970737Z S~^ -y STOCKHOLM 01 |H I ENVIRONMENT U/ 1 J JL INSTITUTE International Institute for Environmental Technology and Management, Rural Power Supply with Local Management: Examples from Bolivia, India and Nepal Asa Gerger and Monica Gullberg RECEIVED SEP 0 ^ ©ST/ Published by the Stockholm Environment Institute ISBN: 91 88714 31 4 1997 /V6TX~S£--3k4A Rural Power Supply with Local Management: Examples from Bolivia, India and Nepal Asa Gerger and Monica Gullberg OBRB&mON OF THB DOCUMENT B UNLM7H) StockholmEnvironment Institute Box 2142 S-103 14 Stockholm Sweden Tel +46 8 723 0260 Fax +46 8 723 0348 Responsible Editor, Amo Rosemarin Publications Manager, Karin Hultcrantz Copy and Layout, Karin Hultcrantz; Stockholm Environment Institute © Copyright 1997 by the Stockholm Environment Institute Nopart of this report may be reproduced in any form by photostat, microfilm, or any other means, without written permission from the publisher. ISBN: 91 88714 31 4 DISCLAIMER Portions of this document may be illegible in electronic image products. Images are produced from the best available original document. TABLE OF CONTENTS TABLE OF CONTENTS..............................................................................................m LIST OF FIGURES........................................................................................................ V LIST OF TABLES...........................................................................................................V ABBREVIATIONS....................................................................................................... VI ACKNOWLEDGEMENTS....................................................................................... VIE ABSTRACT................................................................................................................... IX 1 INTRODUCTION................................................................................................. 1 1.1 Context of study.................................................................................................1 1.2 Prospects of the study......................................................................................2 1.3 Objectives..........................................................................................................2 1.4 Methodology ......................................................................................................3 1.5 Scope and objectives of the case studies...................................................... 4 2 BACKGROUND..................................................................................................5 2.1 General dilemmas of rural electrification in developing countries.............5 2.2 Rural electrification systems based on local management ......................... 7 3 SUMMARY OF FINDINGS FROM THE CASE STUDIES........................10 3.1 Brief presentation of the power systems visited by the study team......... 10 3.2 The role of local participation...................................................................... 16 3.2.1 Bolivia ........................................................................................................16 3.2.2 India............................................................................................................ 19 3.3 The role of external assistance.....................................................................21 3.3.1 Bolivia....................................................................................................... 21 3.3.2 India............................................................................................................22 3.3.3 Nepal...........................................................................................................22 3.4 Tariff setting and financial soundness..........................................................23 3.4.1 Bolivia....................................................................................................... 24 3.4.2 India............................................................................................................24 3.4.3 Nepal...........................................................................................................24 4 RESULTS AND DISCUSSION.......................................................................27 5 COUNTRY REPORT: BOLIVIA.....................................................................30 5.1 Country profile.................................................................................................30 5.2 The Energy Situation.................................................................................... 31 5.3 The Power Sector............................................................................................ 31 5.4 Institutional network.......................................................................... 32 5.4.1. National Electric Power Company - ENDE...........................................33 5.4.2 Bolivian Power Company - COBEE................................................... 33 5.4.3 The Electric Power Company of Cochabamba - ELFEC- SAM......34 5.4.4 National Rural Electric Co-operative Association - NRECA........... 34 5.5 Governmental Policies and Regulations ...................................................... 36 IV Gerger and Gullberg 5.5.1 Rural Electrification Policies..................................................................36 5.5.2 Policies effects on locally managed distribution systems..................37 5.6 Rural Electrification in Bolivia....................................................................37 5.7 Local Management in Rural Power Systems.............................................39 5.7.1 History of rural electrification co-operatives ...................................... 39 5.7.2 Current status............................................................................................39 5.8 Case Studies in Bolivia .................................................................................40 5.8.1 Rural electrification in the area of Yungas ........................................ 40 5.8.2 Rural electrification in Mizque, Bolivia............................................. 45 5.8.3 Rural electrification in Capinota...........................................................48 5.8.4 Rural electrification in Santa Cruz ..................................................... 51 5.9 Conclusions of the Bolivia Study............................................................... 57 6 COUNTRY REPORT: INDIA........................................................................... 62 6.1 Country Profile.................................................... 62 6.2 The Energy Situation...................................................................................... 63 6.3 The Power Sector............................................... 63 6.4 Institutional Framework.................................................................................64 6.4.1 Ministry of Power........................................ 64 6.4.2 Central Electricity Authority - CEA..................................................... 65 6.4.3 The Central Power Corporations ...........................................................65 6.4.4 Energy Management Centre - EMC......................................................66 6.4.5 Ministry of Non-Conventional Energy Sources - MNES...................66 6.4.6 Indian Renewable Energy Development Agency Limited - IREDA 66 6.4.7 Rural Electrification Corporation - REC.............................................66 6.4.8 State Electricity Board - SEB................................................................ 67 6.4.9 Water and Power Consultancy Services (India) Limited - WAPCOS.67 6. 5 Government Policies and Regulations .......................................................... 67 6.5.1 Rural electrification policies...................................................................67 6.5.2 Privatisation policies................ ..................................... ...................... 68 6.5.3 Promotion of locally managed electrification systems.......................68 6.5.4 Problems associated with shortcomings in policies: from the local organisations ’ point of view................................................................................69 6.6 Rural Electrification in India............................. 69 6.7 Local Management in Rural Power Systems................................................70 6.7.1 Development of rural electrification co-operatives ........................... 70 6.7.2 Financing rural electrification co-operatives ....................................... 70 6.7.3 Current Status...........................................................................................71 6.8 Case Study of India............................................. 72 6.8.1 Rural electrification of Lucknow Township ................................................ 72 6.9 Conclusions of the India Study......................................................................75 7 COUNTRY REPORT: NEPAL........................................................................ 77 7.1 Country Profile................................................................................................77 7.2 The Energy Situation................................. 77 7.3 The Power Sector............................................................................................78 7.4 Institutional framework..................................................................................