Improving the Electricity Sector in Haiti
Patricia Eloizin, Latam Energy Advisors LLC
Haiti’s electricity grid is in need of immediate upgrades so that power can be available to the country’s 11 million citizens. Haiti has no centralized electricity grid system, but it is instead separated into nine separate grids, each of which includes one of Haiti’s major cities. In recent years, Haiti has experienced a host of natural disasters – both earthquakes and hurricanes – that contribute to damage to the electricity infrastructure and make the process for grid repairs even lengthier.
Poor Access to Power Impacts Economic Growth
Because of its weak grid, electricity access in Haiti is marked by its unreliability. A household connected to the grid in Haiti’s capital city Port-au-Prince might expect around 15 hours of electricity per day, but on average, throughout the country, customers have access to about 4 hours to 9 hours of electricity per day. Energy losses total about 65% in Haiti. The majority of electricity losses are a result of illegal connections while other losses are because of outdated networks and power plants. This reality does contribute to the high cost of electricity in Haiti.
Electricité d’Haiti (EDH), a government-owned utility company, has a monopoly on electricity transmission and distribution, but it is unable to provide affordable and reliable services throughout the country. EDH is not able to consistently collect electricity bills from its customers, leading to higher costs for the company and end users. To remain operational, EDH requires subsidies from the Haitian government.
It is essential that electricity services consider the specific realities of citizens in rural regions as they constitute about 50 percent of Haiti’s population. Currently, about 5 percent of people in rural communities have access to the electricity grid. In the past, there have been models of successful rural electrification projects.
A National Rural Electric Cooperative Association (NRECA) was created with support from the U.S. and Norwegian governments as well as from the United Nations Environment Programme. Their coordination enabled rural communities in Southwest Haiti to connect to the electricity grid which improved safety and the local economy.
Potential Solutions for Reform
The Haitian government can reform its power sector by taking the following actions:
• Decentralizing EDH and hiring private, external contractors to manage payment collection and electricity generation, distribution and transmission activities.
• Updating the Electricity Sector Organic Law of 1989 to allow private Independent Power Producers (IPPs) into the Haitian electricity market.
To prioritize energy needs of rural communities, the government of Haiti can implement the following:
• Create an Office of Rural Electrification to coordinate mini-grid development.
• Pay special attention to the particular energy needs of rural citizens by establishing advisory councils made up of leaders from rural communities who report back to the newly established ARANSE government agency.
If Haiti is successful in making reforms that will improve its power sector, it can begin a critical transition towards energy independence through renewable energy investment. Please contact Latam Energy Advisors to learn more about our consulting solutions in Haiti.