The World Bank Niger Accelerating Electricity Access Project (Haské) (P174034) Project Information Document (PID) Concept Stage | Date Prepared/Updated: 02-Mar-2021 | Report No: PIDC30143 March 2, 2021 Page 1 of 13 The World Bank Niger Accelerating Electricity Access Project (Haské) (P174034) BASIC INFORMATION A. Basic Project Data OPS TABLE Country Project ID Parent Project ID (if any) Project Name Niger P174034 Niger Accelerating Electricity Access Project (Haské) (P174034) Region Estimated Appraisal Date Estimated Board Date Practice Area (Lead) AFRICA WEST May 17, 2021 Sep 15, 2021 Energy & Extractives Financing Instrument Borrower(s) Implementing Agency Investment Project Financing Government of the Republic Société Nigerienne of Niger d’Electricité (NIGELEC), Agence Nigérienne pour la Promotion de l'Electrification en milieu Rural (ANPER), Agence Nationale d'Energie Solaire (ANERSOL) Proposed Development Objective(s) Accelerate access to modern energy services for households, public institutions and businesses in Niger through grid, off-grid and clean cooking solutions PROJECT FINANCING DATA (US$, Millions) SUMMARY-NewFin1 Total Project Cost 317.50 Total Financing 317.50 of which IBRD/IDA 310.00 Financing Gap 0.00 DETAILS -NewFinEnh1 World Bank Group Financing International Development Association (IDA) 310.00 IDA Credit 280.00 March 2, 2021 Page 2 of 13 The World Bank Niger Accelerating Electricity Access Project (Haské) (P174034) IDA Grant 30.00 Non-World Bank Group Financing Trust Funds 7.50 Energy Sector Management Assistance Program 7.50 Environmental and Social Risk Classification Concept Review Decision Substantial Track I-The review did authorize the preparation to continue Other Decision (as needed) B. Introduction and Context Country Context 1. Niger is a large, landlocked and mostly arid country in Western Africa, with a rapidly growing population. With a total land area of 1,267,000 sq. km, Niger is the sixth biggest country in Africa and the biggest in West Africa. Two-third of the country’s land (mostly in the north) is covered by the Sahara Desert. Consequently, about three quarters of the population is concentrated along the Niger River (in the west) and the long (1,500 km) southern border with Nigeria. Conversely, some parts of the north are almost uninhabited except for a few smaller cities along the northern route to Algeria. In 2019, the population was estimated at more than 23 million inhabitants, of which more than 80 percent lives in rural areas. The population is growing rapidly at a pace of 3.9 percent per annum and is expected to reach 36 million inhabitants by 2030. 2. Niger is rebuilding its democratic governance mechanisms in a challenging security environment. The Government of Niger (GoN) has been combating organized crime and terrorism and promoting the safety and property rights of its citizens. Cross-national security threats have increased considerably in recent years, with spillover effects and terrorist attacks on the border with Mali and Burkina Faso in the south-west (Tillabéri and Tahoua regions), as well as in the Lake Chad area bordering Nigeria and Chad in the east (Diffa region). As a consequence, the socioeconomic situation is deteriorating rapidly and the lack of vital primary resources and basic services (water, food, electricity, closure of schools) is adding to the difficulties faced by the population. 3. Poverty, though declining, remains high, with the country facing substantial wealth disparities. Despite progress made in recent years, poverty remains high in Niger, with two in five individuals (40.8 percent) living below the national poverty line in 2019. This corresponds to an absolute number of 9 million poor individuals, most of which (95%) resides in rural areas. The poverty incidence in rural areas is 46.8 percent, compared to only 11.8 percent in urban areas. Such wealth disparities between regions can be a source of social tension and potentially affect the country’s future growth and security situation. Furthermore, the COVID-19 pandemic and its related economic downturn is having an adverse effect on progress made to reduce poverty, which in turn exacerbates inequality issues. March 2, 2021 Page 3 of 13 The World Bank Niger Accelerating Electricity Access Project (Haské) (P174034) 4. Women in Niger face considerable challenges in terms of their health, education, and access to economic opportunities. Social and cultural norms dictate the specific activities women and men can perform, and these norms work to restrict women’s economic opportunities. Women’s restricted mobility is an impediment to their engagement in productive activities such as venturing outside the home to sell their products or taking their animals to pasture or to the market. Moreover, women cannot legally get a job without permission from their husbands. Women and girls also bear a disproportionate share of household’s duties, cooking responsibilities for example are both time consuming (women spend 2.5h/day cooking) and exerting (12h per week collecting and carrying wood). Gender-based violence (GBV) and survival sex are relatively prevalent and economic opportunities and access to education are very limited for women and girls. 