Electricity Law of Liberia, 2015

Section 2. 1: Purpose and Scope .... ... .. .. .. ... ...................... ... ........ .... . 2

Section 2.2: Definitions ............................................................... . 3 Part III - LEGAL ANO REGULATORY FRAMEWORK Chapter 3: Institutional An·angements... .......... ... .... .... .. ....... .. ........... .. .. ... 5

Section3.I : Roleof1heM inister ........ ............... ...... .. .. ... ... ... ......... , .... 5

Section 3.2: Role of the Department ofEnergy... .................................... 5

Section 3.3: Powers and Duties of the Regulator.............................. ... ..... 5

Section 3.4: Advisory Forums. .............. ..... ............. ... . .......... ............. 6

Section 3.5: Customer and End User Forums................... .... ..... ........... .. .. 6 Chapter 4: Procedures of the Department of Energy................ .. ... ............ ...... 6

Section 4.1 : Procedures.......................................... ... .. ............ .. .... ... 6

Section 4.2: Budget by the Department of Energy...................................... 8

Section 4.3: Annual Repon of the Deprutment of Energy ............... .... ....... .... 9

Section 4.4: Electricity Rationing... ..................................................... 9 PART IV- REGULATIO N Chapter 5: Electricity Licenses and Rehristration................ .. . .. . . .. . . . .. . . .... .. . 9

Section 5.1: Activities Requiring Licensing (Regulated Activities)............... 9

Section 5.2: Registration...................... .... .... ..... .... ........................ I0

Section 5.3 : Application for License................................ .................. I0

Section 5.4: Advertising of License Application.................................... 10

Section 5.5: lnfom1ation to be Supplied..... ...... ..................... .... .......... 11

Section 5.6: Finalizarion of Application.............. .... . ........................... 11 Sect.ion 5.7: Types of Licenses... ................................ . .................... . 11 Chapter 6: Conditions of License/Renewal of License. . ... ............................ 12

Section 6. I: Conditions for Issuance and/or Renewal of License. ................. 12

Section 6.2: Amendment of License....... ...... ................ ..... ........ ... .... .. 13

Section 6.3: Revocation of License on Application..................... ... ... ... .... l3

Section 6.4: Powers and Duties of License...... ....................... ............ ... 13

Section 6.5: Powers of Entry and Inspection................ .... ....... .. ............. 14

Section 6.6: Electricity Infrastructure Not Fixtures.... ............................... l4

Section 6.7: Rights Over Streets.. ........ ................... ... .............. ........... lS

Section 6.8: Acquisition of Land.. ............ ...................... ............. ....... 15

Section 6.9: Self-Supply by Large Consumers.... ..................................... 15

Section 6.10: Micro-Utilities...... ......................... . ......... ....... .............. 16

Section 6.11: Transmission System Operator.................... . ..... ................. 16 ii

Section 6. 12: Noncompliance/Penalties and Fines............................. . ....... 16

Section 6. 13: Theft of Electricity.. ................................. ...................... 17

Section 6.14: Liability of Licensee for Damage or Injury............................ 17 Chapter 7: Dispute Resolution............................................................... 17

Section 7.1: Resolution of Disputes by the Regulator................................ 17

Section 7.2: Remedies against Decisions or the Regulator. .. ....................... 18 Chapter 8: Tariffs and Te1ms ofSupply.......... ...... ... ..... . ............................ 18

Section 8.1: Tariff Principles.......................................................... . .. 18

Section 8.2: Tariff Methodology................................. .................... . ... 18

Section 8.3: Tariffs... ...................................................................... 19

Section 8.4: Consideration of Tariff Adjustment....................................... I 9 Section 8.5: External Contributions in Foreign or Development Aid................ 20 Section 8.6: Power Purchase Agreements/Energy Purchases and SaJes......... .... 20

Section 8.7: SaJes of Excess Electricity by Self-Suppliers ............................ 20

Section 8.8: Process Limitations for Changing Tariffs................................ 20

Section 8.9: Prospective Application ofTariff Changes .............................. 20

Section 8.10: Emergency Changes in Tariffs............................... ............. 20

Section 8.11: Alternative Fonns of Regulation........................................ 21 Chapter 9: Liberia Electricity Corporation (LEC) ... ,............ ... .. .. . . . . . . . . . . . . . . . .. 21

Section 9.1: Liberia Electricity Corporation {LEC)... ... .. . .. .... .. . . . . . .. ....... .. .. 21

Section 9.2: LEC Subject to Regulation under this Law.............................. 21

Section 9.3: LEC as transmission system operator and national grid compan)... 21 Secrion 9.4: Paragraphs 3. 4. 6. 7 and 8 ofrhe Act (rearing LEC Amended ...... 21 Chapter I 0: Water Resources Mallagt:ment................................................. 22 Chapler 11: Planning Process.................................................................. 22 Chapter 12: International Transactions....................................................... 23

Section 12.1: Sale of Electricity& Interconnections across International Borders 23 Chapter 13: Liberia Electricity Regulator, Commission.................................. 23

Section 13.1: Creation or Liberia Electricity Regulatory Commission............. 23

Section 13.2: Removal from Office..... ........ ...................... .......... ..... .... 24

Section 13.3: Autonomy and Independence.. ............... ....................... .... 24

Section 13.4: Funding and Budget... .................................................... 24 Section l 3.S: Staff........................ ............. . .................. ..... . ............ 25

Section 13.6: Transition .................................................................... 25

Section 13.7: Practices and Procedures of the LERC; Judicial Review............. 25

Section 13.8: LERC Planning Process ............................................ , ..... 28 PART V - PRINCIPLES OF LAW Chapter 14: Re1ationship to Other Laws................................................... 29

Section 14.1: Ap~ication and Interpretation of La\\.................................. 29

Section 14.2: Other Laws or Provisions Repealed by this Law...................... 29

Section 1-U: Transitional Provisions After Law Becomes Effective............... 29 29Chapter 15: Effective Date ... .. ....................................................... 29 iii ACRONYMS kW kilowatt LEC Liberia Electricity Corporation LERC Liberia Electricity Regulatory Commission (LERCJ MLME Ministry of Lands. Mines and Energy RREA Rural and Renewable Energ)' Agency A BfLL ENTITLED 2015 ELECTRICITY LAW OF LIBERIA This law regulates the elecn-iciry secror 3nd pro, ides the legal and regulatory frameworh., methods and procedures fonhe pw-poses related thereto and shall be referred to as the 201 S Electricity Law of L iberia. PREAMBLE WHER EAS. the Public Alllhorities Law was amended in 1973 to add Chapter 85 for the creation of the Liberia Electricity Corporation: and WHEREAS. The Liberia Electricity Corporation was created 10 engage in the developmenr, generation. transmission, distribution and sale of electrical energy and related electrical equipment and devices. to cities. towns. and the public in general for heating. lighting. and power purposes and for the carrying on of all business incidentals thereto; and WHEREAS. the need for modem electric energy for economic development and national advancement has overwhelmed the capaciry of Lhe Liberia Electricity Corporation in satisfying said need; and WHEREAS. the need for modem electric energy sector necessitates opening up the sector in Liberia to private investment in order to meet current and future demand. to enhance access, improve quality and lower cost of electricity: and WHEREAS, opening up the electric energy sector to competition demands the unbundling the sector among distinct instirutions for policy oversight. regulatory functions and operations in accordn.nce with international best practices~ Now therefore, it is enacted by the Senate and House of Representatives oflhe Republic of Liberia in Legislature Assembled: PART I - PRELIMINARJES Clrnpter I: Amendment and Short Title Section l.l: Amendment That from and immediately upon the passage of Lhis 2015 Electricit)' Law of Liberia: Chapter 85 of the J97?, Public Authorities Law creating the Liberia Electricity Corporation is hereby amended. Section I.:?.: This law shall also be cited as the 2015 Electricity Law of Liberia. PART IJ - GENERAL PROVISIONS AND POLICY Chapter 2: General Provisions

