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Deliverable 4.2: Detailed roadmap for establishing LEMRA

Task A: Sector performance

and structural sector reform

October 2017

REVISED FINAL REPORTP

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Strategy& | PwC

Disclaimer and copyright note

This document has been prepared only for the International

Bank of Reconstruction and Development ("IBRD") and solely

for the purpose and on the terms agreed with the IBRD in our

agreement dated 21 March 2017 relating to Task A.

The scope of our work was limited to a review of documentary

evidence made available to us. We have not independently

verified any information given to us relating to the services.

We accept no liability (including for negligence) to anyone else

in connection with this document. We have agreed with you

that the report will be provided by you to GECOL for their

consideration. We would ask that it not be provided to anyone

else unless otherwise agreed in writing by us.

This is a draft prepared for discussion purposes only and

should not be relied upon; the contents are subject to

amendment or withdrawal and our final conclusions and

findings will be set out in our final deliverable.

© 2017

PricewaterhouseCoopers

LLP

All rights reserved. In this

document, 'PwC' refers to the

UK member firm, and may

sometimes refer to the PwC

network. Each member firm

is a separate legal entity.

Please see

www.pwc.com/structure for

further details

1

Strategy& | PwC

The present report focuses on detailing the options for the establishment of the Libyan electricity regulator (LEMRA)

Focus of this report

Source: Task A inception report

Rapid sector

performance

assessment

Gap analysis of the

sector structure vs.

previous plan

High-level options for

sector reform

Option study for

GECOL restructuring

Roadmap for

establishing of LEMRA

2.1 3.1

3.2

4.1

4.2

Findings review and

final report

5.1

Data collection

1.1

Workshop & trainings6

Project review and

recommendation

Restructuring of

key actors

Regulatory

reform

Rapid assessment

of the sector

performance

Project

set-up

2 3 4 5

Sector restructuring

(framework, actors and

roadmap)

3.3

Electricity

Act

3.4

1

Methodology,

team and approach

validation

1.2

PMO (progress reporting)7

Focus of

this report

2

Strategy& | PwC

To design the establishment of the LEMRA we have focused on 3 dimensions, answering a number of questions

3

Approach for the LEMRA establishment roadmap

WHAT HOW WHEN

ROLES AND

RESPONSIBILITIES

ORGANIZATIONAL

STRUCTURE

• What is the role of the

regulator in the sector?

• What are the main

responsibilities that the

regulatory body has to

fulfill?

• How are responsibilities

allocated among sector

institutions?

• Which is the best suited

organizational structure for

the Libyan regulator?

• What kind of leadership is

required for the regulator to

be effective?

ESTABLISHMENT

ROADMAP

• What are the main steps

that have to be

accomplished for the set up

of a regulatory entity?

• Is a gradual or a more

daring approach best

suited to the Libyan

context?

Source: Strategy& analysis

Strategy& | PwC

Roles and responsibilities

Organizational set-up

Establishment roadmap

Appendix – Benchmarking study

4

Strategy& | PwC

The main role of the electricity regulator is to balance the sector stakeholders’ conflicting interests

5

Electricity sector stakeholders’ interests

Regulator’s

aims

Government

Reluctant to increase tariffs

because subject to short

term political pressure

• Promote long term

targets of economic and

resource efficiency to

achieve an affordable

cost of service

• Avoid undue short term

political pressure on

prices

Service Suppliers

Wiling to charge higher

prices in order to pursue

high returns

• Support investment by

protecting suppliers

from arbitrary

governmental action

• Guarantee adequate

returns

Customers

Want to receive a reliable

electricity service at low

prices

• Protect consumers from

abuse by firms with

substantial market

power

• Guarantee reliable

service at reasonable

price


Strategy& | PwC

Executive roleAdvisory role

The typical role of a regulator can vary from weak advisory to full functional executive…

6

Types of regulatory institution roles

Weak advisoryConfidential advice to Ministry in

charge

Strong advisoryWritten public advice to the Ministry

in charge

Full functional executiveFinal decision authority &

accountability

Legal

mandate

Secondary legislation

(i.e. presidential or ministerial

decree)

Secondary legislation

(i.e. presidential or ministerial

decree)

Primary legislation

(i.e. parliamentary act)

Decision

making

authority

No decision making authority No decision making authority Full decision making authority

without need for Ministry approval

FundingNo separate budget (depends solely

on ministry budget)

Separate funding outside the

ministry’s budget

Separate funding outside the

ministry’s budget

Decisions

transparency

Decisions might be unwritten or

written but private

Public written decisions with full

discussion of rationale, supporting

analysis / evidence

Public written decisions with full

discussion of rationale, supporting

analysis / evidence

Minister’s

policy and

directives

Given confidentially to the regulator Given through public document Given through public document

Public

consultationsLittle or no public consultation

Public consultations with affected

parties

Public consultations with affected

parties


Strategy& | PwC

… And its responsibilities are concentrated in 4 areas: supply, customers, technical and sector development issues

7

Regulatory body responsibilities


Supply matters

Dealing with license issuance, monitoring of license compliance,

service providers performance monitoring and improvement

Consumers issues

Dealing with tariff assessment and their periodic review,

stakeholders protection, investigating and resolving complaints

by involved parties

Sector development

Defining public interest, developing of regulations for

infrastructure expansion, encouraging private sector investments

Technical issues

Developing technical standards of performance for each

electrical activity, monitoring and enforcing compliance with the

standards

Performance monitoring

Licenses1

2

Standards and rules

Rules enforcement

Information

3

4

5

Tariff

Consumer protection

Disputes settlement

6

7

8

Competition

Market development

Sector structure

9

10

11

Strategy& | PwC

Supply matters

The supply and technical issues involve licensing, setting and enforcing standards and monitoring the sector performance

8



Technical issues

• Set binding minimum technical, safety and service quality

standards for regulated entities

• Develop unified regulatory accounting and reporting procedures for

sector entities

• Adopt and compel compliance with accounting standards and

practices

• Draft subsidiary policy for the sector, consistently with primary policy

(i.e. government declared policies)

• Fully enforce its decisions, standards, and rules, as well as relevant

public policy, either issuing its own order which would be enforced by

the government in the exercise of its police powers, or through the

courts

• Compel the production and provision of information as may be

necessary to carry out the regulatory functions and serve the interests

of transparency

• Set the Electricity Market License Regulation

• Review, approve or reject applications for licenses and grant permits

upon collection of the related fees

• Monitor licensees’ compliance with their license requirements and

conditions

• Develop performance KPIs for sector entities

• Monitor the performance of regulated entities, the functioning of the

market, and the maintenance of supply

• Supervise security and reliability of the power system and propose

performance improvement measures

1

2

3

4

5


Licenses1

2

Standards and rules

Rules enforcement

Information

3

4

5

Strategy& | PwC

Consumers issues

Sector development

Customers and sector development deal with users complaints, competition and private investment attraction

