US$6 million grant to expand access to electricity in Djibouti

The World Bank’s Board of Executive Directors today approved additional financing, in the form of a grant to the Republic of Djibouti to be credited to Electricitè de Djibouti (EDD) for the Power Access and Diversification Project.

The additional financing will add US$6.00 million to the Djibouti Power Access and Diversification Credit, approved on November l, 2005 for US$7 million, which became effective on March 29, 2006, bringing the total cost of the project to US$13.30 million.

It is proposed that the additional financing provided to the Government of Djibouti would deepen the impact of the project and scale up its activities.

Pierre Audinet, Senior Energy Economist at the World Bank, said “The original project resulted in concrete improvements in electricity access for the poor and established a sound initial diagnosis of the measures needed to improve the efficiency of Djibouti’s electricity sector.” “This financing will also help support the costs associated with scaled up activities to enhance the impact of a well-performing original project, allowing for (i) further expansion of electricity access in low income underserved neighborhoods of Djibouti Ville and (ii) efficiency improvements for EDD by reducing losses in electricity distribution,” he added.

“This project fits with broader development strategy for Djibouti and its Country Assistance Strategy (CAS),” said David Craig, Country Director for Djibouti, adding, “Continued and enhanced support to the electricity sector in Djibouti is consistent with and necessary to achieving Djibouti’s objectives of sustained growth, in particular by underpinning the performance of its port which is increasingly energy dependent and by meeting rising demand from a rapidly growing urban population.”

Out of the US$6.00 million, the project allocates around US$2 million towards the extension of the primary network in Balbala neighborhood, thus allowing the connection of households and businesses to the grid and installation of street lighting. The rest of the financing will be used to improve electricity metering and to rehabilitate the electricity line to Arta.

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