5. Niger set the landmark for its vision to development in its Strategy for Sustainable Development and Inclusive Growth (SDDCI) adopted in May 2017. The overall strategy seeks to address main constraints to development, including national security, public administration, human capital (education and health), population growth as well as economic growth, rural development, and private sector development. As the implementation tool of the SDDCI, the Plan for Economic and Social Development (PDES) 2017–2021, adopted in September 2017, seeks to accelerate the economic growth and social development, by building on the revitalization and modernization of the rural world focusing on increased agricultural productivity, private sector participation, and empowerment of women and youth employment. Sustainable expansion of basic services to the population, including access to energy services, plays a key role in the SDDCI. The strategy recognizes that electricity is needed for human capital development (education, health care, access to water, information) and critical for the rural economy (irrigation, agri-businesses, income-generating activities, youth employment, women’s empowerment). 6. Niger is a large, landlocked and mostly arid country in Western Africa, with a rapidly growing population. With a total land area of 1,267,000 sq. km, Niger is the sixth biggest country in Africa and the biggest in West Africa. Two-third of the country’s land (mostly in the north) is covered by the Sahara Desert. Consequently, about three quarters of the population is concentrated along the Niger River (in the west) and the long (1,500 km) southern border with Nigeria. Conversely, some parts of the north are almost uninhabited except for a few smaller cities along the northern route to Algeria. In 2019, the population was estimated at more than 23 million inhabitants, of which more than 80 percent lived in rural areas. The population is growing rapidly at a pace of 3.9 percent per annum and is expected to reach 36 million inhabitants by 2030. 7. Niger is rebuilding its democratic governance mechanisms in a challenging security environment . Since independence in 1960, there have been no less than seven regimes and four military coups in the Republic. The latest coup in 2010 was followed by a restoration of constitutional order in 2011. Since then, elections were peacefully organized in the spirit of the Constitution despite a very fragile environment. The Government of Niger (GoN) has been combating organized crime and terrorism and promoting the safety and property rights of its citizens. Cross-national security threats have increased considerably in recent years, with spillover effects and terrorist attacks on the border with Mali and Burkina Faso in the south-west (Tillabéry and Tahoua regions), as well as in the Lake Chad area bordering Nigeria and Chad in the east (Diffa region). In the north, the lawlessness created by the protracted conflict in Libya has affected the Agadez region by facilitating the trafficking of human beings, drugs, arms and goods. As a consequence, the socioeconomic situation is deteriorating rapidly and the lack of vital primary resources and basic services (water, food, electricity, closure of schools) is adding to the difficulties faced by the population. March 2, 2021 Page 4 of 13 The World Bank Niger Accelerating Electricity Access Project (Haské) (P174034) 8. The spillover of the crisis in Mali and the Boko Haram regional crisis is causing major people displacement towards and within Niger. According to United Nations High Commissioner for Refugees (UNHCR), Niger is hosting more than 519,000 people displaced as a consequence of conflicts in November 2020: 228,000 refugees, 257,000 Internally Displaced People (IDPs) mainly in Diffa and Tillabery, and 34,000 Nigerien nationals who returned from Nigeria. The World Bank’s 2016 Risk and Resilience Assessment (RRA) highlights the security and economic impacts of regional conflicts and forced displacement on Niger. The inflow and extended presence of forcibly displaced people puts additional pressures on already poor hosting regions. Lack of access to basic services, especially education and health, as well as limited economic opportunities already characterized these border regions prior to the current crisis. The pressure posed by an additional influx of people concurrent with a deterioration in the security situation is rendering conditions unsustainable for both displaced people and host populations. 