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LESSONS:

Indonesia: Capacity Building for the Establishment of a Competitive Electricity Market

| country: Indonesia

Two lessons were identified in the project completion report (PCR). This validation agrees with the one lesson, which is:

(i) In implementing a program of power sector reforms, thorough policy research and design, along with adequate assessment of the constitutional and legal constraints, should be ensured
at the time of program formulation.

The second lesson from the PCR is stated as:

(ii) As the technical assistance (TA) loan was formulated prior to adoption of the New Electricity Law, some of its components had to be adjusted, delayed, or even cancelled. With hindsight, the TA loan should have been provided after enactment of the new Electricity Law so as to provide targeted support to implementation of the law. In this validation, the problem vis-a?-vis the new Electricity Law was not to provide targeted support but rather to address risks carefully. And the designers did consider the risks carefully but this particular risk of annulment was not identified. In project scheduling one cannot always wait until all risks are identified before proceeding with implementation. Therefore the lesson that the designers did address but to be reinforced is to address risks carefully in Project design.

This validation would add two further lessons.

(iii) The basis of the design of capacity building projects should be included in the appraisal for capacity building projects and reported in the reports and recommendations of the president (RRPs) and PCRs, particularly to show relevance.

(iv) All of the outcomes and outputs should be identified in the RRP, in the design and in the PCR, to keep the Project focused and to monitor and evaluate achievements.

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