9



• Draft the tariff regulation setting the principles governing examination,

modification and approval

• Set tariffs at reasonable levels for both consumers and regulated

entities

• Adequately protect consumers from unfair or abusive business

practices

• Examine consumer’s complaints on tariffs, quality of service and billing

acting as consumer advocate in public proceedings

• Arbitrate ad adjudicate any dispute that may arise among sector

entities and between regulated entities and consumers through out-of-

court settlements

• Promote competition and impose penalties/sanctions for non

compliance with rules of competition, transparency of information and

equal opportunity principles

• Encourage private sector participation and investments in the

electricity sector

• Provide information and act as advisor to the Ministry on matters

related to sector development (i.e. National Electricity Strategy

drafting)

• Draft unbundling regulation (e.g. accounting unbundling manual with

operating guidelines to draft separated accounts, timing and

procedures for annual accounts submission)

6

7

8

9

10

11

Tariff

Consumer protection

Disputes settlement

6

7

8

Competition

Market development

Sector structure

9

10

11

Strategy& | PwC

The reform roadmap has recommended to set-up an Agency (Wave I) before a fully-functional Authority (Wave II)

10

Evolution of regulatory role

Regulator with

executive role

Full functional

executive

Final decision authority &

accountability

Regulator with

advisory role

Strong

advisory role

Written public advice to

the ministry

Weak

advisory role

Confidential advice to the

ministry

2017 2019 2023

As-is

Government fulfilling sector

regulatory duties

Regulatory Agency

Provides expert advice on

regulatory decisions to the

Minister of electricity.

However, the formal final

decision remains with the

Ministry in charge

Regulatory Authority

(LEMRA)Autonomous, final decision-

making authority set

through primary legislation

(Electricity Act) and

financed through a

separate budget

No regulator

IWave IIWave


Strategy& | PwC

The Agency shall focus on drafting manuals/regulations for performance monitoring, tariff and account unbundling …

11

Regulatory Agency responsibilities (Wave 1)

Regulatory Agency

in operation

Supply matters

Sector development

Market development

Sector structure

Consumers issues

Tariff

Technical matters

Standards and rules

Activities Regulations/Manuals


Draft the KPIs Manual and set short term (3 years) KPI targets

Provide incentives to encourage the utility to achieve targets

Supervise system’s security and reliability and propose improv. measures

Develop unified regulatory accounting and reporting procedures

Set minimum safety standards for O&M, construction and installation

Draft the Grid Code/Interconnecting Guidelines

Draft the Tariff Regulation

State criteria for the preparation of tariff proposals by GECOL

Advise the ministry on matters related to development and operation plans

Draft accounting unbundling regulation

Draft operating guidelines for separated annual accounts

Analyze and review GECOL’s separated annual accounts

KPIs Manual & targets

Safety standards

Grid Code

Tariff Regulation

Accounting unbundling

regulation

2019

Responsibilities


Strategy& | PwC

… Advising the Government, who remains in charge of accomplishing all the key regulatory functions

12

Actors redistribution of responsibilities (Wave I)


Government GECOL GECOL

As-is After Regulatory Agency set up

Set performance

standards R R P

Monitor performance R R P

Define sector vision R R

Determine prices R R R P

Choose technologies R R

Determine investments R R

Establish market rules R R P

Receive public input R R R P R

Balance environmental

and economic goals R R

Determine market

structure R R P

Receive consumer

complaints R P R

Actors

GovernmentRegulatory

Agency

P Full responsibility PAdvisory function

IWave

Responsibilities

Strategy& | PwC

Supply matters

With Wave 2, the Agency will become an Authority (LEMRA), starting to license and enforce the market rules…


Primary responsibilities / tasks (Wave II)

13

Licenses



in operation


Establish quality of service standards

Impose penalties/sanctions for non compliance with rules

Rules for submission of information to the Authority

Rules for availability of the Authority’s information to the public

Start drafting the National Electricity Registry containing full text of

licenses decisions, codes/standards approved by the BoD, etc.

2023

Responsibilities

Technical issues

Rules enforcement

Information

Standards and rules

License regulationSet the Electricity Market License Regulation

Grant (and cancel) licenses and collect license fees

Review short term (3 years) KPI targets

Review incentives to encourage the utility to achieve targets

Supervise system’s security and reliability and propose improv. measures

Service provision manual

National Electricity

Registry

Information submission

and availability rules

Strategy& | PwC

…as well as enacting regulations to foster the electricity industry restructuring


Primary responsibilities / tasks (Wave II)

14

Sector development

Consumers issues

Consumer protection

Tariff

Disputes settlement

Market development

Sector structure

Competition


in operation


Approve/reject/amend regulations for IPP procurement submitted by the

Commission

Approve/reject proposals for IPPs submitted by the IPP Commission after

close scrutiny during the tendering process

Grant concession to the approved winner of the tendering process

Advise the Ministry

Helps the Ministry in drafting the National Electricity Strategy

Promote the development of renewable energy

Draft the Electricity industry restructuring plan

2023

Responsibilities

Review the Tariff Regulation

Review criteria for the preparation of tariff proposals by GECOL

Examine consumer’s complaints, acting as consumer advocate in public proceedings

Arbitrate and adjudicate disputes between licensees and consumers and

among licensees through out-of-court settlements

Tariff regulation

Electricity industry

restructuring plan

Disputes resolution rules

Strategy& | PwC

In Wave 2, LEMRA will draft regulations, standards and rules as in other countries (i.e. ECRA in Saudi Arabia)

15

ECRA’s area of operation & outputs produced

Saudi Arabia

Source: ECRA website, Strategy& analysis

Electricity Law Implementing

Regulations

Provides greater detail on the duties, functions and obligations of the Authority and industry participants outlined in the Electricity Act (e.g. tariff setting and review procedure, process of licensing process and criteria, disputes mediation procedure, etc.)

