Comprehensive Planning for Electric Power Supply in Haiti: Regulatory, Institutional and Tariff Report

This is the regulatory and tariff companion to OLADE's generation-expansion volume for Haiti, produced under the same consulting engagement. Its diagnosis is political rather than technical. Haiti has no ministry dedicated to energy even though the sector accounted for close to 20 percent of GDP in 2013, and EDH sits under direct MTPTC supervision as a vertically integrated public monopoly with about 105 MW of installed capacity operating at a utilization factor below 50 percent because of network problems, maintenance and fuel supply. The report describes the result as a vicious circle: pricing decisions, petroleum subsidies and EDH's engineered financial dependence are all treated as expressions of centralized political control, which distorts the sector's financial reality and leaves the utility wholly dependent on donor and government transfers while unable to plan capacity or fund the vehicles, monitoring equipment and meters needed to attack commercial losses.

On tariffs it documents a customer base of roughly 170,000 residential accounts on the RE code, about 12,000 small commercial accounts on the CO code, and medium-voltage industrial customers, with a substantial share of residential customers unmetered and billed a flat fee. Rates as of 2013 ran between 13.4 and 14 gourdes per kWh, or 33 to 34 US cents, with little separation between residential and large-customer rates. The critique is specific: the industrial and large-consumer price is overvalued through a subsidy mechanism, the last increase and the 2009 price determination rested on no economic study, there is no regionalization and a single national price applies per customer category, the tariff reflects neither commercial nor technical losses, and no indexation tracks production costs.

The proposed framework would amend regulation to draw in private producers and investors, give them a stable environment and reduced financial risk, enable an effective fight against fraud-driven losses, limit state intervention to what market forces allow, and keep a temporary role for the state in cushioning disadvantaged groups through the transition to an open market. The 2001 draft Electrical Code is treated as a sound starting point. Structurally the report recommends transferring the segments requiring the largest capital investment under a concession form, refocusing EDH on exclusive commercialization of electricity, using independent network operators under BOOT contracts that return assets in good condition with a knowledge-transfer transition, and creating a planning office to align government objectives with project selection. Chile is examined as a comparator. On generation it notes that new capacity need not be immediate if loss control succeeds, but projects that from roughly the fourth year of reform Haiti would need additions, and suggests an LNG port and terminal to enable gas-fired plants as the cheapest and less polluting route given fragile EDH finances.