Section 2.1: Purpose and Scope This Law shall establish the legal and regulator) framework for the generation. transmission. distribution and sale of electricity within the territory of The Republic of Liberia and the impon and export of the same. The purposes of this la\\ are to facilitate the implementation of the National Energy Policy whose goals include but are not restricted to the following: I. Expand on a sustainable basis rhe availability of electricity services with the goal of attaining universal service. 2. Assure availability of supply and quality of service in electricity at reasonable and cost compensatory prices, fu lly cognizant of the need to balance affordability to customers with the need to attract capital and private investment to the sector. 3. In crease availability of electricity services needed to suppon economic development. 4. Promote the development of renewable energy resources for electricity generation. 5. Encourage efficient ust: of electricity resources nnd facilitate economic de, elopment. 6. Promote regional and international cooperation in electricity trade and investment. 7. Maintain a financially viable and sustainable electricity industr). 8. Establish and maintain transparency, accountability, and sound principles of governance in the electricity sector through appropriate institutional, market. and regulatory arrnngements. 9. Provide the necessary capacity building process for electricity sustainability and security. 10. Ensure the security of the supply of electricity in Liberia. I !. Ensure the promotion of sustainable and fair competition in the electricity sector \\,here it is efficient to do so. I ?. Prote1.:t the interests of all classes of consumers of electricity as to the terms and conditions and charge of supply. 13. Ensure, so far as it is practicable to do so. the continued availabilit) of electricity for use in public hospitals: and facilities for the disabled. aged and sick. 14. Ensure the availabi lity of health and safety guidance in relation to electricity supply lo the public. 15. Ensure the financial viability of efficient regulated electricity undertakings. 16. Ensure the collection. publication. and dissemination of information relating to standards of pcrfonnance by licensed operators and on the electricity sector in Liberia for the use by the industry. consumers and prospective investors. 17 Participare io regionaJ and intemationaJ maners relating to the regulation of electricity in Liberia: and 18. De, elop annual supply targets for the purpose of ensuring that such sen'ices are accessible to the widest number of electricit) users. I '.I. Achieve the aforementioned goals taking into account the protection of the environment and access 10 electricit) for 10\v income customers. Sectioo 2.2: Definitions I. Customer/Cn11s11mer - cun-ent users of regulated electric services. and includes those under n contrnctual arrangement with a supplier, or who are entitled to ha\ e reasonable expectation of services or who are affected by 1he servires or the manner in ,~ hich they are delivered. 2. Demand-Side A,Ja,ragement - also known as energy demand management, is the modification of consumer demand for electricity through various methods such as financial incentives and education with the goal to encourage the consumer to use less energy during peak hours. or to move the time of energ) use to off-peak times such as nighttime and weekends. 3. Distribution - the conveyance/deli very of electricity to Customers/end-users at the voltage level specified by the Regulator. 4. Generation - the process of generating electric power from any primary source of energy. 5. Grid - the interconnected network for delivering electricity from supplier to cus1omers. 6. Large Consumer - end users who consume more than a threshold number of kilmvatt hours as defined by the regulations 7. Liberia Electricity Corporation (LEC) - the state owned entity created by Chapter 85 of the Public Authorities Law of the Republic of Liberia and all amendments thereto and includes any successor companies that may be created in the future. 8. Liberia Electricity Regulatory Commissio11 (LER C) refers to the Commission authorized to be crea1ed pursuant to Chapter 13 of this law. 9. licensee - the holder of a license granted or deemed to have been granted by the Regulator under this ta,\. 10. Micro Utility- entities and/or individuals who generate. distribute. and/or supply electricit} to a certain number customers or less and/or below a certain threshold of rotal power generated annually, to be defined by the Regulator 3 I /I / I I. Minister- the Minister of the Ministry of Lands. Mines and Energy. 12. Ministry - is the Minisrry of Lands. l\•fines and Energy for the Republic. or any successor entity with responsibility for energy in the Republic of Liberia. 13. Party - any persons who are directly interested in or actively concerned with the prosecution. defense or other proceedings under this la,., . 14. Person - any entity. either narural person. Governmental entity. or corporate entity. 1S. Regulated Entity - alJ entities providing electricity services or othernise licensed pursuant to this law. including, but not limited to those engaged in the sale. distribution. transmission. and/or generation of electricit). 16. Reg11/ator - the Ministry's Department of Energy that is charged with the responsibility for regulating the electriciry sector in the Republic of Liberia. until the Liberia Electricity Regulatory Commissio11 shall be established consistent with Chapter 13 of this law. 17. Renewable Energy - energy that comes from resources which are naturally replenished constantly. I8. Self-Supplier - supplying electricity for one's own needs directly from sclr- g.eneral ion. 19. Supply - the trading and the generation. transmission or distribution of electricit). 20. System Plan - a plan that imegrales all relevam resource options. such as conservation and demand management. distributed generation. large-scale generation. transmission and distribution. 2 L. Tariff - clectriciry pricing, including related charges such as. but not limited to. connection charges. 22. Theft of Electricity - the unauthorized or illegal acquisition of electriciry and/or dectric cunent. 23. Tra11smissio11 - the conveyance/delivery of electricity above the voltage level specified by the Regul.:itor. 24. Trunsmilsi<m System Operaror- the entit) licensed to undertake some or all of the following activities: a. Co-ordinate the power supply system to obtain instantaneous balance between generation and use of electricity: b. Dispatch all generation connected to the transmission infrastructure: c. Co-ordinate p!anned generarion and planned transmission outages: d. tvlonitor the import and expon of electricity: e. Prepare forecasts of generation requirements f. Perfom1 such other functions as may be prescribed 111 its license or in the regulations issued by the Regulator. ;I I tl I Part 111 - LEGAL AND REGULATORY FRAMEWORK Chapter 3: Institutional Arrangements

Section 3.1: Role of the Minister: The Minister shall be responsible for lhe fonnulation and development of national energy policies and master plans and the administration of rhis law. The Minister shall. consistent with the applicable Laws of the Republic of Liberia. form ulate and articulate the national energy policy on a prospective and ongoing basis.

Section 3.2: Role of the De parlment of Enctg)': The Ministry's Department of Energy. headed by a Deputy Minister for Energy. shall regulate and monitor the electricity sector until the Liberia Electricit) Regulatory Commission shall be established consistent with Chapter l 3 of this la½.

Section 3.3: Powers and Duties of the Regulator The powers and duties of rhc Regulator shall include but not be restricted to the following. A. The Regulator must: l. consider applications for licenses and may issue licenses for: a. the operation of generation. transmission and distribution facilities; b. the import and export of electric it) : c. trading: 2. regulate tariffs: 3. register persons who are required to register with the Regulator where they are not required to hold a license: 4. issue regulations designed to implement this law: S. establish. maintain, review and amend as appropriate technical and performance standards for the elecrriciry sector and monitor and enforce compliance with such technical standards: 6. establ ish. maintain, review and monitor safety standards for the electricity sector and monitor and enforce compliance with such safety standards; 8. enforce performance and compliance, and take appropriate sreps in the case of non-perfon;1ance: 9. take the necessary protective measures and may impose temporary limitations on the use of electricity and operation of power plants and e lectricity supply facilities in the case of an emergency crisis affecting the availability of electricity or where physical safety or security of persons, installations. or system integrity is threatened: l 0. promulgate regulations and guidelines for regulated entities ro develop a curtailment and emergency plan, in whkh the priorities for supplying regulated services in case of cw-railment shall be de!1ned: 5 I I. resolve disputes bc-tween licensees and customers or end users by acting either as an adjudicator or mediator as appropriare: 12. compel the production of such infonnation andlor physical evidence as ma)' be reasonably needed to fulfil! obligations under this law B. The Regulator may: I. undertake invesrigarions and inquiries into the activities of licensees: ., require audited financial statements of licensees: 3. conduct audits and inspection of records. facilities and equipment of licensees: ➔. establish. maintain. revie" . monitor. and amend. as appropriate. customer care standards: and 5. perform any other act incidental to its functions.

