BUILDING REGULATORY CAPACITY IN SIERRA LEONE'S ELECTRICITY AND WATER SECTORS

Sierra Leone's Electricity and Water Regulatory Commission (EWRC) needed to transform from a nascent institution into an effective, independent regulator capable of overseeing the country's electricity and water sectors. Without a comprehensive regulatory framework, clear tariff methodologies, or established procedures for utility oversight, the regulator lacked the tools and capacity to fulfill its mandate. The stakes were high: strengthening EWRC was essential not only for sector reform but also for Sierra Leone's eligibility for future development assistance from MCC.

Over four years, DHInfrastructure coordinated the development and implementation of EWRC's complete regulatory framework. We led the design of critical regulations including reporting requirements, regulatory accounting principles, licensing procedures, performance monitoring systems, economic and technical regulations, quality of service standards, and public hearing processes. Working closely with multiple stakeholders, we developed comprehensive tariff methodologies for the electricity and water sectors, including a 10-year electricity sector financial model that projects future financial statements for utilities, government, and independent power producers.

To ensure the framework could be applied in practice, we coordinated hands-on capacity building activities. We designed and facilitated workshops with EWRC staff and utility representatives to conduct a "dry run" tariff review exercise, providing practical experience in rate-case procedures. Throughout the program, we worked with EWRC's Director General to identify gaps requiring additional technical assistance, from transparency protocols to power purchase agreement reviews, and coordinated the delivery of supplemental support in these areas. We also evaluated the regional implications of WAPP membership and assessed transmission tariff methodologies to prepare Sierra Leone for regional energy trading.

The program achieved measurable institutional transformation. An independent evaluation found that regulations approved under the threshold program clarified EWRC's role and established the regulator as a significant player in both sectors. The tariff "dry run" provided clear guidance on rate-setting procedures, strengthened utility capacity to collect and report key performance indicators, and improved communication between entities. In 2021, the Guma Valley Water Company received its first tariff adjustment in five years—a direct result of the strengthened regulatory capacity.

In December 2020, MCC's Board of Directors selected Sierra Leone as compact-eligible—a designation the country has maintained every year since. In September 2024, MCC and Sierra Leone signed a five-year, $480 million Compact to build on the threshold program's energy sector reforms.