JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI CASE STUDY Job Creation Potential of the Clean Energy Transition JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 1 JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI CASE STUDY Job Creation Potential of the Clean Energy Transition ABOUT ESMAP The Energy Sector Management Assistance Program (ESMAP) is a partnership between the World Bank and over 20 partners to help low- and middle-income countries reduce poverty and boost growth through sus- tainable energy solutions. ESMAP’s analytical and advisory services are fully integrated within the World Bank’s country financing and policy dialogue in the energy sector. Through the World Bank, ESMAP works to accelerate the energy transition required to achieve Sustainable Development Goal 7 (SDG7), which ensures access to affordable, reliable, sustainable, and modern energy for all. It helps shape World Bank strategies and programs to achieve the World Bank's Climate Change Action Plan targets. Learn more at: https://www.esmap.org. © November 2023 | International Bank for Reconstruction and Development / The World Bank 1818 H Street NW, Washington, DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org This work is a product of the World Bank, with contributions given by the staff and consultants listed in the acknowledgments. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of the World Bank, its Board of Executive Directors, or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of the World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. 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Contents Acknowledgments v About this Report vi Acronyms vii Key Findings viii 1. Introduction 1 2. Summary of Relevant Energy Interventions 5 3. Overview of the Labor Market 13 4. Identification and Quantification of Direct, Indirect, and Induced Jobs 17 5. Results 21 6. Conclusion 31 References 35 Appendix A: Details on Direct Jobs 37 Appendix B: Dinkelman (2011) Estimates of Employment Impacts of Electricity Access 61 JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI iii List of Tables and Figures List of Tables Table 1. PDO-Level Indicators 8 Table 2. Percentage Distribution of Working-Age Population (Aged 15 Years and Above) 14 Table 3. Overview of Data Sources 18  verview of Direct Jobs during the Implementation Phase, by Project, Contract Table 4a. O Type, and Skill Level 22 Table 4b. Contract-Level Direct Jobs during the Implementation Phase, by project 23 Table 5. Estimated Employment Impacts of Access in Malawi 26 Table 6. Relation Between Employment and Outages by Firm and Year 27 Table 7. Direct, Indirect, and Induced Jobs in Malawi 31 Table A.1 Contract-Level Direct Jobs (ESSP) 37 Table A.2 Contract-Level Use and Value of Inputs (Energy Sector Support Project) 43 Table A.3 Contract-Level Use and Value of Inputs 51 List of Figures Figure 1. Theory of Change for the Energy Sector Support Project 33 iv  ONTENTS C Acknowledgments This work was made possible by the Energy Sector Management Assistance Program (ESMAP) with financial support from the Royal Ministry of Foreign Affairs of Denmark. ESMAP is a partnership between the World Bank and 19 donors to help low- and middle-income countries reduce poverty and boost growth through sustainable energy solutions. The report was prepared by a team coordinated by Zuzana Dobrotková (Senior Energy Specialist) and comprising of Sheoli Pargal (Lead Energy Economist), Anna Aghababyan (Senior Operations Officer) and Anders Pedersen (Senior Energy Specialist). The work was initiated under the guidance of Rohit Khanna (Practice Manager, ESMAP) and completed under Gabriela Elizondo Azuela (Practice Manager, ESMAP), with overall strategic direction provided by Demetrios Papathanasiou (Global Director, Energy and Extractives Global Practice). A team from the consulting company Mathematica, consisting of Faraz Usmani, Duncan Chaplin, Patricia Costa, Sarah Leser, and Sara Bryk, collected background material and conducted upstream research for this case study. The team acknowledges the important inputs, insights and assistance received from Michael Chipalaule Gondwe (Senior Energy Specialist), Kagaba Paul Mukiibi (Senior Energy Specialist) and Zhengjia Meng (Senior Energy Specialist) and World Bank consultants Stephanie Pinnington, Nicolas Fichaux and Kavita Rai. Editor: Fayre Makeig. JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI v About this Report This report presents the findings and conclusions of a case study undertaken under a program of analytical work that investigates the impacts of the global transition to clean energy on the quantity and quality of jobs in low- and middle-income countries. Under the program, entitled “Estimating the Job Creation Potential of the Clean Energy Transition,” the World Bank’s Energy Sector Management Assistance Program (ESMAP) undertook multiple streams of analysis: • A review of the literature and commonly used methodologies of investigation • Modeling of economywide job impacts of policies supporting the clean energy transition in selected countries in Sub-Saharan Africa • Case studies of the effects on employment of selected World Bank clean energy projects • Deep dives into the impact on jobs of closure of coal-fired power plants; of productive uses of electricity associated with mini grids in Nigeria; and of the Rusumo Falls Hydropower Project. Building on the above-mentioned steams of analysis, the program has also produced a high- level report summarizing its findings and conclusions “Jobs for a Livable Planet: Job Creation Potential of the Clean Energy Transition” and a discussion paper to support project design “Tracking Jobs in Projects Focused on Clean Energy and Productive Uses of Electricity”, providing strategies for tracking and enhancing job creation that can be used in the clean energy projects. The reports developed under this program together aim to support low- and middle-income countries in reaping greater socioeconomic benefits from the energy transition by supporting them in increasing the number and quality of local jobs generated while implementing clean energy projects. Realizing the benefits of the jobs created by clean energy interventions will depend on effective planning and preparation in the early stages of projects and sustained support during their implementation. The reports target multiple audiences, from policy makers to development practitioners and academics. They also aim to familiarize energy specialists with the effects of energy projects on jobs and give them tools that enable them to take account of—and, where possible, maximize—the socioeconomic benefits of the clean energy transition. The reports can be found at https://www.esmap.org/publications. vi  ABOUT THIS REPORT Acronyms ESCOM Electricity Supply Corporation of Malawi ESSP Energy Sector Support Project GDP gross domestic product GoM Government of Malawi HWG hot water geyser ICR Implementation Completion and Results Report kV kilovolt MCC Millennium Challenge Corporation MoNREE Ministry of Natural Resources, Energy and Environment MW megawatt O&M operation and maintenance PDO Project Development Objective PSRS Power Sector Reform Strategy TOC theory of change All currency is in United States dollars (US$, USD), unless otherwise indicated. JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI vii Key Findings Rural electrification projects in Malawi generated substantial direct and indirect employment opportunities, particularly in construction and skilled roles. The projects also had an impact on gender disparity in employment and highlighted the need to strengthen domestic capacity for materials and equipment production. Moreover, improved access to electricity and enhanced reliability had positive effects on job creation and enterprise development in the region. Key findings from the case study were: Direct Jobs: EESP, which focused on the construction and rehabilitation of power lines and substations, created an estimated 6,010 job-years. MCC’s larger-scale Infrastructure Development Project generated approximately 79,134 job-years, with both projects considering employment in O&M over a 50-year lifespan. Construction roles varied and included project managers, engineers, professional services workers, cable jointers, meter installers, and construction workers. Gender Disparity: Both projects employed very few women, primarily due to the predominance of construction roles, where women constitute a small fraction of the sector in Malawi. Foreign Workers: A significant number of foreign workers were employed, especially in the MCC project, where approximately 46 percent of workers were foreign. These foreign workers were mainly engaged as skilled professionals, indicating a shortage of domestic skilled labor for this type of work. Indirect Jobs: The projects generated an additional 168,341 job-years of indirect employment, primarily due to the demand for construction inputs like cables, circuit breakers, and voltage transformers. All indirect jobs were foreign because all materials and equipment were procured internationally. Capacity Constraints: The reliance on foreign procurement highlights a severe lack of capacity in Malawi, even for items that could theoretically be produced domestically, such as wood utility poles. Future clean-energy projects in low-income settings should consider addressing such domestic constraints to maximize job creation. Induced Jobs: The case study estimates that productive use of electricity in areas previously without power led to the creation of 375 new jobs. Additionally, improved electricity reliability may have been associated with a 6–7.6 percent increase in employment among registered firms, potentially benefiting 9,000 to 12,000 workers. viii  KEY FINDINGS ONE INTRODUCTION This case study seeks to shed light on the employment outcomes associated with the investments made in Malawi’s distribution network (including rehabilitation, upgrade, and expansion of priority segments of the existing distribution system) under the World Bank– financed Energy Sector Support Project (ESSP), which was approved in 2011 and closed in 2018. It also draws on a closely related project that was funded by the Millennium Challenge Corporation (MCC) through its Malawi Compact, which was in effect from 2013 through 2018. Malawi faced fiscal challenges in the early 2000s, culminating in an economic crisis prior to 2004 due to unsustainable domestic debt, which reached nearly a quarter of gross domestic product (GDP). The implementation of a strong stabilization policy in 2004, coupled with debt relief under the Heavily Indebted Poor Countries initiative, helped ease the fiscal challenges faced by the Government of Malawi (GoM) and create the fiscal setting needed to support economic growth (World Bank 2011). As a result, between 2004 and 2010, annual GDP growth averaged nearly 7 percent (World Bank 2022a). While the government’s fiscal performance did improve, unreliable power remained a key impediment to sustainable long-term growth in Malawi (World Bank 2011). For example, the country faced significant transmission-related challenges. The country’s national transmission network— comprising approximately 1,250 kilometers (km) of wood pole lines and 815 km of steel tower lines transmitting bulk power at 66 kilovolts (kV) and 132 kV, respectively, and feeding power to over 70 transformers located at 39 substations—was characterized by heavily loaded transmission lines and transformers, frequent failures, and low-quality and unreliable supply (World Bank 2011). In addition, regional disparities in system-level investments meant that the quality of the transmission network varied significantly across the country. For example, approximately 60 percent of the power distributed by the Electricity Supply Corporation of Malawi (ESCOM), the GoM-owned electric utility responsible for electricity generation, transmission, and distribution, was supplied to customers in the relatively more industrialized and populous southern part of the country, where Malawi’s power generation capacity was located. The transmission network supplying the northern areas was extremely weak and insecure, posing a major constraint on that region’s economic development (World Bank 2011). In particular, the network’s long transmission lines, which had exhausted carrying capacity and high losses due to low transmission voltage, meant that adequate power could not be transferred to the northern areas to meet existing demand even if the southern regions might have had available power. ESCOM thus routinely relied on rolling blackouts (“load shedding”) to ease the system-level demand. Similarly, the majority of the low-voltage distribution networks supplying the main load centers were overloaded, and operating beyond their design limits, thereby affecting the quality and reliability of supply (World Bank 2011). In addition, ESCOM had significant resource constraints, which implied that the maintenance of the distribution network was largely guided by the need to carry out emergency repairs, with limited investment in systematic rehabilitation and upgrades. This meant that supply interruptions due to network inadequacies and equipment failure remained a key concern even for high-priority industrial and commercial users of electricity, which were typically protected from outages due to load shedding (World Bank 2011). JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 1 Electricity supply was also insufficient to meet demand, and new capacity was urgently required in the generation system. In 2010, the installed generation capacity was approximately 290 megawatts (MW), consisting primarily of six run-of-river hydropower projects on the Shire River, which provided 98 percent of the grid-supplied electrical power (World Bank 2011). Peak demand in Malawi was estimated at about 330 MW, and demand was expected to grow at about 5 percent annually over the next decade. To address these power sector challenges, the World Bank financed the ESSP. The ESSP, which entailed $84.7 million in financing from the World Bank, was designed to complement the large-scale power sector investments of the MCC through its $351 million Malawi Compact, which was signed in 2011, came into force in 2013, and ended in 2018. Specifically, planning for the Malawi Compact commenced in 2007, whereas that for the ESSP was undertaken from 2010 onward, by which point the scope of the necessary power sector investments that would not be covered by the Compact was clear and could hence be targeted by the ESSP. The ESSP aimed to increase the reliability and quality of supply in the major load centers by supporting the strengthening and expansion of the distribution and transmission network, feasibility studies for new generation capacity, demand-side management and energy-efficiency measures, and capacity building and technical assistance for key power sector actors.1 This case study proceeds as follows: Section 2 describes relevant energy interventions and reforms carried out by the GoM in the lead-up to the ESSP to situate the investments made as part of the project within the broader context of the country’s energy sector. It also provides additional details on the activities supported by the ESSP, as well as information on broader electricity network investments made by the MCC. Section 3 describes relevant labor market conditions in Malawi prior to the ESSP’s approval. Section 4 provides an overview of the methodology and data. Section 5 presents the findings from analyses of project-level jobs and input-use data from ESCOM. Section 6 summarizes the results of the case study. Endnote Additional information about the ESSP is available at https://projects.worldbank.org/en/ 1.  