The Millennium Challenge Corporation and the Government of Sierra Leone are partnering on a $44.4 million threshold program to implement policy reforms, build institutional capacity, and improve governance in the water and electricity sectors in Sierra Leone, with a focus on Freetown. By establishing independent regulations, strengthening key institutions, and increasing transparency and accountability, the program seeks to create a foundation for the delivery of financially sustainable water and electricity services, while limiting opportunities for corruption in the delivery of these services.
The partnership comes as the country emerges from the devastating Ebola outbreak and seeks to regain eligibility for an MCC compact. The investment also enhances the U.S. Government’s Power Africa engagement in Sierra Leone.
Regulatory Strengthening Project
The Regulatory Strengthening Project is designed to operationalize and build capacity at the newly formed Electricity and Water Regulatory Commission. MCC’s investments will help the regulator set tariffs, develop policies and procedures, monitor the performance of utilities, and collect corruption reports. The project will also fund a results-based financing system designed to strengthen the regulator’s role, incentivize performance by the utilities, and enhance accountability.
Water Sector Reform Project
The Water Sector Reform Project aims to improve overall sector governance, performance, and accountability by building capacity at the Freetown water utility – Guma Valley Water Company (GVWC). The project includes a demonstration activity to test new strategies for reducing water losses and combatting illegal connections, and a pilot activity to assess the viability of a new, private sector-led management model for public water fountains.
Electricity Sector Reform Project
The Electricity Sector Reform Project will help the Government of Sierra Leone effectively operationalize a new framework and market structure for the country’s electricity sector following recent unbundling. MCC assistance includes support to enhance governance and coordination, strengthen integrated planning capacity, and provide targeted technical assistance for the newly unbundled utilities.
The Millennium Challenge Coordinating Unit (MCCU), which the Government of Sierra Leone established in 2013 to develop its MCC proposal, manages and implements MCC’s investment. MCCU ensures coordination among various beneficiary institutions and has responsibility over the program’s financial management, procurement, contract administration, planning, reporting, and public outreach. MCC coordinates closely with MCCU to provide project oversight, and monitor and evaluate results.
|Sierra Leone Threshold Program Budget|
|Regulatory Strengthening Project||$11,275,000|
|1. EWRC Institutional Strengthening Activity|
|2. Incentive-Based Regulation Activity|
|Water Sector Reform Project||$16,000,000|
|1. Water Sector Roadmap and Coordination Activity|
|2. Guma Valley Water Company Institutional Strengthening Activity|
|3. District Metering Area and Standpipe Demonstration Activity|
|Electricity Sector Reform Project||$11,910,000|
|1. Electricity Sector Roadmap and Coordination Activity|
|2. Institutional Strengthening Activity|
|Monitoring and Evaluation||$1,665,000|
|Threshold Program Total||$44,400,000|