9. The economy grew over the past decade, but sustained growth remains challenging especially considering the current COVID-19 pandemic compounded by Nigeria’s closure of its border to trade. Average growth between 2010 and 2019 was 6 percent, putting the country’s economy among the most dynamic of the West African Economic and Monetary Union (WAEMU). However, the COVID-19 crisis is taking a significant toll on the economy and livelihood. Real growth is projected to slow sharply to 0.5 percent in 2020 (from pre-COVID growth of 5.8 percent in 2019) and the fiscal deficit to increase to 4.8 percent. The Government responded to the COVID-19 crisis by implementing several social protection measures including: increasing health spending, strengthening of the social safety net program and providing two-month free electricity and water to protect the most vulnerable under social tariff categories, introduction of a taxes breaks and moratorium to help businesses mitigate the impact of the pandemic. The economy is projected to rebound in 2021 but prospects are clouded with uncertainty as to how long the outbreak will last, how deep the impact will be and how effective policy measures will be. The country is also confronted with climate change risks including recurring floods and droughts. 10. Poverty, though declining, remains high, with the country facing substantial wealth disparities . Despite progress made in recent years, poverty remains high in Niger, with two in five individuals (40.8 percent) living below the national poverty line in 2019. This corresponds to an absolute number of 9 million poor individuals, most of which (95%) resides in rural areas. The poverty incidence in rural areas is 46.8 percent, compared to only 11.8 percent in urban areas. There are also striking disparities in poverty at the sub-national level. Estimations from the 2018/19 EHCVM1 suggest that a Nigerien inhabitant in Niamey has only a 7 percent chance of being poor while this probability for a person living in Dosso region is 48 percent. Such wealth disparities between regions can be a source of social tension and potentially affect the country’s future growth and security situation. Furthermore, the COVID-19 pandemic and its related economic downturn is having an adverse effect on progress made to reduce poverty, which in turn exacerbates inequality issues. 11. Women in Niger face considerable challenges in terms of their health, education, and access to economic opportunities. This can be observed in the country’s Gender Inequality Index value of 0.647, ranking it 154 out of 162 countries which reflects gender-based inequalities in three dimensions – reproductive health, empowerment, and economic activity. In particular, social and cultural norms dictate the specific activities women and men can perform, and these norms work to restrict women’s economic opportunities. Niger is a predominantly rural country where most of the population engages in subsistence agriculture, pastoralism, or a combination of the two. Women’s restricted mobility is an impediment to their engagement in productive activities such as venturing outside the home to sell their products or taking their animals to pasture or to the market. Women’s participation rate in the labor market is at 67.3 percent 1 Enquête Harmonisée sur les Conditions de Vie des Ménages. March 2, 2021 Page 5 of 13 The World Bank Niger Accelerating Electricity Access Project (Haské) (P174034) compared to 90.5 percent for men. Women and girls also bear a disproportionate share of household’s duties, cooking responsibilities for example are both time consuming (women spend 2.5h/day cooking) and exerting (12h per week collecting and carrying wood). Across all forced displacement situations, the conditions for women and girls are even more difficult. Gender-based violence (GBV) and survival sex are relatively prevalent and economic opportunities and access to education are very limited for women and girls. 12. Niger set the landmark for its vision to development in its Strategy for Sustainable Development and Inclusive Growth (SDDCI) adopted in May 2017. The overall strategy seeks to address main constraints to development, including national security, public administration, human capital (education and health), population growth as well as economic growth, rural development, and private sector development. As the implementation tool of the SDDCI, the Plan for Economic and Social Development (PDES) 2017–2021, adopted in September 2017, seeks to accelerate the economic growth and social development, by building on the revitalization and modernization of the rural world focusing on increased agricultural productivity, private sector participation, and empowerment of women and youth employment. 13. Sustainable expansion of basic services to the population, including access to energy services, plays a key role in the SDDCI. The strategy recognizes that electricity is needed for human capital development (education, health care, access to water, information) and that it is critical for the rural economy (irrigation, agri-businesses, income-generating activities, youth employment, women’s empowerment). Electricity access has been increasing annually at a rate of 1.3 percent in Niger and would reach only 30 percent by 2030 at the current pace and current population growth, far behind the SDG7 goal of universal access by 2030. To change this trajectory, the GoN has prepared a National Electrification Policy Document (NEPD) and a National Electrification Strategy (NES), which are formulated around two main pillars: (a) on the demand side, to ensure – on the basis of a principle of social justice – universal access to electricity for all Nigeriens by 2035 and make electricity the driver of the modernization and development of rural areas in support of the decentralization process, and (b) on the supply side, promote public-private partnerships (PPPs), with a view to increase the share of renewable energy to 30 percent by 2030 and to generate domestically 80 percent of the supply by 2035. 