maxine nestor - energy policy formulation, … nestor - energy policy...engenders trust, buy-in,...

ENERGY POLICY FORMULATION,

IMPLEMENTATION AND MONITORING

– WHAT’S BEST FOR HAITI

Presented by: Maxine Alexander Nestor

Energy Workshop in Haiti

Hotel Ritz Kinm

Pétion-Ville, Haiti

ISSUES CONFRONTING HAITI’S ELECTRICITY AND ENERGY SECTOR

High dependence on diesel especially for

electricity production:

• High

generation

costs translate

to high tariffs;

• Drain on

treasury as

about 50% of

balance of is

payments used

to pay a

fraction of

energy needs

(⅕);

• Environmental

and climate

change

concerns.

• Security of

energy

supplies issues.

Inadequate electricity supplies:

• Limited

installed

capacity – 300

MW;

• Inadequate

maintenance

of generating

units;

• Weak

transmission

and

distribution

system;

• Stymies

economic

development.

Operational issues at EDH

•Lowelectrificationrate – 16% or 9%if only activeconsumersconsidered. Howcould this beincreasedwithout creatinga burden on themasses?;

•High systemlosses (about18% technicaland 35%commercial);

•Billing andcollection issues;

•Hugh subsidiesrequired tosustainoperations.

Heavy Utilization of Woodfuel :

• Deforestation dueto over exploitation;

• Inefficient energysource;

• Health andenvironment issues;

• Substitutionrequires retrainingof large workforce;

• Strategy to promoteLPG has not yieldthe desired results– barriers includeinvestment andregulation;

• No or little potentialfor crude oilexploitation andrefining howeverthere is potentialfor someindigenousresources otherthan biomass(hydro, solar, wind).

Governance, Legal and Regulatory

Reforms:

• Primary Ministrycovers multiplesector – dilutedresponsible forenergy sectormanagement atdecision andstrategic makinglevel ;

• Dearth of skills;

• Responsibility forenergy matters splitamong fourMinistries – needfor clear lines ofauthority to avoidconflict;

• Lack of adequatelegal and regulatoryframeworkparticularly for thepower sector(market structure,tariff setting, qualityof service, licensing,auto-generation,planning andgovernance).

Source: Haiti Energy Sector White Paper December 2010 draft and National Energy Sector Development Plan February 2011 2

MODEL FOR MARKET STRUCTURE

– SINGLE BUYER MODELIndependent

Power Producers

/ Distribution

Generators

Utility

(EDH) Consumers

The Red line represents electricity trade3

EN

ER

GY

PO

LIC

Y F

OR

MU

LA

TIO

N, IM

PLE

ME

NT

AT

IO

N A

ND

MO

NIT

OR

IN

G –

WH

AT

’S B

EST

FO

R H

AIT

I

ENERGY POLICY DIMENSIONS

ENERGY POLICY FORMULATION, IMPLEMENTATION AND MONITORING –

WHAT’S BEST FOR HAITI

Vision (why):

the impetus tostrategy activities.

Content (what):

product of theprocess - policies

and strategies.

Process (how,

who, when): thecontinuum fromplanning, formation,implementation andcontrol.

Context (where): circumstancesand environment within whichprocess and content embedded.

4

PROPOSED STEPS



Develop a

Vision and

Conduct

Environment

Scan to

determine

problems and

issue

(regional,

national and

local)

Commence Engagementon Strategies designed to provide solution

Formulate

Energy

Policy to

provide

Sustainable

Solutions

DevelopandImplementResultsOrientedActionPlans andPrograms

Establish

Strategic

Controls

to analyze

results of

strategies

and detect

any

problems

Amend

Energy

Policy

Strategies,

Action Plan

and

Legislation

as

necessary

to achieve

objectives

and vision

5

STEP 1 – THE VISION



Develop a

Vision and

Conduct

Environment

Scan to

determine

problems and

issue

(regional,

national and

local)

6

STEP 1 – THE VISION

�National EnergyPolicies set thevision, guidingprinciples andobjectives for asustainable energypathway.�Vision could have along-range horizon(e.g. 20 years inJamaica & St.Vincent & theGrenadines).


WHAT’S BEST FOR HAITI7

STEP 1 – ENVIRONMENT SCAN –

The Context



• To scan the wider environment and assess globalperspective and regional setting.

Tool-driven approach

• Appropriate for assessing external environment. Little controlover certain global issues. Need to design strategies to mitigate.

PESTEL framework

• For internal analysis of the country’s energy sector.

Opportunities and strengths maximized and weaknesses and

threats minimized. Baseline data useful.

