Below the Header Ad
Politics

MCC Compact ends

Above Article Ad

-After Liberia failed to make passes

The Millennium Challenge Corporation (MCC) Compact between the Government of Liberia and the United States Government finally ended Thursday January 21, 2021 after the former failed three consecutive times to make a pass.

Liberia made a slick improvement last year over the previous two years but fell short of passing ten of the require items on the scorecard out of 20.

The Compact signed during the Ellen Johnson Sirleaf administration in October 2015, saw the US Government through the MCCproviding US$257 million to help increase access to more reliable and affordable electricity; and improve the planning and execution of routine, periodic, and emergency road maintenance. The goal of the support to the energy and road sectors was to help reduce poverty through economic growth in Liberia.

Under the Compact Liberia witnessed improvement in the amount and reliability of electricity supply, more than doubled the number of homes with electricity access, and left the Liberian government with a sustainable, data-driven road maintenance system.

Mt. Coffee Rehabilitation
The Compact contributed US$146.3 million to the rehabilitation of the Mt. Coffee Hydro Power Plant, the single largest support of any donor to the power plant, constituting 40 percent of the total US$350 million spent to rebuild the hydropower plant.

With 88 MW power generating capacity, Mt. Coffee represents the largest source of power and renewable energy supply for the Liberia Electricity Corporation (LEC). Mt. Coffee has enabled LEC to expand more reliable and affordable power supply to more than 82,000 homes, businesses, and other entities, compared to a little over 34,000 when Mt. Coffee came online in 2016. Mt. Coffee also allowed LEC to reduce the average number of electricity outages by 45 percent since the start of the Compact. Outages are also much shorter now, with a reduction of 83 percent in the average duration of outages.

Electricity tariffs have also reduced from US$0.56 per kilowatt-hour to US$0.35 per kWh, representing a 37.5 percent decrease. While this is still a very high tariff, this decrease has made electricity more affordable for ordinary consumers, particularly marginalized households and small and medium enterprises.

An independent study found that LEC offers cheaper and better-quality power than generators or mini-grids can provide. In focus group discussions with households and interviews with small business owners, respondents described how, once connected to LEC, they could start income-generating activities, such as selling cold drinks, or expand business operations by staying open later and offering more goods.

Customers reported that their main use of electricity was lighting but also showed shifts toward using electronics andappliances. Small businesses shifted toward using freezers and large end-users shifted toward technology and machinery after connection.

The MCC compacts are based on the principle that the U.S. assistance is more effective in countries that have adopted policies promoting an environment for economic growth and poverty reduction.

Other projects under the compact which Liberia benefited include: the completion of the hydropower project, a trained and skilled energy workforce and a stronger management of the Liberia Electricity Corporation (LEC); Completion of the 5 kilometer raw water pipeline from MCHPP to White Plains and the establishment of the Liberia Energy Regulatory Commission and the creation of systems to more effectively manage the maintenance of Liberia’s roads.

Related Articles

Back to top button