantly reducing the financially prohibitive connection fees. This previous GPRBA grant, also funded by Sweden, exceeded its initial target by about 150 percent as it extended energy access to 32,843 households and 5,117 micro and small enterprises -- benefiting approximately 200,000 residents in low-income townships.

Access to electricity in rural areas is important because it helps replace consumption of kerosene, diesel, dry cell batteries, and alternative fuels such as firewood that contributes to deforestation” said Ina-Marlene Ruthenberg, World Bank Country Manager for Zambia. “This project is a prime example of how different agencies can pool funds for a common goal of achieving development outcomes” she added.

The Government of Zambia requested the continuation of the OBA subsidy to connect consumers in rural areas where penetration is extremely low. Whereas the overall national access rate is 31 percent and more than 67 percent of the population in urban areas have access to electricity, these services extend to only about 4 percent of the rural population.

“We are pleased in the confidence demonstrated by Sida and the Government of Zambia in our initial project and look forward to ongoing collaboration to increase access to electricity to benefit rural communities as well, stated Shobha Shetty, Practice Manager of Global Partnerships, World Bank Group.

This results-based financing project seeks to achieve the goals of Vision 2030, a government national strategy plan to reach electrification targets of 90 percent for urban and 51 percent for rural areas by 2030.

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In 2015, the Global Partnership on Output-Based Aid (GPOBA) approved a US$4.95 million grant to increase access to grid-based electricity services for 22,000 low-income households and 5,000 micro and small enterprises (MSEs) in urban and peri-urban areas through use of targeted subsidies, with the aim of reaching low-income communities who would otherwise have gone unserved.

Read more on lessons learned from this project.

Improving Electricity Access for Low-Income Households in Zambia (630.82 KB)
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Overview

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The development objective of this programmatic activity was to promote productive use of electricity by the micro and small enterprises (MSEs) and to evaluate the behavioral changes of the MSEs after accessing electricity in targeted urban and peri-urban Zambia.

All the activities have been completed. They were conducted in conjunction with the MSE typology TA described above. The MSE survey had 1,814 baseline respondents, including the control group, 90% of whom were surveyed for the endline. The MSE evaluation concluded that micro-entrepreneurs continued using and paying for the electricity connections obtained under the GPORA project. As regards electricity consumption and purchase of appliances, MSEs from food-related businesses were predominantly buying fridges. Otherwise, electricity was used for lighting, TV/radio and small appliances. The project encouraged transition from more expensive diesel generators and also from wire-tapping, contributing to fire safety and customer regularization. A charcoal/kerosene switching survey of 500 households was added at the endline. It found that the use of fossil fuel for lighting is negligent. As to cooking, the survey found a limited but encouraging evidence of water boiling with an electrical appliance. To heat water for cooking or bathing/washing, 52% use a wood/charcoal stove (Mbaula) while 33% use electric kettles or heating elements. Going forward, 63% were thinking of getting an electrical appliance for cooking. 

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Washington, August 7, 2014 – The World Bank, acting as administrator for the Global Partnership on Output-Based Aid (GPOBA), has received a supplemental contribution of US$5.8 million (SEK 38,500,000) from the Swedish International Development Cooperation Agency (Sida) to extend electricity access to approximately 22,000 low-income households and 5,000 micro and small enterprises in select urban and peri-urban areas in the Republic of Zambia.   This will be the first GPOBA project in Zambia, and it is designed to bring electricity to 140,000 beneficiaries.
 
“By supporting this project, we hope to contribute to improved living standards for people living in low income households in Zambia, said Lena Ingelstam, head of department for Partnership and Innovation at Sida. The project will empower them to start up and run small businesses, thereby contributing to the creation of job opportunities in Zambia.”
 
The project supports the government of Zambia’s goal to increase the national electricity access rate to about 66 percent by 2030.  Nationwide, only one in four Zambians have an electricity connection, and the high cost of connection often prevents the poor from being able to access electricity service. 
 
This project, supported by Sida funding, will provide subsidies for electricity connections in targeted areas,” said Carmen Nonay, GPOBA Manager. “This is the first time GPOBA has conducted an output-based aid project in Zambia, and it will bring electricity to poor households, and to micro and small businesses like tailors, hairdressers, barbers, and carpenters.”
 
Output-based aid, a form of results-based financing, is different from traditional aid and offers new approaches for funding projects in developing countries.  In the case of Zambia, it will provide subsidies to the utility company after the electricity connection is established and independently verified.  The Sida contribution builds on the Increased Access to Electricity Services (IAES) project, implemented by the national utility ZESCO and co-financed by the World Bank Group and the European Commission.  
 
“This project allows us to build on our experience and support new programs for wider access to electricity services, “said Kundhavi Kadiresan, country director for the World Bank Group in Zambia. “In the fight against poverty in Zambia the condition of women needs particular attention. I am pleased that the project will allow women from low income households to access electricity and use it for improving their status and livelihoods.”
 
In December 2012, Sida added a $26.8 million contribution -- nearly doubling its total share of GPOBA funds.

Full Press Release