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PublicationInvestment Commitments Remain Stable in Latin America While the Number of New Projects Declines(World Bank, Washington, DC, 2009-12) Izaguirre, Ada Karina; Jett, Alexander NicholasPrivate activity in infrastructure in Latin America and the Caribbean showed mixed results in 2008, according to just-released data from the Private Participation in Infrastructure Project database. Investment in new projects slowed in the second half of the year with the full onset of the financial crisis. This slowdown led to a decline in the number of projects for the entire year. The region accounted for 26 percent of the year's total investment commitments in developing countries, the second largest share among developing regions. In 2008, 41 infrastructure projects with private participation reached financial or contractual closure in eight low- or middle-income countries in the region. These projects involve investment commitments (hereafter, investment) of US$14.6 billion. Infrastructure projects implemented in previous years had additional commitments of US$25.7 billion, bringing total investment in 2008 to US$40.3 billion. That represented an increase of 2 percent from the level reported in 2007. Investment in existing projects, up 12 percent from the level in 2007, drove the increase. PublicationUnderstanding Sector Performance : The Case of Utilities in Latin America and the Caribbean(World Bank, 2009-07-29) World BankThis report provides innovative approaches to better understand infrastructure sector performance by focusing on the links between key indicators for private and public utilities, and changes in ownership, regulatory agency governance, and corporate governance, among other dimensions. By linking inputs and outputs over the last 15 years, the analysis proposes key determinants that have impacted sector performance in infrastructure sectors in Latin America and the Caribbean (LAC). It is about understanding how and to what extent the effect of such elements result in significant changes in the performance of infrastructure service provision. This report focuses on the distribution segment of basic infrastructure services. It covers electricity distribution, water distribution and sewerage, and fixed telecommunications. More specifically, the report does: i) depict sector performance with a broad set of indicators that describes the current situation as well its evolution during the last 15 years; ii) propose analytical frameworks for themes less developed in the literature such as regulatory governance and corporate governance for state-owned enterprises (SOEs); iii) benchmark the institutional designs of the regulatory agencies in the region for the water and electricity sectors; and iv) analyze the relationship between sector performance and regulation, private sector participation, and corporate governance. PublicationInnovative Financial Mechanism to Implement Energy Efficiency Projects in Mexico(Washington, DC, 2009-06) World BankThis report provides a summary of Energy Sector Management Assistance Program (ESMAP) supported activities in Mexico focused on the creation of a pooled financing program for multiple energy efficiency projects through a single debt instrument. The report is organized as eight chapters. Chapter one provides additional details regarding the ownership, structure and operation of an special purpose entity (SPE); it discusses the flexibility of this structure and how it can serve a pool of private or public sector projects. Chapter two provides an overview of the Mexican energy sector with a focus on the electricity supply, demand and pricing. Chapter three reviews the market potential for energy efficiency investments and provides comparative data on Mexico's energy prices and costs of capital in other countries where the energy efficiency and energy services company (ESCO) market is active. Chapter four reviews the current financial market conditions in Mexico, and the restrictive nature of commercial lending. Chapter five identifies the market, institutional and financial barriers to implementation of energy efficiency and ESCO projects in Mexico with a focus on financial issues. Chapter six provides an overview of the pilot SPE structures under development for the pool financing of multiple projects. A separate SPE is being created for public and private projects. Chapter seven reviews the current status of each SPE initiative, and takes a look into the future with a discussion of next steps. Chapter eight provides a summary of lessons learned from this project, and their application to future efforts in this area. PublicationLatin America and the Caribbean Region Energy Sector : Retrospective Review and Challenges(World Bank, Washington, DC, 2009-06) Byer, Trevor; Crousillat, Enrique; Dussan, ManuelDuring the 90s, most countries in Latin America and the Caribbean Region (LCR) supported by the World Bank, implemented a market-oriented reform in the energy sector to promote competition, economic regulation and greater private sector participation, as the main instruments to improve the quality, reliability and efficiency of energy services, and improve the government's fiscal position and increase affordable access to modern energy services for the poor. This report comprises an assessment of the energy sector reform in the region: its achievements, difficulties, lessons learnt and current status; an assessment of the future needs of the energy sector investment and financing requirements, constraints, and challenges; and a review of the role of development agencies in supporting the region's energy needs. The study is not a systematic analysis of the reform experience and needs of individual countries, which is not deemed necessary to define an energy strategy for the region, but rather an analysis of the main themes that are common to most countries, with reference to specific cases of individual countries, based on a review of the documentation available on the reform, and on current energy plans. The power sector reform in the region had a substantial positive fiscal impact. During the past 15 years, private investment in electricity in LCR amounted to about US$103 bn, about 60 percent in divestiture of public assets, and 40 percent in green-field projects. Investments in divestiture peaked at about US$21 bn at the time of the privatization of major distribution assets in Brazil, and almost vanished by 2002. Investments in green-field projects have been more stable during the past 10 years. PublicationInfrastructure in Latin America : An Update, 1980-2006(Washington, DC: World Bank, 2009-05-29) Calderón, César; Servén, LuisThis paper documents the trends in infrastructure in major Latin American economies over the last quarter century. Drawing from an expanded and updated data set, the paper sheds light on the region's infrastructure performance along four major dimensions. First, the paper documents the trends in the quantity of Latin America's infrastructure assets, using a comparative cross-regional perspective. Second, the paper presents a battery of indicators of the quality of infrastructure services, taking the same comparative perspective. Third, the paper reviews