14. Niger has very low greenhouse gas emissions but is highly vulnerable to the impacts of climate change. Niger accounts for 0.09 percent of global emissions but is ranked 180th out of 188 countries in terms of its vulnerability to climate change impact2. The climate and disaster risk screening indicate that Niger has a high risk of river and urban floods, water scarcity, extreme heat and wildfires. An increase in the frequency and severity of extreme weather events would inflict a heavy toll in human lives and welfare, with a high risk of damage to the country’s scarce and valuable capital. The poorest, marginalized and most vulnerable households and communities will be hit the hardest, as income and health shocks will drive them deeper into poverty. Infrastructure assets including electricity transmission and distribution network can be vulnerable to both chronic and acute climate hazards. According to World Bank’s Lifelines report, the cost of disruption to power sector due to natural shocks was about 2 percent of GDP in 20193. 2 Notre Dame Global Adaptation Initiative Country Index https://gain.nd.edu/our-work/country-index/rankings/ 3 World Bank, 2018. Lifelines, the Resilient Infrastructure Opportunity, Global Facility for Disaster Reduction and Recovery (GFDRR) March 2, 2021 Page 6 of 13 The World Bank Niger Accelerating Electricity Access Project (Haské) (P174034) Sectoral and Institutional Context 15. Access to electricity in Niger is not only the lowest in Sub-Saharan, but also illustrates big disparities between urban and rural areas. The Multi-Tier Framework (MTF)4 survey data show that 19.5 percent of Niger households have access to electricity through either the national grid or off-grid sources, while the remaining 80.5 percent have no access to electricity. According to NIGELEC’s data5, grid access rate reached 15.8 percent in 2020 at the national level and ranged from 50 percent in Zinder to 86 percent in Niamey6. In other cities and rural areas where lives 83 percent of the population, only 5.3 percent of the population benefited from electricity in 2020. In electrified areas, only 32 percent of the households have electricity connections. 16. The national electricity system in Niger is small and fragmented. The electricity system is composed of four unconnected systems: (a) the Western Zone (Zone Fleuve), (b) the Niger Center-East zone (NCE), (c) the Northern zone, and (d) the Eastern zone. The Western and Center-East grids account for more than 90 percent of Niger’s electricity consumption. The Western grid serves Niamey, Dosso and Tillabery regions through a 132-kV interconnection with northern Nigeria (Birnin-Kebbi substation, up to 120 MW), the Gorou Banda thermal power plant as well as a new thermal IPP to be commissioned soon. The NCE supplies Zinder, Maradi, and Tahoua regions including some of Niger’s largest industries such as the Malbaza cement plant from a second 132-kV interconnection with Nigeria (Katsina substation, up to 60 MW). The Northern Zone provides electricity to the mining sector and related urban centers, such as Arlit and Agadez. The Eastern Zone provides electricity to Diffa Region, using small diesel units. Finally, 115 isolated centers are supplied (either continuously or for only a few hours) through mini grids powered by small diesel units with prohibitive operation costs. 17. The Electricity Code provides the foundation for the participation of the private sector in generation segment and rural electrification with various legal arrangements including concession, affermage, delegation, independent power production (IPP), imports, etc. Several application decrees clarify rules around third party connection to the transmission system, captive power generation, cost-coverage tariff principles and regulation. Furthermore, the GoN approved in 2020 a decree to mandate a transparent and competitive selection process for new IPPs based on least-cost plan. Outside of the grid, the government set a regulatory framework to promote private sector-led solar mini grids as well as exoneration of imports duties on a positive list of off-grid solar devices. Niger signed its first IPP in March 2019 for a total capacity of 111 MW on two sites. Many solar generation projects are under consideration including 90 MWp of solar power plants on three sites which studies were financed by ESMAP. 18. To address the low access to electricity, the Government of Niger (GoN) has prepared and adopted a National Electrification Strategy (NES) and National Electrification Plan (NEP) with the ambition to reach universal coverage and 80 percent access rate by 2035. By preparing a detailed and comprehensive GIS-based least-cost electrification plan, instead of opportunistically selecting which areas to electrify, GoN has provided sector actors with a clear roadmap to reaching universal electricity access. The NES7 clearly establishes grid electrification as the least cost option for 76 percent of the connections complemented by mini-grids (2 percent) and standalone solar systems (22 percent). Achieving the access goal will require the deployment of grid densification and extension in about 10,000 localities for 3.2 million new 4 The MTF defines access to electricity according to a spectrum that ranges from Tier 0 (no access) to Tier 5 (full access) through seven attributes: capacity, availability, reliability, quality, affordability, formality, and health and safety. The survey results were published in June 2020 using data collected in 2018. 