Options to increase private participation in electric power development in AID-assisted countries

This report outlines four specific objectives A.I.D. should pursue to promote private power efforts and the options available under each of them. (1) To improve the policy and institutional climate for private investment, A.I.D. could develop country-specific private power promotion strategies. (2) Several options exist for facilitating actual project development. A.I.D. could: develop a private-power data base, increase the number of definitional missions to countries having favorable policies, create a pool of consultants to assist in private-power contract negotiation, and/or develop programs utilizing a variety of strategies, e.g., investment promotion, feasibility studies, technology assessment, and financial support (through direct loans, loan guarantees, equity funding, or combined grants and export credit on behalf of U.S. energy companies). (3) A.I.D. could create a private-power training program for government officials, state utility officials, and businesspeople. (4) A Special Task Force could be established to coordinate and target U.S. efforts in the area of private power. The task force could help to integrate relevant U.S. trade and aid policies and to focus U.S. resources on a few countries where the policy climate is favorable and specific projects are already underway.