Press Statement by Monie R. Captan

𝐏𝐑𝐄𝐒𝐒 𝐒𝐓𝐀𝐓𝐄𝐌𝐄𝐍𝐓

𝐁𝐲

𝐌𝐨𝐧𝐢𝐞 𝐑. 𝐂𝐚𝐩𝐭𝐚𝐧

𝐂𝐡𝐢𝐞𝐟 𝐄𝐱𝐞𝐜𝐮𝐭𝐢𝐯𝐞 𝐎𝐟𝐟𝐢𝐜𝐞𝐫, 𝐋𝐄𝐂

𝐍𝐨𝐯𝐞𝐦𝐛𝐞𝐫 𝟐𝟕, 𝟐𝟎𝟐𝟒

[𝙎𝙖𝙡𝙪𝙩𝙖𝙩𝙞𝙤𝙣𝙨]

I have called this Press Conference in light of the expiration of my contract as LEC CEO, which expires on November 30, 2024.

This is an opportune time to report on my stewardship over the past 2.5 years as Chief Executive Officer of the Liberia Electricity Corporation. I will use this press conference to inform you and the public of where we met LEC, where we are today, what we have achieved, the challenges we faced and those ahead, and the future opportunities that we have secured for LEC and the wider energy sector. But before I begin, I want to acknowledge that the efforts and achievements during my tenure were a result of teamwork, and therefore I cannot claim sole credit.

As you are all aware, we took over from a foreign management company, ESBI International from Ireland, which was financed by both the Millennium Challenge Corporation and the World Bank. Under the support of management reforms and technical assistance, ESBI competitively recruited a senior management resource pool, from where a successor management team of Liberians was selected, trained, and mentored, thus reintroducing a merit-based system to hiring. Along with this team, we assumed management of LEC in July 2022, and I am proud to report that this is one of the most professional teams I have worked with and is well capable of continuing the management of LEC.

Now I want to take you through the period of our stewardship. We assumed management of LEC on July 22, 2022. At that time, three out of four turbines at Mt. Coffee were functional, while all the thermal generators at Bushrod were down for maintenance and repairs. As a result, the national grid relied on only 3 hydro units which were only available mainly in the rainy season. Our first action was to repair all the thermal units and get them up and running. We accomplished this task at a cost of over $2m and restored all the HFO units thus adding 28MW of installed capacity to our generation supply.

Next, within three months of taking over LEC, we negotiated and signed a Power Purchase Agreement with CIE/CI Energies of Cote d’Ivoire in October 2022 and commenced receiving 27MW by December of the same year. Within four to five months, we had increased the supply of power from 56MW to 107MW, thus easing the impact of the 2023 dry season.

Now for a cursory look at our performance and achievements:

𝗘𝗡𝗘𝗥𝗚𝗬 𝗦𝗨𝗣𝗣𝗟𝗬/𝗚𝗘𝗡𝗘𝗥𝗔𝗧𝗜𝗢𝗡

In 2022, LEC supplied 275,426MWH of energy, which increased to 464,993MWH in 2023, and as of October 2024 energy supply had already reached 430,344 with a projection of over 520,000MWH by the end of 2024. Thus from 2023 to 2024, energy supply will increase by 88.79%. This supply of energy has been a critical driver of socio-economic growth and has positively impacted on manufacturing, education, health, and overall quality of life in our homes.

𝐏𝐎𝐖𝐄𝐑 𝐓𝐇𝐄𝐅𝐓 𝐀𝐍𝐃 𝐂𝐎𝐌𝐌𝐄𝐑𝐂𝐈𝐀𝐋 𝐋𝐎𝐒𝐒𝐄𝐒

At the end of 2022, commercial losses were reported at 41.3%, which decreased to 31.4% in 2023, and which further decreased to 27.5% by October 2024. Thus from 2022 to October 2024, commercial losses have decreased by a total of 33.4%. This achievement was realized through a cocktail of innovative interventions - the establishment of the Anti-Power Task Force, robust metering and regularization of illegal consumers, regular onsite meter audits and vigorous monitoring of large customers, and a more robust responsive meter maintenance team.