5 Off-grid solutions not included 6 According to the SE4all SDG7 tracker (2018), access rate in Niger was 20 percent in 2017. But national data will be used 7 These figures correspond to a steady state situation. In a pre-electrification approach (before grid connection), mini-grids and off- grid potential could play a more prominent role. March 2, 2021 Page 7 of 13 The World Bank Niger Accelerating Electricity Access Project (Haské) (P174034) connections, the development of 400 mini grids covering 636 localities for 240,000 new connections, and the diffusion of standalone solar systems for 1 million households across the country. Mini grids and standalone solar systems will play an important role in the strategy as both transition and definitive solutions. The successful implementation of the NEP will require an acceleration of the electrification pace from 40 villages a year to an average of 300 villages in the first phase (2019-2025) and 700 villages per year from 2026-2035. To achieve these targets, an investment of US$1.9 billion would be required split between the main grid (US$1,225 million), mini-grids (US$364 million) and off-grid solar solutions (US$301 million). The majority of the investments (90 percent) will be directed towards rural electrification. 19. The implementation of the first phase of the NEP would double access by 2025 and require US$ 1.1 billion of investments in transmission and distribution networks, mini-grids and distributed solar systems. Additional investments of US$ 810 million would also be needed in generation capacity to meet the increase in energy demand. To double access to electricity8 in Niger by 2025, 1.6 million connections will be required, serving 10 million people, mainly in rural areas. These investments needs were presented by the GoN to development partners during a round table on accelerating electricity access in Niger in November 2020. 20. The cooking subsector is strained in Niger, wedged between the need to rapidly alleviate the pressure of an increasing demand for fuel, led by demographics, and the difficulties of increasing wood supply. The wood production is constrained by slow growth and low yields in this Sahelian country, and introducing new fuel-saving technologies is difficult, with households’ ability and willingness to adopt them very constrained by poverty. There is however, encouraging progress in urban areas where the use of Liquified Petroleum Gas (LPG) has gained a significant share of users since 2013. Biomass is used by 94 percent of households for cooking fuel9, with wood remaining the preferred choice for 88 percent nationwide. Rural households cook almost exclusively with biomass and three-stone stoves and only 15 percent purchase the wood they use. Urban households also cook predominantly with firewood (66.7 percent), but it has most often been purchased rather than collected, but also access a slightly more diverse array of cooking options, including charcoal (9.5 percent) and LPG, used by 19.9 percent of urban households (4.6 percent nationwide). 21. While some biomass stoves exist beyond the 3 stone solutions, most of the traditional stoves available in the markets are very fuel inefficient and the few locally-produced improved stoves remain very simple with questionable savings in fuel and emissions. The net annual wood fuel balance has been increasingly negative (natural regeneration minus annual fuel use) for an estimated 10 to 15 years and is now heavily impacting the woodstock of the country. Relationship to CPF 22. The proposed Multiphase Programmatic Approach (MPA) operation is well aligned with the World Bank Group’s (WBG) twin goals of reducing extreme poverty and promoting shared prosperity, with the WBG’s Systematic Country Diagnostic (SCD), and the WBG’s FY18–FY22 Niger Country Partnership Framework (CPF). The WBG’s support to the electricity sector is a critical part of the CPF, which is clustered around three focus areas: (a) rural productivity and incomes with the aim to increase Niger’s low levels of productivity and household incomes in rural areas; (b) human capital and social protection; and (c) governance for jobs, service delivery and growth. The proposed project will support the all three focus areas by providing electricity to rural communities in a way that fosters productivity, enhances human capital and 8 Scaling-Up World Bank Group Involvement in the Energy Sector in G5 Sahel Countries, June 2020. 