NRECA International uses funding from USAID’s Cooperative Development Program (CDP) and the NRECA International Foundation, including in-kind donations of volunteer time from NRECA member electric cooperatives in the United States. Our efforts promote the electric cooperative model as a proven system for delivering electricity services to rural areas of developing countries.
The current NRECA CDP program implementation period extends from September 30, 2010 to September 29, 2015. The program consists of country projects in six countries – the Philippines, Haiti, Liberia, Uganda, Guatemala, and the Dominican Republic. Collaborative multi-country efforts are also jointly implemented with other U.S. cooperative development organizations that are members of the Overseas Cooperative Development Council.
Current CDP Country Projects
Haiti Rural Electric Cooperative Project
Start-up of a new electric cooperative in South Haiti, alongside clean energy investments by the United Nations Environment Program. The Haiti Rural Electric Cooperative Project is intended to transform several mini-grids in three communes of the Département Sud in the southwest of Haiti – Port-a-Piment, Coteaux, and Roche à Bateaux – into a new, formally registered rural electric cooperative that will provide reliable electric service 7 days a week within a sustainable financial model, and demonstrate the feasibility of a clean energy investment in solar-diesel hybrid generation for isolated rural mini-grids.
NRECA’s partner in the project is the Solar Electric Light Fund (SELF), a non-profit organization specialized in solar generation, which is handling the design and installation of the rooftop solar installations, installation of solar-powered streetlights, and training of cooperative personnel in operation and maintenance of the completed solar power installations.
As of June 2015, there are currently more than 600 cooperative members, who have conducted their first general assembly and elected the Board of Directors. Commissioning of the solar-diesel hybrid system is expected some time in 2015, and the cooperative is expected to reach 1600 members by December 2015.
The HREC project sponsors are the Government of Norway, UNEP, the Inter-American Development Bank, USAID, and the NRECA International Foundation.
Philippines Cooperative Governance Training Project
Philippine electric cooperatives (ECs) are governed by boards of directors that are composed of democratically elected representatives from the communities served by the ECs. As the power sector grows in sophistication, the directors are increasingly forced to make decisions that involve examination and analysis of complex issues for which many of the directors have little or no training. In cases wherein the directors have insufficient knowledge, under-informed decisions can lead to operational inefficiencies, higher costs to the member/owners, and a weakening of EC financial positions. The Credentialed Cooperative Director program has been designed to introduce into the Philippines an appropriately priced training program – adapted from NRECA’s highly successful U.S.-based Credentialed Cooperative Director program – that is providing participating directors with improved knowledge of the intricacies of the changes in the Philippine power sector, regulatory issues that affect decisions on bulk power purchase agreements, electricity tariffs, and quality of service issues; and advances in technology that may affect EC investments and future business systems, among other themes. The net impact of the training will be to better prepare directors to make informed decisions for their ECs, and consequently, will result in improved governance capacity, increased transparency of the governance process, and consequent improved financial and technical performance of the ECs they serve.
The Philippines Credentialed Cooperative Director training program has been implemented through the Center for Sustainable Human Development at the Development Academy of the Philippines (http://www.dap.edu.ph/cshd/AboutUs.php). Through September 2014, a total of 335 EC directors have completed the CCD program and gained their certification as Credentialed Cooperative Directors.
Philippines Electric Cooperative Rates Transition Project
In 2009, the ERC issued “Rules for Setting Electric Cooperatives’ Wheeling Rates (RSEC-WR)” to provide a new structure under which performance incentives would be proposed to on-grid electric cooperatives (ECs) as well as to ease burdens on the national regulator (ERC). Under RSEC-WR, ECs were classified in seven rate groups on the bases of number of consumers served, mean customer consumption of electricity and the ratio of residential sales to total EC sales. The new tariff methodology follows a logic that is derived from a statistical analysis of EC performance, but does not follow the utility best practice reflecting true cost of service. The methodology has thus led to a number of anomalies in tariff levels for several ECs. The Rates Transition Project has been designed to evaluate the means by which the anomalies can be identified, evaluated and minimized through an open and productive dialogue between the affected ECs and ERC. This activity directly serves the goal of strengthening EC financial performance by balancing EC operating costs with the required revenues to meet present and future financial obligations. The activity will further improve the transparency and fluidity of the dialogue between the community of ECs and the ERC that governs EC revenue recovery, quality of service, and bulk power relationships with power suppliers.