𝐑𝐄𝐕𝐄𝐍𝐔𝐄

In 2022, LEC earned a total of $24,000,000, which increased to $54,660,000 in 2023, and $56,610,000 by October 2024, with a projected revenue of $68,000,000 by the end of 2024. Thus, from 2022 to 2024, revenue will increase by 183%. However, energy supply costs have increased with the decreasing proportion of hydropower from Mt. Coffee. The geographical span of the national grid has also grown significantly, resulting in increasing operating cost. The expansion of the grid across transmission, distribution and generation, the increase in the number of customers, and the increase in energy imports, have all led to additional demands for more staff, vehicles, specialized equipment, tools, spare parts and equipment, customer outlets, IT equipment and software, and consumables. Prudent fiscal management is therefore a critical requirement for the company’s sustainability.

𝐏𝐑𝐎𝐅𝐈𝐓/𝐋𝐎𝐒𝐒

In 2022, LEC net loss was US$27.2 million which decreased to $18.3 million in 2023 and is expected to further decrease to about $11 million in December 2024. The corporation estimates that it will break even in the next two years subject to several assumptions, including restoration of Mt. Coffee Unit 1 turbine, commissioning of the new 20MW solar power plant, government payment of energy bills and further reduction in commercial losses.

𝐏𝐀𝐘𝐌𝐄𝐍𝐓 𝐒𝐓𝐀𝐓𝐔𝐒 𝐎𝐅 𝐂𝐋𝐒𝐆 𝐏𝐎𝐖𝐄𝐑 𝐈𝐌𝐏𝐎𝐑𝐓𝐒

Since the inception of power import from CIE/CI Energies through the CLSG Transmission line, LEC has been billed $32,499,334 for energy imported, of which the amount of $27,116,114 has been paid as of October 2024 leaving an outstanding balance of $5,383,224. Additionally, LEC has also been billed by Transco CLSG a total of $9,425,267 for transmission charges, of which $8,314,034 has been paid, leaving an outstanding balance of $1,111,233.

As at September 30, 2024, the balance on the Cross-Border HTA legacy debt was US$10,672,550. This amount is owed CIE in part by the Government of Liberia, and the operators of the distribution networks in Nimba, Bong, Maryland, Grand Gedeh and River Gee Counties. This debt was rescheduled over a three-year payment period agreed with the Ivorian authorities.

𝗚𝗢𝗟 𝗜𝗡𝗗𝗘𝗕𝗧𝗘𝗗𝗡𝗘𝗦𝗦

The Government of Liberia is the largest consumer of the electricity supplied by LEC, which accounts for approximately 14% of all energy sold. Currently, the government is indebted to LEC in the amount of $18,975,049 as of October 31, 2024. The LEC management and the Board of Directors have engaged the government through the Ministry of Mines and Energy and the Ministry of Finance and Development Planning to ensure that beginning 2025, budgetary allocations will be made to pay for the energy consumption of each government entity through prepay metering service. The payment of energy bills by the government will improve LEC’s capacity to pay for energy imports and the maintenance of its electrical network, thus improving service delivery to the general public.

𝗖𝗨𝗦𝗧𝗢𝗠𝗘𝗥 𝗖𝗢𝗡𝗡𝗘𝗖𝗧𝗜𝗢𝗡𝗦

In 2022, LEC total customer base stood at 199,441 customers, which increased to 282,505 in 2023, and by October 2024 had reached a total of 306,433 customers. Thus, LEC customer base increased from 2022 to October 2024 by 53.6%.

𝗘𝗫𝗣𝗔𝗡𝗗𝗜𝗡𝗚 𝗔𝗖𝗖𝗘𝗦𝗦

To complement the support of Donor Partners, LEC for the first time in post – war Liberia committed a portion of its revenue annually to connect households in unserved communities. Under its Gap Communities Electrification Project, LEC financed the connection of 9974 households across nineteen unserved communities to the grid at $5.2M. Some of these communities had no electricity since the end of the war, and others from before the war. Beneficiary communities include Zeon Town, Iron Factory, Wanwosu, Virginia Red Hill Field, Brewerville Store, New Jerusalem Johnsonville etc. LEC is continuing its GCEP into its 5th Cycle with the connection of 1039 households in Paynesville and Bardnesville at an additional cost of $630,000.