ECRA CharterConstitution of the Authority outlining its objectives, responsibilities, leadership composition, organizational structure and operating model

Targets & Incentives

Report

Outlines targets for KPIs related to generation, transmission, distribution and customer service determined through international comparisons

Audit ManualDescribes the audit methodology performed by the Regulator on an annual basis on the underlying processes and data applied by the utility to compute submitted KPI values

KPI ManualDetails formulas and methodologies for the computation of KPIs in order to provide a base for consistency among licensees’ KPIs reporting procedure

Saudi Arabian

Grid Code

Defines obligations, responsibilities, minimum technical requirements of all parties towards ensuring open, transparent, non-discriminatory and economic access and use of the grid while maintaining its safe, reliable and efficient operation

Saudi Arabian

Distribution Code

Indicates procedures for both planning and operational purposes covering both normal and exceptional circumstances for various participants access and use of the distribution system

ECRA Charter Implementing

Regulations

Provides greater detail on the duties, functions and obligations of the Authority outlined in the Charter

Le

ve

ls o

f re

gu

lati

on

Documents

Rules and Manuals

Codes &

Standards

Regula-

tions

SELECTED EXAMPLE

Strategy& | PwC

Outlines:• tariff review process and the procedure for submission of tariff recommendations by the Authority• reporting requirements for the calculation of the cost of provision of electricity services

Sets out:• requirements for submission of information to the Authority by sector entities • rules for Authority’s disclosure of information to the public through the National Electricity Registry

Defines:• electricity activities subject to licensing• licensing application process, granting criteria and conditions (i.e. renewal, amendment, suspension, revocation

and withdrawal and required fees)

Details:• the quality of service for consumers• standards and conditions as well as the situations in which service to consumers may be suspended

States:• the definition of anti-competitive practices• remedies for anti-competitive practices, mergers and acquisitions

Defines the content of the Electricity Industry restructuring plan to be prepared by the Authority consistently with the National Strategy prepared by the Ministry and in accordance with the requirements of the Electricity Act

Defines procedures for resolution of:• consumer disputes (i.e. between a consumer and a licensee)• electricity industry disputes (i.e. between licensees or licensees and large consumers)• disputes relating to the Authority decisions

ECRA for example, drafts all the necessary regulations mandated by the Saudi Arabian Electricity Law …

16

Electricity Law Implementing Regulations contents

Tariff

Licensing of electricity activities

Quality of service

SELECTED EXAMPLE

Restructuring of the electricity industry

Disputes and resolutions procedures

Saudi Arabia

Source: ECRA website, ECRA Electricity Law Implementing Regulations, Strategy& analysis

Submission and provision of information

Key

Titles

Competition and anti-competitive

conduct

Electricity Law Implementing Regulations

Strategy& | PwC

… And also leads a program of performance monitoring of the sector entities against a set of specific targets / KPIs

17

KPI Manual contents

Source: ECRA website, ECRA KPIs Manual, Strategy& analysis

Generation Transmission Distribution Supply

Availability factor

Forced outage factor

Scheduled outage factor

Equivalent forced outage rate

Starting reliability

Gross capacity factor

Net capacity factor

SAIDI

SAIFI

MAIFI

Network losses

SAIDI

SAIFI

MAIFI

Network losses

Average time to supply

(existing connections)

Average time to supply

(new connections)

Average time to reconnect

after payment

Notification of interruption of

supply

Frequency of complaints

Average time to resolve

billing complaints

Average waiting time call

center

SELECTED EXAMPLE

Saudi Arabia

KPI Manual ECRA has initiated a project to develop Key Performance Indicators for Saudi power

sector participants. As part of this project the KPI Report has been produced setting

out the recommendations for the computation of KPIs for each value chain

activity. The Regulator has established specific KPI targets, against which

performance of market participants will be audited each year

Strategy& | PwC

With Wave II, the Government will delegate many of its current responsibilities to LEMRA

18

Actors redistribution of responsibilities — Wave II


Government GECOL GECOL

As-is After LEMRA establishment

Actors

Responsibilities

P Full responsibility PAdvisory function

Wave

Government Regulator

II

Set performance

standards R R

Monitor performance R R

Define sector vision R R

Determine prices R R R

Choose technologies R R

Determine investments R R

Establish market rules R R

Receive public input R R R R R

Balance environmental

and economic goals R R

Determine market

structure R R P

Receive consumer

complaints R R R

Issue licenses R R

Responsibilities transferred to other actor

Strategy& | PwC





19

Strategy& | PwC

For the identification of the target organizational set-up, we benchmarked similar countries along 4 dimensions

20

Organizational structure dimensions benchmarked


SUPPORT SERVICES UNITS

FUNCTIONAL DEPARTMENTS

LEADERSHIP MODEL2

3

4

International benchmarking

SIZE AND COMPLEXITY1

Dimensions

Strategy& | PwC

The benchmarking exercise highlighted a number of insights on how regulators are usually set-up

21


Summary of lessons learnt

SUPPORT SERVICES UNITS

FUNCTIONAL DEPARTMENTS

LEADERSHIP MODEL2

3

4

• There are two main types of leadership structure: centralized

or delegated

• BoD terms of office and renewal are common across countries

(3-4 years with 1 term renewal)

• Composition varies widely from 5 to 13 members

Regulatory organizations are typically split vertically along their

key functions which reflect their primary responsibilities

HR, General administration, IT, Financial planning and Budgeting

are typically centralized within a Support Services unit

SIZE AND COMPLEXITY1

Dimensions

There are streamlined horizontal organizations and more complex

vertical ones

Key lessons learned

Strategy& | PwC

Organizational structures of regulators vary from simple / streamlined to complex set-ups

22

Examples of Regulators’ organizational structures SELECTED EXAMPLES

1) Does not include departments not dealing with the electricity sector (Mineral Resources and Affairs, Radiological and Nuclear Affairs, Petroleum and Gas Affairs)

Source: Centre for Administrative Innovation in the Euro Mediterranean Region (C.A.I.MED.), Energy and Mineral Resources Commission website, Strategy& analysis

LeanElectric Utility and Consumer

Protection Regulatory Agency (EUCPRA)

ComplexElectricity Regulatory Commission

(ERC)1

Chairman of

BoDBoD

Chaiman’s

Office

Inspection

and Control

Quality

Control Unit

Technical Audit

Section

Environment

and Public

Safety Section

Control and

Internal Audit

Planning and

Org.

development

Admin. of

Supportive

Services

Admin. of

Electricity &

Renewables

Comm. &

Inter. Coop.

Financial

Affairs

Adm. & HR

IT

Legal

Electricity &

Renewable

Energy

Tariffs and

Financial

Analysis

Generation &

transmission

Distribution

El. energy

studies

Renewables

Energy

conservation

Tariffs

Financial

Analysis

Statistics

BoD

CEO

Tariff &

licensing

Awareness

& customer

protection

Legal affairs

general

department

Financial

administrativ

e & affairs

department

Information

& doc.

general

department

Cost &

pricing

License

evaluation

Plan

revision

Consumer

protection

Awareness &

mass comm.