projects-operations/project-detail/P099626. Additional information on the Malawi Compact is available at https://www.mcc.gov/resources/doc/star-report-malawi (MCC 2020b). 2 Introduction TWO SUMMARY OF RELEVANT ENERGY INTERVENTIONS The GoM implemented a series of energy sector reforms and interventions in the early 2000s. Key among these was the Power Sector Reform Strategy (PSRS), approved in 2003, which provided for the unbundling of ESCOM and opened the door for private sector participation in the power sector via long-term concessions in transmission and distribution, and the entry of independent power producers for new generation capacity (World Bank 2011). Consistent with the PSRS, the national parliament approved a set of power sector legislation in 2004 (including the Energy Regulation Act, the Electricity Act, the Liquid Fuels and Gas Act, and the Rural Electrification Act). However, due to implementation challenges related to power sector unbundling (partly due to the size of the national power system, which was subsequently assessed to be too small for ESCOM to be unbundled and concessioned out), the legislation did not come into effect until the end of 2007, with some provisions of the Electricity Act eventually being deferred (World Bank 2011). As part of the operationalization of the 2004 legislation, the Malawi Energy Regulatory Authority (MERA) was established with a mandate to (1) review tariff applications from ESCOM and recommend tariff changes to the GoM; (2) grant licenses for generation and distribution operators; and (3) arbitrate any commercial disputes arising under the 2004 energy legislation (World Bank 2011). To clarify the future direction of its energy sector reform agenda, the GoM prepared a “Letter of Intent” in the lead-up to the approval of the ESSP, which articulated the reforms that it intended to implement over the project’s lifetime. Specifically, the letter described how the GoM would review the PSRS and clarify the framework for private investment in the energy sector (World Bank 2011). Using its own financing as well as support from donors (including the MCC), the GoM also launched a series of new power sector interventions, including those pertaining to long-term generation potential, and transmission and distribution network upgrades: • Long-term generation potential: Given the need to urgently accelerate the development of new generation capacity to meet the country’s capacity deficit, a screening analysis was conducted by the GoM to identify potential hydropower generation sites. This was in line with the requirement under the MCC Compact (described in detail below) to prepare for the development of additional generation capacity. Based on the findings of this analysis, it committed to financing the second phase of the Kapichira Hydroelectric Power Station, and work on the site was underway by 2011 (World Bank 2011). However, the screening analysis had also identified several other candidate sites, full feasibility studies (including detailed environmental and social impact assessments) for which were urgently required as the first step in beginning their development/expansion.1 • Transmission and distribution network upgrades: Even if additional generation capacity was available, it was understood that the national transmission system, particularly to the economically promising northern region of the country, was weak and in need of reinforcement. The existing system along the Lake Malawi shoreline, for instance, was limited to 33 kV transmission capacity in some places, and a systematic strengthening of transmission capacity to the north was needed to ensure reliable supply for mining and other emerging industrial loads in that region. With support from the MCC Compact JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 5 (details below), the GoM committed to upgrading the existing lakeshore transmission system. In addition, the GoM was interested in finding funding for the construction of a new medium- or high-voltage “backbone” farther to the west, heading north from Lilongwe, the capital. Energy Sector Support Project As noted above, ESSP’s Project Development Objective (PDO) was to increase the reliability and quality of power supply in the major load centers. It aimed to do so by supporting the strengthening and expansion of the distribution and transmission network, feasibility studies for new generation capacity, demand-side management and energy-efficiency measures, and capacity building and technical assistance for key power sector actors. As such, World Bank support for the ESSP was complementary to the Bank’s prior and ongoing portfolio of energy interventions. For example, through its support for electricity network strengthening and expansion, the ESSP sought to establish a foundation for long-term economic growth through improved infrastructure, a key objective articulated in the World Bank’s 2007–11 Malawi Country Assistance Strategy. As outlined in the ESSP Project Appraisal Document (World Bank 2011), the project comprised four components: 1. Electricity network strengthening and expansion ($56.2 million): This component included the rehabilitation, upgrade, and expansion of priority parts of the existing distribution and transmission system. The component was divided into three subcomponents: a. Distribution and transmission uprating and expansion ($41.9 million): The activities under this subcomponent included the (1) construction of four new substations and associated lines; (2) uprating of five existing substations; (3) construction of new 33 kV and 11 kV lines, and installation of capacitor banks; (4) rehabilitation of 33 kV lines; (5) rehabilitation of underground cables; (6) expansion of the peri-urban network; and (7) acquisition of generation spare parts. The planned substation investments were largely expected to be “interface” substations between the 66 kV transmission system and the distribution system (i.e., with 11 kV or 33 kV as the secondary voltages). Similarly, all the lines to be built or rehabilitated were expected to be subtransmission lines at either 33 kV or 11 kV. b. Low-voltage reticulation reinforcement and technical implementation support ($10.5 million): The activities under this subcomponent covered the acquisition and installation of low-voltage (LV) reticulation goods and equipment, including (1) reconfiguration and extension of medium-voltage (MV) overhead lines (11 kV and below) supplying distribution transformers (such as pole-mounted MV/LV step-down transformers); (2) installation of approximately 111 new distribution transformers; (3) construction of new three-phase LV overhead lines and conversion of single-phase to three-phase LV overhead lines; and (4) supply of associated maintenance and 6 Summary of relevant energy interventions operation tools. This subcomponent also provided support and training to ESCOM’s existing Training School in Blantyre. This was to enhance the school’s capacity to deliver a comprehensive, hands-on training program for ESCOM technicians in industry best practices for all aspects of LV reticulation reinforcement, including the design principles of LV reticulation. c. Design, procurement, and supervision ($3.8 million): To support smooth implementation of the project, this subcomponent aimed to support ESCOM’s procurement of the services of a consulting engineering firm with international experience in the design and construction of transmission and distribution projects. The consulting engineering firm would support project preparation (including preliminary survey and design work, delineation of technical specifications, preparation of bid documents, and procurement assistance for Subcomponents 1a and/or 1b) as well as implementation (supervision of contractors, management of procured materials, and “due diligence”). 2. Generation and transmission feasibility and design studies ($15.2 million): This component included financing for feasibility studies needed to inform the development of up to 380 MW of new hydropower generation capacity in Malawi. The feasibility studies were expected to include technical, engineering design, and economic assessments; environmental and social impact assessments; and dam safety assessments; as well as the development of environmental and social mitigation/management plans. This component also included a feasibility study for a new 350 km transmission “backbone” line that would run north from Lilongwe. 3. Demand-side management and energy efficiency measures ($6.8 million): To address the severe capacity constraints in Malawi’s power system, this component aimed to finance demand-side management and energy-efficiency activities in order to reduce the peak load, which in turn would lower the incidence of load shedding and help achieve energy savings. Specifically, this component focused on the household-level use of hot water geysers (HWGs) for water heating, which accounted for a substantial share of household energy consumption. The planned activities under this component, all of which were designed to reduce peak loads, included the replacement of HWG parts, installation of “insulation blankets,” and remote management of HWGs during peak hours. 4. Capacity building and technical assistance ($3.5 million): This component aimed to provide institutional strengthening and technical assistance to ESCOM and the Ministry of Natural Resources, Energy and Environment (MoNREE) to support their efforts to further develop Malawi’s energy sector. Specifically, this component was divided into two subcomponents: a. Support to ESCOM ($0.6 million), including the provision of new software and equipment to support distribution planning and training; training in World Bank procurement, financial, disbursement, and environmental/social safeguard management; and resources for the effective management/supervision of the project. b. Support to MoNREE ($2.9 million), including support for specialized technical studies to accelerate the exploitation of renewable energy resources in Malawi (such as wind power), sectoral studies (e.g., to strengthen the institutional, legislative, regulatory, and safeguards frameworks for dam safety), independent power producer advisers to inform private sector investment in the power sector, and resources for effective project management/supervision. JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 7 Following the beginning of its implementation, the ESSP was restructured three times, as follows: • May 2015: Responsibility for a feasibility study of the “backbone” transmission line under Component 2 shifted to ESCOM, with the remainder of the studies remaining with MoNREE (World Bank 2015). • April 2016: This restructuring primarily entailed the cancellation of the demand-side management activities planned under Component 3 (due to exchange rate losses). These activities were replaced with a new activity (namely, the supply and installation of an automatic meter reading [AMR] system). The Results Framework, components, costs, and implementation schedule were also revised (namely, a 21-month extension of the project closing date to July 31, 2018) to reflect the cancellation and reallocation (World Bank 2016). • May 2018: Extension of the closing date from July 31, 2018 to October 15, 2018 (World Bank 2018). It is worth noting that while electricity access (via new household- and enterprise-level connections to the grid) was not a focus of the ESSP, the transmission and distribution investments supported by the project also created opportunities to provide new customers with electricity connections. TABLE 1 PDO-Level Indicators PDO-LEVEL RESULT INDICATORS CORE UNIT OF AT APPROVAL POST ACTUAL MEASURE (JUNE 2011) RESTRUCTURING ACHIEVED (APRIL 2016) BY PROJECT CLOSING BASELINE TARGET BASELINE TARGET (DECEMBER 2018) Indicator 1: Electricity losses per year Yes % 17.4 13.4 17.4 20 17 in the project areasa Indicator 2: Total interruption time Yes Hours per 31.2b 26.4b 32.1 25.8 19.71 per kVA installed per year in the yearb project areas Indicator 3: Average interruption New Count — — 132c 112.8c 78.6c frequency per year in the project areac, d Indicator 4: Direct project beneficiaries Yes Count (%) 0 47,000 0 (50%) 294,940 398,023 (number), of which females are (%) (50%) (50%) (51.49%) Note: PDO = Project Development Objective; kVA = kilovolt-ampere. a The decrease in losses in this table may not be solely due to technical loss reduction. The automatic meter reading system and meters likely also contributed to reducing non-technical losses. b This indicator was originally expressed in hours per month at baseline but was later modified to hours per year after restructuring. c The original baseline and target values were inaccurately presented as monthly instead of annual. The table now presents equivalent annual values for baseline, target, and achievement. d The Project Appraisal Document (World Bank 2011) initially included an indicator for "Customers served in the project area," but it was removed during restructuring due to inaccuracies in the figures (World Bank 2019). 