The OBA scheme would help EEPCo, a state owned national utility, finance the cost of connection of poor customers or 286,000 households in rural areas. The lack of access to financing is a barrier to including poor costumers in the current rural access expansion efforts. The proposed one-off subsidy would pay for: the financing costs to provide a 5 year loan to poor strata of the population who get connected to the electricity grid; and the delivery of two energy efficient Compact Fluorescent Lamps, (CFLs), to promote energy conservation and help the customers reduce their electricity bills.

Grant Agreement Signed on October 30, 2008.

Pending the commitment of GPOBA subsidy funds, this project will help connect 286,000 households to electricity services.

GPOBA would subsidize the financing costs of such loans to make connections more affordable and to accelerate the pace of direct connections among the poorest households.

"B"

Luiz T. A. Maurer