Section 3.4 : Advisory fo rums The Regulator may appoint forums consisting of as many of its members and employees and other persons as may be necessary to advise the Regulator in general or on a particular maner. or as may be prescribed in regulations issued by the Regulator.

Section 3.5: Customer and end user forums A. The Regulator may establish customer or end user forums consisting of as rnan)- members and employees of the Regulator. licensees. and categories of customers or end users as may be necessary to advise the Regulator on maners affecting customers or end users. in general_ or a cntegory of customers or end users in particular. B. The Regulator may require a licensee ro establish and fund a customer or end users· forum in the manner set out in the license held b) such a person. Chapter 4: Procedures the Department of Energy The Department of Energy shall report to the Minister.

Section 4. 1: Pl'ocedures I. The Department of Energy shall articulate and publish fom1al and binding procedures for decision making on all non-rulemaking processes. and establish a fom1al docketing system for tracking ma1ters pending before the Department of Energy. The procedures must include the following; a. Issuance of public notice of the pendency of any matter brought before the Department of Energy. and the assignment of an official docket number for the maner. b. Once the pendenc) is formally noted and a docket nwnber is assigned. publication of a formal schedule for deciding the matter. c That schedule shall include date(s) for formal inten ention b) interested parties. date(s) for pem1itted or required submissions. time(s). date(s). and location(s) of public hearings. and such other information as may be required for affording all parties a fair and meaningfuJ opportunity for participation. d. All persons. natural. Governmental. or other legal entities~ who seek 10 become fonnally recognized as parties. must file written notification with the Department of Energy of their desire to do so. e. All persons. unless they are completely wrnffected by the outcome of a pa11icular maner. as formally determined b) the Department of Energy. are entitled ro party status. f. The Department of Energy shall provide all affected parties a meaningful opportunity to participate in the process of deciding pending matters. g. Such opportunity includes. but is not necessaril> limited 10, providing all parties the ability to obtain necessary information and documentation from other parties to the matter. the right to submit evidence and argument to the Department of Energy. and the opportuniry to examine all of the evidence which Lhe Department of Energy considers before making a decision on a matter. h. The Department of Energy shall conduce public hearings on all matters related to the setting of tariffs and regulations. fonnally adjudicated consumer complaints. and other types of disputes. and on all other matters where an affected party requests such a hearing. i. The Department of Energy shall. in all matters related 10 tariffs and to quality and availability of service. afford all members of the public a formal opportw1ity to be heard by the Department of Energy through public hearing(s} and written submissions. j. All decisions must be in writing and published. k. Decisions shall include a procedural history of the matter. a precise description of the issues to be decided. reciwtioo of facts. stunmary of the evidence and arguments presented by each formal participant in the maner. factual and legal analysis. clear statement of conclusions and decision. as well as complete explanation of reasoning underlying the decision. I. All Department of Energy decisions shall become final 30 days after publication. unless an eligible part) to the matter files a wrinen application for formal reconsideration prior to rhe expiration of that 30 day period. m. In requesting reconsideration. an eligible party must specifically set forth the specific issues on which reconsideration is sought and the grounds for doing so. n. Reconsidera1ion may only be sought by a party who participated in the original proceeding and who either fonnall) addressed the subject on which reconsideration is being sought in the Department of Energy proceedings. or who was precluded from doing so for reasons beyond that party's control. ti. While eligible parties may raise as many issues as they choose for seeking reconsideration, no party may make more than one application for reconsideration. 7 p. In considering an application for reconsiderarion. the Department of Energy may. \\ithin 30 days of the filing of an application, either issue a formal decision granting or denying reconsideration. re-open the matter in order to seek out further infonnation or argument. or rake no acLion. q. If the Department of Energ) takes no action within JO days after an application for reconsideration shall have been filed. the decision shall be deemed denied. by operation of Law. .2. The Department of Energy shall follow the following Rule Making procl'!dure: a. Publish a Notice of Proposed Rule Making that sets forth the subject on which regulations are being contemplated. initial Department of Energy Yiews on the subject. and/or questions or information requests regarding that subject on which the Department of Energ) is soliciting written comments from stakeholders and other members of the public. b. State the date. which. absent an emergency. shall be no less than 30 days. by which ii is looking for feedback. c. Following receipt of the comments. the Department of Energy. having fully considered lhe comments received. may choose t0 go no further. or i1 may seek furrher comment. Should the Department of Energy seek to go forward with rulemaking. it shall proceed as follows: 1. The Department of Energy, after following the processes set forrh in subsections a. and b. of this Section. shall publish proposed regulations or the proposed Set of Rules. 11. In so doing. the Department of Energy shall ask For written comments from stakeholders and members of the pub Iic. iii. The Department of Energy shall state the date. \\hkh shall be no less than 30 days. by which commems are to be made. iv. Following receipt of the comments. and full consideration thereof. the Department of Energy may request a second round of comments. may discontinue 1he contemplation of the regulations proposed, or ma) publish and adopt a Final Ru.le or se1 of Rules. v. When regulations are adopted. the action of the Department of Energy shaJI include promulgation of the regulations. as well as an explanation of the Department of Energy's reasoning for adopting the regulations.

Section 4.2: Budget of the Department of Energy 1. The Department of Energy shall propose its budget through the nonnal budgeting process. The Department of Energy may impose a le\ y or surcharge on electricity bills for the purpose of strengthening the regulation of the electricity sector: until such time as the transition to the independent LERC shall have been completed. however. such levy or sun.:harge shall not continue after two (1) years from effectiveness of this law when such levy or surcharge may be imposed by the independent LERC for its operating budget. 8 3. The amount of the levy shall be set in tenns of a per cent of Lhe electrici1y bill within a billing cycle. 4. The funds deiived from the levy shall be deposited in a separate account managed by the Ministry of Lands. Mines and Energy for purposes consistent with this la\,. 5. Information on the funds shall be included in the Depanmenr of Energy's annual report pursuant to this la\\. Fines col lecred from regulated entities shall belong 10 the National Treasury and the Department of Energy shal l have no insritutional self-interest in the revenues derived there from.

Section 4.3: Annual Report by the Department of Energy ! The Depanment of Energy shall publish an annual report of its activities wirhin three months of the end of a fiscal year and a plan of activities for the subsequent year.

Section 4.4: Electricity Rationing The Department of Energy may put into effecl electricity rationing including enforced reductions in supply or requisiLioning if extraordinary circumstances make this necessary . The procedure for rat ioning will be as prescribed by regulation. PART IV- REGULATIO Chapter 5: Electricity Licenses and Registration

Section 5. 1: Activities requiring licens ing (regulated activity) I. No person may. without a license or registration issued by the Regulator in accordance with this law: a. operate any generation. trans1111ss1on or distribution facilicy in excess of a threshold defined by the Regulator: b. import or export electiicicy; c. be involved in trading electriciry: or d. be a transmjssion system operator. Notwithstanding subsectjon (I) of this Section, a person involved in regulated acth•ities below tne thresholds set by the regulations need not apply for or hold a license issued by the Regulator. 3. Nothing in this law precludes a potential licensee from discussing any contemplated regulated activity or any other activiry relating thereto. prior to ftling a license application with the Regulator. The Regulator must furnish an applicant contemplated in this Section with all infonnation necessary to facilitate the filing. of an application for license. 5. No request for further information. notifica1ion or discussions referred to in this Section may in any way be construed as confen-ing any right or expectation on an applicant.

Section 5.2: Registration I. Any person engaged in a regulated activity under this law must register with the Regulator. 2. Any person who must register with the Regulator must do so in the fonn and in accordance with the procedure prescribed in this law and in the regulations.