9 All numbers in this section are from “Niger Energy Access Diagnostic Report Based on Multi-Tier Framework, June 2020� March 2, 2021 Page 8 of 13 The World Bank Niger Accelerating Electricity Access Project (Haské) (P174034) stimulates job and economic activity. The use of IDA19 Window for Refugees and Host Communities provides resources to support Niger’s development approach to refugee crises. 23. The proposed operation also supports the World Bank’s engagement under the energy pillar of Sahel Alliance initiative by providing development to combat poverty and fragility. The World Bank adheres to the Alliance three targets in the energy space for 2022: (i) double the rate of access to electricity, an intermediate objective aimed at ultimately achieving universal access by 2030 as envisaged by the SDG7; (ii) double renewable energy generation capacity; (iii) increase interconnection arrangements to facilitate cross-border trade. The World Bank is championing the energy access agenda in Niger and is mobilizing other donors to fund the implementation of the NES. In this role, the Bank has provided support to the Government and the Sahel Alliance to organize a successful donor roundtable in November 2020. The World Bank engagement through the proposed project will send the right signal to leverage financings from other donors to accelerate access to electricity in Niger. Many other donors10 are engaged in the electricity access space in Niger and close coordination is put in place and driven by the World Bank to create the required synergies of actions. 24. Going beyond the target set by the Sahel Alliance to double access by 2022 in G5 Sahel countries, the World Bank has set a milestone to accelerate access to energy through the Energy Access Initiative. The Initiative aims to support economic recovery from COVID-19, catalyze growth by mainstreaming productive use interventions, and improve resilience to future shocks. Scaling up access to energy in the G5 Sahel countries is a priority. For Niger, this means an investment of US$ 5.4 billion to achieve universal with an intermediate target to reach 50 percent access rate by 2026. The proposed project will be an important contributor to the Bank’s corporate priorities as it will embed post-COVID-19 recovery principles, support private sector participation and the Bank’s climate change agenda. As such, the operation will strengthen the energy sector, provide electricity energy services to households, businesses, and enable human capital development and protection with the electrification of public institutions, productive uses and empowerment of women. 25. Accelerating reforms to Maximize Finance for Development (MFD) and to deliver jobs and economic transformation. Creating an enabling environment for increased private sector participation is key to improve access to services and address supply constraints, particularly to develop new renewable generation capacity and the solar market. With calibrated technical assistance, the World Bank will continue to support the development of grid-scale solar and off- grid solar. The project is designed to maximize private sector participation in solar-based rural electrification for households, community infrastructures, businesses, jobs creation for women and youth. It will build on ongoing operations including NESAP and ROGEP as well as the collaboration with IFC in the development of solar mini-grids and solar home systems and solar lighting systems. The emphasis on zero-emission and low-emission electrification is critical to support Niger’s target of increasing the share of renewable energy to reach 30 percent share energy mix in the primary and final energy balance by 2030, as stated in its Nationally Determined Contribution (NDC). This is also aligned with New Generation Africa Climate Business Plan’s objectives. 26. The proposed Multiphase Programmatic Approach (MPA) fits well with the long-term vision of the Government and the strategy of the World Bank in the Sahel Region. During November 2020 roundtable on access to electricity, the World Bank, AfDB and AFD pledged US$64011 million of US$1.1 billion sought by GoN to double access by 2025. It is expected that EU will co-finance a mini grid project with AFD for US$40 million while EIB showed interest to co-finance 10 Other donors investing in the energy sector in Niger include: the French Development Agency (AFD), the African Development Bank (AfDB), the European Union (EU), the European Investment Bank (EIB), West African Development Bank (BOAD), ECOWAS Bank for Investment and Development (EBID), Islamic Development Bank (IDB), Abu Dhabi Fund for Development (ADFD), International Renewable Energy Agency (IRENA), Arab Bank for Economic Development in Africa (BADEA). 