RY-RURAL ELECTRIFICATION & REN. EGY DEV

The proposed project will address GEF strategic priorities as following: (1) Productive uses of renewable energy in agriculture, water, education, telecommunications, and rural industry (OP#6). With the focus on rural electrification issues, this project will include rural electricity for productive uses and social benefits, with possible applications of renewable energy in enterprise development. Sustainable models for joining renewable energy to income generation will be demonstrated so that they can be replicated; and (2) Power sector regulatory frameworks and policies for grid-based renewable energy (OP#6). The project preparation will also address grid-connected renewables, particularly generation from wind. The priority will be development of power sector regulatory frameworks and policies that provide fair and competitive grid access to renewable energy producers. The proposed MSP will include two main components. These are: (a) Rural and Renewable Energy Policy Support Component: This component is targeted at creating a comprehensive Rural Electrification Strategy and an enabling environment for renewables in the context of the ongoing power sector reforms. Specifically, support will be provided for the development of: (i) a National Rural Electrification Strategy; (ii) a national renewable energy strategy; (iii) an appropriate institutional and legal/regulatory framework; and (iv) Test pilot scale service delivery models for renewable energy (wind/solar/bio-mass) based on physical implementation of one/two projects. Based on this technical/business demonstration, potential for private sector activation, development and support will also be assessed (b) Market Assessment Component: In order to build on the policy development undertaken in component (a) and scale-up renewable energy development, it would be important to understand the market size for such technologies in Yemen. This component is focused on establishing the exploitable potential for renewables, market barriers and readiness and consumer readiness and will build on findings of the ongoing ESMAP funded Household energy study. Under this component, specific support will be provided for: (i) development of wind/solar atlas; (ii) Market assessment for solar home systems (SHS) and renewable energy based community size grid operations for residential as well as productive uses; private sector potential assessment. 11/18/04 Minor delays were caused because of confirming cofinancing arrangements and Eid vacations in Yemen. The MSP document (Request for Financing) is now expected to be sent to the GEF on 11/23/04. 04/13/05. Grant Agreement dated 2/4/05 was counter-signed on February 21, 2005. The planned closing date is February 28, 2007. 11/11/08. Completion memo for the MSP is under preparation and will be delivered by December 2008.