Output-Based Aid in the Philippines : Improving Electricity Supply on Remote Islands
The Philippines has introduced an output-based aid (OBA) subsidy scheme to improve electricity supply on remote islands as a way to enhance living standards in the poor communities there. The subsidy, to come from a national fund financed by a surc...
| Main Authors: | , , , , |
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| Format: | Brief |
| Language: | English |
| Published: |
World Bank, Washington, DC
2012
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2006/05/7068466/output-based-aid-philippines-improving-electricity-supply-remote-islands http://hdl.handle.net/10986/11039 |
| Summary: | The Philippines has introduced an
output-based aid (OBA) subsidy scheme to improve electricity
supply on remote islands as a way to enhance living
standards in the poor communities there. The subsidy, to
come from a national fund financed by a surcharge on all
electricity users, will be paid to private generators
selected through competitive bidding, and disbursed on the
basis of the energy they supply. These generators will take
over from the government provider, entering into a supply
agreement with the cooperatively owned distribution utility
on each island. The competitive bidding process should
ensure that the costs of supply, and thus the required
subsidy, will be lower. That will allow subsidy funds to be
used more efficiently, benefiting more communities. The
quality of electricity service should also improve. The
International Finance Corporation worked with the government
to establish a framework ensuring delivery of electricity
supply and transparency in subsidy payments. The first
transaction, focusing on three pilot areas, has been
successfully completed. |
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