11 World Bank pledged US$340 M, AfDB US$200 M and AFD US$100 M while EU and EIB committed to support the investment when their new program is finalized during 2021. March 2, 2021 Page 9 of 13 The World Bank Niger Accelerating Electricity Access Project (Haské) (P174034) the proposed Haské Project for about US$90 million. A two-phase MPA is proposed for a total program envelope of US$560 million of IDA funding including IDA WHR funding of US$60 million. This will close the financing gap on the budget needed to increase the access rate by twofold in a foreseeable horizon. The first phase of the MPA is proposed for US$310 million. It is expected that the subsequent phase will be overlapping with the first phase to ensure continuity of support and build on the momentum expected in the first phase. The financing of the second phase will be subject to then applicable IDA terms and country borrowing limits at the time of preparation. C. Proposed Development Objective(s) 27. Accelerate access to modern energy services for households, public institutions and businesses in Niger through grid, off-grid and clean cooking solutions. Key Results (From PCN) • People provided with new or improved electricity service (number) (Corporate Results Indicator), of which women (%). • Generation capacity of energy constructed or rehabilitated (MW) (Corporate Results Indicator) • Beneficiaries with new or improved access to electricity and clean cooking in refugee camps and host communities (Number) • People provided with new or improved clean cooking solutions under the project (number) 28. The ultimate project beneficiaries will be households, businesses, and public institutions in Niger through the following channels: (a) a portion of the currently unelectrified households will get electricity connections (on-grid or off- grid); (b) the quality and reliability of electricity services will improve, enabling households and businesses to make better and productive use of electricity; (c) households using biomass for cooking are expected to get health and economic benefits by switching to cleaner cooking options; and (d) a portion of currently unelectrified public institutions in Niger, including schools and health centers, will get electrified. By supporting electrification through solar off-grid solutions the project will help reduce greenhouse gas emissions if equivalent electricity were sourced from fossil fuel-based utility-scale power plants or emergency diesel power plants. NIGELEC, the implementing agency, will also be a direct beneficiary of the project as it is expected to benefit from higher cost-recovery through improved operational efficiency (lower technical and commercial losses), and potentially higher revenues through increased electrification rate and improved quality of service. D. Concept Description 29. The proposed project aims to accelerate access to electricity in Niger and support the implementation of the NES by financing the construction of various electricity infrastructure to support human capital development. The considered infrastructure includes transmission and distribution backbones and extensions, mini-grids and standalone systems and connect new consumers and public institutions (health facilities, schools, water boreholes, public lighting). It will also support the deployment of clean cooking solutions. The project has five components. 30. Component 1. Reinforcement and expansion of transmission and distribution networks for Increasing Access to Grid Electricity (Estimated Cost: US$195 million of which IDA US$195 million) March 2, 2021 Page 10 of 13 The World Bank Niger Accelerating Electricity Access Project (Haské) (P174034) 31. This component will enable grid access by building the transmission and distribution backbones, upgrading and densifying existing distribution networks. This component will also facilitate the integration of more renewable energy over time and include specific measures to ensure the resilience of the infrastructure to geophysical and climate risks. The component will transform and reshape the electricity systems in Niger linking the Western grid (Zone Fleuve - ZF) and the Center-Eastern Grid (Niger Centre-Est - NCE), which are the two largest grids, representing 90 percent of the electricity consumed in the country. The component will consist in the construction of a 270 km double circuit 132-kV line or single circuit 330-kV line and 3-4 substations connecting Zabori (ZF) to Malbaza (NCE) through Doutchi and Konni. Finally, this component will include the construction of new medium voltage (MV) distribution backbones as well as low voltage (LV) networks to electrify new localities targeting development hubs in this first place. Localities will be selected among 1,997 rural development hubs to drive economic growth. 32. Component 2. Reinforcing the Ecosystem for the Development of Solar Mini-Grids Electricity for Rural Areas (Estimated Cost: US$40.00 million equivalent, of which IDA US$40.00 million). 33. This component will scale up and reinforce activities under the Niger Solar Electricity Access Project (NESAP) by supporting two streams of activities: (i) the development of private sector led new solar mini-grids, and (ii) the solar hybridization and densification of existing diesel-powered mini grids to provide access to new consumers as well as improving access for existing users. 