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Rwanda: Electricity Tariff Reform

Author

Listed:
  • Angel-Urdinola, Diego
  • Cosgrove-Davies, Malcolm
  • Wodon, Quentin

Abstract

Rwanda is facing a severe electricity crisis. Higher demand and production cost as well as a reduction in revenues in real terms have led to large operating losses for the electricity operator Electrogaz. In order to deal with this crisis, a doubling of electricity tariffs was recently approved, from a flat rate of RWF 42/kwh to a flat rate of RWF82/kwh. This flat rate may not be appropriate to protect some of the poorer residential customers of Electrogaz from the necessary increase in the average level of electricity tariffs. For this reason, Electrogaz has recently proposed to implement an Inverted U Block Tariff Structure. The objective of this paper is to provide a preliminary assessment of the distributive properties of the new tariff proposal, as well as simulations for the properties of alternative tariff designs using recent household survey data. The results show how simple techniques can be implemented fairly rapidly in order to assess the benefit incidence and poverty impact of policy proposals.

Suggested Citation

  • Angel-Urdinola, Diego & Cosgrove-Davies, Malcolm & Wodon, Quentin, 2006. "Rwanda: Electricity Tariff Reform," MPRA Paper 9044, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:9044
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    File URL: https://mpra.ub.uni-muenchen.de/9044/1/MPRA_paper_9044.pdf
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    References listed on IDEAS

    as
    1. repec:ebl:ecbull:v:9:y:2007:i:4:p:1-7 is not listed on IDEAS
    2. Diego Angel-Urdinola & Quentin Wodon, 2007. "Do Utility Subsidies Reach the Poor? Framework and Evidence for Cape Verde, Sao Tome, and Rwanda," Economics Bulletin, AccessEcon, vol. 9(4), pages 1-7.
    3. Antonio Estache & V. Foster & Q. Wodon, 2002. "Accounting for Poverty in Infrastructure Reform: Learning from Latin America's Experience," ULB Institutional Repository 2013/44108, ULB -- Universite Libre de Bruxelles.
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    Citations

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    Cited by:

    1. Banerjee, Sudeshna & Wodon, Quentin & Diallo, Amadou & Pushak, Taras & Uddin, Elal & Tsimpo, Clarence & Foster, Vivien, 2008. "Access, affordability, and alternatives: Modern infrastructure services in Africa," MPRA Paper 27740, University Library of Munich, Germany.
    2. Wodon, Quentin & Banerjee, Sudeshna & Diallo, Amadou Bassirou & Foster, Vivien, 2009. "Is low coverage of modern infrastructure services in African cities due to lack of demand or lack of supply ?," Policy Research Working Paper Series 4881, The World Bank.
    3. repec:ebl:ecbull:v:9:y:2007:i:4:p:1-7 is not listed on IDEAS
    4. Blanca Moreno-Dodson & Quentin Wodon, 2008. "Public Finance for Poverty Reduction : Concepts and Case Studies from Africa and Latin America," World Bank Publications - Books, The World Bank Group, number 6881.
    5. Angel-Urdinola, Diego & Wodon, Quentin, 2008. "Assessing the Targeting Performance of Social Programs: Cape Verde," MPRA Paper 11072, University Library of Munich, Germany.
    6. Lin, Boqiang & Jiang, Zhujun, 2012. "Designation and influence of household increasing block electricity tariffs in China," Energy Policy, Elsevier, vol. 42(C), pages 164-173.
    7. Elena Bardasi & Quentin Wodon, 2008. "Who pays the most for water? Alternative providers and service costs in Niger," Economics Bulletin, AccessEcon, vol. 9(20), pages 1-10.
    8. Diego Angel-Urdinola & Quentin Wodon, 2007. "Do Utility Subsidies Reach the Poor? Framework and Evidence for Cape Verde, Sao Tome, and Rwanda," Economics Bulletin, AccessEcon, vol. 9(4), pages 1-7.
    9. repec:ebl:ecbull:v:9:y:2008:i:20:p:1-10 is not listed on IDEAS

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    More about this item

    Keywords

    Electricity tariff; Poverty; Impact Analysis;
    All these keywords.

    JEL classification:

    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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