Latin America's performance in terms of the universality of access to infrastructure services. Lastly, the paper offers a detailed account of the trends in infrastructure investment in Latin America's six major economies since 1980, disaggregated by both sector of origin (public and private) and destination (power, transport and telecommunications). PublicationCrisis in LAC : Infrastructure Investment and the Potential for Employment Generation(World Bank, Washington, DC, 2009-05) Tuck, Laura; Schwartz, Jordan; Andres, LuisInfrastructure investment is a central part of the stimulus plans of the Latin America and Caribbean Region (LAC) as it confronts the growing financial crisis. This paper estimates the potential effects on direct, indirect, and induced employment for different types of infrastructure projects with LAC-specific variables. The analysis finds that the direct and indirect short-term employment generation potential of infrastructure capital investment projects may be considerable-averaging around 40,000 annual jobs per US$1billion in LAC, depending upon such variables as the mix of subsectors in the investment program; the technologies deployed; local wages for skilled and unskilled labor; and the degrees of leakages to imported inputs. While these numbers do not account for substitution effect, they are built around an assumed "basket" of investments that crosses infrastructure sectors most of which are not employment-maximizing. Albeit limited in scope, rural road maintenance projects may employ 200,000 to 500,000 annualized direct jobs for every US$1billion spent. The paper also describes the potential risks to effective infrastructure investment in an environment of crisis including sorting and planning contradictions, delayed implementation and impact, affordability, and corruption. PublicationToward Cleaner, Cheaper Power : Streamlined Licensing of Hydroelectric Projects in Brazil(Washington, DC, 2009-02) World BankBrazil is confronted with steadily increasing demands for electricity. The country has the ability to meet that demand by developing its considerable hydropower potential, but the regulatory process that governs the approval of new hydroelectric plants imposes unnecessary delays that push up project costs and increase uncertainty. The process, among other reasons, has created a shortage of investment in otherwise viable hydropower projects in favor of less efficient and more harmful technologies. Brazil's electricity sector serves roughly sixty million residential and commercial customers and generates revenues of US$20 billion. With demand growing at a rate of 4.4 percent annually, an additional 3,000 megawatts of generating power will be needed by 2015. The cost of the new power plants needed to provide that power is estimated at US$40 billion. Presently, five-sixths of the country's power needs are met by hydroelectric plants, though in recent years only half of the new plants receiving licenses to begin construction have been hydroelectric. The other half of the licenses have been issued for coal, diesel, and nuclear plants that provide electricity at higher unit costs than hydroelectric plants and have greater adverse effects on people and the environment. The seeming anomaly can be explained by the fact that the licensing process for thermal plants is simpler and more predictable than that for hydroelectric plants. PublicationResidential Electricity Subsidies in Mexico : Exploring Options for Reform and for Enhancing the Impact on the Poor(World Bank, 2009) Komives, Kristin; Johnson, Todd M.; Halpern, Jonathan D.; Aburto, Jose Luis; Scott, John R.This report addresses a pressing issue in Mexico's electricity sector the large and growing subsidies to residential consumers and their regressive incidence across different segments of the population. It responds to requests from the Ministry of Energy to provide a preliminary assessment of alternatives to the current subsidy system, building on prior collaboration between the Government of Mexico and the World Bank on the distributional impact of public spending, the performance of conditional cash transfer programs and other poverty-targeted programs, and related work on pricing and subsidies for infrastructure services. This study was designed as the first phase of a multiphase program of collaborative analytical work. This first phase provides estimates of the distributional and fiscal performance of alternative subsidy targeting mechanisms to help inform discussion and deliberations on feasible goals and practical approaches over the medium term. A second phase will address transition paths, specific compensatory mechanisms, and decision processes for pursuing the options that the Mexican authorities deem most promising. PublicationInvestment Commitments in Latin America and the Caribbean Increased in 2007(World Bank, Washington, DC, 2008-12) Izaguirre, Ada Karina; Jett, Alexander NicholasInvestment commitments to infrastructure projects with private participation in Latin America and the Caribbean grew by 28 percent to US$38.3 billion in 2007, according to just-released data from the private participation in infrastructure project database. The region accounted for 24 percent of the year's total investment commitments in developing countries. Despite having grown for four consecutive years, investment commitments remained well below the region's peak levels reached in 1997-98. Investment in 2007 was just 44 percent of the peak in 1998. Previously implemented projects largely drove the 2007 investment. Projects reaching financial or contractual closure in 1990-2006 attracted US$22.3 billion, while the 46 new projects implemented in 2007 accounted for US$16 billion. Investment in physical assets amounted to US$32.5 billion. Indeed, if only investment in physical assets were counted-that is, excluding payments to the government (such as divestiture revenues and spectrum or concession fees) investment in 2007 would be just 22 percent below the peak level of 1998. PublicationPeru: Institutional and Financial Framework for Development of Small Hydropower(Washington, DC, 2008-06-26) World BankPeru is favored by a stable and growing economy and the availability of indigenous sources of energy for electricity generation, hydro and natural gas. Installed capacity in Peru in 2006 was 6658 MW, of which 48 percent was hydro-based. However, regarding new investment in generation, there is reason for concern. Demand growth over the past five years has been 5-10 percent, with no signs of slowing down. At the rate of 10 percent demand growth, 400 MW of new generation capacity is necessary each year, representing at least US$250 million annually of new investment. The present study on small hydropower contains the following sections: (i) introduction; (ii) technical potential for development of small hydropower in Peru; (iii) economic and financial viability of small hydro development in Peru; (iv) institutional and regulatory environment; (v) identification of barriers to small hydropower development and mitigation measures; (vi) international experience with small hydropower development; (vii) the potential impact of the Renewable Energy Decree; and finally, (vii) conclusions and recommendations.