8 Summary of relevant energy interventions Specifically, ESCOM cofinanced new connections for customers when doing so was in alignment with planned and ongoing transmission and distribution upgrades (e.g., for “undergrid” households located in the vicinity of ongoing infrastructure upgrades). Because access was not originally planned as a focus of the ESSP, the results framework for the project did not include access-related objectives and indicators. Table 1 highlights the original and revised results frameworks for the PDO-level indicators for the ESSP. As noted earlier, this case study focuses on the investments made in the distribution network (covered under Component 1a). However, the PDO-level indicators shown in table 1 apply to the ESSP as a whole. Millennium Challenge Corporation Malawi Compact At about the same time as the ESSP’s approval in June 2011, in April 2011, the MCC signed a $351 million Compact with the GoM to provide support to the energy sector in Malawi. The Compact entered into force in September 2013 and ended in September 2018. It adopted a “systemic approach to strengthening the nation’s power sector, recognizing the need for infrastructure, policy reform, and environmental management to comprehensively drive the sector forward as no one of these investments alone would result in sustainable change” (MCC 2020a). As part of these investments, the Compact provided financing for a program of grid expansion with some rehabilitation and upgrades, as well as investments in natural resource management. The grid expansion program was focused on the generation and transmission subsectors. Specifically, the Compact comprised three projects (MCC 2020a): 1. Infrastructure Development Project: This project aimed to improve the availability, reliability, and quality of the power supply in Malawi through investments in the country’s transmission and distribution infrastructure. It also supported power availability with the refurbishment of the Nkula A hydropower station. 2. Power Sector Reform Project: This project complemented the Infrastructure Development Project by providing support for the GoM’s policy reform agenda and building capacity in power sector institutions (namely, ESCOM, MERA, and MoNREE). The Compact also supported the restructuring of Malawi’s energy market based on the GoM’s preferred option; this led to the amendment of the Electricity Act and the unbundling of ESCOM to create two utilities: ESCOM (responsible for transmission and distribution) and the Electricity Generation Company (EGENCO) (responsible for generation). 3. Environment and Natural Resource Management Project: This project was designed to help the GoM and other stakeholders mitigate the growing problems of aquatic weed infestation and excessive sedimentation in the Shire River, and to reduce costly disruptions to Malawi’s downstream hydropower generation by investing in weed and sediment management, and the implementation of better environmental and natural resource management in upstream areas. JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 9 The ESSP was designed to be complementary to the large-scale investments made under the Compact. For example, the unfunded scope that was originally a part of the MCC Compact was combined with new activities to inform the objectives and activities of the ESSP during its design stage. Similarly, detailed feasibility studies financed by the MCC, which identified urgent energy sector investments costing approximately $475 million in Malawi (World Bank 2011), were drawn on in the preparation of some activities in ESSP. Thus, although the ESSP was designed as a stand-alone project, and the achievement of its PDOs was not expected to rely on the successful implementation of the MCC Compact, in reality, due to the grid’s evolution, there were in fact certain operational interdependencies between the two projects as they were implemented (World Bank 2019). Given the complementary nature of the investments made in Malawi’s distribution network as part of the MCC Compact’s Infrastructure Development Project, this case study also examines the employment impacts resulting from the distribution line and substation contracts under that project. This component of the MCC Compact received a total of $257.1 million in investment. Employment data for the refurbishment of the Nkula A hydropower station under the Infrastructure Development Project are not captured in this analysis. Endnote After Phase II of Kapichira, Lower Fufu (90–180 MW), Mpatamanga (100–150 MW), and 1.  Kholombidzo (160–370 MW) were seen as strong candidates for the next large hydro project (World Bank 2011). 10 Summary of relevant energy interventions THREE OVERVIEW OF THE LABOR MARKET In 2010, nearly 80 percent of Malawians earned their income from agriculture (World Bank 2022a), and the sector played a central role in the national economy, accounting for approximately 30 percent of GDP and 80 percent of the country’s exports. Earnings and livelihoods were, therefore, closely tied to agricultural performance. Relatively large harvests between approximately 2005 and 2010, for instance, coincided with a period during which there was also a substantial buildup of assets and livestock (Durevall and Mussa 2010; Holden and Lunduka 2010). Table 2 presents a distribution of the working-age population based on data from the 2008 Welfare Monitoring Survey conducted by Malawi’s National Statistical Office (NSO 2009). As shown in the table, 86 percent of the working-age population was considered economically active, with the labor force participation rate slightly higher for women and significantly higher in urban areas. The table also shows that the unemployment rate was only about 1 percent. However, note that this figure is closely tied to the distinct definition of “employment” used in the Welfare Monitoring Survey, which considers an individual as employed if they reported being engaged in formal, informal, or unpaid work contributing to the household’s livelihood for at least one hour in the past week. Modeled estimates from the International Labour Organization suggest that the conventional unemployment rate nationally in 2010 was closer to 6 percent (World Bank 2022a). The seemingly low unemployment rate, however, masked widespread underemployment, particularly in rural areas. Data collected as part of Malawi’s Third Integrated Household Survey in 2010–11 indicate that the average working-age adult reported working for only about 25 hours per week in the high season, with a substantial share of the population reporting fewer than 15 hours per week; underemployment in the low season was even more pronounced (de Janvry, Duquennois, and Sadoulet 2022). The vast majority of employment was informal. According to the International Labour Organization (Durevall and Mussa 2010), in 2008, only 7 percent of a labor force of approximately 6.1 million, that is, 440,000 individuals, worked in the formal sector, making the informal sector (even excluding subsistence farmers) larger than the formal private and public sectors combined. Informal employment is often associated with limited access to basic services and labor protections, low earnings, and irregular, unpredictable income. The substantial informality in the Malawian labor market may thus partly explain why, in many cases, actual pay was reported to be less than the minimum wage. According to a 2008 survey, for example, over half of all adults (aged over 18) earned less than MK 5,000 ($36) per month, and 30 percent earned less than MK 2,500 ($18) per month (Durevall and Mussa 2010).1 Many of these existing labor market challenges could be addressed by the investments to upgrade Malawi’s transmission and distribution infrastructure under the ESSP and the MCC project, which are expected to improve reliability as well as access. JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 13 TABLE 2 Percentage Distribution of Working-Age Population (Aged 15 Years and Above) LABOR FORCE EMPLOYMENT UNEMPLOYMENT PARTICIPATION RATE TOTAL MALE FEMALE TOTAL MALE FEMALE TOTAL MALE FEMALE (%) (%) (%) (%) (%) (%) (%) (%) (%) Malawi 86 84 87 99 99 99 1 1 1 Urban 96 95 96 96 96 97 4 4 4 Rural 79 79 79 99 99 99 1 1 1 By education: None 87 85 88 100 100 100 0 0 0 Primary 1–5 85 82 88 99 99 100 1 1 1 Primary 6–8 82 81 83 99 99 99 1 1 1 Secondary + 80 82 76 96 97 96 4 3 5 Source: Durevall and Mussa 2010. Note: Employment = “At least one hour of work during 7 days preceding the survey.” Work = “Both formal and informal work, both paid work (in cash, in kind, or barter), and unpaid work contributing to the livelihood of the household, including work on the agricultural holding, not only for the owner, but for family members helping out without pay” (NSO 2009). Labor force participation rate = “share of the working-age population (between 15 and 64 years old) actively engaged in the labor market, i.e., employed or unemployed.” Endnote The corresponding daily minimum wage and housing allowance in Malawi would result 1.  in monthly incomes of MK 3,362 and MK 2,742 in urban and rural areas, respectively. 14 Overview of the labor market FOUR IDENTIFICATION AND QUANTIFICATION OF DIRECT, INDIRECT, AND INDUCED JOBS Objectives and Overall Methodology This case study combines (1) labor- and input-use-related contract-level data provided by ESCOM for the distribution network investments financed by the ESSP (under Component 1a) and the MCC (under the Infrastructure Development Project); (2) ESCOM’s estimates of the size of its customer base (as a proxy for electrification rate); (3) data from the World Bank and the MCC project documentation on changes in electricity reliability (for example, outages) over time; (4) enterprise-level data from multiple rounds of the World Bank Enterprise Survey in Malawi; (5) insights from discussions with in-country World Bank and ESCOM staff; and (6) findings from the wider literature on the employment impacts of electrification initiatives to assess the creation of the following types of jobs: • Direct jobs: Direct jobs are those that are required for design, construction, and operation and maintenance (O&M). Design and construction activities focused on the distribution network were carried out by 19 contractors (15 associated with the ESSP and 4 with the MCC), which hired a variety of direct workers, including project managers, engineers, professional services workers (such as accountants and procurement specialists), cable joiners, meter installers, and construction workers. O&M activities were carried out by ESCOM. • Indirect jobs: Indirect jobs would typically result from the demand for the inputs needed for construction. Specifically, the 19 contractors mentioned above carried out upgrades and expansion of the distribution network. This entailed the procurement of a variety of materials/equipment, including cables, circuit breakers, and voltage transformers. However, all necessary material/equipment were reportedly procured internationally (see tables A.2 and A.3). Hence, all indirect jobs described in this case study are foreign. • Induced jobs: This case study considers two types of induced jobs. First, “productive use of electricity” jobs can emerge due to new access in previously unelectrified areas as well as due to improvements in service quality in the electrified areas, both of which can allow households and enterprises to use electricity for productive, income-generating activities. In line with the MCC project’s goal to “improve the availability, reliability, and quality of the power supply” (MCC 2020a), this case study estimates the creation of “productive use of electricity” jobs related to increased access due to distribution network investments by combining data on the evolution of Malawi’s national electrification rate between 2013 and 2018 from ESCOM with insights from the peer-reviewed literature on the impact of a per-unit increase in access on job creation. Specifically, in the absence of such estimates for Malawi, the case study relies on results from rural South Africa, as described below. Second, in line with ESSP’s PDO to “increase the reliability and quality of power supply in the major load centers” (World Bank 2011), the case study uses data on electricity reliability in conjunction with enterprise-level data on employment to assess the extent to which the observed reliability improvements were associated with economywide job creation. Following the terminology used by ESCOM, the case study distinguishes between professional, skilled, and unskilled jobs. Professional jobs require a diploma/degree (e.g., in civil, mechanical, or electrical engineering for engineering positions) or certification from an accredited training JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 17 institute. In certain cases, they also require registration with relevant professional associations. Skilled jobs (such as operators and technicians) require a technical license and some years of experience handling heavy-duty machinery. Unskilled work (such as in construction) does not require technical training or certification. Data Collection Approach This case study relies on labor- and input-use-related contract-level data provided by ESCOM for the distribution network investments financed by the ESSP and the MCC. For each contract, these data shed light on the contract’s focus (e.g., substations, distribution lines); the type, gender, and number of workers hired by the relevant contractor; and the type and total value of inputs used. The case study also relies on ESCOM data on the total connected customer base to calculate the national electricity access rate. Table 3 summarizes these data. TABLE 3 Overview of Data Sources DATA SOURCE PROJECT CONTRACTORS DESCRIPTION COVERED ESCOM ESSP 15 Labor-related information: • Worker role (e.g., project manager, design engineer)* MCC  4 • Worker gender • Worker locality (domestic or foreign) • Number of workers • Length of employment (duration of contract) Input-use information: • Input type • Total value ($) and/or quantity • Procurement source (domestic or foreign) n.a. n.a. Customers connected to the grid in 2013 and 2018 World Bank 2019 ESSP n.a. Key project indicators (as collected in the project’s Implementation Completion and Results Report), including those related to systemwide electricity reliability MCC 2019 n.a. n.a. Key project indicators (as collected in the Compact’s Indicator Tracking Tables), including those related to total customer base and frequency of forced interruptions/outages World Bank Enterprise n.a. n.a. Enterprise-level data from 2009 and 2014 on: Survey (World Bank • Employment trends 2022b) • Reported obstacles for business growth Note: * Data covering MCC contracts do not provide information on the specific role of the workers. Instead, these data provide information on worker skill levels (professional, skilled, unskilled, or “other”). Data covering ESSP contracts do not include worker skill-level categorizations. ESCOM = Electricity Supply Corporation of Malawi; ESSP = Energy Sector Support Project; MCC = Millennium Challenge Corporation; n.a. = not applicable. 