34. Component 3. Increasing Access to Solar Off-Grid Electricity for Public Institutions, Households and Productive Uses and Clean and Efficient Cooking Solutions (Estimated Cost: US$47.50 million equivalent, of which IDA US$40.00 million and CCF US$7.5 million) 35. This component will support the development of human capital by electrifying social infrastructures including schools, health centers and drinking water pumping systems, in rural areas not identified for electrification through mini grids or the main grid. The component will leverage on achievements and learning from the implementation of the ongoing NESAP project. It will also facilitate the acquisition of solar lighting systems (SLS), solar home systems (SHS), solar applications for productive uses and Clean and Efficient Cooking (CEC) solutions for households and small businesses, specifically targeting vulnerable and female-headed households and women-led businesses when applicable. It would consider distributing SLS and clean and efficient stoves and provide public lighting in selected refugees’ areas (host communities and forcibly displaced people). The multiphase programmatic approach will enable the testing of various business models to address a number of barriers that prevent the development of off-grid solar and clean cooking market. 36. Component 4. Utility Operational Improvement, Institutional Strengthening, Technical Assistance and Implementation Support (Estimated Cost: US$30.00 million equivalent, of which IDA US$30.00 million) 37. The project will finance: (i) a revenue protection program to reduce commercial losses through an advanced metering infrastructure and control center; (ii) an incident management system coupled with the distribution control center; (iii) upgrade of customers management and billing systems. It supports the enterprise communication plan to rebrand the company image, the digitalization of the internal processes as wells as promotion of household energy efficiency, trainings for young managers to rebuild NIGELEC’s manager pools and to also improve its gender equality. The activities to be financed will be defined by the ongoing study on an emergency plan that encompasses all the issues aforementioned. 38. The Project will finance institutional capacity of the Ministry of Energy (MoE), ARSE and ANERSOL, including (a) strengthening the planning capacity for the MoE for electrification and generation that promote a low-carbon March 2, 2021 Page 11 of 13 The World Bank Niger Accelerating Electricity Access Project (Haské) (P174034) technologies; (b) improvement of the regulatory framework supporting ARSE; (c) strengthening capacity stakeholders on development of new power generation projects, mainly solar power, including studies, and advisory services for private sector participation; (d) trainings and South-South exchange energy sector issues. 39. The subcomponent covers all activities related to project implementation for NIGELEC and ANPER, including the recruitment of additional project staff, the purchase of vehicles for site supervision, the acquisition of computers and office equipment, training, audits, and other operational costs. In the project arrangement assessment, possibility for implementing an e-procurement platform will be considered and financed, if deemed appropriate to improve implementation and lower fiduciary risks. 40. Component 5. Contingent Emergency Response Component (Estimated Cost: US$0.00). 41. This Contingent Emergency Response Component (CERC) is added to provide the needed space for quick responses to natural disasters or health crisis to protect people livelihoods, if needed, as part of the World Bank projects portfolio contributions in mobilizing financial resources to support the Government’s emergency plan. Legal Operational Policies Triggered? Projects on International Waterways OP 7.50 No Projects in Disputed Areas OP 7.60 No Summary of Screening of Environmental and Social Risks and Impacts . The environment and social risk to the project are rated Substantial due to the large scale nature and complexity of the project as well as the capacity issues related to developing off-grid solutions. Environmental impacts are localized and can be managed if effectively implemented by the Government- this includes issues in the right of way related to preservation of biodiversity, and proper management of hazardous waste materials. On the social side, while no resettlement is anticipated, other issues such as GBV, restricted land access, particularly in the right of way, and worker occupational health and safety issues are key issues to assess in the ESMF. . CONTACT POINT World Bank Affouda Leon Biaou Senior Energy Specialist Borrower/Client/Recipient Government of the Republic of Niger Aichatou Boulama Kane Ministry of Planning March 2, 2021 Page 12 of 13 The World Bank Niger Accelerating Electricity Access Project (Haské) (P174034) aichatou.boulama.kane@gamil.com Implementing Agencies Société Nigerienne d’Electricité (NIGELEC) Arzika Mahamadou Secretary General arzikam@yahoo.fr Agence Nigérienne pour la Promotion de l'Electrification en milieu Rural (ANPER) Salouhou Hamidine Director General shamidine12@gmail.com Agence Nationale d'Energie Solaire (ANERSOL) Mariama Sido Director General nsido2003@yahoo.fr FOR MORE INFORMATION CONTACT The World Bank 1818 H Street, NW Washington, D.C. 20433 Telephone: (202) 473-1000 Web: http://www.worldbank.org/projects APPROVAL Task Team Leader(s): Affouda Leon Biaou Approved By APPROVALTBL Country Director: Joelle Beatrice Dehasse 01-Apr-2021 March 2, 2021 Page 13 of 13