Promotion of Private Sector Participation - Revision history

Ranisha at 13:55, 25 August 2014

2014-08-25T13:55:08Z

Ranisha at 13:54, 25 August 2014

2014-08-25T13:54:15Z

Ranisha at 12:05, 19 August 2014

2014-08-19T12:05:12Z

Ranisha at 08:52, 14 August 2014

2014-08-14T08:52:14Z

Wiki Gardener: /* Experience with Private Sector Participation */

2014-08-13T15:54:01Z

Experience with Private Sector Participation

Wiki Gardener at 15:52, 13 August 2014

2014-08-13T15:52:13Z

Show changes

Ranisha at 13:19, 13 August 2014

2014-08-13T13:19:35Z

Show changes

Ranisha: /* Further Information */

2014-07-30T14:37:50Z

Further Information

Ranisha: /* Loan */

2014-07-30T14:36:56Z

Loan

Ranisha: /* PSP Hydro - Rwanda: */

2014-07-30T13:10:26Z

PSP Hydro - Rwanda:

@@ Line 29: / Line 29: @@
 The significance of support from the private sector in the context of small-scale electrification, primarily from hydropower, the preconditions to be met and the issues involved are discussed below.
+[[Promotion of Private Sector Participation#toc|►Go to Top]]<br/>
 = Loan =
@@ Line 230: / Line 230: @@
 <references />
 [[Category:Rwanda]]

@@ Line 41: / Line 41: @@
 Read more [[Loans for Financing Hydropower#Loan Financing|here]].
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]<br/>
+[[Promotion of Private Sector Participation#toc|►Go to Top]]<br/>
@@ Line 55: / Line 55: @@
 Equity participation implies contributing risk capital to an enterprise, under the condition that revenue will be generated out of which the shareholder can be recompensed. The precise nature of the enterprise is not material for the funding process as such; it is of course material for the investor. In principle, a distinction need not be made between programme and project finance although the purposes of each must be sufficiently clear and transparent to satisfy the investor that a reasonable return can in fact be achieved. In the hydro case, for example, a small utility may attract programme finance for development which is not necessarily linked with a single hydro scheme. On the other hand, a single scheme attracting project finance may be developed into a vertically integrated local utility warranting programme finance for further expansion. With a mixed funding package the loan and equity components must be devoted to the same objective to ensure compatibility of the financial inputs.
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
@@ Line 80: / Line 80: @@
 Training and technology transfer often did not prove adequate in the past to keep a new plant in satisfactory operating condition, particularly in the case of small schemes which suffered from marginalisation of effort due to the overriding needs of the central areas. Packages financed under suppliers' credit were thus expanded to include post-commissioning support. Cost-effective management usually meant that the supply was limited to a turnkey plant for which the supplier could offer a range of follow-on options. These are the following:
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
@@ Line 88: / Line 88: @@
 Under Build-Operate-Transfer (BOT) contracts the supplier provides and installs the plant and includes a subsequent operating service in his supply package. The plant usually remains the property of the borrower and he disposes of the electricity produced. He will take over the operation of the plant after a pre-arranged span of time. The aim is to cross the interface between construction and routine operation gradually and expertly and to give time to the ultimate owner to become fully familiar with all aspects of the plant's functioning.
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
@@ Line 96: / Line 96: @@
 Under Build-Own-Operate-Transfer (BOOT) contracts the plant remains the property of the supplier and is operated by him for an agreed period of time. The electricity produced is sold on pre-arranged terms to the ultimate owner or to the local utility. This is a first step in privatisation. The duration of private ownership depends on the commitment the supplier is prepared to take on and the extent to which government or the national utility will accept a privately owned plant. Throughout the period of ownership, the supplier will be reimbursed through the revenue from electricity sales; if the period of ownership is too short to permit full cost recovery by the supplier, the ultimate owner may have to pay a balancing charge on transfer.
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
@@ Line 104: / Line 104: @@
 Build-Own-Operate-Train-Transfer (BOOTT) contracts these are similar to BOOT, but include a training component prior to transfer for the plant to the ultimate owner. Training is intended to ensure that local operating personnel becomes fully familiar with the characteristics of the plant and is able to run it safely and effectively. International development agencies now consider inclusion of a training component to be an essential feature of a turnkey project.
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
@@ Line 112: / Line 112: @@
 Build-Own-Operate (BOO) contracts, or DBFO (design, build, finance, operate) contracts, are a more advanced form of privatisation in which the plant remains in the hands of the original supplier for an indeterminate period of time, limited only by the duration of government consents on private-sector inputs to the public utilities system. This is an attractive option from the public point of view because an electricity service is made available at no cost to the public purse. The scheme can be financed by a consortium of private and public sources and the supplier can also form a team of different contracting and service organisations. The expertise of other utilities can likewise be drawn on.
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
@@ Line 130: / Line 130: @@
 <br/>
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
@@ Line 156: / Line 156: @@
 <u>There are basically two ways by which an existing plant is transferred to private management:</u>
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
@@ Line 164: / Line 164: @@
 A buy-out involves the straightforward purchase of the existing assets by lump-sum payment, deferred payment through annual installments or an injection of equity.
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
 === Deferred Payments ===
@@ Line 170: / Line 170: @@
 In this method, the existing owner gives in effect a loan to the purchaser. The loan is redeemed over an agreed period of time by annual charges of principal (a proportion of the value of the assets on take-over) and interest on the outstanding amount of the loan. Deferred payments can also be in the form of an annuity at fixed annual installments payable over the agreed redemption period.
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
 === Equity Participation ===
@@ Line 176: / Line 176: @@
 The purchaser takes equity capital up to the value of the plant at the time of take-over. The yield on the issued capital remunerates the vendor but a management company will now have to ensure that the equity is adequately serviced; profits arising out of operating revenue will have to be remitted to the equity holder.
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
 === Valuation ===
@@ Line 192: / Line 192: @@
 Determination of buy-out values follows basically the same approach as that used for privatisation of electricity supply facilities i.e. it requires asset valuation as described above. This can be a fairly complex matter but, in the case of a small plant, shortcuts can probably be introduced by agreement between vendor and buyer.
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
@@ Line 204: / Line 204: @@
 As in the case of turnkey contracts, buy-out and lease arrangements also offer scope for developing new approaches in due time.
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
@@ Line 215: / Line 215: @@
 The PSP Hydro project in Rwanda supports the development of privately owned and operated Micro Hydro Power plants. So far two plants have been commissioned within the framework of the project, the first in mid 2010 and the second in April 2012. Further reading at [[:File:Psp hydro rwanda baseline report - rwi2009.pdf|EnDev Rwanda]].
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
@@ Line 224: / Line 224: @@
 <br/>
-[[Promotion of Private Sector Participation#Overview|►Go to Top]]
+[[Promotion of Private Sector Participation#toc|►Go to Top]]
 = References =
@@ Line 230: / Line 230: @@
 <references />
 [[Category:Hydro]]

