Lesson Learned

Selection of Results-Based Financing (RBF) Key Performance Indicators (KPIs) should give consideration to payment metrics that may appear to be out of the control of the receiving entity when there is sufficient political or other motivations that can impact the result.

Selection of Results-Based Financing (RBF) Key Performance Indicators (KPIs) should give consideration to payment metrics that may appear to be out of the control of the receiving entity when there is sufficient political or other motivations that can impact the result. The threshold program provided support to stand up the new regulator, the Electricity and Water Regulatory Commission (EWRC). Under the RBF activity, EWRC was assigned KPIs related to regulations, performance monitoring of the utilities, public outreach and tariff setting. In particular, one KPI on the passing of regulations by parliament within a given timeframe was ambitious and not directly within EWRC's control. A key principle of the RBF structure is to link KPIs to areas that are directly in the control of the receiving entity. Nevertheless, eight out off the nine regulations submitted were passed. While EWRC received only partial payment on this KPI, the high visibility of the RBF program, strides made in increasing EWRC's legitimacy due in part to the threshold program, and advocacy from the MCA entity and electricity sector stakeholders likely contributed to the passing of the regulations.