The Power of Renewable Energy : Fostering Investment and Competition to Generate Electricity

Renewable energy is a viable, cost-effective way to provide power to rural and remote areas, lower electricity generation costs over time, and reduce costly power outages. Renewable energy technologies could benefit the nearly 1.5 billion people who lack electricity access — 85 percent of whom are in rural areas — and reduce losses for firms due to power outages (which are equivalent to about 8 percent of their sales in low-income countries). This note discusses key steps for opening the power sector to renewable energy projects in developing countries while encouraging efficient, competitive markets. It recommends policy approaches, measures to ease entry, and ways of reducing investor risks for on- and off-grid renewable energy projects