18 Identificationandquantificationof direct, indirect, and induced jobs FIVE RESULTS Direct Jobs Design and Construction Data on total domestic direct job-years were obtained from ESCOM. For the MCC project, ESCOM provided data on the numbers of employees by contract type (substation or distribution line), contractor, labor skill level (professional, skilled, unskilled, or “other”), gender, and locality (foreign or domestic). For the ESSP, ESCOM provided similar information, as well as additional details on the start and end dates for each contract, and approximately 30 types of job roles (e.g., project manager, surveyor, wayleave officer). Table 4a provides an overview of the direct jobs reported by ESCOM. As shown in table 4A, the workforce hired by the contractors was almost entirely male. For the ESSP, only one worker was reported to be female. Gender was not reported for unskilled construction workers (35 percent of the workforce) as well as for a few other workers (about 1 percent of the workforce) (see table A.1 for a full disaggregation). However, since males were significantly more represented than females in the Malawian construction sector in 2013 (Mussa 2016), it can be assumed that the majority of construction workers in the ESSP workforce were also male. For the MCC project, about 7 percent of the workers were female. Table 4B presents the direct jobs reported by ESCOM disaggregated by contract. For the ESSP, domestic job-years were estimated by multiplying the number of domestic jobs by the contract duration (as indicated by the contract date) for each job (i.e., subtracting the contract start date from the end date and dividing the result by 365). This produced an estimate of 3,526 domestic job-years.1 Since no information on contract length was available for the MCC project, the job-years in this case were estimated by multiplying the total domestic jobs (10,129) by the average job-years estimate from the ESSP (2.83); this yielded an estimated 28,665 domestic job-years for the MCC project. Operation and Maintenance ESCOM provided data on the total O&M workers by full-time or part-time status. It also provided data on the total value of all the infrastructure maintained by ESCOM, and the value of the infrastructure created by the ESSP and the MCC project. Specifically, ESCOM reported having 1,371 full-time workers and 1,154 part-time workers engaged in O&M, which implies a total of 1,948 person-years of work per year (counting part-time workers at 50 percent). The assets financed by the projects (worth a total of about MK 110 billion) were about 53 percent of ESCOM’s total assets (approximately MK 208 billion). This implies that the assets specific to the ESSP and the MCC project required a total of approximately 1,039 person-years of work per year.2 Assuming that these assets will last 50 years and that all of the workers are domestic, in turn, implies a total of 51,953 domestic person-years of employment over the 50-year period.3 JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 21 TABLE 4A Overview of Direct Jobs during the Implementation Phase, by Project, Contract Type, and Skill Level PROJECT CONTRACT TYPE SKILL LEVEL NUMBER OF FOREIGN FEMALE WORKERS WORKERS WORKERS ESSP Distribution line Professional 23 22 0 Skilled 35 20 0 Unskilled 360 0 0 Meter contract Professional 2 2 0 Skilled 36 2 0 Unskilled 0 0 0 Substation Professional 15 14 0 Skilled 18 15 0 Unskilled 826 0 1 System contractor Professional 4 4 0 Skilled 2 2 0 Unskilled 0 0 0 MCC Distribution line Professional 705 52 45 Skilled 9,692 8,350 68 Unskilled 6,118 0 859 Substation Professional 111 77 10 Skilled 590 79 29 Unskilled 1,084 0 190 Substation; distribution Professional 27 6 4 line Skilled 131 6 7 Unskilled 241 0 66 Source: ESCOM. Note: Contract-level direct job data for ESSP contracts provided information on the specific job role. Corresponding skill-level categorizations are based on a descriptive assessment of these job roles (see table A.1 for a full disaggregation of ESSP-specific direct jobs). Contract-level direct job data for MCC contracts provided information on skill-level categorizations but did not provide analogous information on the specific job role. This table covers the project’s implementation phase. It does not cover the O&M phase. ESSP = Energy Sector Support Project; MCC = Millennium Challenge Corporation. 22 results TABLE 4B Contract-Level Direct Jobs during the Implementation Phase, by Project PROJECT CONTRACTOR CONTRACT CONTRACT DATE SKILL LEVEL NUMBER OF FOREIGN FEMALE TYPE WORKERS WORKERS WORKERS ESSP Apollo Substation November 12, 2015 Professional 5 4 to June 5, 2018 Skilled 5 4 CME Distribution September 23, 2015 Professional 5 4 line to April 9, 2018 Skilled 10 6 Unskilled 60 EMCO Substation November 12, 2015 Professional 5 5 to August 20, 2018 Skilled 4 3 ESCOM Substation January 1, 2016 to Unskilled 6 1 April 30, 2019 ESCOM Substation June 1, 2015 to Skilled 1 December 31, 2018 Unskilled 300 Eya Bantu Substation March 25, 2015 to Skilled 1 1 June 4, 2018 Unskilled 180 Grasha Meter May 10, 2015 to Professional 2 2 Electrical contract October 15, 2018 Contractors Skilled 35 1 Grid Substation November 12, 2015 Skilled 1 1 transmission to August 20, 2018 and Opco civil Unskilled 220 engineering contractors Inhemeter Meter May 10, 2015 to Skilled 1 1 contract October 15, 2018 KK Nirma Substation November 12, 2015 Skilled 1 1 to June 5, 2018 Unskilled 120 Lucky Exports Distribution September 1, 2016 Professional 5 5 Lot 2 line to April 20, 2018 Skilled 6 5 Unskilled 60 MBH Power LTD Distribution September 1, 2016 Professional 8 8 Lot 1 line to October 15, 2018 Skilled 10 4 MBH Power LTD Distribution September 1, 2016 Professional 5 5 Lot 3 line to April 27,2018 Skilled 6 5 Unskilled 40 (continues) JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 23 TABLE 4B Contract-Level Direct Jobs during the Implementation Phase, by Project (Continued) PROJECT CONTRACTOR CONTRACT CONTRACT DATE SKILL LEVEL NUMBER OF FOREIGN FEMALE TYPE WORKERS WORKERS WORKERS Powertech System November 12, 2015 Professional 4 4 Systems contractor to August 20, 2018 Integrators Skilled 2 2 Sieyuan Substation March 25, 2015 to Professional 5 5 June 4, 2018 Skilled 5 5 VAP Electrical Distribution September 1, 2016 Skilled 3 Contractors line to October 15, 2018 Unskilled 200 MCC Kalpataru Distribution — Professional 376 8 9 Lot 1A line Skilled 5,083 4,434 46 Unskilled 2,976 324 L&T Lot 1B Substation — Professional 38 31 Skilled 350 27 6 Unskilled 582 74 Kalpataru Distribution — Professional 329 44 36 Lot 2A line Skilled 4,609 3,916 22 Unskilled 3,142 535 Chint Lot 2B Substation — Professional 49 23 9 Skilled 95 32 15 Unskilled 285 85 CONCO Substation — Professional 24 23 1 Package 3.1 Skilled 145 20 8 Unskilled 217 31 L&T Package 3.1 Substation, — Professional 27 6 4 distribution line Skilled 131 6 7 Unskilled 241 66 Source: ESCOM. Note: Contract-level direct job data for ESSP contracts provided information on the specific job role. Corresponding skill-level categorizations are based on a descriptive assessment of these job roles (see table A.1 for a full disaggregation of ESSP-specific direct jobs). Contract-level direct job data for MCC contracts did not provide analogous information on the specific job role. The data on MCC contracts also did not provide information on the contract date. This table covers the project’s implementation phase. It does not cover the O&M phase. ESSP = Energy Sector Support Project. MCC = Millennium Challenge Corporation— Not available. 24 results Indirect Jobs As noted above, ESCOM reported that all the project inputs for the MCC project and the ESSP were procured internationally (see tables A.2 and A.3). This implies that the distribution network investments did not lead to the creation of any domestic indirect jobs. Foreign indirect jobs are estimated based on the total project funding and data on energy- efficiency grid upgrades in South Africa (UNIDO and GGGI 2015). Those data suggest a total of 31.6 indirect domestic jobs per million dollars of spending. This is based on having 65 percent of inputs procured domestically in South Africa, which implies a total of 48.6 total indirect jobs (foreign or domestic) per million dollars in South Africa compared with only 24.3 direct jobs.4 Thus, the ratio of indirect jobs to direct jobs is 2 for the South African grid upgrade projects. This ratio is applied to Malawi in the absence of primary data on indirect jobs associated with the ESSP.5 Induced Jobs As noted earlier, this case study considers two types of induced jobs: “productive use of electricity” jobs (due to increased electricity access) and jobs resulting from wider firm-level expansion (due to improved quality of electricity). Induced Jobs Related to Increased Electricity Access The impacts of the ESSP and the MCC project on “productive use of electricity” jobs were estimated by multiplying the estimated number of working-age people given access to electricity by the project by an estimate of the employment impacts of increased electricity access obtained from Dinkelman (2011) for rural parts of South Africa.6 Table 5 walks through how these estimates were produced. Dinkelman (2011) estimated that being in an electrified community increased employment rates by 9.5 percentage points for women and by 3.5 percentage points for men. ESCOM reported making 2,655 new connections for the MCC project and the ESSP. This implies that increased electricity access created by the projects resulted in approximately 375 new jobs.7 These estimates suggest positive benefits of access on employment, especially for women, which is plausible if electricity access reduces hours of household chores. However, more recent evidence suggests that the economic benefits of electricity may not be as large as those found by Dinkelman (2011) (Lee, Miguel, and Wolfram 2020).8 JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 25 TABLE 5 Estimated Employment Impacts of Access in Malawi DESCRIPTION NUMBER Estimated employment impacts of access in South Africa (from Dinkelman 2011) Women 0.095 Men 0.035 Average of women and men 0.065 Connections made by ESCOM for the MCC project and the ESSP in Malawi 2,655 Estimated household size in Malawi (2018) 4.4 Estimated beneficiaries in Malawi (product of the two previous rows) 11,682 Working-age population in Malawi (2018) 8,953,357 Population in Malawi (2018) 18,143,215 Fraction of working-age population in Malawi (ratio of the two previous rows) 0.493 Estimated working-age beneficiaries of the project (product of estimated beneficiaries and fraction of 5,765 working-age population) Estimate of induced jobs created by electricity access (product of the third row and the previous row) 375 Sources: Dinkelman (2011) for estimated impacts; ESCOM for connections; and NSO (2019) for household size and population estimates. Note: ESCOM = Electricity Supply Corporation of Malawi; ESSP = Energy Sector Support Project; MCC = Millennium Challenge Corporation. Induced Jobs Associated with Increased Reliability in Major Load Centers Programmatic documents associated with both the ESSP and the MCC project indicate that investments in distribution assets were associated with measurable increases in electricity reliability. For example, the average number of electricity service interruptions per year in the ESSP project area fell from 11 in 2015 to 6.55 in 2018, as outlined in the Implementation Completion and Results Report for the ESSP (World Bank 2019), representing a 40 percent reduction in the frequency of outages. Estimates from the Malawi Compact Table of Key Performance Indicators (MCC 2019) are similar, pointing to a 32 percent reduction in the frequency of forced outages/interruptions between 2012–13 and 2018. To assess the magnitude of job creation related to these reliability improvements, this case study relies on enterprise-level panel data from Malawi. Specifically, the case study uses a sample of 61 enterprises that were interviewed during the 2009 as well as 2014 rounds of the World Bank Enterprise Survey in Malawi to analyze the relation between changes in electricity reliability reported by firms and changes in the number of people they employed full time.9 26 results TABLE 6 Relation Between Employment and Outages by Firm and Year DESCRIPTION NUMBER Relation between % change in outages and the dependent variable (% change −0.188 in employment) Standard error 0.116 Firms 61 Years per firm 2 Years 2009 and 2014 Notes: This table is based on a regression of the natural log of the number of full-time employees on the natural log of the number of power outages experienced in a typical month, firm fixed effects, and year fixed effects. The observations are by year and month. Standard errors (in parentheses) are clustered at the strata level (region-size-sector-panel). The number of full-time employees includes both permanent and temporary/seasonal workers. The p-value is 0.118. Table 6 presents the results from a regression of the log of full-time employees (including both permanent and temporary/seasonal workers) at the end of the most recent fiscal year on the log of the average monthly outages over the same period, controlling for trends over time common to all enterprises (through the inclusion of year fixed-effects) and unobserved enterprise-level differences (through the inclusion of enterprise fixed-effects).10 The table shows that a 1 percent increase in the frequency of monthly outages was associated with a 0.19 percent reduction in enterprise-level employment between 2009 and 2014. This suggests that a 32–40 percent reduction in outages (as observed over the period covered by the ESSP and the MCC project) would have been associated with a 6–7.6 percent increase in employment among formal (registered) firms, corresponding to an increase of 9,000–12,000 workers in the labor force employed by formal enterprises.11 However, the estimate presented in table 5 is not statistically significant at conventional levels (5 percent or even 10 percent), and the relationship may not be linear or apply to a decline of this size. For these reasons, these numbers are not incorporated into the estimates of induced jobs presented at the end of this case study. Endnotes This method may overestimate job-years, since some jobs will not last for the full  1.  contract period. It could also underestimate job-years if some workers are working overtime. 0.53 × 1,948 person-years of work per year = 1,039 person-years of work per year.  2.  The 50-year life-span estimate is based on evidence regarding substations in Malawi  3.  