CROSS CUTTING | Energy Sector Governance, Planning and Markets

Meeting the SDG7 2030 targets of universal access, energy efficiency and renewable energy requires strong financial health of the energy sector, adequate skills in energy system planning, predictable and independent regulatory frameworks which enable cost-recovery pricing, and clear sector and market rules for new capacity addition, system operation and dispatch.

ESMAP has a long-standing record of engagement with client country governments on the full spectrum of issues of energy sector performance and of leveraging development financing and private sector participation. For decades, ESMAP has provided targeted assistance to help governments review, design, and implement energy policies, develop the system planning capacity, and advance the efficiency of the energy markets through better governance arrangements and market designs. 

This targeted assistance has had a measurable impact on World Bank operations. ESMAP’s most recent portfolio review estimates that between FY2014 and FY2016, 50 completed activities in 33 countries funded by a total of $9.8 million in annual block grants (ABG) informed a $1.2 billion lending portfolio of World Bank operations supporting the objectives of governance, markets and planning under the Energy Assessments and Strategies Program area of ESMAP.

Under its Business Plan for FY2017-20, activities falling within the broad cross-cutting area of energy sector Governance, Planning, and Markets (GPM) continue to be supported through ABGs to World Bank regional energy units. This support is demand-driven and flexible, with key strategic areas of focus identified in consultation with the regions as follows:

Energy Sector Reform

  • Technical assistance to government bodies, regulators and system operators on effective institutional/governance structures for greater market efficiency, private sector participation, and technological innovation

  • Advice on regulatory incentives for expanded energy access

  • Advice on cutting-edge options for efficient and competitive market design

  • Advice on market structures and pricing conducive to variable renewable energy integration

Power System Planning, including support to programs/projects involving transfer of tools to clients and associated training; and

Regional Integration of Infrastructure, including technical assistance to power trade institutions.