Size and complexity1

Strategy& | PwC

Board of Directors

In terms of leadership, there can be delegated or centralized models …

23

BoD

Executive

Director

Technical

department

Accounting and

finance

department

Legal

department

Management

Services

department

Technical

department

Accounting and

finance

department

Legal

department

Management

Services

department

Chairman

Commissioner Commissioner Commissioner Commissioner

Regulatory institutions leadership models


CentralizedDelegated

• Chairman and commissioners are part of a Board of

directors, which concentrates on decision making

• Professional and preparatory work and due-

diligence effort is done under the supervision of an

appointed executive director

• Individual BoD members have two roles:

– Hands-on managerial roles as heads of

individual functional departments

– Decision making role as directors on board

meetings

Leadership model2

Strategy& | PwC

…with BoD terms of office usually set for 3-4 years and composition varying from 5 to 13 members

24

Board of Directors characteristics

Egypt Jordan Saudi Arabia

Reporting toMinistry of Electricity

and EnergyPrime Minister Council of Ministers

AppointmentPrime Minister’s Decree

upon proposal by the Ministry of

Electricity and Energy

Council of Ministers upon

recommendation of the Prime

Minister

Council of ministers upon

recommendation of the Minister

Chairman Competent MinisterSecretary general of Ministry of

Energy and Mineral ResourcesMinister of Water and Electricity

Terms

of office

# years 3 4 3

Renewal

conditions1 for a term of equal time 1 for a term of equal time 1 for a term of equal time

Qualifications Electricity, legal, economics

At least a bachelor in either law,

accounting, administration,

economics, engineering or finance

and 15 years experience or 10 years

experience in the electricity sector

N/A

Number of commissioners 12 5 (fulltime) 13

Represented stakeholders• Electricity company (3 members)

• Consumers (4 members)

• Technical experts (3 members)

No required representatives

1 representative for each of the

following Ministries:

• Water and Electricity

• Finance

• Petroleum & Mineral Resources

• Commerce and Industry

• Economy and Planning

Source: Centre for Administrative Innovation in the Euro Mediterranean Region (C.A.I.MED.), EMRC website, ECRA website, Strategy& analysis

Leadership model2

Strategy& | PwC

Functions / divisions are functionally split in accordance with the key responsibilities

25

Typical functional departments

Egypt Jordan1 Saudi Arabia Argentina Italy

Tariff and licensing Legal and licensing

Service Providers Planning and control

Technical affairsAnalysis for reg. and

special studies

Sanctions and

penalties

Appl. & admin. of

regulatory standards

Accountability and

enforcement

Information & doc.

general dept.PR & Information

Tariff and licensingTariff and financial

analysisEconomics & Tariffs Tariff revision

Awareness &

customer protectionCustomer care

Customer

advocacy/protection

Planning and controlEnergy infrastructure

& unbundling

1) No clear division of responsibilities among organizational units can be determined from Annual report

Source: Centre for Administrative Innovation in the Euro Mediterranean Region (C.A.I.MED.), EMRC website, ECRA website, ENRE website, AEEGSI website, Strategy& analysis

Focus on customer

protection and

enforcementFocus on tariff setting

Market structure Single Buyer Wholesale market Retail competition

Technical

issuesRules

enforcement

Standards

and rules

Information

3

4

5

Consumers

issues

Consumer

protection

Tariff

Disputes

settlement

6

7

8

Sector

developmentMarket

development

Competition

Sector

structure

9

10

11

Supply

matters

Performance

monitoring

Licenses1

2

Responsibilities

Functional departments3

Strategy& | PwC

Energy and

Mineral Resources

Commission

(EMRC)

Typical support services departments are HR, Finance and ICT , generally centralized under one single general manager

26

Typical support services units

Electricity &

Cogeneration


(ECRA)

Ente Nacional

Regulador

de la Electricidad

(ENRE)

Source: Centre for Administrative Innovation in the Euro Mediterranean Region (C.A.I.MED.), EMRC website, ECRA website, ENRE website, AEEGSI website, Strategy& analysis

Support services aggregated under Administrative and

Supportive Services division:

– Communication and International cooperation

– Financial affairs

– Administration & HR

– IT

– Legal

• Support services grouped under the managament of the Vice

Governor of Support Services:

– Finance

– HR

– Property management

– Administrative support

• Support services reporting directly to Governor (MD):

– IT

– PR & Information

• Support services aggregated under the Administration

department:

– Heritage & Supply

– Treasury

– Accounting

– HR

– Purchasing & Contracts

• Support services reporting directly to Directory:

– IT

Support services units4

Strategy& | PwC

The reform identified specific responsibilities for the Agency (Wave I) and Authority (Wave II)

27

Regulatory responsibilities evolution

Regulatory Agency

Supply

matters

Sector

development

Consumers

issues

Technical

issues




Licenses

Rules enforcement

Standards and rules

Information

Consumer protection

Tariff

Disputes settlement

Market development

Competition

1

2

3

4

5

6

7

8

9

10

Sector structure11

IWave IIWave

Performance monitoring2

Standards and rules3

Rules enforcement4

Information5

Tariff6

Consumer protection7

Disputes settlement8

Competition9

Market development10

Sector structure11

Licenses1

Strategy& | PwC

Government

In line with its limited responsibilities, the Agency shall have a simple and centralized structure with only 3 departments

28

Agency organizational structure


Responsibilities

Supply

matters

Sector

development

Consumers

issues

Technical

issues



Rules enforcement4

Information5

Tariff6



Competition9


Sector structure11

Licenses1

Chairman

Support

services head

IT

Financial

admin. & HR

Internal

audit

Tariff

Commissioner

6

Technical

affairs

Commissioner

Sector

development

Commissioner

2 3 10 11

Proposed organizational structure(Regulatory Agency – Wave I)

Ministry in

charge

IWave

Strategy& | PwC

With increasing responsibilities, the Regulator will instead assume a more decentralized structure …

29

LEMRA Organizational structure


Responsibilities

Supply

matters

Sector

development

Consumers

issues

Technical

issues



Rules enforcement4

Information5

Tariff6



Competition9


Sector structure11

Licenses1 Board of Directors

Regulatory affairs

Executive

Commissioner

Stakeholders affairs

Executive

Commissioner

Support services head

IT

Administration

& HRTariff

Technical

affairs

Service

providers

Customer

protection

Finance and

budget

Public relations

Development

studies

5

Legal &

licensing

6

10

87

911

1

8

2 3 4

ChairmanInternal

audit

Proposed organizational structure(Regulatory Authority – Wave II)

IIWave

Strategy& | PwC

…with a regulator’s stakeholders affairs division that will oversee licensees and monitor service quality…