Philippines Electric Cooperative Regional Power Project
This project is designed to support Philippines electric cooperatives (ECs) facing challenges in negotiating viable power supply contracts, and includes evaluation of the value and potential of EC power supply aggregation models. Power supply aggregation has the potential to offer economies of scale to ECs that will need to negotiate new power purchase agreements with future power providers, allowing groups of ECs to negotiate the terms and conditions of power purchase agreements jointly with power suppliers. NRECA has developed a pro-forma contract that is available for EC-aggregators to use in their negotiations with independent power providers; the pro-forma is under review by the national regulator (ERC) and is expected to be approved soon. ERC has furthermore requested that NRECA conduct a review of 30 power supply contracts to highlight issues and areas of non-conformity with ERC’s model contract. ERC faces a large backlog of power supply contracts under review; the NRECA team is demonstrating review methods while simultaneously contributing directly to backlog reduction. These activities directly support the NRECA goal of supporting more effective and cost-efficient power supply by participating ECs.
Philippines Electric Cooperative Procurement Best Practices Project
The Philippines Electric Cooperative Procurement Best Practices project is intended to improve capital expenditure costs for Philippines ECs by bringing to bear the advantages of e-sourcing techniques. ECs have long suffered from the disadvantages of the remote location of the Philippines and the fragmented nature of the EC community that has led to sub-optimal procurement pricing for substation and distribution materials. As ECs expand service, there is a need to avail of market-competitive prices for poles, conductor, distribution transformers, protection equipment, power transformers and line hardware to result in higher impact of rural electrification expansion projects. Towards this end, e-sourcing methodologies – processes designed to allow ECs to avail of market prices for all future substation and distribution procurement and construction activities – are being brought to the market in the Philippines through a cooperative-to-cooperative alliance sponsored by the Procurement Best Practices Alliance project.
The project is developing a commercial alliance between two electric cooperative organizations – the Philippines Rural Electrification Financing Corporation through its procurement subsidiary RETC and the Roanoke Electric Cooperative in Aulander, North Carolina through its e-sourcing procurement subsidiary RFQ Hosting Inc. The project is expected to leverage increased CAPEX investment by REFC member electric cooperatives.
OCDC Collaborative Activities
Through a Fixed Obligation Grant to the Overseas Cooperative Development Council (OCDC – www.ocdc.coop), NRECA supports collaborative activities with other US cooperative development organizations. The focus of these activities are on improving methodologies for measuring the effectiveness of cooperatives and the impact of cooperative development programs, as well as developing a common framework for assessing the legal and regulatory framework for cooperatives in developing countries. Of particular note are the Cooperative Legal and Regulatory Reform initiative (CLARITY – www.clarity.coop), the Measuring Cooperative Success (METRICS) initiative, and the IMPACT initiative.
Completed CDP Country Projects
Sustainable Electric Cooperatives Program in Uganda
In 2011, NRECA provided training to two electric cooperatives – the Pader-Abim Community Multipurpose Electric Cooperative Society (PACMECS) in Pader and Abim Districts and the Bundibugyo Energy Cooperative Society (BECS) in Bundibugyo District, Uganda. In order to strengthen these two electric cooperatives and the overall rural electrification program, NRECA provided training sessions to cooperative staff and board members, and Rural Electrification Agency staff, on board governance issues, understanding co-op operations, finances and member services. Some of the topics covered were Understanding Board Governance and Director’s Duties and Liabilities, an Introduction to Understanding Electric Cooperative Operations, Finances and Member Services.
Liberia Electric Cooperative Development Project
The LECDP project was implemented in two phases: an institutional assessment in 2011 and business planning support for a community-based hydropower utility in 2013.
In 2011, the NRECA CDP program assisted the Government of Liberia to evaluate the institutional framework for rural electrification, with a focus on the conditions necessary to establish sustainable electric service providers in rural areas of Liberia. The institutional review was focused on a rapid evaluation of existing or de facto implementation frameworks, institutional capacities, and physical and human capital needs in comparison to other countries where NRECA has implemented rural electrification programs. The project was funded by the USAID-funded Cooperative Development Program, for which oversight is provided by the USAID/IDEA/LS office in Washington, in coordination with the USAID/Liberia office in Monrovia.
A team of NRECA specialists conducted key stakeholder interviews in Liberia, focused on information and data collection through meetings with electric sector and renewable energy principals, as well as on-site assessment of several current and prospective rural electrification projects. Subsequent to reviewing and analyzing the information obtained, the team endeavored to define the necessary conditions to facilitate the long-term sustainability of future electric/energy service providers (ESPs), in particular those that would serve areas outside of Monrovia. The team evaluated the adjustments required within the Government of Liberia (GOL) rural energy program and in particular in the role and functions of the Rural and Renewable Energy Agency (RREA) needed to attract future investments and support sustainable ESPs.