𝗡𝗘𝗧𝗪𝗢𝗥𝗞 𝗥𝗘𝗟𝗜𝗔𝗕𝗜𝗟𝗜𝗧𝗬 (𝗦𝗔𝗜𝗙𝗜/𝗦𝗔𝗜𝗗𝗜)

Network reliability in terms of frequency and duration of interruptions has improved significantly. The System Average Interruption Frequency Index (SAIFI) improved from 22 times a year to 5 times a year between January 2022 to September 2024. The System Average Interruption Duration Index (SAIDI) improved from 31.01 hours to 8.9 hours between January 2022 to September 2024. In simple terms, the number of times power went off and the length of time power remained off have reduced significantly from 2 years ago.

𝗚𝗥𝗜𝗗 𝗖𝗢𝗩𝗘𝗥𝗔𝗚𝗘

Through donor support 3 new substations were added to the grid in Congo Town, RIA and Schieffelin enabling the extension of electricity to as far as Cotton Tree and Dolos Town. Today, LEC has 13 major substations, namely Bushrod, Mt. Coffee, Kru Town, Virginia, Kle, Capitol, Congotown, Stockton Creek, Gardnersville, Paynesville, Kakata, Schieffelin, and RIA. These substations supply energy through a total of 39 MV/feeder networks.

From 2022 to date, LEC added 92km of high voltage (HV)/transmission lines (66kV), 138km of medium voltage (MV) lines (22kV/33kV), 350 km of low voltage (LV) lines and 768 distribution transformers to its network. Currently, LEC has 376km of 66kV-HV lines; 667km of 22kV-MV lines; 262km of 33kV-MV lines; 1312km of LV distribution lines and 3341 distribution transformers. All of this has been achieved through the tremendous support of our partners, particularly the World Bank, EU, AfDB and KfW. Grid coverage now extends over Montserrado, Bomi, Cape Mount and Margibi counties. Franchise arrangements cover Maryland, River Gee, Grand Gedeh, Nimba, and Bong counties.

𝗙𝗨𝗘𝗟 𝗥𝗘𝗦𝗘𝗥𝗩𝗘 (𝗛𝗙𝗢)

As part of the dry season preparedness, management has procured and stored 1.62m gallons of Heavy Fuel Oil (HFO) for the operation of its thermal generators at the LEC Bushrod facility. The value of the fuel stock is approximately $5m. However, this stock level cannot serve the entire dry season and will have to be augmented.

𝗛𝗨𝗠𝗔𝗡 𝗥𝗘𝗦𝗢𝗨𝗥𝗖𝗘𝗦

LEC has a total of 1,100 employees, of which 668 are non-technical and 442 are technical staff. Building staff capacity is key to operational efficiency across diverse operational theaters within LEC. Training plans are developed and implemented annually with a key focus on improving service delivery. Over 50% of LEC staff have benefited from LEC training programs in-country and abroad, covering all aspects of utility operations.

Gender mainstreaming is an important policy priority for LEC. With support from USAID under its Engendering Utilities Program, management organized and held a ten (10) day intensive training program for nineteen (19) female technicians and engineers to build their capacities for supervisory leadership roles.

Management has successfully negotiated and concluded a Collective Bargaining Agreement with the Workers Union for the next three years, which will provide union employees with a salary increment, Shift Allowance, educational assistants for three dependents, transportation allowance, housing allowance, July 26 and Christmas bonus, retirement sendoff benefits, and provision of rice.