30

LEMRA Organizational structure — Functional statements

• Handle documentation for service

providers’ rights and obligations

• Conduct fair and impartial investigations

• Review disputes and claims of violations

by service providers against each other

and against the Authority

Service Providers

Customer Protection


• Investigate consumer complaints and

claims of violations by service providers

• Review periodically causes of customers’

complaints and disputes in order to

suggest appropriate rules and procedures

to eliminate them


IT

Administration

& HRTariff

Technical

affairs

Service

providers

Customer

protection

Finance and

budget

Public relations

Development

studies

Legal &

licensing

ChairmanInternal

audit

ActivitiesOrg. unit

Regulatory affairs

Executive

Commissioner


Executive

Commissioner


IIWave

Strategy& | PwC

Tariff

Technical

affairs

Service

providers

Customer

protection

Public relations

Development

studies

Legal &

licensing

ChairmanInternal

audit

IT

Administration

& HR

Finance and

budget

…and a regulatory affairs division that will handle both tariff reviews and technical affairs…

31


Regulatory affairs


• Conduct studies on the economics of the

electricity industry

• Draft studies for tariff reviews

• Review methodologies and procedures for

tariff setting

• Develop indicators and incentives for

consumers and service providers to

encourage conservation and reserve

margins

Tariff

Technical affairs

• Prepare technical studies dealing with

regulating the electricity sector

• Develop rules to insure provision of reliable

and efficient services

• Set standards of performance for licenses

and overseeing their compliance with

these standards (KPIs)

• Establish performance targets and

incentivize their achievement by industry

participants

ActivitiesOrg. unit

Regulatory affairs

Executive

Commissioner


Executive

Commissioner


IIWave

Strategy& | PwC

… as well as performing all necessary development studies and handling of legal & licensing issues

32


Regulatory affairs


• Forecast medium to long-term power

system security, stability and reliability

• Carry out power studies to enhance

competition and find sector development

opportunities

• Advise the Government on development

issues

• Regulate sector structure evolution (e.g.

unbundling regulation)

• Estimate new investment projects that

should be implemented in electricity sector

Development studies

Legal & licensing

• Receive applications for authorizations,

licenses and exemptions from licensing

• Oversee compliance of licensees with the

requirements and conditions of the law and

their licenses

• Prepare contracts and agreements

• Draft and review proposed rules,

procedures and standard forms used in the

industry

• Represent the Authority in litigations and

courts

ActivitiesOrg. unit

Regulatory affairs

Executive

Commissioner


Executive

Commissioner


Tariff

Technical

affairs

Service

providers

Customer

protection

Public relations

Development

studies

Legal &

licensing

ChairmanInternal

audit

IT

Administration

& HR

Finance and

budget

IIWave

Strategy& | PwC

LEMRA BoD, in charge of 4-years, may have 5 members of which 2 will be non-executive representatives

33

LEMRA Organizational structure — Board of Directors

Number of members 5

AppointmentPrime Minister Decree upon proposal by the

Ministry in charge of the electricity sector

Terms of

office

Duration 4-years

Renewal 1 term of equal duration

MeetingsAt least 4 times a year and upon demand from

Commissioners

Responsibilities

• Monitoring of LEMRA management

• Ratification of the Authority’s work plan and

its operational plans within the framework of

the government overall plan

• Approval of the Authority’s proposed budget,

its closing accounts and annual report prior

to their submittal to higher authorities

• Approval of received grants, donations

• Approval of the Agency’s organizational

structure and of the financial, technical,

administrative and employment regulations

that organize the Agency’s activities

• Approval of the

regulations/rules/codes/manuals

implementing the Electricity Law in matters

concerning LEMRA’s responsibilities

• Approval of rules for licenses, authorizations

and other services offered by the Authority

and determination of the related fees

Executive

Commissioner

Commissioner

(GECOL

representative)

Chairman

Executive

Commissioner

Commissioner

(Consumers

Representative)

BoD Chairman & CEO

Executive Board Members

BoD Composition

Stakeholder representative Members


IIWave

Strategy& | PwC





34

Strategy& | PwC

The roadmap for the establishment of the Libyan regulator could be summarized in two steps for each wave

35

Roadmap evolution of regulatory body

Step / measure

Set

regulatory

agency

2018

2019 2023

2027

Set up

regulatory

authority

Regulatory

Agency

Regulatory

Authority

Agency in

operation

Authority in

operation

1) Beside its regulatory functions, this government agency will be in charge for supporting, leading and overseeing the sector reform implementation;


2019202020212022202320242025

Regulatory agency in operation

Ministry in

charge

Regulatory

Agency

Establish regulatory agency within the government1

LEMRA BoD

Appointment/Renewal of BoD and budget review

OwnerYear

Drafting and approval of LEMRA’s Charter

Ministry in charge

Renewal/termination of key personnel office

Review and approval proposed organizational structure Senior mgmt. team

&BoD

Recruitment to achieve target org. structure Senior mgmt. team

& HR head

LEMRARegulatory authority in operation

Activities

Senior mgmt. team

&BoD

IWave IIWave Ambition

A

B

C

D

Strategy& | PwC

In Wave 1, by end of 2018, the Gov’t will set-up the Agency and its new mgmt. team will start prepare its operations

36

Regulatory agency setting roadmap

2018 2019

Q1 Q2 Q3 Q4 Q1 OwnerActivities

Select and appoint consultants/advisors to help in the process

Senior mgmt. team & HR headHire technical and support staff for each org. unit

Senior mgmt. team & HR head

BoD and Chairman

Senior mgmt. team1

Government

BoD

Develop basic recruitment criteria

Select and appoint departments heads

(e.g. Executive Commissioners)

Vote and approve strategic goals/objectives

Recruitment of technical and support staff

Select Chairman among BoD members1

Define key goals of the strategic goals/objectives

Development and approval of Agency’s 4 years strategic goals

Government

Appoint initial BoD members for a 4 years term

Year

Government

Appointment of BoD and initial budget allocation

Define and allocate the initial budget

Recruitment of key personnel

Government

1) Executive Commissioners; Source: Strategy& analysis

A Agency set-up

BoD & chairman selected and

in operation

Approved agency statute

and [4]-years strategic plan

Full operating team in place

PRELIMINARY

Strategy& | PwC

From 2019 for 4 years, the Agency will then support the Gov’t and draw all the necessary rules & regulations

37

Regulatory agency setting roadmap

2018 2019 2020-2023

Q4 Q1 Q2 Q3 Q4 … …

Department in chargeOther manuals & regulations2

Year

Senior mgmt. team

Training of technical and support staff

Activities

Department in charge

Support in the National Electricity Strategy definition

Draft regulations/manuals in line with the Agency’s responsibilities

Department in chargeAccounting unbundling regulation



Department in chargeReview KPIs manual & targets

Grid code

Agency (& advisors)

Support Government in legal framework review

Support Government in legal advisors selection process

Owner

Draft Tariff regulation

Support in the Electricity Act endorsement process

Launch staff training programs1


Senior mgmt. team

Ex. Commissioners

Support in the internal Electricity Act endorsement discussions

Safety standards

1) As an example, during its first 3 years the Saudi Arabian Regulatory Authority (ECRA) began English and IT skills trainings for all staff resources;