The NRECA specialists then worked with RREA staff to develop programmatic and organizational adjustments that are needed in the rural electrification program including establishing institutional structures for RE planning, introducing cost recovery, lowering barriers to supply, achieving economic scale for service providers, good governance and sector capacity development / training. The NRECA team also made recommendations with regard to the role RREA needs to play in the RE sector, additional resources and personnel required, in addition to the need for medium and long-term planning including the development of the Rural Energy Master Plan (REMP). NRECA provided recommendations for the sustainable development of a successful RE program driven by effective and appropriate electricity service providers.
In 2013, NRECA provided support from LECDP to aid in the start-up of the Mein River Mini-Hydropower Company (MMHC) as a community-owned enterprise under Liberian law, while MMHC’s 1MW hydropower plant is constructed by the USAID-supported Liberia Energy Sector Support Program (LESSP). NRECA completed the several tasks that are described below:
- Reviewed the study prepared by LESSP to understand the legal requirements for establishing an electric service provider that will manage/operate MMHC and an electric distribution system under Liberian law, and evaluate the eligibility of Cuttington University and Phebe Hospital to become equity participants in the new electric generation-distribution utility.
- Reviewed the company act and regulatory provisions in preparation for registration of the new electric service provider, including reporting requirements, quality of service issues, and the tariff setting process that will govern future generation-distribution system operations.
- Conducted a stakeholder workshop to discuss institutional options, roles and responsibilities of shareholders and board members, means of generating future investment capital, and typical features and characteristics of electric utility bylaws and registration processes.
- Prepared the draft constitution and bylaws for MMHC, which defined board composition, the process of board selection, board term limits, roles and responsibilities, reporting relationships and requirements, company shareholding structure, distribution of profits, and general assemblies.
- Designed and implemented a focused willingness to pay (WTP) survey for the project area, employing a sample frame designed to achieve 95% confidence level for the population to be served by the project.
- Evaluated strategies to overcome access barriers, including the role of financing initial service connection charges, internal household wiring costs, and other potential barriers to service uptake. One of the key findings in this task was to identify the need for a year-round source of power supply, in addition to the seasonal hydropower plant, to meet the expectations of the communities in the service territory for year-round power supply.
- Developed a business plan for MMHC that incorporated a ten year load/sales forecast for the MMHC service provider, defined the management and staffing plan for MMHC, developed a tariff analysis using the load projection and results of WTP study.
Guatemala CDP Project
The project completed energy assessments for smallholder coffee producer associations and worked in partnership with the associations to determine the viability of investments in electricity supply improvements for these groups. Working with coffee grower cooperatives and associations in the Western Highlands (especially in Huehuetenango and San Marcos), near the border zone of Guatemala and Mexico, NRECA coordinated efforts with USAID, the Federation of Coffee Grower’s Cooperatives (FEDECOCAGUA), the Association of Federations of Cooperatives (CONFECOOP), ANACAFE (the Coffee Growers Association), Rainforest Alliance, and other key players who are actively involved in the improvement of coffee standards in Guatemala.
NRECA completed a diagnostic to assess energy requirements in traditional coffee processing facilities and practices. NRECA staff visited coffee farms to interview cooperative members and understand their needs and plans. In addition, NRECA staff met with the coffee associations, leadership of the cooperatives and rural village leaders.
On completion of the diagnostic, NRECA implemented the following activities:
- Completed energy audits for 15 coffee cooperatives, with recommendations for improvements to electric infrastructure to improve efficiency and reliability and increase safety.
- Provided design expertise to the electric distribution expansion activities supported by the NRECA International Foundation in Huehuetenango Department, which increased access to electricity for coffee-grower families in rural villages.
- Organized and delivered conferences in 20 cooperatives and associations, covering better practices for safer and more efficient use of electricity at coffee processing facilities and in homes.
- Organized and delivered training targeting young technicians, designated by the coffee cooperatives, to improve their skills in electrical internal wiring and troubleshooting of electric machinery, as well as identification of electric power issues affecting their cooperative.
Dominican Republic CDP Project
In 2010-2011, the CDP program supported energy audits in the processing facilities for the National Association of Cocoa Producers (CONACADO) in the Dominican Republic, making recommendations for feasible investments to improve the reliability of electricity supply.