## where

- HV is high voltage and MV is medium voltage;

- US$0.025 and US$0.05/kWh represent the costs of low-voltage (LV) distribution lines (below 1 kV) in urban and rural areas, respectively, detailed in section A1.4 annex 1;

- new customers are customers added in the previous year; and

- US$100 represents the cost of a new meter and installing a line from the grid to the customer’s premises.

The first term for capex is divided by 90 percent of kWh dispatched (allowing for 10 percent T&D losses) and the second term is to account for capex for LV distribution lines based on regulatory costs in Peru (which allow for total losses of 10 percent comprising T&D and collection losses), but opex does not correspond to operational efficiency of 10-percent total losses or proper maintenance of existing assets.

# 2.3 Data sources and coverage

A database was developed to capture more than 300 indicators related to the financial, commercial, and technical aspects of power sectors in SSA. The primary sources of data were utility financial statements and annual reports. Where data gaps remained, data were collected directly from utilities, or taken from available reference documents, including cost-of-service studies, tariff studies, power sector reports, industry sources, regulatory documents, and project documents, supplemented by locally available data provided by World Bank specialists working in the sector. Where data were inconsistent between sources, priority was generally given to utility data over other sources.

**Countries in scope.** Data availability determines the countries in scope in each analysis presented in this paper. The 39 countries included in this study out of 48 in SSA accounted for 95 percent of installed capacity, 86 percent of the population, and 85 percent of GDP in SSA in 2014. Due to lack of data, the following nine countries were excluded from the analysis: Angola, Chad, the Democratic Republic of Congo, Equatorial Guinea, Eritrea, Guinea Bissau, Namibia, Somalia, and South Sudan.

**Reference utility and sector structure.** The general methodology used in this paper estimated opex using the financial statement of the main utility listed in annex 2, and estimated capex costs of existing state-owned assets using a new replacement value approach on assets reported in utility annual reports. This methodology means that the sector structure has a significant effect on the computation of capex and opex.

Figure 1 summarizes the sector structures observed in SSA. For each country analyzed in this paper, the structure shown in the figure is that in the reference year. For those excluded from the study, the structures shown are based on the most recent available data. The procedures and assumptions applied to take account of sector structure are outlined in section A1.5 in annex1. The structures are categorized into five groups:

- **Group 1: One vertically integrated state-owned utility** . In 19 countries the sector was fully vertically integrated, with one state-owned utility operating as a monopoly. Most of the countries excluded in the study due to lack of data fall into this group. Of the 19, seven lacked data for inclusion in the present study, leaving 12 included in the study.

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