and transmission lines elsewhere. Specifically, the estimate for substations is based on a World Bank Environmental and Social Impact Assessment Study conducted for the JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 27 Mozambique-Malawi 400 kV Interconnection Project (Electricidade de Moçambique 2019), which indicates that “with regular maintenance, [substations] are expected to be operational for much more than 50 years.” According to this report, lines and power transformers have life expectancies of 40 and 50 years, respectively. 48.6 = 31.6/0.65. This estimate implicitly assumes that the number of indirect jobs  4.  would not vary based on the fraction of inputs that were imported. The results’ accuracy may vary depending on the extent of difference between the  5.  work done on “energy efficiency grid upgrades” in South Africa and the project work done in Malawi. Other context-specific differences between South Africa and Malawi may further limit the results’ validity. See appendix B for details and a discussion of the potential limitations to this method.  6.  Note that impacts on induced jobs are estimated using numbers of jobs rather than  7.  job-years because of a lack of data on how long the impacts of electricity access on employment rates last. See appendix B for details.  8.  Unreliable electricity supply can impact employment outcomes through various channels  9.  (Mensah 2018). For example, in response to electricity supply uncertainties, firms may reorient their production processes by outsourcing intermediate production to external firms. Similarly, in the face of productivity losses imposed by power outages, firms may respond by reducing variable costs (e.g., by cutting jobs or reducing wages). A “log-log” model helps make the relationship between the dependent and independent 10.  variables interpretable. Specifically, the estimated coefficient from such a regression represents the percent change in the value of the dependent variable given a 1 percent change in the independent variable’s value. According to the International Labour Organization (Durevall and Mussa 2010), in 2008, 11.  about 2.5 percent of the labor force (approximately 153,000 employees) worked for formal private businesses. A 6 percent increase in the size of this labor force would correspond to 9,180 additional workers, whereas a 7.6 percent increase would correspond to 11,628 additional workers. 28 results SIX CONCLUSION Summary of Findings This case study sought to assess the direct, indirect, and induced employment impacts associated with investments in the upgrade and expansion of the electricity distribution network in Malawi. To do so, the case study relied on contract-level employment data related to distribution network investments across two projects financed by the World Bank and MCC. To estimate the induced jobs associated with these investments, it combined these data with additional data from ESCOM on the national electrified customer base, as well as insights from the wider peer-reviewed literature on the job creation impacts of electrification in the African context. Table 7 summarizes the case study’s main results. The MCC project was substantially larger than the World Bank–financed ESSP, in terms of both job-years and financing. Together, the projects produced a total of approximately 275 job-years of direct employment per million dollars spent, another 550 job-years of indirect jobs, and an additional 1.2 induced jobs. The direct jobs included a mix of foreign and domestic workers. The indirect jobs were all foreign and the induced were all domestic. These estimates may be too low for at least two reasons. First, the induced jobs estimate only covers jobs due to improved electricity access and not jobs due to improved electricity quality. The data analyzed for this case study provide suggestive, though not conclusive, evidence that improving quality may also increase employment in Malawi. Second, the induced jobs estimate also excludes jobs generated by local economic growth potentially associated with the injection of investment funds into the project areas. Both projects employed very few women. Only 1 of the 1,321 direct non-O&M jobs associated with the ESSP reported by ESCOM was held by a female, whereas only 7 percent of the TABLE 7 Direct, Indirect, and Induced Jobs in Malawi PROJECT JOB-YEARS JOB-YEARS PER $ MILLION DIRECT INDIRECT INDUCED DIRECT INDIRECT INDUCED MCC 78,134 156,138 n.a. 304 608 n.a. ESSP  6,010  12,023 n.a. 123 245 n.a. Total 84,144 168,341 375 275 550 1.22 Note: This table covers Component 1 of the ESSP and the Infrastructure Development Project of the MCC Malawi Compact. Direct jobs include O&M jobs and foreign and domestic jobs, whereas indirect jobs are all foreign and induced jobs are all domestic. Funding included $257 million for the MCC project and $49 million for the ESSP. ESSP = Energy Sector Support Project; MCC = Millennium Challenge Corporation; n.a. = not applicable. JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 31 18,699 direct non-O&M jobs associated with the MCC project were. This is likely because jobs in construction constituted a large fraction of the employment created by these projects. As noted previously, women constitute a small fraction of the construction sector in Malawi (Mussa 2016); this likely limited their potential job creation opportunities associated with the projects. This issue is not unique to Malawi (e.g., English and Le Jeune 2012), and the barriers to employing women in the energy sector more broadly are primarily related to perceptions of gender roles (e.g., safety and security concerns among managers as well as workers) (IRENA 2019). At the same time, both projects also employed a large number of foreign workers. This was particularly the case for the MCC project. Specifically, about 46 percent of the 18,699 workers employed for the MCC project were reportedly foreign (the corresponding figure for the ESSP was only about 6 percent of the 1,321 workers). Over 97 percent of these foreign workers were reportedly engaged as skilled workers (such as project managers, design engineers, accountants, and environmental health and safety officers) on two separate distribution-line contracts awarded to the same contractor. The high fraction of foreign workers hired for the MCC project suggests that there was a shortage of domestically available staff to contribute to this type of skilled work in Malawi. Lastly, ESCOM data indicated that all inputs used for these projects were procured from foreign sources. This points to a severe lack of capacity in Malawi, including for inputs that could theoretically be produced domestically (such as wood utility poles). Future projects making clean energy investments in low-income settings may wish to allocate resources to also address such domestic constraints so as to maximize the associated job creation impact. Theory of Change Figure 1 presents a theory of change (TOC) for the ESSP, with a specific focus on Component 1a. The TOC delineates the causal pathways between the distribution-network investments carried out as part of the ESSP and the resulting effects on the creation of direct, indirect, and induced jobs by drawing on the findings of this case study as well as the key objectives of the ESSP, as outlined in its Implementation Completion and Results Report (World Bank 2019). The TOC indicates that World Bank financing for Component 1a was focused on supporting the uprating and expansion of the distribution and transmission network. It also highlights that in support of these infrastructure-focused activities, the project created direct jobs for skilled, semiskilled, and unskilled workers, and indirect jobs at upstream firms providing key project inputs. Although female workers held relatively few of the direct jobs created by the project, the TOC highlights those employment categories listed as part of labor inputs where increased opportunities for female workers were observed over the course of the data collection conducted as part of this case study. Specifically, as can be seen in figure 1, female workers were largely involved as semiskilled/unskilled workers over the course of implementation of project activities (for example, reportedly in administration-related roles). 32 conclusion FIGURE 1 Theory of Change for the Energy Sector Support Project Long-term Activities Outputs Outcomes outcomes Component 1a: Distribution and Transmission Uprating and Expansion • Substations: Four constructed, five upgraded • Capacitor banks installed Improved quality of • Construction of new substations and associated lines electricity in major • Uprating of existing substations • 33 kV distribution lines and underground cables Electricity serving Blantyre and surrounding areas rehabilitated load centers • Construction of new 33 kV and 11 kV lines and installation of reliability capacitor banks • Distribution network extended to 22 high-priority is main peri-urban neighborhoods binding • Rehabilitation of 33 kV lines constraint • Rehabilitation of underground cables • Necessary spare parts acquired for Kapichira, Nkula B • Extension of the peri-urban network and Tedzani I, II and III power stations • Acquisition of generation spare parts • Creation of new Higher wages enterprises and increased • Expansion of employment existing enterprises Rising Availability of experienced Direct and Indirect jobs F V incomes boost JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI engineers and architects with: domestic • University degrees Semiskilled/ demand for Skilled/semiskilled/ goods and Increased labor • Relevant work experience unskilled jobs (e.g., Skilled jobs unskilled jobs services • Expansion of quantity productivity construction worker, (e.g., design, (i.e., jobs among produced and range of possible Building materials meeting cable jointer, engineering) suppliers of project using goods and services cost/quality standards available operations and inputs) additional that can be produced for procurement maintenance) electricity • Greater by households and access to enterprises good-quality electricity Electricity for majority of Component 1b: Low-Voltage Reticulation Reinforcement and access is the population Technical Implementation Support • 115 km of distribution lines constructed main ~295,000 potential including in • Reconfiguration/extension of medium-voltage overhead lines • 26 km of distribution lines rehabilitated binding beneficiaries in rural areas supplying distribution transformers constraint • Installation of 111 new distribution transformers project area with • Economic • Construction/conversion of three-phase low-voltage overhead lines increased/ growth and Capacity of ESCOM’s Training School in Blantyre to improved access to • Support/training for ESCOM’s existing Training School for LV deliver a comprehensive, hands-on training program for shared reticulation reinforcement training electricity prosperity ESCOM technicians enhanced Consulting engineering firm hired to support: Component 1c: Design, Procurement, and Supervision • Project preparation (including preliminary survey and • Support ESCOM’s procurement of the services of a consulting design work engineering firm with international experience in design and construction • Delineation of technical specifications of transmission and distributions projects • Bid preparation • Procurement assistance for components 1a and/or 1b Increased private Component 2: Generation and Transmission Feasibility and Design • Supervision, management, and “due diligence”) sector investment in Studies electricity sector • Three hydropower generation/new transmission “backbone” Conduct feasibility studies needed to inform the development of up to (particularly for • feasibility studies completed 380 MW of new hydropower generation capacity in Malawi increased generation • Environmental and Social Impact Assessment and Resettlement Action Plan (RAP) prepared, and Environmental and Social capacity) Component 3: Demand Side Management and Energy Efficiency Advisory Panel established Measures • AMR system design • Supply and installation of AMR meters • AMR system installed for high-voltage customers • 750 AMR meters installed for high-voltage customers Component 4: Capacity Building and Technical Assistance • Capacity building/technical assistance to MoNREE and ESCOM to support energy-sector development, including provision of software, training, and • Wind power and geothermal resources assessment study completed resources for management and supervision to carry out wind power and geothermal resources assessment study Legend 33 Direct jobs Indirect jobs Induced jobs WB-supported activity F = females employed Assumptions Notes: Adapted from World Bank (2019). Note that while this case study primarily focused on Component 1a as far as the ESSP was concerned, this component was implemented in conjunction with several other complementary interventions. The TOC thus outlines the specific nodes along the causal pathway where the complementary effects of these related activities are likely to have been the most salient. For example, under Component 1b, ESCOM’s Training School received support to enhance its capacity to train technicians. The TOC reflects the potential link between this intervention and the jobs related to Component 1a through the jobs created to support ongoing O&M associated with the assets constructed under that component. Specifically, it is likely that technicians supporting O&M in the future will have received some training at this institution, highlighting the ways in which complementary interventions can address multiple potential constraints simultaneously (in this case, increasing the availably of workers with the skills to continue contributing to the project in the future by directly enhancing training capacity). 34 conclusion References Bensch, Gunther, Gunnar Gotz, and Jörg Ankel-Peters. 2020. “Effects of Rural Electrification on Employment: A Comment on Dinkelman (2011).” MetaArXiv, October 6. doi:10.31222/ osf.io/zhn9b. De Janvry, A., C. Duquennois, and E. Sadoulet. 2022. “Labor Calendars and Rural Poverty: A Case Study for Malawi.” Food Policy 109 (May): 102255. Dinkelman, T. 2011. “The Effects of Rural Electrification on Employment: New Evidence from South Africa.” American Economic Review 101 (7): 3078–108. http://www.aeaweb. org/articles.php?doi=10.1257/aer.101.7.3078. Durevall, D., and R. Mussa. 2010. “Employment Diagnostic Analysis: Malawi.” Employment Working Paper 73, International Labour Organization, Geneva, Switzerland. Electricidade de Moçambique. 