SWOT analysis

8

STEP 2 - ENGAGEMENT



Commence Engagementon Strategies designed to provide solution

9

STEP 2 - ENGAGEMENT

� EXTREMELY IMPORTANT to engage allstakeholders in the process of energy policyformulation (relevant Ministries; Governmental &NGOs; private sector; manufacturers; citizenry;electricity consumers; interest groups, mediaetc).

� Energy plays an important part in daily lives ofeveryone.

�There will be dissention BUT involvementengenders trust, buy-in, ownership & avertsresistance and derailment of process.



UNDESIRED OUTCOME



Everyone pulling in different directions

11

DESIRED OUTCOME



… pull in the same direction

12

PURPOSE OF ENGAGEMENT?

� Provides a forum for views of various stakeholdersto be discussed.

� Stimulates exploration of a wide-range of solutions– Governments do not have all the answers.

� Feedback is instructive in informing energystrategies and decision-making on options andalternatives.

HOWEVER GOVERNMENTS MUST MAINTAINRESPONSIBILITY FOR ULTIMATE STRATEGIES ANDSOLUTIONS.



PROCESS FOR ENGAGEMENT

�Varies from country-to-country – no prescribedformula – determine what works best.

�Antigua and Barbuda commenced theengagement process by establishing 18 Memberbroad-based task force.

� In Jamaica:

- the initial draft document (Green Paper) was in the public

domain for over 2 years online.

- public consultation on revised draft held over 3 – 4

month period throughout island.

�Town hall style engagement becoming popular.



STEP 3 – FORMULATE POLICY



Formulate

Energy

Policy to

provide

Sustainable

Solutions

15

STRATEGIC PRIORITIES AND POLICY OPTIONS - the Content

Energy Planning

and Management

• Streamline

policy and

decision making

• Improvement of

the energy

information and

database

• Introduction of

an effective

coordination of

the energy

sector

• Regular

elaboration and

updating of an

Energy Action

and

Implementation

Plan

• Institutional

strengthening

and capacity

building

Power Sector

• Improvement

of efficiency

at all levels of

electricity

supply

•Rural

electrification

• Encourage

net metering

• Establishment

of a

Regulatory

Authority

• Electricity

tariffs

reflective of

actual costs

•Market

Structure to

include

private sector

participation

– SBM and

IPPs common

in Region

Renewable

Energy

• Promote

appropriate

Renewable

Energy

technologies –

on-grid and off

grid

• Analyse RES

potential

• Development of

local capacity for

RET

• Encouragement

of private sector

participation in

RE projects

• Provision of

financial and

fiscal incentives

for RET

• Incentives for

installation of

solar water

heaters

Energy Efficiency

• Promotion of

Energy Audits

for key energy

consuming

sector

• Fiscal incentives

for the import of

energy-efficient

products

• Establishment of

standards and

guidelines for

electrical

appliances,

equipment and

materials

• Increase

awareness on

energy

conservation,

efficient use and

energy-efficient

appliances

• Ban inefficient

incandescent

light bulbs

• Efficiency in the

use of fire wood

and charcoal

Biomass

• Substitution

of firewood

and charcoal

as the major

source of

energy for

residential

cooking and

industrial

heating

• Incentives to

promote the

use of LPG

Transportation

•Taxation

system that

provides

incentives for

low-

consuming

vehicles

•Restrict the

importation

of second-

hand cars

with

excessive fuel

consumption

• Set emission

and fuel-

consumption

controls for

vehicles

16

APPROVAL OF NATIONAL ENERGY POLICY

Cabinet Approved document is Official Energy Policy.

Tabled in Parliament – no debate required.

Cabinet may:Consider and approve policy Appoint a select sub-committee for review and comments

Final Policy document prepared and sent to Cabinet for approval:In St. Vincent & the Grenadines draft submitted first to the National Energy Committee prior to submission to Cabinet

Feedback during consultation considered and incorporated and ‘white paper’ prepared. Several drafts of the ‘white paper’ may be circulated to stakeholders for comments.

Approval process varies in slightly in Member States:In Jamaica the first draft document circulated for discussion and consultation is termed ‘green paper’.

Usually the line Ministry takes the lead during the Energy Policy formation process.

17

LEGAL FORCE

�Enactment of new legislation or amendmentof existing legislation may be required to givelegal force to range of policy issues:

�Policies and strategies could impact a rangeof legislation and other statutory instrumentsincluding:

Re-negotiation of monopoly utility licence to allow for competition in generation;

Building code to set standards for energy efficiency in building sector;

Motor Vehicles Act set emission levels on vehicles;

Tax and Fiscal Act – exemptions.



