If HIER wants to raise the tariff, it should make the request formally to ORE (The Regulator). However, in practice, tariff increases are more limited by consumers’ ability to pay than they are limited by the regulator. The operator receives subsidies from ADER only for the initial investments. The initial capital subsidy is fixed at 75 percent of the amount needed, but to this day the subsidy remains promised but unpaid. For any grid extension and ongoing maintenance, HIER must put in its own cash or finance the expense. Coverage and service standards The service area and the setting minimum coverage levels are all determined in the bidding documents prior to contract signature and agreed with the mayor of the city. Main challenges and problems Low income levels Subsidies not paid when promised Transformers damaged and no money to fix them Limited number of customer for some projections for Ankilizato and Soavina were very badly established (425 projected vs. 210 actual for Ankilizato and 375 projected vs. 170 actual for Soavina) Limited network extension due to finance, customers and isolated areas. Contact details for concessionaire Name of Manager André FILLET Email Address Phone Number +261 20 22 543 71 or +261 34 02 228 01 Small Concessionaire Case Study – CASIELEC Overview Concessionaire CASIELEC operates 16 concession mini-grids, serving a total of 2,913 connections in several areas of Madagascar. The company operates 16 generation plant using diesel, biomass with rice husk and dual fuel technology. The company has been in business for about 10 years. Formation of the company, background and motivation CASIELEC started as a small scale individual company. The owner, Mr. Ranaivo Casimir worked at JIRAMA for 15 years and later moved to the rural electrification agency ADER. He got into the business because he wanted to help the rural population. When ADER launched the first expression of interest, there were no interested bidders.
If HIER wants to raise the tariff, it should make the request formally to ORE (The Regulator). However, in practice, tariff increases are more limited by consumers’ ability to pay than they are limited by the regulator. The operator receives subsidies from ADER only for the initial investments. The initial capital subsidy is fixed at 75 percent of the amount needed, but to this day the subsidy remains promised but unpaid. For any grid extension and ongoing maintenance, HIER must put in its own cash or finance the expense. Coverage and service standards The service area and the setting minimum coverage levels are all determined in the bidding documents prior to contract signature and agreed with the mayor of the city. Main challenges and problems Low income levels Subsidies not paid when promised Transformers damaged and no money to fix them Limited number of customer for some projections for Ankilizato and Soavina were very badly established (425 projected vs. 210 actual for Ankilizato and 375 projected vs. 170 actual for Soavina) Limited network extension due to finance, customers and isolated areas. Contact details for concessionaire Name of Manager André FILLET Email Address Phone Number +261 20 22 543 71 or +261 34 02 228 01 Small Concessionaire Case Study – CASIELEC Overview Concessionaire CASIELEC operates 16 concession mini-grids, serving a total of 2,913 connections in several areas of Madagascar. The company operates 16 generation plant using diesel, biomass with rice husk and dual fuel technology. The company has been in business for about 10 years. Formation of the company, background and motivation CASIELEC started as a small scale individual company. The owner, Mr. Ranaivo Casimir worked at JIRAMA for 15 years and later moved to the rural electrification agency ADER. He got into the business because he wanted to help the rural population. When ADER launched the first expression of interest, there were no interested bidders.
116643-WP-PUBLIC-P150241-52p-Detailed-Case-Study-Madagascar.docx