UNECA High level Workshop on PPPs in Energy Sector in Africa

1. UNECA High level Workshop on PPPs in Energy Sector in Africa UNDP work on Pro-poor PPP for Local Service Delivery Addis Ababa (Ethiopia), 30 June – 1st July 2011 By:Maleye DIOP, Global Manager Public Private Partnerships for Service Delivery Capacity Development Group, Bureau for Dev. Policy UNDP Regional Centre, Johannesburg, South Africa

2. Drivers of UNDP work on pro-poor PPP • Decentralization process in UNDP programme countries. • MDGs: growing number of people not having access to basic services (e.g.: clean water, sanitation, solid waste, energy, health care, education, etc...). • Increasing demand for support from UNDP programme countries to respond to unsolicited proposal from private sector offering local governments solutions to the service delivery problems they faced. Gov’t (national, local) not being able to make it alone and inclusive P’ships with Non State Actors (incl. users) offer opportunity to face local service delivery challenges.

3. ....… as a result, Various Non-State Providers (large, small, formal, informal private sector, CBOs, NGOs, CSOs, FBOs) are filling in the gap in the context of a regulatory vacuum. ........leading to: poor getting services at higher cost, poor quality and limited quantity…

4. Objective of UNDP/PPPSD To support alternative LSD approach that complement efforts of Gov’t that uses comparative advantages of both State and Non State Actors (incl. the Private Sector) to improve service delivery and to advance MDGs and long term sustainable development.

5. Government(s) Enabling Policies, Regulation, Oversight Businesses Capable Providers or Financiers P P P Civil Society [CBOs, CSOs, FBOs] Beneficiaries or Providers Who are the Partners?

6. Broadest Definition of “Public-Private Partnerships” Agreeing Frameworks Local Agenda 21 Community Visioning Traditional Public Contracting Design Build Joint Ventures Co-ownership Co-responsibility Passive Public Investment Equity Debt Guarantees Grants Passive Private Investment Government Bonds Service ContractsOperate Maintain Lease Build Operate and Invest BOT Concession Agreeing Frameworks Regulatory Dialogue Covenants Public Private Investment Responsibility Enabler and Regulator Government Role Provider Menu of PPP options in LSD Fully Public Sector Fully Private Sector

7. Services of Focus Basic services including: renewable energy, primary education, health care, water supply, sanitation, solid waste management that are vital for poverty eradication and achievement of MDGs.

8. PPPSD Service Offerings • Promoting enabling environment: Policy, regulation and institutional frameworks for pro-poor PPP. • Capacity Dev. for local governments, businesses & communities to effectively engage through PPP in service delivery. • Implement “quick wins” pro-poor PPP. • Knowledge sharing to foster exchange of good practices and experiences.

9. Poverty is not just lack of income. It is lack of: - Income and productive assets.- Access to basic services. - Power, participation and dignity.

10. Direct Provision, Operation + Maintenance Administration Emergency Services Basic Services and related Infrastructure Public Sector Healthcare Roads/Transportation Taxes User Fees Water, Energy, Sanitation, etc.. Users / Consumers / Communities Public Sector as Direct Provider

11. PPP provide practical solution and framework for actors to work together to: • Deliver basic services to the poor & contribute to the achievement of the MDGs targets. • Provide livelihood opportunities for the poor. • Ensure participation and representation by the poor. • Contribute to local development efforts.

12. Municipal Waste Collection, Nepal

13. From Waste to Wealth, Energy

14. toRegulator/Enabler of services provision From Govt as Direct Provider of basic services toPurchaserof services and Infrastructure provided by the private sector or other NSA PPP: Shifting role of Government &

15. Government Private Provider • Regulation • - price • quality • quantity User Fees Services Users / Consumers / Community Public Sector as Regulator

16. Non State Provider Government Competition Non State Provider Regulation - quality Non State Provider Water User Fees Services Services Users / Consumers / Community also Public Sector as Regulator Services User Fees

17. Taxes Public Sector as Purchaser Purchase / Service Agreement Government Non State Providers Services User Fees Users / Consumers / Community

18. Options Description Duration Ownership Cooperatives Can take various forms, but in the main are self-governing, voluntary organisations, which serve the interests of their own members Various Public/Private Service Contract Private company performs specific tasks on a contractual basis 1 to 3 yrs Public Managt Contract Private company assumes the managerial responsibility & is remunerated based on key performance indicators 3 to 5 yrs Public Lease Private company rents public assets, responsible for the service provision & buys the right to revenue stream 5 -15 yrs Public Concession Private company pays fee to operate public assets & is expected to finance capital investments 25-30 yrs Public BOT Private company develops, finances & operates facilities 25-30 yrs Private - after contract expiration to be transferred to the public Types of PPP Arrangements

19. India: from Waste to Energy Country Experience in Energy

20. Develop Public Private Community partnership model for poultry litter management to............ Example: From Waste to Sustainable Local Energy Services Provision in Tamil Nadu State (India)

21. ............generate electricity (3.7 MW of power) from the poultry waste to…

22. .....feed it to the state grid and ultimately to be sold to users (long term purchase contract)

23. Lessons from Practices On pro-poor PPP for LSD

24. Country Experience Analysis Learning by Doing: Feedback loop It is important to have a constant feedback mechanism between country level experiences and global level analysis and to ensure mutual learning through sharing of lessons, analysis + dissemination of good practices to better inform new partnerships for service delivery: Dev. partners have critical role. Innovative Partnerships Learning Network

25. Capacity Development is key! • Capacity of Government to identify service sectors for Non State Providers’ (NSP) involvement. • Capacity to establish adequate policies, institutions in support of PPP in Service Delivery. • Capacity to regulate service sectors to ensure inclusive participation of users to assess services provision through adequate oversight & feedback mechanisms; • Capacity to effectively engage non State Partners: Partnership Dialogue Forum facilitated by neutral broker. • Capacity to monitor performance of service providers through adequate contractual arrangements that ensure flexibility, continuous revisions to reflect evolving needs.

26. Sequencing Policy-Implementation versus Implementation-Policy based on context. Institutionalization of PPP in local SD. Participation of communities and local SP is key to serve the un-served poor areas and meet poverty reduction objectives. Access to sustainable services provision better ensured through users participation. Policy versus Implementation 26

27. Let service provider decide on the best option to deliver the required services !! Input Choices Solid Waste Management, Malaysia

28. THANKS Email:pppsd@undp.orgWebsite: www.undp.org/pppsd