@@ Line 3: / Line 3: @@
 = Overview =
-The term 'private' loosely describes all non-governmental parties; it has come into general use although its precise meaning is not always clear. The term is applied conventionally in contrast to governmental or quasi-governmental, in effect to the public sector. Perhaps it would be more correct to employ the term non-governmental which is in any case more appropriate in connection with small-scale power supply where a number of non-governmental bodies other than strictly private individuals or corporations can playa significant role. The key to sectoral definition is perhaps that the promoter - the driving force for initiating and implementing a project - should be independent of government although he may well be subject to some measure of government supervision and, in some cases, benefit from active government participation.
+The term 'private' loosely describes all non-governmental parties; it has come into general use although its precise meaning is not always clear. The term is applied conventionally in contrast to governmental or quasi-governmental, in effect to the public sector. Perhaps it would be more correct to employ the term non-governmental which is in any case more appropriate in connection with small-scale power supply where a number of non-governmental bodies other than strictly private individuals or corporations can play a significant role. The key to sectoral definition is perhaps that the promoter - the driving force for initiating and implementing a project - should be independent of government although he may well be subject to some measure of government supervision and, in some cases, benefit from active government participation.
@@ Line 230: / Line 230: @@
 <references />
 [[Category:Rwanda]]

@@ Line 1: / Line 1: @@
 = Overview =
@@ Line 229: / Line 230: @@
 <references />
 [[Category:Hydro]]

@@ Line 207: / Line 207: @@
-== Experience with Private Sector Participation ==
 === PSP Hydro - Rwanda: ===
@@ Line 214: / Line 215: @@
 [[Promotion of Private Sector Participation#Overview|►Go to Top]]

@@ Line 177: / Line 177: @@
 The PSP Hydro project in Rwanda supports the development of privately owned and operated Micro Hydro Power plants. So far two plants have been commissioned within the framework of the project, the first in mid 2010 and the second in April 2012. Further reading at [[:File:Psp_hydro_rwanda_baseline_report_-_rwi2009.pdf|EnDev Rwanda]].
 = Further Information =
 <br/>
 = References =
 [[Category:Hydro]]