Design Coupon/Voucher Scheme for reducing the rural electricity connection fees

PROJECTS

Design Coupon/Voucher Scheme for reducing the rural electricity connection fees

Client

World Bank and Senegalese Rural Electrification Agency (ASER)

Services

Clean Development Mechanism and climate change mitigation

Beginning

07/2017

Conclusion

01/2018

Location

Senegal

CONTEXT

Albeit the fact that Senegal has steadily increased electrification rates reaching a national average of 54 percent, with almost fully electrified urban areas, the majority of people in rural areas do not have access to electricity (approximately 76percent), including social services (health centers, schools, etc.). For basic energy needs, households mainly rely on fuelwood for cooking and wicks, and kerosene lamps for lighting.

 

 

OBJECTIVES

The objective of the project is to design a coupon / voucher scheme aiming a cost reduction on the connections of households to the electric grid, thus making the connection fees affordable to the poor rural population in Senegal.

 

 

DESCRIPTION

ASER is considering a proposal to buy down the connection fees for the households. Instead of asking the concessionaires to directly reduce the cost of connection (and ASER reimbursing that amount to the Concessionaires), ASER will implement a coupon/voucher scheme, wherein households will receive coupon/voucher of certain cash values that they can use to pay for the connection fees. By giving the redeemable cash vouchers/coupons to HHs instead of directly asking the concessionaires to reduce the connection fees, achieves two purposes – (i) it empowers the HHs and provides choices to the HHs to opt for certain service levels, (ii) it creates a condition for HHs to immediately demand services from the concessionaires, as the vouchers/coupons may be invalid after a certain time. Overall, the scheme is expected to create demand and accelerate the pace of connections, if properly implemented alongside a strong communication campaign.

 

 

SUMMARY OF SERVICES

Review, discuss and agree with the key stakeholders the objectives and key parameters of the scheme based on Senegal´s rural electrification program objectives; Analyze the international best practices; Design the coupon scheme; Design a pilot program for 5 villages; Survey of the selected villages and compilation of information on households including; Design of the information and communication campaign; Develop a clear road map for implementation of the pilot; Work closely with the respective concessionaires and ASER to implement both the communications campaign; Support ASER and the concessionaires on the implementation of the pilot program and fine-tuning of the scheme based on the results of the pilot programs; Prepare a large scale coupon/voucher scheme for wider implementation including final design model.