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Power Sector Structure, Public Sector Entities and Established Roles

Need for an adequate institutional framework. An effective and successful implementation of the Rural Energy Master Plan requires not only adequate funding, but also competent and well aligned entities with clear roles for implementation, both on the public and private sectors.

2015 Electricity law of Liberia. The Senate and House of Representatives of the Republic of Liberia approved in October 2015 a bill entitled 2015 Electricity Law of Liberia. The new electricity law sets the guiding principles for the power sector organization and gives some guidance on the roles of the different entities without too much detail. The Law offers sufficient flexibility for different institutional approaches regarding rural energy. The Master Plan study evaluated different alternatives, all with pros and cons, and proposes the ones with the potential to be more effective.

Power sector structure. Although now-a-days all power sector activities are provided by Liberia Electricity Corporation, the new Electricity Law structures the power sector in the following different activities which all – except system operation - can now be licensed to the private sector:

  • Generation;
  • Transmission;
  • Transmission system operation;
  • Distribution;
  • Import and export of electricity;
  • Trading of electricity.

Micro-utilities. Micro utilities or operations, such as “Community Current” – common business in Liberia where an entrepreneur operates and distributes power from a small diesel generator – can be exempted from licensing.

LEC. LEC is the State owned Utility which by law continues to be the transmission system operator and the national grid company and is entitled to engage in all other activities at its election. As transmission system operator LEC has to guarantee an instantaneous balance at any given time between the total generation and the total consumption of power taking account of the power exchanges with interconnected foreign systems. The role and scope of the “National Grid Company” is not clearly defined in the Law.

Ministry of Lands, Mines and Energy. Ministry is responsible for the formulation and development of national energy policies and the administration of the Law.

Liberia Electricity Regulatory Commission. LERC is the newly created regulatory agency in charge of licensing activities, issuing regulations to implement the electricity law, approving tariff setting methodologies and to establish, monitor and enforce technical, performance and security regulations and standards.

Rural and Renewable Energy Agency. RREA is an autonomous agency owned by the Government of Liberia with the objective of acting for and on behalf of the Government to promote energy access in rural areas with an emphasis on locally available renewable resources.