Section 5.3: Application for license I. Application a. A person who must hold a license under this law must apply to the Regulator for such a license in the form and in accordance 1.vith the procedure prescribed in this law and in the regulations. b. Such an application musr be accompanied by the prescribed application fee as detenuined by the Regulator. 2. Any application contemplated in subsection (I) mus1 include: a. a description of the applicant. including vertical and horizontal relationships with other persons engaged in regulated activities under tllis law or any other prescribed activity relating thereto: b. such documentary evidence of the administrative. financial and technical abilities of the applicant as may be required by the Regulator: c. a desc1iption of the proposed regulated activity. including maps and diagrams where appropriate: and cl. such other particulars as may be prescribed b) regulations.

Section 5.4: Advertising of license application l. When application is made for a license the Regulator may require rhat the applicant publish a notice of the application in appropriate ne,vspapers or other appropriate media circulating in the area of the proposed activil). " The advertisement must state: a. the name ohhe applicant: b. the objectives of the applicant: c. the place where the application wil l be available for inspection by any member of the public: d. the period within which an) objections to the issue of the license may be lodged with the Regulator: t'. the address of the Regulator ,,here any objections may be lodged: f. that objections must be substantiated by way of an affidavit or solemn declaration: and I II .:. g. such other pruticuhirs as may be prescribed by regulations.

Section 5.5: Information to be supplied Before considering an application for a license in terms of this law. the Regulator: 1. must furnish the applicant with all subs1antiated objections in order to allow the applicant to respond thereto: and 2. may request such additional information as may be necessary to consider the application properly.

Section 5.6: Finalization of application 1. The Regulator must make a decision on an application in the manner prescribed under Chapter 4 of this law. 2. The Regulator must provide the applicant with a copy of its decision as well as the reasons for the decision.

Section 5. 7: Types of licenses I. For all electricity undertakings with capacity above a defined threshold to be determined in the regulations. the Regulator must issue separate licenses with inhereni rights and duties for the operat ion of: a. a generation facility: b. a transmission facility: c. a distribution facility: d. the irnpon and cxporl of electricity: e. the trading of electricity: or f. transmission system operator. .., Micro-utilities or operations with capacity below the defined threshold may either be exempred from licensing or be given a single license authorizing all the functions related to regulated activities under this law 3. Self-supply by large conswners with capacity above the defined threshold may either be exempted from licensing or be given a single license authorizing all the functions related to regulated activities under this law. 11 Chapter 6: Conditions of License/Renewal of Jicense

Section 6.1: Conditions for issuance and/or renewal of license I. The Regulator may make any license or renewal of license subject to conditions relating to: a. the establishment of and compliance with directives to govern relations between a licensee and its customers or end users. including the establishrn~nt of customers or end user forums: b. the fumishing of information. documents and details that the Regulator ma) require for the purposes of this law: c. the period of validity of the license in accordance with such other particulars as may be prescribed by regulations: d. the setting and approval of tariffs charged by licensees: e. the methodology to be used in the detennination of tariffs which must be imposed by licensees: f. the format of and contents of agreements related to activities regulated by this law and entered into among licensees: g. the quality of elecrricic) supply and service: h. in the event of the failure of a licensee to perform an essential obligation under this law. the surrender, transfer or enctunbrance of licenses. including the compulsory transfer of a license to another person: i. the term ination or reconnection of electricity suppl) in a neutral. nondiscriminarory manner and/or as prescribed by regulations; .i. the area of electricity supply to which a licensee is entitled or bound: k. the categories of customers and end users to whom electricity may or must be supplied; I. the types of energy sources from which electricity must or may be generated: m. compliance with health. safety and environmental standards and requirements; n. compliance with any regulations and/or. guidelines made under this law: o. compliance with energy efficiency standards and requirements. including demand-side management: p. to maintain [acilities in a fu lly operational condition; q. the period within which licensed facilities must become operational: r. a licensee may assign or transfer a license upon prior approval and prior written consem of the Regulator: and s. any other condition as prescribed by regulations under the law. II;

Section 6.2: Amendment of license The Regulator may vary, suspend or remove any license condition. or may include additional condirions: I. in the public interest: or 2. on application by the licensee and in the event that the benefit of the proposed amendment for the applicant does not outweigh any detriment or ham, lo another part) or to society as a whole.

Section 6.3: Revocation of license on application I. The Regulator may revoke a license: a. in the e\ent of a significant breach of an essential obligation of the licensee under this laYv: and b. repeated failure by the licensee to cure the breach. 2. A licensee must. in the circumstances contemplated in subsecrion (I). give the Regulator reasonable notice in writing of intent to cure the breach. 3. The procedure to be followed in revoking, a license will be as prescribed by the regulations.

Section 6.4: Powers and duties of licensee I. A li cense issued in tem,s of this law empowers and obliges a licensee to exercise the powers and perfonn the duties set out in such license and this lav,·. and no licensee may cede. transfer any such pO\\er or duty to any other person without the prior consent of the Regulator. A licensee may not discriminate between customers or categories of customers regarding. access. rari ffs. and conditions of sen-ice. except for objectively justifiable and identifiable differences approved by the Regulator. 3. A u-ansmission or distribution Iicensee must. to the extent provided for in the license. provide non-discriminatory access to the transmission and distribution power systems to third parties. 4. Access in tenns of subsection {3) must be provided on the conditions set out in the license of such transmitter or distributor. which may relate to: a. the circumstances under which access must be allowed: b. the circums!ances under which access may be refused: c. the strengthening or upgrading of the transmission or distribution power system in order to provide for access. including contributions towards such uµgrading by the potential users of such systems, if applicable: d. the rights and obligations of other existing or new users regarding the use of such power systems; e. compliance \\ ith any regulations. guidelines or practice made by the Regulator: or f. the fees that may be charged by a licensee for the use of such power sysrern 13 5 A licensee may not reduce or te1minare the supply of electricity to a customer. unless: a. the customer fails to make payment within a reasonable time: b. the customer has failed to honor. o r refuses to enter into. an agreement for the supply of electric it) : c. the customer has violated the payment conditions of that licensee: or d. the customer is found to have obtained electricity illegally or unauthorized 6. This Section 6.-+ (Powers and duties of licensee) has priority over Section 6.1 (Conditions oflicense/Renewal of license J above. in the event of a conflict.

Section 6.5: Powers of entry and inspection l. Any person authorized thereto by a licensee shall at all reasonable rimes be provided access to any premises to which electricity is or has been supplied by such licensee. in order to inspect the lines, meters. finings. worl,.s and apparanis belonging to such licensee. or for the purpose of ascertaining the quantity of electricity used. or where a supply is no longer required. or where such licensee ma) cur off the supply. for the purpose of removing any lines, meters. finings. works and apparatus belonging to such licensee. 2. Any person wishing to enter any premises in tenns of subsection ( l) shall: a. if possible, make the necessary arrangements with the legal occupant of the premises before entering such premises and shall adhere to all reasonable security measures. if any. of the occupant or owner of the premises; b. exhibit authorization at the request of any person materially affecLed by the activities. 3. Damage caused by such entry. inspection or removal shall he repaired or compensated for by the licensee.

