The Inter-American Development Bank (IDB) approved a $35 million grant to support Haiti's efforts to modernize its energy sector and improve the financial and operational management of the state power company, Electricité d'Haïti (EDH).

The new, fast-disbursing grant is the first of three policy-based operations the IDB expects to make over three years to help Haiti develop a reliable and sustainable electricity system. At present, about 70 percent of its population has no access to electricity. In areas with coverage, service averages 10 hours a day but is plagued by outages. Available generation capacity stands at less than one-third of the estimated 500 megawatt demand.

In coordination with other international donors, the IDB has provided Haiti grant resources to repair electricity infrastructure affected by the 2010 earthquake. The Bank is also supporting the rehabilitation of the Péligre hydroelectric plant, the use of solar energy and EDH's efforts to reduce technical and commercial losses by upgrading its equipment and boosting billing and collection efficiency.

The policy-based grants will assist the Haitian government in carrying out a broad reform program aimed at expanding access to energy for urban and rural households, reducing the country's reliance on fossil fuels for power generation, improving the reliability of electricity services and transforming EDH into a viable utility. Another goal is to encourage more households to switch to liquefied petroleum gas from charcoal, the most commonly used cooking fuel in Haiti.

Combined with public and private investments, these reforms will enable Haiti to establish a robust regulatory and institutional framework to promote the expansion of its energy sector. The Haitian government is already taking steps to improve EDH's financial, commercial and operational performance by strengthening its management.

HL/ HaitiLibre / IDB