𝗜𝗡𝗧𝗘𝗥𝗡𝗔𝗧𝗜𝗢𝗡𝗔𝗟 𝗠𝗘𝗠𝗕𝗘𝗥𝗦𝗛𝗜𝗣 𝗜𝗡 𝗧𝗛𝗘 𝗘𝗗𝗜𝗦𝗢𝗡 𝗘𝗟𝗘𝗖𝗧𝗥𝗜𝗖 𝗜𝗡𝗦𝗧𝗜𝗧𝗨𝗧𝗘 (𝗘𝗘𝗜)

In 2023, LEC joined the Edison Electric Institute (EEI) as one of its 70 international members and as a strategic goal to collaborate with other electric companies on public policy, business development, and knowledge sharing. Since joining EEI, LEC has benefited from an important initiative aimed at enhancing the capacity and knowledge of LEC stakeholders. The event which took place from July 2-12th, 2024, is a part of LEC’s effort to strengthen its power infrastructure and service delivery. The engagement aimed to educate stakeholders on the fundamentals of electrifying a country, raise awareness about the challenges and opportunities in the electrification process, and transfer knowledge to LEC employees in areas such as electric company planning, operations, maintenance, customer engagement, communications, and financial management.

𝗔𝗨𝗗𝗜𝗧𝗦

The General Auditing Commission (GAC) commenced audit of LEC on July 30, 2024, for the period 2018 to 2023. The audit is ongoing and will be published once completed.

Concurrently, Price Waterhouse Coopers (PWC) is auditing LEC for the period 2021 to 2022. This audit is ongoing and will be published once completed.

𝗢𝗡𝗚𝗢𝗜𝗡𝗚 𝗔𝗡𝗗 𝗣𝗟𝗔𝗡𝗡𝗘𝗗 𝗣𝗥𝗢𝗝𝗘𝗖𝗧𝗦

We have focused primarily on addressing critical issues that will impact our service delivery, namely, the generation and power supply gap, network optimization, and access.

𝗘𝗡𝗘𝗥𝗚𝗬 𝗦𝗨𝗣𝗣𝗟𝗬

1. Owing to the high cost of thermal energy and its negative impact on climate change, LEC has planned its future energy generation development on a transition from fossil-fuel-based thermal to renewable energy, with solar and hydropower as its priority sources. The seasonality of the rainy and dry seasons provides a good opportunity for hybridization of solar and hydro, thus optimizing the supply of power from renewable sources.

2 As you are aware, three out of the four turbines at Mt. Coffee are operational, with one unit out of operation dur to a fire outbreak in the stator unit. We have been successful in obtaining financing of $5.5m through the World Bank LESSAP project for the repair of the unit. With the procurement process almost completed, we expect repairs to begin in 2025 thus restoring Mt. Coffee to its original 88MW installed capacity.

3 Construction of a 20MW solar power plant at Mt. Coffee has commenced and will be concluded by October 2025. This project, which cost $16 m, was financed through the World Bank under the RESPITE Project. The solar project can potentially be increased to 30MW.

4 Financing in the amount of $62m for the expansion of Mt. Coffee Hydropower plant by the addition of 2-4 turbines has also been approved under the World Bank RESPITE Project. Engineering and design work are ongoing along with the preparation of bidding documents.

5 Negotiations are underway to lease a 16.5MW solar plant with Battery Storage. LEC has already purchased 100 acres of land near its substation on the RIA Highway for this project and a Letter of Intent has been signed. The final contract is under discussion and will need to be finalized between LEC and SCATEC. The project is supported by the International Finance Corporation through financial guarantees.

6 A new hydro dam is planned as one of the priority energy investments of the government along the St. Paul River upstream of the Mt. Coffee dam. This project will deliver between 150 – 200MW. Feasibility studies covering engineering and environmental studies will be ready next year. The project will cost approximately $600m to $700m and will include an access road from Bong Mines to the project site, a substation, transmission lines from the Project site to Mt. Coffee and an operators’ camp. Based on negotiations with development partners, conditional commitment for 50% financing of SP2 has been made by the World Bank. In late September of this year, I was opportune to travel to Luxembourg to the Headquarters of the European Investment Bank (EIB) where I met with officials of EIB about financing SP2.

I am pleased to report that our meeting with the EIB and the EU was very productive with strong interest expressed for the co-financing of the project. A mission from the EIB is due in Liberia next week for further discussions on potential support to Liberia. Continued oversight of the feasibility studies and engagement with partners to mobilize financing are key requirements going forward.

7 When all these projects are successfully implemented, LEC can expect to increase its installed generation capacity from 126MW to 412.5MW, thus strengthening Liberia’s energy sovereignty.