Section 6.6: Electricity infrastructure not fixtures I. An) asset belonging 10 a licensee that is lawfully constructed. erected. used. placed. installed or affixed to any land or premises not belonging to that licensee, remains the propert) of rhat licensee notwithstanding the fact that such an asset may be of a fixed or permanent nature. 2 An asset belonging to a licensee in terms of subsection (I): a. may not be anached or taken in execution under any process of law, or be the subject of ·any insolvency or liquidation proceedings, instin1ted against the owner of the land. the landlord or the occupier of the premises concerned: b. may not be subjected to a landlord's claims or rights for rent; and c. may only be validly disposed of or otherwise dealt with in terms of a written agreement with the licensee. I J(j Sectio n 6.7: Rights ove r streets 1. A licensee may do all such things over. in or along roads or streets and associated infrastructure as may be necessary to carry out irs licensed acrivicies. 2. Any activity contemplated in paragraph ( t) must be undertaken subjecl ro the right of supervision and in accordance with the plans. routes and specifications of the authority or person in control of that street. excepr in cases of emergency or where 1he authority concerned fails or refuses to co-operate with t.he licensee. 3. A licensee may only exercise its rights in tem1s of this Section to the extent necessar) to carry out its licensed activities. and must in doing so: a. comply with any laws. regulations or guidelines that may be applicable; b. complete its activiries wirhin a reasonable time: and c. repair any damage caused or reimburse the person or authority in control of that road or street for any damage caused. 4. Nothing in this Section may be construed as giving a licensee any rights that ir does not already have in terms of its license, or relieving a licensee from any liability in respect of any loss or damage caused by its negligence. 5. For the purposes of this Section 'street' includes any square or enclosed public place the control or care of which is vested in any person or authorit).

Section 6.8: Acquisition of land 1. The Government may, in order 10 Facilitate the achievement of the purposes of this lavv. acquire land. or any right in. over or in respect of land. on behalf of a licensee in accordance with the Constitution and the Eminent Domain law of the Republic of Liberia. 2. The regulations shall presctibe the procedure to be followed in gi\ing effect to paragraph (I) of this section. 3. The Government may exercise the powers contemplated in paragraph (1) or this Section onl) if: a. a licensee is unable to acquire land or a right in. over or in respect of such land by agreement with the owner; and b. the land or any right in. over or in respect of such land is reasonably required by a licensee for facilities which will enhance the electricity infrastrucrure in the national inrerest.

Section 6.9: Self-Supply by Large Consumers I. Large Consumers are the end users who consume more than a threshold number of kilowatt hours, as defined by the regulations. and who may be eligible to self-supply electricity pursuant to authorization from che Regulacor. 15 • 2. These consumers may only self-suppl) upon obtaining specific authorizarion to do so from the Regulawr. 3. Applicants must indicate in their applications the source of electricity supply and the quantity of the supply available to them. 4. In their application to the Regulator for such self-supply status, the consumer must show how it intends Lo supply itself, how it intends to obtain back-up supply, and what it intends to do with any surplus supply it may possess. 5. Self-suppliers may seek authorization from the Regulator to sell surplus to LEC or some other customers off the LEC grid. 6. The Regulator will waive this requirement for those conswners who own generating equipment that is nor connected to the distribution system and that have a voltage lower than a number of kilo-volts dete1mined by the Regulrnor.

Section 6.10: Micro- Utilities I. Entities and/or individuals who generate. distribute, and/or supply elecrricity to a certain number cusromers or less and/or below a certain threshold of total power generated annually. to be defined by the Regulator are eligible for a micro-utility license. 2. Such licenses may include bundled services in providing electricity from generating to full provision to end users.

Section 6. J l: Transmission System Operator I. The Regulator shall issue regulations governing the responsibility for system operation. '.?.. The Regulator delegates the authority to exercise responsibilit) for system operatfon as prescribed by regulations. 3. The syste1n operator see that there \viii be an instantaneous balance at any given time between the total generation and the total consumption of power taking account of the power exchanges with interconnected foreign systems. 4. Anyone who fully or partly owns or operates a grid. power generation or an organized marketplace with trading companies and end users are required to comply with the instructions of the entity responsible fo r system operation during the operation of the system. and to comply v.,ith the provisions relating to the responsibility for system operation specified in or pursuant to this law.

Section 6.12: Noncompliance/Penalties and fines The Regulator may impose penalties and fines for noncompliance or violation under this la¼ as prescribed by regulations. included but not limited to: I. Adminislrati ve tines 2. Coercive fines 3. Punitive fines/penalties 4. Suspension/revocacion of Iicense 5. Imprisonment 41 16

Section 6.13: Theft of Electricit)' Theft of electricity is a criminal offense and shall be prosecuted Lmder the laws of the Republic of Liberia. Obi.aining or attempting to obtain electricity or electric current without payment is considered theft of electriciry and shaJI be prosecuted under the laws of the Republic of Liberia. 1. Offenses: a. It shall be unlawful for any person{s) who knowingly. with the intent to defraud. obtain or attempt to obfain. for themselves or for others. electric current, power and/or electricity services. through any illegitimate means. or where such services have been disconnected by the supplier and notice of disconnection has been given. b. A customer or end user who engages in any of the activities set forth in subsection 1(a) above. commits the offence of energy or power theft for which he/she is liable and may be imprisoned and/or fined. 2. Remedy to offenses: An aggrieved Regulated Entity. such as the LEC, may seek relief in a criminal or civil proceeding in any court of competent jurisdiction. and be awarded damages. including attorney's fees and costs.

Section 6. 14: Liability of licensee for damage or injury In any civil proceedings against a licensee a.rising out of damage or tnJury caused by a regulated activiry by the licensee under this law, such damage or injury shall be deemed to have been caused by the negligence of the licensee. unless there is credible evidence to the conrrary. Chapter 7: Dispute Resolution

Section 7. 1: Resolu tion of disputes by the Regul::itor I. The Regulator. in relation to any dispule arising out of this la¼ that the parties thereto are unable to amicably resolve. shall: a. Enforce the provisions of this la\\. the approved tariffs. and the rules of the Regulator: b. If it is a dispute between Iicensees, act as mediator if so requested by a party to the dispute: c. [fit is a dispute between a customer or end user. on the one hand. and a person subject to regulation under this law. on the other hand. resolve the dispute by such means and on such terms as the Regulator shall determine. including by adjudication of matters within the scope of the Regulator's authority under this law. 2. The Regulator may appoint a suitable person to act as mediator on its behalf and any action or decision of a person so appointed shall be deemed to be an action by or decision of the Regulator. 17 3 The Regulator shall prescribe the procedure to be followed in the mediation and the fees required to be paid.

Section 7.2: Remedies against Decisions of Regulator Any decision by the Regulator taken under this law. provided that said decision has been subject to formal reconsideration. if requested under subsection 4.J of this law. shall be binding pending any appeal which may be lodged in the Civil Law Courts and any other subsequent court of competent j urisdiction in the Republic of Liberia. Chapter 8: Tariffs and Terms of Suppl)

Section 8.1 : Tariff Principles l. License conditions determined under this law relating to the setting or approval of tariffs: a. must en~blc an efficient licensee to recover the full cost of its licensed activities. including a reasonable margin or rerum: b. must provide for or prescribe incentives for cominued improvement of the technical and economic efficiency"' ith which services are to be provided: c. must give end users proper information regarding the costs that their use imposes on the licensee's business: d. must avoid undue discrimination: and e. may pen11 itthe subsidy of taiiffs to certain classes of customers: ') A licensee ma) not charge a customer any other tariff and make use of provisions in agreements other than that detennined or approved by the Regulator as part of its licensing conditions. 3. Notwithstanding subsection (2). the Regulator may. in prescribed circumstances. approve a deviation from sel or approved tariffs. 4. The Regulator may issue regulations to further detail the regulacion of tariffs and te1ms of supply. including conditions and charges for connection.