2019. Mozambique-Malawi 400 KV Interconnection Project: Environmental and Social Impact Assessment Study. Maputo, Mozambique: Electricidade de Moçambique. https://documents1.worldbank.org/curated/en/275841559105418449/ pdf/Environmental-and-Social-Impact-Assessment-for-the-Matambo-Substation-to-the- Border-with-Malawi-142-km.pdf. English, J., and K. Le Jeune. 2012. “Do Professional Women and Tradeswomen in the South African Construction Industry Share Common Employment Barriers despite Progressive Government Legislation?” Journal of Professional Issues in Engineering Education and Practice 138 (2): 145–52. Holden, S., and R. Lunduka. 2010. Impacts of the Fertilizer Subsidy Program in Malawi: Targeting, Household Perceptions and Preferences. Noragric Report 54. Ås, Norway: Department of International Environment and Development Studies, Norwegian University of Life Sciences. IRENA (International Renewable Energy Agency). 2019. Renewable Energy: A Gender Perspective. Abu Dhabi: IRENA. Lee, K., E. Miguel, and C. Wolfram. 2020. “Experimental Evidence on the Economics of Rural Electrification.” Journal of Political Economy 128 (4): 1523–65. MCC (Millennium Challenge Corporation). 2019. “Malawi Compact Table of Key Performance Indicators.” Millennium Challenge Corporation, Washington, DC. https://www.mcc.gov/ resources/doc/malawi-compact-kpi. MCC. 2020a. “Executive Summary.” In Star Report: Malawi Compact. Washington, DC: Millennium Challenge Corporation. https://www.mcc.gov/resources/story/section- mwi-star-report-executive-summary. MCC. 2020b. Star Report: Malawi Compact. Washington, DC: Millennium Challenge Corporation. https://www.mcc.gov/resources/doc/star-report-malawi. Mensah, J. T. 2018. “Jobs! Electricity Shortages and Unemployment in Africa.” Policy Research Working Paper 8415, World Bank, Washington, DC. Mussa, R. 2016. Labour Market Transitions of Young Women and Men in Malawi: Results of the 2014 School-to-Work Transition Survey. ILO Work4Youth Publication Series. Geneva: International Labour Organization. JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 35 NSO (National Statistical Office of Malawi). 2009. Welfare Monitoring Survey (WMS) 2008. Zomba, Malawi: NSO. http://www.nsomalawi.mw/index.php?option=com_content&view= article&id=54&Itemid=57. NSO. 2019. 2018 Malawi Population and Housing Census: Main Report. Zomba, Malawi: National Statistical Office of Malawi. https://malawi.unfpa.org/sites/default/files/resource-pdf/ 2018%20Malawi%20Population%20and%20Housing%20Census%20Main%20Report%20 %281%29.pdf. UNIDO and GGGI. 2015. Global Green Growth: Clean Energy Industrial Investments and Expanding Job Opportunities. Volume 1: Overall Findings. Vienna: United Nations Industrial Development Organization and Seoul: Global Green Growth Institute. https://gggi.org/report/global-green- growth-clean-energy-industrial-investments-and-expanding-job-opportunities/ World Bank. 2011. Project Appraisal Document for a Proposed Grant in the Amount of SDR 40.4 Million (US$65.4 million equivalent) and a Proposed Credit in the Amount of SDR 12.0 Million (US$19.3 million equivalent) to the Republic of Malawi for the Energy Sector Support Project. Report No: 62070-MW. Washington, DC: World Bank. World Bank. 2015. “Restructuring Paper on a Proposed Project Restructuring of the Energy Sector Support Project (Grant H7150-MW and Credit 4980-MW) Approved on June 28, 2011 to the Republic of Malawi.” Report No: RES18919. World Bank, Washington, DC. World Bank. 2016. “Second Amendment to the Financing Agreement for Credit 4980-MW and Grant H715-MW.” World Bank, Washington, DC. World Bank. 2018. “Restructuring Paper on a Proposed Project Restructuring of Energy Sector Approved on June 28, 2011 to Republic of Malawi.” Report No: RES32565. World Bank, Washington, DC. World Bank. 2019. Implementation Completion and Results Report on a Grant in the Amount of SDR 40.4 Million (US$65.4 million equivalent) and a Credit in the Amount of SDR 12.0 Million (US$19.3 million equivalent) to the Republic of Malawi for an Energy Sector Support Project. Report No: ICR00004654. Washington, DC: World Bank. World Bank. 2022a. “World Development Indicators.” https://data.worldbank.org/. World Bank. 2022b. “World Bank Enterprise Surveys.” http://www.enterprisesurveys.org/. 36 References APPENDIX A Details on Direct Jobs JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 37 TABLE A.1 Contract-Level Direct Jobs (ESSP) 38 Appendix A CONTRACT DATE CONTRACT TYPE CONTRACTOR JOB ROLE SKILL GENDER LOCALITY NUMBER OF LEVEL WORKERS September 1, 2016 to October 15, 2018 Distribution line MBH Power LTD Lot 1 Project manager Skilled Male Foreign 1 September 1, 2016 to October 15, 2018 Distribution line MBH Power LTD Lot 1 Surveyor Professional Male Foreign 1 September 1, 2016 to October 15, 2018 Distribution line MBH Power LTD Lot 1 Wayleave officer Skilled Male Local 3 September 1, 2016 to October 15, 2018 Distribution line MBH Power LTD Lot 1 Design engineer Professional Male Foreign 2 September 1, 2016 to October 15, 2018 Distribution line MBH Power LTD Lot 1 Procurement officer Skilled Male Foreign 2 September 1, 2016 to October 15, 2018 Distribution line MBH Power LTD Lot 1 Distribution engineer Professional Male Foreign 3 September 1, 2016 to October 15, 2018 Distribution line MBH Power LTD Lot 1 Accountant Professional Male Foreign 1 September 1, 2016 to October 15, 2018 Distribution line MBH Power LTD Lot 1 Project engineer Professional Male Foreign 1 September 1, 2016 to October 15, 2018 Distribution line MBH Power LTD Lot 1 Line site supervisor Skilled Male Local 3 September 1, 2016 to October 15, 2018 Distribution line MBH Power LTD Lot 1 Environment health and safety officer Skilled Male Foreign 1 September 1, 2016 to October 15, 2018 Distribution line VAP Electrical Contractors Subcontractor Skilled Male Local 3 September 1, 2016 to October 15, 2018 Distribution line VAP Electrical Contractors Construction worker Unskilled — Local 200 September 1, 2016 to April 20, 2018 Distribution line Lucky Exports Lot 2 Project manager Skilled Male Foreign 1 September 1, 2016 to April 20, 2018 Distribution line Lucky Exports Lot 2 Surveyor Professional Male Foreign 1 September 1, 2016 to April 20, 2018 Distribution line Lucky Exports Lot 2 Wayleave officer Skilled Male Foreign 1 September 1, 2016 to April 20, 2018 Distribution line Lucky Exports Lot 2 Design engineer Professional Male Foreign 1 September 1, 2016 to April 20, 2018 Distribution line Lucky Exports Lot 2 Procurement officer Skilled Male Foreign 1 September 1, 2016 to April 20, 2018 Distribution line Lucky Exports Lot 2 Distribution engineer Professional Male Foreign 2 September 1, 2016 to April 20, 2018 Distribution line Lucky Exports Lot 2 Project engineer Professional Male Foreign 1 September 1, 2016 to April 20, 2018 Distribution line Lucky Exports Lot 2 Line site supervisor Skilled Male Foreign 1 (continues) September 1, 2016 to April 20, 2018 Distribution line Lucky Exports Lot 2 Environment health and safety officer Skilled Male Local 1 September 1, 2016 to April 20, 2018 Distribution line Lucky Exports Lot 2 Subcontractor Skilled Male Foreign 1 September 1, 2016 to April 20, 2018 Distribution line Lucky Exports Lot 2 Construction worker Unskilled — Local 60 September 1, 2016 to April 27, 2018 Distribution line MBH Power LTD Lot 3 Project manager Skilled Male Foreign 1 September 1, 2016 to April 27, 2018 Distribution line MBH Power LTD Lot 3 Surveyor Professional Male Foreign 1 September 1, 2016 to April 27, 2018 Distribution line MBH Power LTD Lot 3 Wayleave officer Skilled Male Foreign 1 September 1, 2016 to April 27, 2018 Distribution line MBH Power LTD Lot 3 Design engineer Professional Male Foreign 1 JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI September 1, 2016 to April 27, 2018 Distribution line MBH Power LTD Lot 3 Procurement officer Skilled Male Foreign 1 September 1, 2016 to April 27, 2018 Distribution line MBH Power LTD Lot 3 Distribution engineer Professional Male Foreign 1 September 1, 2016 to April 27, 2018 Distribution line MBH Power LTD Lot 3 Project engineer Professional Male Foreign 1 September 1, 2016 to April 27, 2018 Distribution line MBH Power LTD Lot 3 Line site supervisor Skilled Male Foreign 1 September 1, 2016 to April 27, 2018 Distribution line MBH Power LTD Lot 3 Accountant Professional Male Foreign 1 September 1, 2016 to April 27, 2018 Distribution line MBH Power LTD Lot 3 Environment health and safety officer Skilled Male Foreign 1 September 1, 2016 to April 27, 2018 Distribution line MBH Power LTD Lot 3 Subcontractor Skilled Male Local 1 September 1, 2016 to April 27, 2018 Distribution line MBH Power LTD Lot 3 Construction worker Unskilled — Local 40 September 23, 2015 to April 9, 2018 Distribution line CME Project manager Skilled Male Foreign 1 September 23, 2015 to April 9, 2018 Distribution line CME Surveyor Professional Male Foreign 1 September 23, 2015 to April 9, 2018 Distribution line CME Wayleave officer Skilled Male Foreign 1 September 23, 2015 to April 9, 2018 Distribution line CME Design engineer Professional Male Foreign 1 September 23, 2015 to April 9, 2018 Distribution line CME Procurement officer Skilled Male Foreign 1 September 23, 2015 to April 9, 2018 Distribution line CME Distribution engineer Professional Male Foreign 1 September 23, 2015 to April 9, 2018 Distribution line CME Project engineer Professional Male Foreign 1 39 (continues) TABLE A.1 Contract-Level Direct Jobs (ESSP) (Continued) 40 CONTRACT DATE CONTRACT TYPE CONTRACTOR JOB ROLE SKILL GENDER LOCALITY NUMBER OF Appendix A LEVEL WORKERS September 23, 2015 to April 9, 2018 Distribution line CME Cable site supervisor Skilled Male Foreign 1 September 23, 2015 to April 9, 2018 Distribution line CME Cable joiner Skilled Male Foreign 2 September 23, 2015 to April 9, 2018 Distribution line CME Accountant Professional Male Local 1 September 23, 2015 to April 9, 2018 Distribution line CME Environment health and safety officer Skilled Male Local 1 September 23, 2015 to April 9, 2018 Distribution line CME Subcontractor Skilled Male Local 3 September 23, 2015 to April 9, 2018 Distribution line CME Construction worker Unskilled — Local 60 May 10, 2015 to October 15, 2018 Meter contract Inhemeter Project manager Skilled Male Foreign 1 May 10, 2015 to October 15, 2018 Meter contract Grasha Electrical Contractors Site audit contractor Skilled Male Local 1 May 10, 2015 to October 15, 2018 Meter contract Grasha Electrical Contractors Design engineer Professional Male Foreign 1 May 10, 2015 to October 15, 2018 Meter contract Grasha Electrical Contractors Procurement officer Skilled Male Foreign 1 May 10, 2015 to October 15, 2018 Meter contract Grasha Electrical Contractors Meter engineer Professional Male Foreign 1 May 10, 2015 to October 15, 2018 Meter contract Grasha Electrical Contractors Subcontractor Skilled Male Local 1 May 10, 2015 to October 15, 2018 Meter contract Grasha Electrical Contractors Meter installer Skilled — Local 12 May 10, 2015 to October 15, 2018 Meter contract Grasha Electrical Contractors Site auditor Skilled — Local 20 November 12, 2015 to August 20, 2018 System contractor Powertech Systems Integrators Project manager Skilled Male Foreign 1 November 12, 2015 to August 20, 2018 System contractor Powertech Systems Integrators System design engineer Professional Male Foreign 1 November 12, 2015 to August 20, 2018 System contractor Powertech Systems Integrators Hardware and software engineer Professional Male Foreign 1 November 12, 2015 to August 20, 2018 System contractor Powertech Systems Integrators Procurement officer Skilled Male Foreign 1 November 12, 2015 to August 20, 2018 System contractor Powertech Systems Integrators Installation engineer Professional Male Foreign 1 November 12, 2015 to August 20, 2018 System contractor Powertech Systems Integrators Testing and commissioning engineer Professional Male Foreign 1 (continues) November 12, 2015 to August 20, 2018 Substation EMCO Project manager Skilled Male Foreign 1 November 12, 2015 to August 20, 2018 Substation EMCO Surveyor Professional Male Foreign 1 November 12, 2015 to August 20, 2018 Substation EMCO Wayleave officer Skilled Male Local November 12, 2015 to August 20, 2018 Substation EMCO Design engineer Professional Male Foreign 1 November 12, 2015 to August 20, 2018 Substation EMCO Procurement officer Skilled Male Foreign 1 November 12, 2015 to August 20, 2018 Substation EMCO Construction engineer Professional Male Foreign 1 November 12, 2015 to August 20, 2018 Substation EMCO Project engineer Professional Male Foreign 1 November 12, 2015 to August 20, 2018 Substation EMCO Construction supervisor Skilled Male Foreign 1 JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI November 12, 2015 to August 20, 2018 Substation EMCO Accountant Professional Male Foreign 1 November 12, 2015 to August 20, 2018 Substation EMCO Environment health and safety officer Skilled Male Local 1 November 12, 2015 to August 20, 2018 Substation Grid Transmission and Opco Civil Subcontractor Skilled Male Foreign 1 Engineering Contractors November 12, 2015 to August 20, 2018 Substation Grid Transmission and Opco Civil Construction worker Unskilled — Local 220 Engineering Contractors March 25, 2015 to June 4, 2018 Substation Sieyuan Project manager Skilled Male Foreign 1 March 25, 2015 to June 4, 2018 Substation Sieyuan Surveyor Professional Male Foreign 1 March 25, 2015 to June 4, 2018 Substation Sieyuan Wayleave officer Skilled Male Foreign 1 March 25, 2015 to June 4, 2018 Substation Sieyuan Design engineer Professional Male Foreign 1 March 25, 2015 to June 4, 2018 Substation Sieyuan Procurement officer Skilled Male Foreign 1 March 25, 2015 to June 4, 2018 Substation Sieyuan Construction engineer Professional Male Foreign 1 March 25, 2015 to June 4, 2018 Substation Sieyuan Project engineer Professional Male Foreign 1 March 25, 2015 to June 4, 2018 Substation Sieyuan Construction supervisor Skilled Male Foreign 1 March 25, 2015 to June 4, 2018 Substation Sieyuan Accountant Professional Male Foreign 1 March 25, 2015 to June 4, 2018 Substation Sieyuan Environment health and safety officer Skilled Male Foreign 1 41 (continues) TABLE A.1 Contract-Level Direct Jobs (ESSP) (Continued) 42 CONTRACT DATE CONTRACT TYPE CONTRACTOR JOB ROLE SKILL GENDER LOCALITY NUMBER OF LEVEL WORKERS Appendix A March 25, 2015 to June 4, 2018 Substation Eya Bantu Subcontractor Skilled Male Foreign 1 March 25, 2015 to June 4, 2018 Substation Eya Bantu Construction worker Unskilled — Local 180 November 12, 2015 to June 5, 2018 Substation Apollo Project manager Skilled Male Foreign 1 November 12, 2015 to June 5, 2018 Substation Apollo Surveyor Professional Male Local 1 November 12, 2015 