𝗜𝗠𝗠𝗘𝗗𝗜𝗔𝗧𝗘 𝗣𝗟𝗔𝗡𝗦 𝗙𝗢𝗥 𝟮𝟬𝟮𝟱 𝗗𝗥𝗬 𝗦𝗘𝗔𝗦𝗢𝗡

Presently, negotiations are ongoing to renew the Power Purchase Agreement with CIE, which will expire at the end of December 2024. LEC has submitted a proposal to CIE/CI Energies, and awaits a draft renewal proposal for the PPA, with terms and conditions going forward. Every effort has been made to increase the firm capacity that will be supplied to LEC under the PPA.

LEC management has engaged in negotiations with Volta River Authority to purchase up to 50MW of power from Ghana. These negotiations are ongoing and are subject to the successful negotiation of trans-border transmission agreements with Ghana, Cote d’Ivoire, and Transco CLSG.

𝗟𝗔𝗥𝗚𝗘 𝗖𝗨𝗦𝗧𝗢𝗠𝗘𝗥 𝗖𝗢𝗡𝗡𝗘𝗖𝗧𝗜𝗢𝗡𝗦

LEC has continued to connect commercial and industrial customers to the grid as a means of assuring revenue for the Corporation and improving the business climate in Liberia. In 2022, LEC added a total of 15MVA large customer connection, in 2023 a total of 21MVA and in 2024 a total of 41MVA. Some of these customers and facilities are critical to our economy and national security, including CEMENCO, Jeety Rubber Processing, Schieffelin Military Barracks, and Roberts International Airport. LEC has financed the connection of all customers within the Monrovia Industrial Park to the grid. LEC has also been allotted 2 acres of land within the park for the construction of a 40MVA substation.

Additionally, we have engaged ArcelorMittal in negotiations for a power purchase agreement for the supply of power to their mines through the CLSG. The negotiations are fully advanced and could provide an opportunity for further investment in LEC’s generation capacity.

𝗧𝗥𝗔𝗡𝗦𝗠𝗜𝗦𝗦𝗜𝗢𝗡 𝗔𝗡𝗗 𝗗𝗜𝗦𝗧𝗥𝗜𝗕𝗨𝗧𝗜𝗢𝗡 𝗜𝗡𝗙𝗥𝗔𝗦𝗧𝗥𝗨𝗖𝗧𝗨𝗥𝗘

The Transmission lines from Mt. Coffee substation to Monrovia and Paynesville have almost reached their maximum thermal capacity posing a risk to network performance and grid stability and will require an upgrade from 66kV to 132kV. LEC management has engaged the European Union to finance the upgrade, which has received an encouraging response pending a formal request from the Government. This upgrade will cost approximately $45m.

For the first time ever, LEC will have a Supervisory Control and Data Acquisition (SCADA) system for the management of its electrical network. The SCADA system will allow LEC to improve reliability, optimize operation, and enhance intelligent control and protection of the national power grid. The SCADA system is under development at LEC’s Bushrod yard and will cost a total of $11.5m.

As most of you are aware, a large number of LEC’s transformers deployed in its network are damaged quite frequently and continue to be damaged due to overloading and illegal activities on our network. Repair of transformers has been constrained due to the lack of a properly equipped transformer repair facility. With support from the World Bank, I am pleased to inform you that LEC has just constructed and equipped a modern transformer repair workshop at its Bushrod facility at a cost of $127,000. The new workshop will enable our staff to repair damaged transformers rapidly and properly, thus improving LEC’s response time in restoring power to affected communities.

𝗘𝗫𝗣𝗔𝗡𝗗𝗜𝗡𝗚 𝗔𝗖𝗖𝗘𝗦𝗦

Access to electricity in Liberia is estimated at 33% therefore this remains an urgent concern nationally and particularly for LEC as many communities within the national grid remain without access to electricity. Under the World Bank LESSAP Project, LEC is connecting 50,000 households in communities along the Paynesville – Kakata corridor and the St. Paul River Bridge – Po River Corridor. All transformers and connection materials for this project have been delivered to LEC Bushrod facility. A survey of the project areas is completed, and construction works are expected to commence soon.