Section 8.2: Tariff Methodolgy I . Tariffs methodology s)1all include appropriate incentives. both positive and negative. for perfon11ance. compliance with all applicable standards. and efficient operations. 2. Regulated entities shall propose tariffs in accordance with tariff methodologies approved by the Regulator which will analyze the proposal and. after following the processes set out in this law. shall issue a decision. 3 In making its decision(s) on tarifT methodologies. the Regulator shall first determine the company's overall revenue requirement. based upon either: a. \erified costs of the company ,vhose tariffs methodologies are being established over,._ the cow·se of a stated test year. no more thai1 six (6) months of which may be projected, so that at \east one-half of the tesr year reflects histo1·ic costs: or 18 b. verified benchmark costs of a s.imilarly situated company which is efficiently engaged in the same business activit): or c. a combination of a and b. 4. Tariffs shall be reflective of those costs necessar) and prudently incurred to the efficient operation of the power sysrem in accordance with reasonable and applicable standards of quality of service as well as extension of services to potential customers. 5. Anyone empluyed by the Regulator. including consultants. may not have financial or other ties to interested parties. 6. The Regulator shall revie\\ tariff methodologies no less than every five (5) years. However, in no event, absent clear demonstration of error or need, shall tariffs have a life of less than two (2) years. 7. The component of rate of return in tariffs shall only reflect those costs borne by the regulated entity itself. and must not retlect the costs of any portion of the regulated entity's asset base that was acquired by contribution fro m a third pany. 8. However, tariffs may reflect any costs incurred by the regulated entity in maintaining and/or operating a contributed asset. 9. The Regulator may permit that the tariff renec1s the cost of contributions 10 capital reserve for investment and maintenance within the electricity sector.

Section 8.3: Tariffs I. Tariffs can consist of a fixed charge, energy charge a11d load charge. There may also be connection charges. 2. Tariffs shall include all charges and taxes that the Government of Liberia lawfull y levies upon the generation. transmission. distdbution licensee. 3. The tariffs shall consist of separate components for each licensed activity. 4. When approving tariffs, the Regulator shall take into consideration pro\'iding appropriate incentives for improvements in productivity and efficiency. 5. AILhou~h tariffs may include specified fuel costs. currency nucrnalions, or other costs not fu tI) controlled by the licensee. such costs may only be adjusted at pre-set intervals pursuant to an index or methodology set out at the time of the fixation of tariffs. provided that. a. The Regulator does so in fashion consistent with the Procedures set iorth in this law: h. The Regulator identified the type of costs subject to periodic adjustment in advance of those costs actually being incurred: c. The licensee's conduct in regard to the incurring of the costs was prudent: and d. The adjustments are on a dollar-for-dollar pass-through basis with no markup and are adjusted upwards and downwards to renect the actual costs.

Section 8.4: Consideration of Tariff Adj ustment Adjustments in tariffs shall seek to send con-ect price signals to customers uf electricity. but also reduce economic disruption or hardship. 19

Section 8.5: External Contributions in Foreign or Development Aid When there is an external financial contribution from a foreign country or development agency for investments in the electricity sector. a mechanism by wh ich a portion of the tariff is directed to a separate bank account where the funds shall be used for specific purposes in the electricity secror may be allowed by the Regulator: provided that this eannarking of funds does not pose an undue risk to any Regulated Entity's capacity ro cover all its caste;.

Section 8.6: Power Purchase Agreements/Energy Purchases and Sales To minimize the potential for abuse of marker power. the Regulator shall have the right to review conrracts for sales of excess electricity and/or competitive procurement of additional electricity, such as power purchase agreements from Regulated Entities. or self-suppliers 10 LEC or any other eligible buyer. The review shall be focused on minimizing potential for abuse of market power.

Section 8.7: Sales of Excess Electricity by Self-Suppliers The Regulator shall regulate the tariffs of e lectricity sold b) any licensee pursuant ro the principles contemplated in this law.

Section 8.8: Process Limitations for Changing Tariffs Changes in tariffs or tenns of supply shall follow the processes required of lhe Regulator in accordance with this law.

Section 8.9: Prospective Applicalion of Tariff Changes Unless explicitly authorized by the Regulator guidelines and regulations, all tariff changes may only be applied prospective!).

Section 8.10: Emergency Changes in Tariffs 1. A licensee which believes itself to be in an emergency financial situation. the scope of which could not have been anticipated. and which has a substantial likelihood of constraining its capabi lity to meet its legal and/or service obligations. may .;eek to have its tariff revised on an expedited basis. ,., The Regulator may. approve such adjusunents. provided that: a. The Regulator finds that there is clear and convincing evidence of an emergency fi nancial situa tion. the scope of which could not have been anticipated, and which has a substantial likelihood of constraining its capability to meet its legal and/or service obligations; and b. That public notice of the emergency application is given and that those affected are provided with the most meaningful opportunity to be heard on the matter lhar circumstances pennit, before the Regulator renders its decision.

Section 8.1 I Aleernative forms of Regulation Notwithstand ing. other provisions of this chapter. the Regulator shall have the authority beginning three (3) years after the creation of the LERC to investigate alternative forms of regulation such as flexible tariffs, incentive based regulations. and the use of competitive markets. The Regulator may adopt one or more alternative methods of regulation following such investigation upon a finding made using an open and transparent process that the use of alternative forms of regulation will fulfil! the purposes of this law and will result in rares that are just and reasonable for consumers and compensatory for licensees. Chapter 9: Liberia Electricity Corporation (LEC)

Section 9. 1: Liberia Electrici ty Corporation (LEC) LEC is the state O\\rned entity created by Chapter 85 of the Public Authorities Law of the Republic.

Section 9.2: LEC subject to regu lation under this la,,, l. from the date that this law comes into effect. LEC shall continue to exist and be considered to be provisionally licensed to engage in all the activities for which it is authorized pursuant to the Act Creating the LEC. subject to the provisions of this law. This provided. however. that during a one (I) year transitional period, commencing on the date that this law comes into effect, LEC shall work closely with the Regulator to ensure that it brings itself into compliance with the tenns and conditions for holding licenses for the activities it intends to engage in.

Section 9.3: LEC as transmission system operato r and national grid company For purposes of this law and pursuant to Paragraph l of the Act Creating LEC. LEC shall continue to be: a. the transmission system operator; and b. the national grid compan) . For avoidance of doubt. in addition to engaging in the activities enumerated in subsections a and b. above. LEC shall cominue. at is election. to engage in all of the acrivhies induuing electricit;1 generation. for which it is authorized pursuant to the Act Creating LEC. subject lo the provisions of this Law.

Section 9.4: Section 85.2, Paragraphs 3, 4, 6, 7 and 8 of the Act Creating LEC amended I. Paragraph 3 of the Act Creating LEC is hereby amended to require LEC to propose fair. reasonable rates. fees and charges to the Regulator for review and approval and to require LEC to allov,, third parry access to the gtid. consistent with this la\\. ') Paragraphs -l of the Act Crearing LEC is hereby repealed and all powers granted thereunder shall be regulated pursuant to this law. :! I 3. Paragraph 6 of the Act Creating LEC is hereby amended to reflect only those powers inherent in corporate entities in Libelia. All other powers contajned in Paragraph 6 are hereby repealed and shall be regulated pursuant this la\\'. 4. Paragraph 7 of the Act Creating LEC is hereby repealed and all the powers gramed thereunder shall be regulated pursuant to this law. 5. Paragraph 8 of the Act Creating LEC is hereby repealed and all the powers granted thereunder shall be regulated pursuant to this law. Chapter 10: Water Resources Management The Minister. in consultation with the relevant stakeholders. shall commission a study for the suitability of the various river basins in the territory of the Republic of Liberia for developmenr of hydroelectric fac ilities. taking into consideration the economic. social, and environmental impact associated with such an initiative. and shall advise the Presidem of the results and recommendations from the studies. including the establishment of a legal and institutional framework for water resources. Chapter 11: Planning Process I. Licensed transmission and distribution entities and the Rural and Renewable Energy Agency (RREA) shall submit to the Regulator from time to time as presc1ibed by the regulations. a proposed system plan which sets out specific plans for new construction for expansion of the system. ,, The System Plan must include. where relevant: a. Forecast of demand. supply. finances. fuel prices. operations and maintenance plan; b. A safety plan: c. An operational environmental compliance plan: d. Estimated installed generating capacity needed to meet forecasted demand, including whether demand response and renewable resources are available to meet forecasted demand: e. Transmission and distribution facilities needed to meet forecasted demand and/or to support new generating facilities; f. Quality of service goals and current and planned activities intended to address quality of service issues: g. Efficiency and loss reduction goals and current and planned activities intended to address and promote efficiency: h. Current and planned activities intended to expand the connection to renewable resources: I. Current and planned activities intended to expand the availability of services to all areas of the country. including a proposed schedule for accomplishing Lhc stated objectives and estimates of the costs thereof, as wel I as a plan for cost recovery: I tz If! .I· Updates on international interconnections. either existing or prospective. the regional inrerconnection for the West Africa Po,ver Pool (WAPP). and including imports and exports of energy. both actual and potential: and k. Other information requested by the Regulator. Chapter 12: International T ransactions Section l 2.J: Sale of Electricity and ln tercon necrions Across International Borders I. LEC. wilh the prior consent of the Regulator. may acquire or sell electricity outside of the Republic of Liberia both through short-term transactions to support the operation of the system and long-tem1 transactions intended to meet demand. ') Other transmission licensees are obliged Lo coordinate with LEC closely for planning. pooling. rel iability. and economic purposes with other West African countries and the transmission entities serving them. Generating companies are to be permined to operate in West African power pools (WAPP) and markets. unless expressly prohibited from doing so by operation of Liberian law or regulation. Chapter 13; Liberia Electricity Regulatory Co mmission (LERC}