2) In line with the Agency 4-years strategic goals & objectives


B Agency operation

Electricity Act

endorsed

Accounting unbundling

regulation published

PRELIMINARY

Strategy& | PwC

In 2022 the Gov’t will then spin-off the Agency and the BoDwill form the regulator charter and organization

38

LEMRA establishment detailed roadmap


C Regulatory Authority set-up

2021 2022 2023

Q4 Q1 Q2 Q3 Q4 Q1

Approve LEMRA’s Charter LEMRA BoD

BoD & Chairman

Ministry in charge

LEMRA BoD

Ministry in charge

Activities

LEMRA BoD

& CEO

LEMRA

In operation

Design and approve LEMRA organizational structure

Year

Owner

LEMRA CEO

& HR

Recruit and appoint staff

Develop LEMRA strategic plan

Hire/recruit/confirm key personnel

Appoint BoD and allocate initial budget

Spin-off regulatory agency from government

Clarify duties/functions/powers of the Authority LEMRA BoD

Release of

Electricity Act

Either confirm

Agency BoD or

appoint a new one

PRELIMINARY

Strategy& | PwC

Starting from 2023, LEMRA will then begin operating as an independent regulatory institution

39

LEMRA establishment detailed roadmap 2024+

Q1 Q2 Q3 Q4Activities

Draft Service Provision Manual

Department in chargeDraft licensing regulation

Year

Update electricity industry restructuring plan for Wave III


Owner

Draft disputes resolution rules

Department in chargeDraft Information submission and availability rules



Review & approve new tariff Department in charge


D Regulatory Authority operation PRELIMINARY

Strategy& | PwC

By 2023, LEMRA will operate on the basis of a series of clear principles, among which independence

40

Core principles

Consultation

Consistency

Independence

Effectiveness and efficiency

Communication

Predictability

Flexibility

Accountability

Transparency

Information should be made available to all stakeholders on a timely and

accessible basis

Participation of stakeholders in meetings promote the exchange of information

and the education of those affected by regulatory decisions

The logic, data sources, and legal basis for decisions should be consistent

across market participants and over time

A reputation for predictable decisions facilitates planning by suppliers and

customers, and reduces risk as perceived by the investment community

The agency should use appropriate instruments in response to changing

conditions

Freedom from undue stakeholder influence promotes public confidence in the

regulatory system

Cost effectiveness should be emphasized in data collection and in policies

implemented by the regulator

Regulators should provide clearly defined processes and rationales for

decisions. Appeals procedures need to be specified to provide appropriate

checks and balances

The openness of the process to stakeholders promotes legitimacy

Focus in next slide


D Regulatory Authority operation

Strategy& | PwC

The regulator will act independence (impartiality), but continue to respond to the Government (owner of the policy)

41

Regulator independence misconceptions

Independent regulators are free

from government oversight

Independent regulatory are ministerial

entities that do not have to get the

approval of the prime minister or other

higher level political authority to

raise/lower tariffs

Independent regulators are not

accountable towards other

institutions

Regulators are set through primary law,

hence are accountable (directly or through

the ministry) to the Parliament

Independent regulatory entity must

be given complete authority over all

policy decisions that affect the

power sector

Policy development stays with the

government and policy implementation is

delegated to the regulatory body

Independence is a guarantee of

ethical and impartial behavior

A regulatory entity could be independent

and still become a rogue/corrupted

regulatory body

COMMON MISCONCEPTIONS WHAT INDEPENDENCE MEANS

Independence



Strategy& | PwC

However, restrictions to Gov’t ability to overrule Regulator’s decisions will be taken (thus guaranteeing its independence)

42

Building blocks of independence

Independent funding

Fixed and staggered terms

for BoD commissioners

Restrictions on post

regulatory employment

Restrictions on the

government’s ability to

delay or overrule the

Regulator decisions

Limits on government’s

ability to remove BoD

commissioners and

protection from being sued

for performance of official

Prohibitions on current

and future financial ties

with regulated entities

INDEPENDECE

Focus in next

slides



Strategy& | PwC

LEMRA will fund its operations through the revenues collected from licensees (same as other regulators)…

43

Example of regulators sources of funding

SELECTED EXAMPLES

Source: EMRC Annual report 2014; AEEGSI Annual report 2014; Strategy& analysis

CEGCOCentral Electricity Generation Company

0.7

NEPCONational Electric Power Co.

1.7

EDCElectricity Distribution Company

0.3

SEPGCOSamra Electric Power Company

0.5

IDECOIrbid District Electric Company

0.2

JEPCOJordan Electric Power Company

0.9

AAEPC Ammam Asia Electric Power Co. (IPP3)

0.3

QEPCOAl-Quatraneh Power Gen. Co. (IPP2)

0.3

One time licensee 0.2

Average revenue per licensee 0.6

LicenseesRevenues

from licensee(Mn $)

Regulatory Authority for

Electricity, Gas and Water(AEEGSI)

Energy and Mineral

Resources Commission (EMRC)

91%

52.0

4%

100%

4%

5.3100%

94%

4%1%

Revenues of grants

Other revenues

Revenues from electricity licensees

Other revenues

Revenues from Water licensees

Revenues from electricity and gas licensees

2013 2013

Mn $ Mn $


Strategy& | PwC

… With revenues sufficient to cover the personnel costs, G&A and the expenses for studies and consultations

44

Example of regulatory authority income statement

SELECTED EXAMPLE

Source: EMRC Annual report 2014; ECRA Annual report 2014; Strategy& analysis

5.3

4.6

0.7

8.5

13.4

0.0

32.5

Mn $2013

Total Expenses

Personnel costs

Training expenses

Studies and

consultation

Rent

Depreciation &

amortization

General &

administrative

expenses

Electricity & Cogeneration

Regulatory Authority(ECRA)

Mn $

0.2

0.3

0.1

0.0

2.1

1.3

0.1

Energy and Mineral

Resources Commission (EMRC)

100%1.3

4%9%

53%

34%

Personnel

Costs(Mn $)

Salaries and wages

Allowances and bonuses

Social security

Retirement compensations


Strategy& | PwC





45

Strategy& | PwC

EgyptERA is set-up through a delegated lean structure with organizational units reflecting its key responsibilities

46

Source: Strategy& analysis, EgyptERA website, A.R.E. Presidential Decree Law of 2015, Centre for Administrative Innovation in the Euro-Mediterranean Region (C.A.I.M.E.D.)