STEP 4 - ACTION / IMPLEMENTATION PLAN



DevelopandImplementResultsOrientedActionPlans andPrograms

19

ACTION / IMPLEMENTATION PLAN

� Support Policies with an Energy Action Plan designedto enhance the achievement of strategies and goals.

� Plan must detail clear measurable targets, activities,timeframes, tasks, responsibilities, resourcesallocation, milestones and performance measures(indicators).

� Targets and activities could be classified according totime-scale (short, medium, long-term).

� Haiti’s December 2010 White Paper examines severalscenarios for the Energy Sector and combines theseOptions with an Action Plan outlined as a Roadmap.



STEP 5 – ESTABLISH CONTROLS

/ MONITOR



Establish

Strategic

Controls

to analyze

results of

strategies

and detect

any

problems

21

WHAT AND WHY

�Strategic controls are essential for trackingstrategies and activities duringimplementation to detect problems orchanges.

�Since energy policies and strategies arefuture-oriented and forward looking they arebased on assumptions.

�Lapse in time between implementation ofstrategies and activities and achievement ofresults.



TYPES OF CONTROLS



Premise Control

• Check Continuouslywhether the underlyingassumptions orpredictions are still valid– (specific ).

Strategic Surveillance•Monitor global and regionalevents that are likely toimpact the achievement ofintended results (loose andunfocused).

Special Alert Control• Sudden, unexpected or

unforeseen event thatnecessitates a reconsiderationof strategies e.g. January2010 Earthquake.

Implementation Control• Monitor milestone results to

determine whetherimplementation activitiesshould be revised.

23

STEP 6 – AMEND TO STAY ALIGNED



Amend

Energy

Policy

Strategies,

Action Plan

and

Legislation

as

necessary

to achieve

objectives

and vision

24

STEP 6 – AMEND TO STAY ALIGNED

Based on information obtained from controls:

�Implement strategic changes as necessary toremain in harmony with any shifts inopportunities or threats in the environment –‘strategic renewal’.

�Amend Policies, Action plan, Legislation etc.

�Failure to align with environment could resultin ‘strategic drift’.



SUMMARY OF POLICY ACTIVITIES –

WHERE IS HAITI?



INDENTIFYING

• Know the problem

• Set vision

DIAGNOSING

• External and Internal Assessment

CONCEIVING

• Generate and selectpolicy options anddevelop instruments.

REALISING

• Develop and implement Action Plan

• Implement Controls & Monitor

STAKEHOLDERS

ENGAGEMENT

26

CONCLUDING THOUGHTS

�Haiti is moving in the right direction in terms offormulating an Energy Policy.� Several documents have been developed that

inter alia:- provide baseline data of the energy sector; - identify key strategy priorities for the country based on

five broad categories;- highlight the pros and cons of several options on several

matters for decision making. These options need to bedistilled and crystallized into succinct strategies to beoutlined in an Energy Policy.

�Based on the outcome of Consultations on theoptions, an Energy Policy needs to beformulated supported by an Action Plan.� Support should be leveraged from donors to

support implementation of the Action Plan.ENERGY POLICY FORMULATION, IMPLEMENTATION AND MONITORING – WHAT’S

BEST FOR HAITI

27

CONCLUDING THOUGHTS

� Maybe some gaps in the instruments developed to dateare:

- Absence of a vision statement around which the strategicpriorities revolve;

- Scan of the globally and regional energy outlook;- SWOT analysis matrix that summaries the issues and problems

confronting the sector;- Consider the use of energy in the transportation sector as a

strategic priority.

� An Energy Policy or Strategy is not an end in itself, but ameans for reaching particular objectives or achieving acertain vision.

� Usually the end is the creation of a sustainable EnergySector to meet the present and future energy needs ofthe country.

ENERGY POLICY FORMULATION, IMPLEMENTATION AND MONITORING – WHAT’S

BEST FOR HAITI

28



Contact:

Joseph Williams

Manager, Energy Programme

Caribbean Community Secretariat

Tele: 592 -222-0001-75 Ext 3521

592-222-0139 (Direct)

Fax :592-222-0155

E-mail: [email protected];

[email protected]

SKYPE 'jwilliams67641“

__________________________

Maxine Alexander Nestor

Regional Energy Policy Advisor

Caribbean Renewable Energy

Development Project

c/o Caribbean Community Secretariat

Tele: 592-222-0001-75 Ext. 3501

592-222-0222 (direct)

email: [email protected]

skype: maxine.alexander.nestor

29

maxine nestor - energy policy formulation, … nestor - energy policy...engenders trust, buy-in,...

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