Section 13. J: Creation of Liberia Electricity Regulato ry Commission I . There is hereby authorized to be creared wi thin the Ministry with effect nor later than two {2) years after the effective date of this law the independent Liberia Electricity Regulatory Commission (LERC). The LERC shall be created within the Ministry not later than one (I) year after the effective date of this law and a transition of functions to the LERC shall be completed within one (I) year after the LERC shall have been created. 1 LERC shall consist of a chairperson and tvvo members. appointed by the President wi th the consem of the Senate. The Chairperson and members of LERC shall be appoin1ed no later than one ( l ) year after the effective date of this law. 3. The tem1 of offi ce of a Commissioner shall be four years. Commissioners may be reappointed for no more than two consecutive terms. To ensure continuity of institutional knowledge the terms of office of Comm issioners shall be staggered. -+. To establish staggered tem,s. initial appointments of Commissioners shall be as follows· a. The First Commissioner shall be appointed for a period of fow· years and shall serve as Chairperson; b. The Second Commissioner shall be appointed fo r a period of three years; and c. The Third Commissioner shall be appointed for a period of l"\\O years. 5. Following the initial appointments. all Commissioners shall be appointed for o period of four (4) years. 6. Commissioners shall have relevant professional and academic backgrounds in areas such as law. economics. accounting. finance. science, business. public administration and 23 l; policy. sustainable development. energy. environmental studies. and/or engineertng. Commissioners shall be of acceptable moral character. 7. The President shall establish the salaries of the Commissioners. In setting salaries. the President shall 1101 be bound by legal requirements used in other Government agencies. but shall consider what compensation is required to attract and retain highly qualified personnel.

Section 13.2: Removal from Office 1. A Commissioner may be removed from office by the President before the end of lhe term for which the Commissioner is appointed for non-performance. inability to perform. or for legal or ethical misconduct

Section 13.3: Autonomy and Independence I. LERC shall initially reside within the Minisrry for administrative purposes only. LERC shall be independent with respect to its budget, management. staffing and in the exercise of its duties and authorities. Nor-withstanding its independent role. LERC shall work closely v{ith the Ministry during the transition period described in Sectfon 13.6 to ensure that the transfer of authority is conducted in a smooth manner and that employee transfers. if any. are coordinated to serve 1he needs of both LERC and the Ministry. 2. LERC shall be an independent agency and shall ace independemJy from any regulated entity and shall not seek or take directions from any Government or public or private entiry when carrying out its regulatory tasks other than as required under this Law. LERC shall be qualified. within the scope of its legal authority and jurisdiction. to make final adjudicatory and administrative decisions. subject only to the appellate process.

Section 13.4: Funding and Budget l. LERC shall propose its budget through the nonnal budgeting process. 2. The revenues to meet the budgeted amount shall be derived from a levy or surcharge on the energy bills paid by jurisdictional energy suppliers and consumers. The amount of the levy shall be set by the Legislature in terms of a percent of revenues collected in the regulated sector(s). Thal percent shal I be calculated from time to time to reflect the level which shall be needed to produce the amount of revenue needed to meet the budgeted amount. The percent shall be included in the legislative approval of LERC's budget. The levy shall be treated as a pennissible pass-through expense by the regulated entities. 4. To the extent that the levy or surcharge is insufficient to meet the budgeted amount in any fiscal year. LERC may seek a supplemental appropriation from the Legislan,re for that year. To the extent that there is a surplus at the end of any fiscal year. that amount shall be credited to the next year's budget for LERC with the levy o r surcharge for that year being correspondingly reduced.

Section 13.5: Staff I. LERC shall employ a Managing Director\\ ho shall manage the staff of LERC and the affairs of LERC. ' LERC will recruit personnel with expertise in required fields, specifically including, although not necessari!) limited to. economics. finance. law. consumer relations. accounting. science and technology. and engineering. 3. LERC's staff shall be recruited through a publicly solicited, competitive selection process. 4. LERC shaJI have the authority to allocate resources and to promote training and education programs for its staff. 5. LERC shall have the authority and resources to hire external Liberian consultants and expe11s (or international consultants and experts when no qualified Liberian staff are deemed by LERC to be a,ailable) as it deems necessary for specified assignments. 6. LERC. in consultation ,vith the Minister of Finance and Development Planning. shall have set the compensation levels. including fringe benefits. for the sraff. In doing so. LERC shall be mindful of compensation levels of other civil servants. but also of what is required to recruit and retain highly skilled and competent personnel.

Section 13.6: Transition l. LERC shall have all necessary auth01ity required to perform the duties transferred to LERC' under this Set:tion as if the duties had been assigned lo LERC two (2) years after enactment of this Law. 2. During the one-year period following the creation of the LERC. the Ministry and the LERC shaJl coordinate closely in the transfer of functions and duties of the regulator from the Department of Energy to the LERC. The transition shal l ensure that the regulation of licensees is not impaired or interrupted and that services provided to the public and to licensees are not diminished or delayed. 3. Ar the commencemern of the one-year transitional period. the Ministry and LERC shall constitute a transitional committee composed of the commissioners of LERC and staff from the Ministry to develop a detailed craJ1Sition plan. which will guide the implementation of the transition of LERC from the Ministry. Said plan shall first be discussed with the oversight committees of the Legislanire prior to submissio,1 to the President of Liberia for approval. . 4. Ar the end of tbe one-year transitional period. LERC shall be fully established and completely separated from ru1d housed outside the Ministry.