Organizational structure and key information

Focus in

next slide

Support services

BoD

CEO

Tariff &

licensing

Awareness

& customer

protection

Legal affairs

general

department

Financial

administrativ

e & affairs

department

Information

& doc.

general

department

Cost &

pricing

License

evaluation

Plan

revision

Consumer

protection

Awareness &

mass comm.

Egypt

EstablishmentPresidential Decree

(Decree 326 of 1997 and reorganized

through Decree 339 of 2000)

Organizational structure Legal Mandate

Separate

annual budgetYes

Sources of

income

• Funds allocated from the State

budget

• Proceeds from licenses

issuance/renewal

• Proceeds from services rendered to

electricity companies users

• Agency’s fund investment proceeds

• Donations, contributions and grants

AppointmentPrime Minister Decree upon

suggestion of Competent Minister

Terms of

office

Duration 3-years


RemunerationDetermined by Prime Minister

Decree

Funding

CEO

Strategy& | PwC

The BoD is composed of 12 members appointed through Prime Minister’s Decree for a term of 3 years

47

BoD composition and key facts

Egypt

Chief executive

officer

x3 Electricity Utility

representatives

x3 experts in

technical,

financial,

legal areas

Minister of Electricity

and Energy

Chairman of the

Competition

Protection and Anti-

monopolistic

Practices Agency

Chairman of the

Consumer

Protection

Agency

Chairman of the

Chambers of Commerce

Federation

Chairman of the

Egyptian

Industries Union

Source: Strategy& analysis, EgyptERA website, A.R.E. Presidential Decree Law of 2015, Centre for Administrative Innovation in the Euro-Mediterranean Region (C.A.I.M.E.D.)

BoD ChairmanCEOBoard Members

AppointmentPrime Minister Decree upon proposal by the

Ministry of Electricity and Energy

Reporting institution Ministry of Electricity and Energy

Terms of

office

Duration 3-years


Meetings At least once a month and whenever required

Responsibilities

• Approval of Agency’s action plans

• Approval of rules required to exercise

electricity power activities

• Decisions on of concessions, renewal and

monitoring of licenses for projects involving

the generation, transmission, distribution

and sale of electricity

• Supervision of projects realization

• Ratification of procedures for the granting of

licenses

• Determination of fees for licenses and other

services rendered by the Agency to third

parties

• Draft and approval of annual budget

• Approval of the Agency’s organizational

structure and of the financial, technical,

administrative and employment regulations

that organize the Agency’s activities

• Approval of grants, donations

BoD Composition

Strategy& | PwC

ECRA is organized around 3 divisions: Regulatory Affairs, Consumers and Providers Affairs and Support Services

48

1) Source Thomson Reuters does not clarify reference year

Source: Strategy& analysis, ECRA website, ECRA Annual report 2015, Charter of the Electricity & Cogeneration Regulatory Authority

Focus in

next slide

Support services

Support services

BoD

Governor

IT

Governor‘s

Office

Consultants

Internal

Auditing

Vice-Governor

Regulatory affairs

Vice-Governor

Consumers and Service

Providers Affairs

Vice-Governor

Support Services

Finance

HR

Property

Management

Administrative

support

Legal &

Licensing

Economics

& Tariffs

Technical

Affairs

PR &

Information

External

Auditor

Service

Providers

Customer Care

Saudi Arabia


Separate

annual budgetYes

Sources of

income

• Fees for licenses and authorizations

issued by the Authority

• Fees charged by the Authority for

services and work offered to third

parties

• Revenues from fines

AppointmentRoyal Order on recommendation

of the Ministry of Electricity

Terms of

office

Duration 3-years


Remuneration Council of Ministers decision

Funding

Governor


125 FTEs1

EstablishmentCouncil of Minister decision number 236

issued on 13th November 2001

Strategy& | PwC

The BoD is composed by 13 members elected upon Government recommendation for a term of 3 years

49

Saudi Arabia


Minister of Water and

Electricity

BoD Composition

BoD ChairmanCEOBoard Members

AppointmentRoyal Order on recommendation of the Ministry

of Electricity

Reporting institution Ministry of Electricity and Water

Terms of

office

Duration 3-years (with exception of the Chairman)


MeetingsAt least 4 times a year and upon demand from

public stakeholders

Responsibilities

• Monitoring of ECRA’s management

• Approval of the Authority’s organization

chart

• Approval of the Authority’s internal, financial

and administrative bylaws

• Approval of the regulations implementing

the Law in matters concerning the

responsibilities of the Authority

• Approval of technical, environmental and

procedural bylaws, rules and standards

• Approval of the Authority’s work plan and its

operational plans within the framework of

the government overall plan

• Approval of the Authority’s proposed budget,

its closing accounts and annual report prior

to their submittal to higher authorities

• Approval of rules for licenses, authorizations

and other services offered by the Authority

and determination of the related fees

GovernorRepresentative of

Ministry of Water and

Electricity

Representative of

the Ministry of

Finance

Representative of

the Ministry of

Petroleum &

Mineral

Resources

Representative of the

Ministry of Commerce &

Industry

Representative of the

Ministry of Economy

and Planning

Representative of

the Ministry of

Saline Water

Conversion

Corporation

5x members

appointed by

Council of

Ministers

Source: Strategy& analysis, ECRA website, ECRA Annual report 2015, Charter of the Electricity & Cogeneration Regulatory Authority

Strategy& | PwC

Focus in

next slide

EMRC has a more centralized organizational structure with the Chairman of the BoD covering also the role of CEO

50

1) Sub-departments not dealing with electricity sector matters are not displayed

Source: Strategy& analysis, EMRC website, General Electricity Law N° 64 of 2003, EMRC Annual Report 2014

Support services

Chairman of

BoDBoD

Chaiman’s

Office

Inspection

and Control

Quality

Control Unit

Technical

Audit Section

Environ. &

Public Safety

Control and

Internal Audit

Planning and

Org.

development

Admin. of

Supportive

Services

Admin. of

Electricity &

Renewables

Comm. &

Inter. Coop.

