THE CENTRAL AFRICAN REPUBLIC’S INFRASTRUCTURE: A CONTINENTAL PERSPECTIVE consumption (EIU 2007). Very low population densities in the CAR impose a substantial challenge to expanding access to power.

Consumption of electricity in the CAR is a fraction of its African peers. The available electricity is erratic and unreliable; leading to an estimated 11 gigawatt-hour (GWh) suppressed demand (that is, the difference between so-called notional demand and availability at the going price). Outages in 2006 lasted as much as 950 hours during the year, with an average duration of 5.2 hours (Rosnes and Vennamo 2009). Load shedding cut off power as much as 8 hours a day in 2008 and has reportedly increased to 13.5 hours a day on average (World Bank 2010c). Secondary centers in rural areas are powered by expensive diesel generation (Bernard Kief Consultants 2006).

Limited power availability has wider repercussions throughout the economy. Connecting to the grid is expensive, and firms—most of which are small and informal—wait around 7 months to get a connection to electricity (World Bank 2011b). Obtaining a power connection costs around 52 times the average yearly income per capita in the CAR.<sup>9</sup> Firms’ efficiency is handicapped by chronic power shortages and frequent outages, and they have to rely on their own expensive generators. During the power crisis of 2008, power shortages badly impacted SODECA, the CAR’s water utility, as it was unable to pump water in some neighborhoods. Hospitals were also impacted by the lack of power. Bangui is said to have come close to facing a serious humanitarian crisis. Meanwhile, the creditworthiness of both the government and sector has deterred investments in the sector. Inadequate resources to reestablish reliable power supply around Bangui—coupled with faulty generation equipment that frequently breaks down, and ENERCA’s inability to cover its costs—have led the government to appeal to the international community for resources to rehabilitate the power infrastructure.

The CAR will need to develop 143 MW of additional capacity to fully meet growing demand over the next 10 years.<sup>10</sup> But after the development of Boali 3, the next available plant at Palambo is a full 300 MW site that would require huge investment ($450 million) to develop and would likely support excess capacity for some time. Initial estimates suggest that it might not be possible to export this power, although this possibility would need to be further explored. Another option would be to link the development of the power plant to the expansion of the mining activities in the country.

The CAR’s power sector is critically affected by ENERCA’s poor performance, a public enterprise characterized by enormous system losses (both technical and nontechnical in nature), an inability to recover operational and capital costs, and low revenue collection rates.

On average a staggering 50 percent of the generated power in the system has been lost every year since 2006. Around 35 percent of the power is lost due to nontechnical factors such as theft. Illegal users

> 9 _Doing Business 2011_ (World Bank 2011, http://www.doingbusiness.org/data/exploretopics/getting-electricity). The cost to obtain a connection is recorded as a percentage of average income per capita. Costs are recorded exclusive of value added tax. All the fees and costs associated with completing the procedures to connect a warehouse to electricity are recorded, including those related to obtaining clearances from government agencies, applying for the connection, receiving inspections of both the site and the internal wiring, purchasing material, getting the actual connection works, and paying a security deposit. Information from local experts and specific regulations and fee schedules are used as sources for costs. If several local partners provide different estimates, the median reported value is used. In all cases the cost excludes bribes.

> 10 These represent investments in the Palambo and Boali 3 plants.

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