Republic of Yemen - Restoring and expanding energy access : power sector reengagement note

Already before the conflict, much of Yemen’s population was deprived of basicelectricity services. Even before the conflict, Yemen was considered the least electrifiedcountry in the MENA region, with a pre-crisis access rate from all sources of only 55percent. The country’s per capita electricity consumption stood at 243 kWh in 2013,almost one-sixth of the regional average (The World Bank Group, 2016). There had been little progress in the electricity sector over the last decade. The sectormade little progress on improving operational efficiency and quality of service or inreducing high electricity losses, while costing the country over 10 percent of its GDPannually through direct and indirect subsidies (The World Bank, 2013). The ongoing conflict has significantly worsened the electricity supply situation from an already low level, with severe impact on health, education, water and sanitation, and the private sector, which all rely heavily on a functioning power supply.The top-down model of service delivery has been replaced by a combination of locally managed urban public services and a private-sector driven bottom-up model. The poor have limited access to solar so far, and there are concerns about the qualityof the installed technology.Because the limited functionality of the energy sector has severe consequences for other sectors and the overall Yemeni economy, restoring electricity supply will be a priority for any in-conflict or post-conflict engagement.A recent review of the World Bank’s interventions over the last 15 years in the energy sector concluded that alternative models for procurement and/or project implementation may be needed for in-conflict or post-conflict interventions.New, project-specific public sector institutions created for the purpose ofinfrastructure development were no panacea.Distributed infrastructure investments, while also not as successful as anticipated, tended to work better.The proposed priorities represent sequential steps the electricity system is re-built from the bottom up, both technically and institutionally.The proposed priorities and sequencing are underpinned by a vision for Yemen’spower sector that involves a stronger role for the private sector and moredecentralized service provision.