23 November 2012
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African Development Bank (Abidjan)

The Bank Group Policy On Energy Sector Approved By the Board of Directors

press release

The Board of Directors approved, on 26 September 2012, the revised Bank Group Energy Sector Policy. This policy supersedes the 1994 Bank Group Energy Sector Policy and the 1985 Framework for Public Utility Tariff Policy previously applied to Electric Power, Telecommunications, Water Supply and Sanitation operations. It is the product of broad based and transparent consultations internally within the Bank Group and externally with key stakeholders including the regional member countries (RMCs), regional economic communities (RECs), the private sector, development partners and the civil society.

The new "Energy Sector Policy" provides a general framework that will help the bank face a dual challenge: addressing the continent's energy needs in order to unlock its development potential while responding to energy related local and global environmental concerns, especially climate change, and sustainably reducing reliance on fossil fuels. The policy advances therefore the following objectives: (i) to support Regional Member Countries (RMCs) in their efforts to provide all of their populations and productive sectors with access to modern, affordable and reliable energy infrastructure and services; and (ii) to assist RMCs develop their energy sector in a socially, economically and environmentally sustainable manner.

Increasing access to energy for all remains a priority for the bank, given the urgent need for more cost-effective powering to boost the continent's economic activity and enhance its competitiveness.

It is critical for driving faster economic growth and equitable social development. To that end, the Bank will help its RMC's to harness their energy resource endowments to ensure energy security and expand access to affordable and reliable energy services. It will adopt a demand-driven approach customized to RMCs/RECs' specific circumstances, resource endowments and priorities.

However, to ensure that its efforts to increase access to energy for all does not undermine its commitment to social and environmental sustainability, the AfDB will help its clients (i) assess different energy options against their ability to achieve such objectives; and (ii) gradually adopt a sustainable low-carbon growth path, underpinned by the three levers :renewable sources, energy efficiency and clean technologies.

To effectively deliver on the policy, medium-term Energy Strategies proposing result-oriented operational action plans will be developed under the leadership of the Energy, Environment and Climate Change Department. The bank will ensure mainstreaming of the energy dimension in its policies, strategies and operations. It will also step up its efforts to mobilize resources, invest in the development of staff skills, and engage in strategic partnerships.

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