Financial

Affairs

Adm. & HR

IT

Legal

Electricity &

Renewable

Energy

Tariffs and

Financial

Analysis

Generation,

Transmission

Distribution

El. energy

studies

Renewables

Energy

conservation

Tariffs

Financial

Analysis

Statistics

Mineral

Resources

Radiological

and Nuclear

Petroleum and

Gas

Admin. not

dealing with

electricity sector1

Jordan


AppointmentCouncil of Ministers upon

recommendation of the Prime

Minister

Terms of

office

Duration 4 years (fulltime)


Remuneration Council of Ministers

Funding

Chairman of BoD/ CEO


Separate

annual budgetYes

Sources of

income

• Revenues from license fees and

services provided Amounts allocated

from general government budget in

case of emergency

• Grants, donations accepted by the

Board and approved by the Council

of Ministers

358 FTEs

in 2014

Establishment General Electricity Law N°64 of 2002

Strategy& | PwC

There are five BoD members, appointed upon fulfillment of several conditions for one renewable term of 4 years

51

Jordan


Chief Commissioner and

Chief Executive Officer

BoD CompositionAppointment

Council of Ministers upon recommendation of

the Prime Minister

Reporting institution Prime Minister

Terms of

office

Duration 4 years (fulltime)


MeetingsAt least once a month and as necessary

according to circumstances

Responsibilities

• Approval of licenses

• Issuance of the required directives to ensure

that the Commission obtains from the

licensees technical and financial data and

any other information for the purposes of

discharging its functions under the law

• Establishment of the methodological basis

for computing electric tariffs

• Prescription of directives for meters

inspection and testing

• Establishment of appropriate operating

codes and safety, security and reliability

standards

• Settlement of disputes

• Drafting and preparation of by-laws relating

to the sector

Deputy Chief

Commissioner

Commissioner Commissioner

Commissioner

Source: Strategy& analysis, EMRC website, General Electricity Law N° 64 of 2003, EMRC Annual Report 2014

Requirements for Council members appointment:

• Hold at least a bachelor degree in law, accounting,

administration, economics, engineering or general finance

and either a minimum of 15 years experience in the profession

related in the degree he possesses or a minimum of 10 years

experience in public or private sector in the fields of generation,

transmission, system operation, supply and distribution

• Does not have a financial interest in any business connected

directly or indirectly with the sector

• Is not an employee of licensees and has not worked for any of

them during the year preceding appointment

BoD Chairman & CEOBoard Members

Strategy& | PwC

Focus in

next slide

ENRE‘s units dealing with customer issues and technical matters report directly to the BoD

52

Source: Strategy& analysis, ENRE website

Argentina

Support services

BoD

Legal

Internal auditSecretariat of

directory

Institutional

relations

Planning &

controlIT

Analysis for

reg. and

special

studies

Public and

environment

protection

Application

and adm. of

regulatory

standards

Tariff revision

Administra-

tion

Attention to

users

Generation

Transmission

Distribution

Security

Communication

& networks

R&D

Tech. support

HR

Heritage

& Supply

Treasury

Accounting

Purchasing &

contracting



AppointmentSecretary of Energy after

selection from public job offering

Terms of

office

Duration 5 years

Renewal Indefinitely

Remuneration N/A

Funding

Chairman of BoD/ CEO

Separate

annual budgetYes

Sources of

income

• Revenues arising from collection of

the inspection and control duties

paid by the Wholesale Electricity

Market Agents (electricity

generators, transmitters and

distributors)

Establishment

Law N° 24.065 under the scope of the

Ministry of Energy and the Ministry of

Federal Planning, Public Investment

and National Services

Strategy& | PwC

There are five BoD members, appointed with the term of 5 years renewable indefinitely

53

Source: Strategy& analysis, ENRE website

Argentina


BoD Composition

Appointment

Appointment of the Presindent and Vice

president based on public job offering with

requirements being an economist or engineer.

Final selection was based on interviews

conducted by a private consulting firm

(shortlisting 3 among which the Secretary of

Energy would choose the President and Vice

president)

Reporting institutionEnergy Secretariat under the Ministry of

Federal Planning, Public Investment and

Services

Terms of

office

Duration 5 years

Renewal Indefinitely

Meetings

Responsibilities N/A

President

Vice-president


Commissioner


Strategy& | PwC

Focus in

next slide

AEEGSI org. structure displays many units dealing with customer advocacy, protection and complaints

54

Source: Strategy& analysis, Italian Regulatory Authority for Electricity and Gas website, AEEGSI Annual report 2017

Italy

General

Secretariat

BoD

Energy

DivisionEnvironment

Division

PR

Legal

Customer

advocacy/protection

Accountability and

enforcement

Institutional and

external relations

Sanctions and

penalties

General Affairs and

Resources

Wholesale market &

environmental

sustainability

Retail market &

consumers

protection

EU regulation

Energy

infrastructure &

unbundling

Water Systems

Environmental

Services (Heat)

Environmental

services customer

protection

Ethics

committee

Board of

Auditors

Legal

advisers

Strategic

Control


Organizational structure202 FTEs

in 2016

Legal Mandate

Appointment BoD

Terms of

office

Duration N/A

Renewal N/A

Remuneration N/A

Funding

General Secretary and Divisions’ Heads

Separate

annual budgetYes

Sources of

income

• Annual contributions paid by the

market operators

Establishment Law 481 of 14th November

Strategy& | PwC

There are five BoD members, appointed with the term of 7 years fulltime and they meet weekly and upon request

55

Italy


BoD Composition

Appointment

President of the Republic following qualified

majority vote of 2/3 of members of both

chambers of the Parliament on the Ministry of

Economic Development proposal

Reporting institution

Terms of

office

Duration7 years fulltime (BoD members can not

exercise any other working activity while in

office)

Renewal Not renewable

Meetings Weekly and upon request

Responsibilities N/A

Chairman

Commissioner


Commissioner

Source: Strategy& analysis, Italian Regulatory Authority for Electricity and Gas website, AEEGSI Annual report 2017


Strategy& | PwC

Saudi ArabiaEgypt

BoD members usually are ex executives of the sector players or government members

56

BoD members experience

Chairman Minister of Electricity and Energy Minister of Water and Electricity

Members

1. Ex. EEHC Board Member for G, T and D Companies

Affairs

2. Ex. EEHC Chairman

3. EEHC Chairman

4. AUC University Faculty Member, Chairman of Finbi

Group

5. Ex. EEHC Board Member for Financial and

Administrational Affairs

6. Head of EE Unit at the Council of Ministers

7. Ex. Minister of Utilities

8. Law Professor at Cairo University

9. Physics Professor at the AUC University

10. Agent Federation Of Egyptian Industries

1. Governor of ECRA & Deputy Chair of the Board

2. Vice-Governor for Planning & Development of the

Saline Water Conversion Corporation

3. Chair of the Saudi ABB Co. Board

4. Deputy Minister for Planning & Development of

Ministry of Water & Electricity

5. Executive Director of Educational & IT Projects Co.

6. Deputy Minister for Central Services of the Ministry of

Finance

7. Senior Vice-President for Technology and Operations

Group at Saudi Telecom Co.

8. Assistant Deputy for Follow-up and Information od

the Ministry of Economy & Planning

9. College of the Engineering King Saud University

10. Director, Gas Supplies and Pricing Department

Ministry of Petroleum & Mineral Resources

11. CEO of Southern Region Cement Co.

12. Director General, Industrial Cities and Technology

Zones Authority (Representing the Ministry of

Commerce and Industry)