Under its Gap Communities Electrification Project (GCEP), LEC has completed surveys, designs and costing for the continuation of the 6th, 7th and 8th cycle of this project targeting 7,500 households across 15 communities.

𝗖𝗨𝗦𝗧𝗢𝗠𝗘𝗥 𝗦𝗘𝗥𝗩𝗜𝗖𝗘

Improving Customer Service has also been a major consideration for management, especially in facilitating customer access to customer service. We are pleased to announce that we have provided several customer service outlets in the following communities: Congotown, Chocolate City. Jacob Town, Tweh Farm, Rehab. Junction, Kakata, and Tubmanburg. Additionally, an Agile Unit was established of technicians with assigned motorcycles and tricycles who can quicky be deployed in the field to respond to customers complaints or to meter customers.

As a further measure to enhance responsiveness to customer complaints, the Customer Advocacy Unit was established to resolve long-standing complaints by dealing with cross-cutting problems across various departments.

𝗦𝗨𝗣𝗣𝗟𝗬 𝗢𝗙 𝗠𝗘𝗧𝗘𝗥𝗦

Meter availability has always been a challenge and LEC has been solely dependent on donor support for the supply of meters. To alleviate this situation, LEC entered into a three-year framework agreement for the provision of 300,000 meters. It is important to note that this procurement is solely financed by LEC. The first consignment of these meters, amounting to 12,880 meters, has already arrived in the country.

LEC has also entered into a three-year framework agreement for the supply of High Security Meters for the connection and robust monitoring of additional large commercial and industrial customers. This procurement is solely financed by LEC. The first consignment of these meters, amounting to 120 meters, has already arrived in the country. This effort is complemented under the World Bank LESSAP program with the procurement of an Advanced Metering Infrastructure (AMI) to ensure the remote monitoring of large customers.

These and other efforts have not gone unnoticed. We have received many commendations from our partners and stakeholders in recognition of the performance of the LEC management in turning LEC around, especially in respect of major reduction of commercial losses, increase in revenue, improved service reliability, increased coverage and customer connections.

On April 17, 2024, the President of the World Bank Mr. Ajay Banga and the President of the African Development Bank, Mr. Akinwumi Adesina announced a joint partnership platform on the margins of the World Bank/IMF Spring Meetings to provide electricity access to 300 million people in Sub-Saharan Africa by 2030. I am pleased to announce that in recognition of Liberia’s progress in the energy sector, and LEC’s performance and achievements, Liberia was selected among 15 countries in Africa to develop an energy compact with the World Bank and the African Development Bank.

In this regard, H.E. Joseph N. Boakai, Sr., President of Liberia has been invited to the Head of State Energy Summit that will take place on January 2025 in Tanzania, where Liberia’s National Energy Compact will be presented.

As I draw down to the end of my service, I take this opportunity to thank all the employees and staff of LEC for their unparalleled support, hard work, and professionalism in realizing these achievements which I have enumerated. LEC is a national success story in Liberia and the energy sector. We only need to look back and see where we have come from. The numbers do not lie, and that is why I have taken the time to provide the data of our success in this public manner.

Our international partners have really been true partners, who because of our demonstrated performance and achievements, have provided invaluable support to LEC and the energy sector. Without them, we would indeed be in a woeful state. So, to our key energy sector development partners, I, and my colleagues at LEC remain forever grateful for your generous support and confidence.

Lastly, to our Board of Directors and the President of Liberia, H.E. Dr. Joseph N. Boakai Sr., I thank you for the opportunity to serve.

Permit me to end with a parting quote from Theodore Roosevelt:

“It is not the critic who counts: not the man who points out how the strong man stumbles or where the doer of deeds could have done better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly, who errs and comes up short again and again, because there is no effort without error or shortcoming, but who knows the great enthusiasms, the great devotions, who spends himself in a worthy cause; who, at the best, knows, in the end, the triumph of high achievement, and who, at the worst, if he fails, at least he fails while daring greatly, so that his place shall never be with those cold and timid souls who knew neither victory nor defeat.”

Theodore Roosevelt

Speech at the Sorbonne, Paris, April 23, 1910

𝗧𝗵𝗮𝗻𝗸 𝘆𝗼𝘂.