Power for Development: A Review of the World Bank Group's Experience with Private Participation in the Electricity Sector (Independent Evaluation Group Studies)

Power for Development evaluates the performance of the World Bank Group during the 1990s in promoting private sector development in the electric power sector. This joint review aims to inform the implementation of the World Bank Group's 2001 Energy Business Renewal Strategy and the 2003 Infrastructure Plan. It is based on an evaluation of the World Bank Group's assistance for private sector development of the electric power sector in 80 countries.

The main messages of the report are:

- The World Bank Group should continue to support private sector development in the electric power sector as a key objective. Well-implemented Bank Group activities in this area can improve sector efficiency in countries politically committed to the advancement of power sector reforms.
- Outcomes of International Finance Corporation and Multilateral Investment Guarantee Agency transactions have been positive, but the Bank's project-level outcomes were disappointing, mostly because the Bank underestimated the complexity and time required for reforms to achieve lasting and equitable outcomes. At the sector level, outcomes have been poor or, at best, mixed, except in countries fully committed to reforms.
- Private sector development of the electric power sector is a work in progress because the power sector reform process is complex, takes time, is resource-intensive, and requires phasing and careful sequencing to create the conditions for sector transformation.
- Much work remains to integrate poverty reduction and environmental mainstreaming into the design of power sector reform and related strategies, which to date have focused mostly on sector efficiency and macro-fiscal objectives.