to June 5, 2018 Substation Apollo Wayleave officer Skilled Male Local 1 November 12, 2015 to June 5, 2018 Substation Apollo Design engineer Professional Male Foreign 1 November 12, 2015 to June 5, 2018 Substation Apollo Procurement officer Skilled Male Foreign 1 November 12, 2015 to June 5, 2018 Substation Apollo Construction engineer Professional Male Foreign 1 November 12, 2015 to June 5, 2018 Substation Apollo Project engineer Professional Male Foreign 1 November 12, 2015 to June 5, 2018 Substation Apollo Construction supervisor Skilled Male Foreign 1 November 12, 2015 to June 5, 2018 Substation Apollo Accountant Professional Male Foreign 1 November 12, 2015 to June 5, 2018 Substation Apollo Environment health and safety officer Skilled Male Foreign 1 November 12, 2015 to June 5, 2018 Substation KK Nirma Subcontractor Skilled Male Foreign 1 November 12, 2015 to June 5, 2018 Substation KK Nirma Construction worker Unskilled — Local 120 June 1, 2015 to December 31, 2018 Substation ESCOM Procurement specialist Skilled Male Local 1 January 1, 2016 to April 30, 2019 Substation ESCOM Storekeeper Unskilled Male Local 2 January 1, 2016 to April 30, 2019 Substation ESCOM Storekeeper Unskilled Female Local 1 January 1, 2016 to April 30, 2019 Substation ESCOM Assistant storekeeper Unskilled — Local 3 June 1, 2015 to December 31, 2018 Substation ESCOM Construction worker Unskilled — Local 300 Source: ESCOM. Note: Skill-level categorizations are based on a descriptive assessment of job roles and were not included in the data shared by ESCOM. TABLE A.2 Contract-Level Use and value of Inputs (Energy Sector Support Project) MONTH OF DATA TYPE OF CONTRACTOR INPUT TYPE TOTAL VALUE EQUIPMENT CONTRACT OF INPUTS PROCURED LOCALLY OR FOREIGN November 12, 2015 Supply Rousant 11/33 kV surge arrest, $4,202,150.88 Foreign to March 2017 contract International Ltd outdoor fuse cutout, 11 kV composite insulator. Tools: Oil test kit, grip ammeter, pole safety belts, fire-resistant overalls, safety helmets, thermal imaging camera, sleeving, dee shackles, wire rope lift/pull machine, OH line draw tongs, ground anchors, hacksaw, engineers’ ball pein hammer, universal pliers, banding tool, linesman tool bag, reinforced plastic extension ladder, cable route tracer, cable fault locator, electrical testers, vice grip. Line materials: Timbers, wooden staybulk, wooden rustic crossarm, copper conductor. September 1, 2016 Distribution MBH Power Ltd Total HV 140.3675 km, $5,140,577.47 Foreign to October 15, line Lot 1 23 × 100 kVA, MK 631,642,861.98 2018 6 × 200 kVA, 8 × 315 kVA, 1 × 500 kVA, 1 × 1,000 kVA transformers, 27 DOF structures, 2,515 m × 11 kV × UGC × 3C × 185 mm, 1,814 m × 33 kV × UGC × 3C × 185 mm. September 1, 2016 Distribution Lucky Exports Total HV 28.42 km, $3,515,718.47 Foreign to April 20, 2018 line Lot 2 total LV structures 94.5 km, MK 52,644,849.79 44 × 315 kVA transformers, 49 DOF structures. (continues) JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 43 TABLE A.2 Contract-Level Use and value of Inputs (Energy Sector Support Project) (Continued) MONTH OF DATA TYPE OF CONTRACTOR INPUT TYPE TOTAL VALUE EQUIPMENT CONTRACT OF INPUTS PROCURED LOCALLY OR FOREIGN September 1, 2016 Distribution MBH power Ltd Total HV structures 76, $767,428.22 Foreign to April 27, 2018 line Lot 3 total LV structures 399, MK 184,422,995.41 33 kV ACSR (dog) 100 mm 461.233 km, 0.4 kV AAC 100 mm (wasp) 16.33 km, 10 × 11/0.4 kV/315 kVA transformer, 2 × 33 kVA, 0.4 kVA/315 kVA, 185 mm UGC × 121 m, 70 mm UGC × 583 m. September 23, 2015 Distribution CME Cable 11,500 m, €1,838,698.06 Foreign to April 9, 2018 line jointing kits, MK 821,276,762.22 termination kits, cable warning or marking tape, cable route markers, cable lags and joint indicators, 4 legged RMU, earthing materials, 11 kV jointing kits, 11 kV 240 mm × LPE termination kits, cable fault locator May 10, 2015 to Meter Inhemeter Ltd 750 meters $1,497,622.50 Foreign October 15, 2018 contract 750 communication modules, 10 toolkits, 5 accuracy verifiers, 750 13-way test blocks, 30 meter enclosures, assorted LV CT sets September 8, 2015 AMR/AMI Powertech Production system: R 4,766,508.00 Foreign to October 15, 2018 system System Server hardware and UPS, software Integrators and operating system software, hardware licenses, application software, communication system between hardware and software, communication system for meter reading Disaster recovery system: Server hardware and UPS, operating system software, licenses, application software, communication system between hardware and software, communication system for meter reading, PCs. (continues) 44 Appendix A TABLE A.2 Contract-Level Use and value of Inputs (Energy Sector Support Project) (Continued) MONTH OF DATA TYPE OF CONTRACTOR INPUT TYPE TOTAL VALUE EQUIPMENT CONTRACT OF INPUTS PROCURED LOCALLY OR FOREIGN Test system: Test and communication hardware, operating system software, databases, licenses, application software, UPS and printer, FAT and SAT, training, project management and documentation, out-of-warranty system support and SLA September 8, 2015 System Foreign to July 1, 2017 contract November 12, 2015 Substation EMCO $9,537,850.63 Foreign to August 20, 2018 MK 123,190,666.42 Foreign $9,537,850.63 MK 123,190,666.42 Dwangwa Power transformer 132/33/11 kV, 25/30 MVA, auxiliary transformer 200 kVA, marshalling boxes, steel structures, 132 kV transmission feeder bay, surge arresters 132 kV, capacitive voltage transformers, motorized switching disconnector 132 kV, current transformer 132 kV, steel lattice busbar gantries, circuit breakers 132 kV, aluminum busbar conductor, 132 kV busbar coupler, motorized disconnector 33 kV, surge arrester 33 kV, transformer differential protection relay, station control system, telecommunication equipment, low-voltage and control cables and accessories, low-voltage auxiliary power supply, equipment and accessories for outdoor lighting, equipment and accessories for indoor lighting (continues) JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 45 TABLE A.2 Contract-Level Use and value of Inputs (Energy Sector Support Project) (Continued) MONTH OF DATA TYPE OF CONTRACTOR INPUT TYPE TOTAL VALUE EQUIPMENT CONTRACT OF INPUTS PROCURED LOCALLY OR FOREIGN Katoto Power transformer 33/11 kV, Foreign 10/15 MVA, auxiliary transformer 100 kVA, marshalling boxes, steel structures, 33 kV transmission feeder bay, surge arresters 33 kV, capacitive voltage transformers, motorized switching disconnector current transformer 33 kV, steel lattice busbar gantries, circuit breakers 33 kV, aluminum busbar conductor, 33 kV busbar coupler, motorized disconnector 33 kV, surge arrester 33 kV, transformer differential protection relay, station control system, telecommunication equipment, low-voltage and control cables and accessories, low-voltage auxiliary power supply, equipment and accessories for outdoor lighting, equipment and accessories for indoor lighting. Kauma Power transformer 66/11 kV, Foreign 15/20 MVA, auxiliary transformer 100 kVA, marshalling boxes, steel structures, 66 kV transmission feeder bay, surge arresters 66 kV, capacitive voltage transformers, motorized switching disconnector 66 kV, current transformer 66 kV, steel lattice busbar gantries, circuit breakers 66 kV, aluminum busbar conductor, 66 kV busbar coupler, motorized disconnector 66 kV, power transformer feeders 11 kV, surge arrester 11 kV, transformer differential protection relay, station control system, telecommunication equipment, low-voltage and control cables and accessories, low-voltage auxiliary power supply, equipment and accessories for outdoor lighting, equipment and accessories for indoor lighting. (continues) 46 Appendix A TABLE A.2 Contract-Level Use and value of Inputs (Energy Sector Support Project) (Continued) MONTH OF DATA TYPE OF CONTRACTOR INPUT TYPE TOTAL VALUE EQUIPMENT CONTRACT OF INPUTS PROCURED LOCALLY OR FOREIGN March 25, 2015 to Substation Sieyuan $9,826,706.00 Foreign June 4, 2018 MK 58,767,500.00 Chingeni Power transformer 66/33/11 kV, Foreign 15/20 MVA, auxiliary transformer 100 kVA, marshalling boxes, steel structures, 66 kV transmission feeder bay, surge arresters 66 kV, capacitive voltage transformers, motorized switching disconnector 66 kV, current transformer 66 kV, steel lattice busbar gantries, circuit breakers 66 kV, aluminum busbar conductor, 66 kV busbar coupler, motorized disconnector 33 kV, surge arrester 33 kV, transformer differential protection relay, station control system, telecommunication equipment, low-voltage and control cables and accessories, low-voltage auxiliary power supply, equipment and accessories for outdoor lighting, equipment and accessories for indoor lighting. Balaka Power transformer 33/11 kV, Foreign 10/15 MVA, auxiliary transformer 100 kVA, marshalling boxes, steel structures, 33 kV transmission feeder bay, surge arresters 33 kV, capacitive voltage transformers, motorized switching disconnector 33 kV, current transformer 33 kV, steel lattice busbar gantries, circuit breakers 33 kV, aluminum busbar conductor, 33 kV busbar coupler, motorized disconnector 11 kV, surge arrester 11 kV, transformer differential protection relay, station control system, telecommunication equipment, low-voltage and control cables and accessories, low-voltage auxiliary power supply, equipment and accessories for outdoor lighting, equipment and accessories for indoor lighting (continues) JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 47 TABLE A.2 Contract-Level Use and value of Inputs (Energy Sector Support Project) (Continued) MONTH OF DATA TYPE OF CONTRACTOR INPUT TYPE TOTAL VALUE EQUIPMENT CONTRACT OF INPUTS PROCURED LOCALLY OR FOREIGN Golomoti Power transformer 132/33/11 kV, Foreign 25/30 MVA, marshalling boxes, steel structures, 132 kV transmission feeder bay, surge arresters 132 kV, capacitive voltage transformers, motorized switching disconnector 132 kV, current transformer 132 kV, steel lattice busbar gantries, circuit breakers 132 kV, aluminum busbar conductor, 132 kV busbar coupler, motorized disconnector 33 kV, surge arrester 33 kV, transformer differential protection relay, station control system, telecommunication equipment, low-voltage and control cables and accessories, low-voltage auxiliary power supply, equipment and accessories for outdoor lighting, equipment and accessories for indoor lighting. Nkhotakota Power transformer 132/66/33 kV, Foreign 25/30 MVA, marshalling boxes, steel structures, 132 kV transmission feeder bay, surge arresters 132 kV, capacitive voltage transformers, motorized switching disconnector 132 kV, current transformer 132 kV, steel lattice busbar gantries, circuit breakers 132 kV, aluminum busbar conductor, 132 kV busbar coupler, motorized disconnector 33 kV, surge arrester 33 kV, transformer differential protection relay, station control system, telecommunication equipment, low-voltage and control cables and accessories, low-voltage auxiliary power supply, equipment and accessories for outdoor lighting, equipment and accessories for indoor lighting November 12, 2015 Substation Apollo $7,776,078.17 Foreign to June 5, 2018 MK 97,503,117.87 (continues) 48 Appendix A TABLE A.2 Contract-Level Use and value of Inputs (Energy Sector Support Project) (Continued) MONTH OF DATA TYPE OF CONTRACTOR INPUT TYPE TOTAL VALUE EQUIPMENT CONTRACT OF INPUTS PROCURED LOCALLY OR FOREIGN Fundis Power transformer 66/33/11 kV, Foreign 15/20 MVA, auxiliary transformer 100 kVA, marshalling boxes, steel structures, 66 kV transmission feeder bay, surge arresters 66 kV, capacitive voltage transformers, motorized switching disconnector 66 kV, current transformer 66 kV, steel lattice busbar gantries, circuit breakers 66 kV, aluminum busbar conductor, 66 kV busbar coupler, motorized disconnector 33 kV, surge arrester 33 kV, transformer differential protection relay, station control system, telecommunication equipment, low-voltage and control cables and accessories, low-voltage auxiliary power supply, equipment and accessories for outdoor lighting, equipment and accessories for indoor lighting. Bangwe Power transformer 33/11 kV, Foreign 10/15 MVA, auxiliary transformer 100 kVA, marshalling boxes, steel structures, 33 kV transmission feeder bay, surge arresters 33 kV, capacitive voltage transformers, motorized switching disconnector 33 kV, current transformer 33 kV, steel lattice busbar gantries, circuit breakers 33 kV, aluminum busbar conductor, 33 kV busbar coupler, motorized disconnector 11 kV, surge arrester 11 kV, transformer differential protection relay, station control system, telecommunication equipment, low-voltage and control cables and accessories, low-voltage auxiliary power supply, equipment and accessories for outdoor lighting, equipment and accessories for indoor lighting. (continues) JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 49 TABLE A.2 Contract-Level Use and value of Inputs (Energy Sector Support Project) (Continued) MONTH OF DATA TYPE OF CONTRACTOR INPUT TYPE TOTAL VALUE EQUIPMENT CONTRACT OF INPUTS PROCURED LOCALLY OR FOREIGN Nkula Power transformer 66/33/11 kV, Foreign 25/30 MVA, auxiliary transformer 200 kVA, marshalling boxes, steel structures, 66 kV transmission feeder bay, surge arresters 66 kV, capacitive voltage transformers, motorized switching disconnector 66 kV, current transformer 66 kV, steel lattice busbar gantries, circuit breakers 66 kV, aluminum busbar conductor, 66 kV busbar coupler, motorized disconnector 33 kV, surge arrester 33 kV, transformer differential protection relay, station control system, telecommunication equipment, low-voltage and control cables and accessories, low-voltage auxiliary power supply, equipment and accessories for outdoor lighting, equipment and accessories for indoor lighting. Source: ESCOM. Note: AAC = all aluminum conductor; ACSR = aluminum conductor steel-reinforced cable; AMI = advanced metering infrastructure; AMR = automated meter reading; CT = current transformer; FAT = Factory Acceptance Test; HV = high volt- age; km = kilometer; kV = kilovolt; kVA = kilovolt-ampere; LPE = cross-linked polyethylene] LV = low voltage; m = meter; mm = millimeter; MVA = megavolt-ampere; OH = overhead; PC = personal computer; SAT = Site Acceptance Testing; SLA = service level agreement; UGC = underground insulated cables; UPS = uninterruptible power supply. 50 Appendix A TABLE A.3 Contract-Level Use and Value of Inputs TYPE OF CONTRACTOR INPUT TYPE TOTAL TOTAL IMPORTED/ CONTRACT VALUE OF QUANTITY LOCAL INPUTS ($) OF INPUTS 400 kV OHL Kalpataru Design services and engineering 31,822,296.48 1 Preliminary works, site preparation, and 1 general facilities Normal suspension towers (NST4) 415 Imported Light angle tower (LAT4) Imported Heavy angle tower (HAT4) Imported Heavy angle tower (HAT4/DET4) Imported Light transposition angle tower (LAT/TR) Imported Conductor For 173 km Imported Spacer damper for conductor For 173 km Imported Rigid spacer for conductor jumpers 586 Imported Vibration damper stockbridge type 173 Imported OPGW and accessories Imported Earth wire, compression joints, and accessories. Imported Insulator sets Imported Tower earthing (galvanized steel) For 415 towers Imported Spare parts for NST4 Imported Spare parts for LAT4 Imported Spare parts for HAT4 Imported Spare parts for HAT4/DET4 Imported Spare parts for OPGW and earth wire accessories Imported Spare parts for insulator sets Imported Tools Imported Training of employer’s personnel 1 Imported Commissioning and energizing 1 Imported Supervision cars 4 (continues) JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 51 TABLE A.3 Contract-Level Use and Value of Inputs (Continued) TYPE OF CONTRACTOR INPUT TYPE TOTAL TOTAL IMPORTED/ CONTRACT VALUE OF QUANTITY LOCAL INPUTS ($) OF INPUTS 400/132 kV L&T Single busbar system, including steel 37,233,977.00 Imported substation equipment, gantries and equipment supports, aluminum busbar, AAC conductors, post insulator, cap insulators clamps, connecting material and accessories. 400 kV OHL bay comprising three-phase 2 of each Imported pantograph disconnectors, bypass disconnectors, three-phase single-pole circuit breaker, five-core CT, three-phase disconnectors with two earth switches, CVT, surge arrestors. 400 kV reactor bay comprising: three-phase 2 of each Imported pantograph disconnectors, three-phase single pole circuit breaker, five-core CT, three-phase disconnectors with two earth switches, surge arrestors, shunt reactor of 400 kV 50 MVar, neutral earthing reactor including lightning arresters, connecting material and accessories, point of wave switching device. 400 kV transformer bay comprising: three- 2 of each phase pantograph disconnectors, three-phase single pole circuit breaker, five-core CT, three-phase disconnectors with two earth switches, surge arrestors on the 400 kV side, surge arrestors on the 132 kV side, auto transformer 400/132/33 kV-200/200/2 MVA, single-phase units, earthing transformer 36/0.4 kV_630 kVA including an isolator, CB, resistor (R = 300 W), connecting material and accessories. (continues) 52 Appendix A TABLE A.3 Contract-Level Use and Value of Inputs (Continued) TYPE OF CONTRACTOR INPUT TYPE TOTAL TOTAL IMPORTED/ CONTRACT VALUE OF QUANTITY LOCAL INPUTS ($) OF INPUTS 400 kV busbar measuring bay including a 6 CVT and capacitive voltage transformer and a three- 2 sets of earth phase earthing switch, switches Double busbar system including 2 lots Imported steel equipment, gantries and equipment supports, aluminum busbar, AAC conductors, post insulator, cap insulators clamps, connecting materials and accessories. 132 kV OHL bays comprising: Imported three-phase horizontal center break disconnectors, three-phase angle pole breakers, a five-core CT, three-phase disconnectors with two earth switches, CVT surge arrestors, surge arrester discharge counter with current leakage monitoring insulated mounting 132 kV × LPE aluminum cable connection 1 × 800 mm2 (length approximately 350 m for each cable; total length 3,150 m), 132 kV cable terminals and accessories. 132 kV transformer bay with the following: Imported three-phase horizontal center break disconnectors, three-phase single-pole breakers, five-core CT, three-phase disconnectors with two earth switches. 132 kV bus coupler bay with the following: Imported three-phase horizontal center break disconnectors with one earth switch, three-phase single-pole breakers, five-core CT. 132 kV busbar measuring bay CVT and a three-phase earth switch 33 kV metal clad with a line feeder cubicle, Trafo feeder cubicle, bus coupler cubicle, measuring cubicle, station service transformer 33/04 kV 1,600 kVA, LVAC distribution board, 110 VDC distribution including a battery and a charger, 230 volt AC UPS, emergency diesel generator set 230/400 volt 50 Hz 200 kVA. (continues) JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 53 TABLE A.3 Contract-Level Use and Value of Inputs (Continued) TYPE OF CONTRACTOR INPUT TYPE TOTAL TOTAL IMPORTED/ CONTRACT VALUE OF QUANTITY LOCAL INPUTS ($) OF INPUTS power and control cables 1 lot control and protection equipment 1 lot a metering system 1 lot interface scada and telecommunication 1 lot an earthing and lightning protection system 1 lot civil works 1 lot Local commissioning works 1 lot supervising cars 6 132/66 kV Kalpataru 132 kV overhead lines 27,324,144.49 OHL Design services and engineering Imported Preliminary works, site preparation, and Imported general facilities Normal suspension towers (NST4) Imported Light angle tower (LAT4) Imported Heavy angle tower (HAT4) Imported Heavy angle tower (HAT4/DET4) Imported Light transposition angle tower (LAT/TR) Imported Conductor Imported Spacer damper for conductor Imported Rigid spacer for conductor jumpers Imported Vibration damper stockbridge type Imported OPGW and accessories Imported Earth wire, compression joints, and Imported accessories Insulator sets Imported Tower earthing (galvanized steel) Imported Spare parts for NST4 Imported Spare parts for LAT4 Imported Spare parts for HAT4 Imported Spare parts for HAT4/DET4 Imported (continues) 54 Appendix A TABLE A.3 Contract-Level Use and Value of Inputs (Continued) TYPE OF CONTRACTOR INPUT TYPE TOTAL TOTAL IMPORTED/ CONTRACT VALUE OF QUANTITY LOCAL INPUTS ($) OF INPUTS Spare parts for OPGW and earth wire Imported accessories Spare parts for insulator sets Imported Tools Imported Training of employer’s personnel Imported Commissioning and energizing Imported 66 kV overhead lines Normal suspension towers (NST4) Imported Light angle tower (LAT4) Imported Heavy angle tower (HAT4) Imported Heavy angle tower (HAT4/DET4) Imported Light transposition angle tower (LAT/TR) Imported Conductor Imported Spacer damper for conductor Imported Rigid spacer for conductor jumpers Imported Vibration damper stockbridge type Imported OPGW and accessories Imported Earthwire, compression joints, and Imported accessories Insulator sets Imported Tower earthing (galvanized steel) Imported Spare parts for NST4 Imported Spare parts for LAT4 Imported Spare parts for HAT4 Imported Spare parts for HAT4/DET4 Imported Monopole Spare parts for OPGW and earth wire Imported accessories Spare parts for insulator sets Imported Tools Imported (continues) JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 55 TABLE A.3 Contract-Level Use and Value of Inputs (Continued) TYPE OF CONTRACTOR INPUT TYPE TOTAL TOTAL IMPORTED/ CONTRACT VALUE OF QUANTITY LOCAL INPUTS ($) OF INPUTS 132/66 kV Chint 132 kV three-pole single circuit breakers 16,226,247.80 11 Imported substation 132 kV three-phase horizontal center break 23 sets Imported disconnectors 132 kV surge arresters with counters 18 sets 132 kV surge arresters 33 sets Imported Multicore current transformers 33 sets Imported Voltage transformers 33 sets Imported Three-phase disconnectors with two earth 10 Imported switches Three-phase disconnectors with one earth 8 Imported switch Earthing transformer 11 kV 2 Imported 132 kV × LPE aluminum cable 3 × (1 × 500 mm2) 1 Imported 132 kV cable terminal and accessories 1 Imported Power transformer 132/33/11 kV 25/25/5 1 Imported MVA OLTC Autotransformer 132/66/11 kV 25/25/5 MVA 1 Imported OLTC Power transformer 132/66 kV 50 MVA 1 Imported Synchro switching device 2 Imported 66 kV three-phase disconnectors 8 Imported 66 kV three-phase single-pole circuit breakers 10 Imported 66 kV multicore current transformers 27 Imported 66 kV voltage transformers 24 Imported 66 kV three-phase disconnector with one 6 Imported earth switch 66 kV three-phase disconnector with two 8 Imported earth switches Power transformer 66/11 kV 15 MVA 1 Imported 66 kV × LPE cable 3 × (1 × 240 mm2) 1 lot Imported Disconnectors 5 Imported Three-phase earth switches 2 Imported SF6 circuit breaker 6 Imported (continues) 56 Appendix A TABLE A.3 Contract-Level Use and Value of Inputs (Continued) TYPE OF CONTRACTOR INPUT TYPE TOTAL TOTAL IMPORTED/ CONTRACT VALUE OF QUANTITY LOCAL INPUTS ($) OF INPUTS 33 kV surge arresters 9 Imported 33 kV SF6 CB 3 33 kV current transformers 9 sets Imported 33 kV disconnectors with earth switch 2 Imported 33 kV three-phase earth switch 1 Imported 33 kV × LPE cable copper or aluminum 3 × 1 Imported (1 × 185 mm2) Station service transformer 11/0.4 kV 200 kVA 1 Imported Station service transformer 11/0.4 kV 50 kVA 1 Imported 11 kV MV switchgear—line feeder cubicle 4 Imported 11 kV MV switchgear—Trafo feeder cubicle 2 Imported 11 kV VT 3 11 kV earth switch 2 11 kV isolator 2 11 kV autorecloser 2 11 kV surge arresters 12 Imported 3 × (1 × 400 mm2) × LPE 11 kV cable (copper/ 1 Imported aluminum) 600 m 3 × (1 × 185 mm2) × LPE 11 kV cable (copper/ 1 aluminum) 500 m LVAC distribution 3 sets Imported 110 VDC distribution including a battery and 3 Imported a charger 230 V AC UPS 3 Imported Power and control cables 4 Imported Control and protection 4 Imported Interface SCADA/telecommunication 4 Imported Earthing and lightning protection 4 Imported Gasket/seals for each CB type installed 8 Imported Driving mechanism three-pole of each 2 Imported Gasket/seals of the driving mechanism for the 2 Imported CB type installed (continues) JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 57 TABLE A.3 Contract-Level Use and Value of Inputs (Continued) TYPE OF CONTRACTOR INPUT TYPE TOTAL TOTAL IMPORTED/ CONTRACT VALUE OF QUANTITY LOCAL INPUTS ($) OF INPUTS Relays for the CB drive of each breaker type 4 Imported installed Valve coils for each type installed 4 Imported Close coils for each type installed 4 Imported Trip coils for each type installed 4 Imported Heating resistors for each type installed 4 Imported Leakage detectors 2 Imported Current path for each disconnector installed 12 Imported Driving mechanism for each disconnector 4 Imported installed Current path for each earth switch type 8 Imported installed 33/11 kV CONCO Various distribution equipment 13,752,162.62 Imported substations and OHL 33/11 kV L&T Various distribution equipment 10,556,451.85 Imported substations and OHL Source: ESCOM. Note: AAC = all aluminum conductor AC = alternating current; CB = Circuit Breaker; CT = current transformer; CVT = continuous variable transmission; Hz = hertz; km = kilometer; kV = kilovolt; kVA = kilovolt-ampere; LPE = cross-linked polyethylene; LVAC = low voltage alternate current m = meter; mm2 = square millimeters; MVA = megavolt-ampere; MVAR = megavolt-ampere of reactive power; OHL = overhead line; OLTC = on-load tap changer; OPGW = optical ground wire; SCADA = supervisory control and data acquisition; SF6 = sulfur hexafluoride; UGC = underground cable; UPS = uninterruptible power supply; V = volt; VDC = volts direct current; VT = voltage transformer. 58 Appendix A APPENDIX B Dinkelman (2011) Estimates of Employment Impacts of Electricity Access As noted in the case study, the “productive use of electricity” jobs associated with the Energy Sector Support Project (ESSP) and the Millennium Challenge Corporation (MCC) project were estimated by multiplying the change in the fraction of the population with electricity access between 2013 and 2018 in Malawi by estimates of the employment impacts of increased electricity access obtained from Dinkelman (2011) for rural parts of South Africa and by the working-age population of Malawi in 2018. This appendix provides more details on the methods used by Dinkelman (2011). Dinkelman (2011) estimated the impacts of increasing electricity access on the employment- population ratio for working-age people (ages 15–59) in rural areas of South Africa. This was conducted as part of South Africa’s National Electrification Programme. Specifically, Dinkelman’s approach used an instrumental variable (IV) design and was based on the idea that steeper land gradients (slopes) raised the average cost of a household connection, making gradient an important factor in prioritizing areas for electrification. Assuming that gradient influences household-level outcomes only through its effect on grid placement (a key assumption known as the “exclusion restriction” in IV designs), Dinkelman’s approach accounts for endogenous (nonrandom) placement of the grid and helps recover the unbiased impact of electricity access on outcomes of interest. Critiques of Dinkelman (2011) have questioned the validity of the exclusion restriction (e.g., Bensch, Gotz, and Ankel-Peters 2020). In addition, more recent evidence suggests that the economic benefits of electricity may not be as large as those found by Dinkelman (2011). Specifically, Lee, Miguel, and Wolfram (2020) note that the literature on the labor- supply impacts of electrification is mixed, with large effects demonstrated by evaluations in South Africa, Nicaragua, and Brazil, and relatively modest and even null results from evaluations in India and Kenya. They argue that differences in empirical methods used to carry out the evaluations (e.g., experimental versus quasi-experimental techniques), in the nature of the intervention, and its potential for spillovers (e.g., national electrification schemes versus village-level experimental trials), and in regional and population-level characteristics (e.g., lack of complementary infrastructure) help explain these divergent estimates. The transferability of the results of Dinkelman (2011) from South Africa to Malawi may be limited by differences in contextual factors between the two countries. Specifically, these contextual factors can influence the impact of new or improved electricity access on labor-market outcomes, leading to the labor-market impacts in the parts of Malawi targeted by the ESSP and the MCC project differing from those covered by Dinkelman (2011) in South Africa. A comparison of the two areas suggests, however, that they do share JOBS GENERATED BY THE ENERGY SECTOR SUPPORT PROJECT IN MALAWI 59 many attributes. For example, although gross domestic product per capita in South Africa is much higher than in Malawi, Dinkelman (2011) focuses primarily on rural electrification occurring in relatively remote parts of the South African province of KwaZulu-Natal (KZN) between 1996 and 2001. The socioeconomic characteristics in KZN at that point bear a closer correspondence to those in Malawi at the time of the implementation of the ESSP and the MCC project. Specifically, Dinkelman (2011) reports that, at baseline, the poverty rate in the sample communities was approximately 60 percent, which is similar to the national poverty rate in Malawi in 2010. 60 Appendix B