Section 13.7: Practices and Procedures of LERC; Judicial Review I. LERC shall articulate and publish fom1al and binding procedures for decision making on all non~ru!ernaking processes. and establish a fonnal docketing system for tracking niarters pending before LERC. The procedures must include the following: a. Issuing a public notice of the pendency of any matter brought before LERC, and assigning the matter an officiaJ docket number. b. Once lhe pendency is fo11nally noted and a docket number is assigned. publish a formal schedule for deciding the mauer. c. That schedule shall include dare(s) for fomial intervention by interested panies. date(s) for pennitted or required submissions. time(s), date(s). and location(s) of public hearings, and such other information as may be required for affording all parties a fair and meaningful opportunity for participation. d. All persons. natural. GovemrnentaJ. or other legal entities~ who seek to become fonnally recognized as parties. must file written notification with LERC of their desire to do so. e. All persons. unless they are completely unaffected by the outcome of a panicular matter. as fonnally determined by LERC. are entitled to party status. f. LERC shall provide all affected parries a meaningful opportunity to participate in the process of deciding pending matters. g. Such opportunity includes, bur is not necessarily limited to. providing all parties the ability to obtain necessary information and documentation from Other parties to the matter. the right co submit evidence and argument to LERC. and the opportunity to examine all of rhe evidence which the LERC considers before making a decision on a matter. h. LERC shal l conduct public hearings on all matters related to the setting of tariffs. promulgation of rules and regulations. fonnally adjudicared consumer complaints and other types of disputes. and on all other matters \vhere an affected party requests such a hearing. i. LERC shall. in all matters related to tariffs and to quality and availability of service. afford all members of the public a formal opportunity 10 be heard by LERC through public hearing(s) and written submissions. j. Regulatory decisions shall be taken during public meetings. k. All decisions must be in writing and published. I. Decisions shal I include a proceduraJ history of the matter. a precise description of the issues to be decided, recitation of facts. summary of the evidence and arguments presented by each formal participant in the matter. factual and legal analysis. clear statement of conclusions and decision. as well as complete explanation of reasoning underlying the decision. m. Al l LERC decisions become final 30 days 3fter publication, unless an eligible party to the matter files a written application for fonnal reconsideration prior to the expiration of that JO day period. n. In requesting reconsideration. an eligible party must speci lically set forth the specific issues on which reconsideration is sought and the grounds for doing so. o. Reconsideration may only be sought by a pany who participated in the original proceeding and who either fonnally addressed the subject on which reconsideration is being sought. in LERC proceedi ngs. or who was precluded from doing so for reasons beyond that party's control. 26 p. While eligible parties may rajse as many issues as they choose for seeking reconsiderarion. no part) may make more than one application for reconsideratjoo. q. In considering an application for reconsideration. LERC may. within 30 days of the filing of an application. either issue a fom1al decision granting or denying reconsideration. re-open the matter in order to seek out further information or argument. or lake no action. r. If LERC takes no action within 30 days of an application for reconsideration being filed. the decision is, by operation of Law. deemed to be denied. 2. ln regard to rulemaking LERC shall adopt rules that include the following elements: a. Publish a Notice of Proposed Rule Making. setting forth the subject on which Rules are being contemplated. initial LERC views on the subject. and/or questions or infonnation requests regarding that subject on which LERC is soliciting written comments from stakeholders and other members of the public. b. State the dare, which. absent an emergency, shall be no less than 30 days. by ,,·hich it is looking for feedback.. c. Following receipt of the comments. LERC. having fully considered the comments received. may choose to go no further. or it may seek further comment. Should LERC seek to go forward ,, ith rulemaking. it shall proceed as follows: i. LERC. after following rhe processes set fonh in subsection a. and b. of thjs Section, shall publish a Proposed Rule, or Proposed Set of Rules. u. In so doing. it shall ask for written comments from stakeholders or members of tbe public. 111. LERC shall stare the date. which shall be no less than 30 days. by which il is looking for comments. iv. Following receipt of the comments. and full considera1ion thereof. LERC may. by action of LERC. ask for a second round of comments. may discontinue the contemplation of the rules proposed. or may publish and adopt a Final Rule or Rules. v. ff Rules are adopted. the action of LERC shall include the rule(s) itself /themselves. as well as a full explanation of LERC's deliberations and analysis of the comments received. a summary of those comments. and a full explanation of LERC's reasoning for adopting the rule(s). and justification for the tem1s thereof. 3. Decisions of LERC - a. must be consistent with its amhoriry under this la\\: b. must be consistent with LERC's own rules: c. must be consistent with the national electriciry policy as published by the 1\linistry: d. must be supported by legal or factual record evidence esrnblished in a public process before LERC: ?.7 ,/J; 'Ii e. must be taken in an open, transparent process. including public hearings for all significant maners: f. are subject to reviev. in a court of competent jurisdiction to consider whether LERC regularly pursued its authority and whether its decision is supported by leg.al or factual evidence.

Section 13.8: LERC Planning Process l. A most significant function ofLERC is to oversee the planning processes of licensees to ensure that the long-term plans of licensees are adequate and consistent with the national energy policy as set forth by the Ministry. Review and acceptance of approved plans will be closely tied to approval of major investments by licensees. 2. Licensed transmission and distribution entities shall submit to LERC no less often than every three years. a proposed system planning document (System Plan) which sets our plans for new construction and for expansion of the system over the next ten years. with a specific action plan addressing the next three years. 3. The System Plan must include: a. Forecast of demand. supply plan. cost estimates. operations and maintenance plan; b. A Safety Plan c. An operational environmental compliance plan d. Estimated installed generating capacity needed to meet forecasted demand (including whether demand response and renewable resources are available to meet forecas1ed demand): e. Capital Investment Plan for transmission and distribution facilities needed to meet forecas1ed demand and/or to support new generating facilities: f. Quality of service goals and current and planned activities intended to address quality of service issues: g. Efficiency/ loss reduction goals and current and planned activities intended to address and promote efficiency and metrics to measure perfonnance: h. Current and planned activities intended to expand the connection to renewable resources: i. Current and planned activities intended to expand the availability of services to all areas of the country. including a proposed schedule for accomplishing the seated objectives and estimates of the costs thereof. as well as a plan for cost reco\'er5'. J. The System Plan shall include incentives and penalties associated wirh the expansion of service to all customers. Such incentives may include accelerated depreciation and increased return on capital for expansion projects completed during earlier years of implementation as well as penalties for non- completion of expansion projects b) agreed set dates. k Updates on international interconnections. either existing or prospective. the regional interconnection for West Africa. and including imporu and e:-..ports of energy, both actual and potential: and 28 4. Once entity Business Plans have been reviewed and accepted by LERC following an open. transparent process. a. Licensees shall fol low through with the implementation of the plans unless compelling reasons. acceptable to LERC. dictate other.vise. b. Should any licensee believe there is good cause to deviate significantly from the accepted plan. it shall notify LERC and seek consent to deviate. c. All prudently costs incurred in fulfilling the relevant mandates of the approved plan shall be reco, erable in rares. PART V - PRJNCIPLES OF LAW Chapter I~: Relations hip to Othe r Laws

Section 14. l: Application and Interpretation of La\-, In the evenr of any conflict or inconsistency between this law or any other Liberian law or executive order relating to electricity. the provisions of this law shall be given priority and shall be interpreted to prevail. Section l 4.2: Other laws or provisions repea led by this la\\ Paragraphs 3. 4. 6 and 7 of the Act Creating the Liberia Elect.ricity Corporation. 1973 are hereby repealed and amended by this law.

Section 14.3: T ransitional provis ions after law becomes effective I. On t:he date of enactment. all operators shall be deemed licensed for their respective activities until new license forms. procedures and requirements are promulgated. ' All ongoing projects already approved prior to the effective of this law shall be automatically granted a license hereunder until ne\\ license fom1s. procedures and requirements are promulgated. Chapter 15: Effective Date This Law shall take effect immediately upon publication in handbills. ANY LAW TO T HE CONT RARY NOTWITHSTANDING . • -2015- -2015- FOURTH SESSION OF TH E FI FTY-TIJIRD LEGISLATURE FOURTH SESSION OF THE FIFTY-THIRD LEGISLATURE OF T HE REPUBLIC OF LIBERIA OF THE RE PUBLIC OF Lll311RIA 1IOUSE'S ENDORSEMENT TO SENATE'S ENGROSSED BILL SENATE'S ENGROSSED BILL NO. 01 ENTITLED: NO. 01 ENTITLED: "AN ACT TO AMEND CHAPTER 85 OF THE 1973 PUBLIC ..AN ACT TO AMEND CHAPTER 85 OF TH £ 1973 PUBLIC AUTHORlTY LAW CREATI NG THE LIBERIA AUTHORITY LA\V CREATING TH£ LlBERlA ELECTRICI TY CORPORATI ON AND AMENDMENT ELECTRICITY CORPORATI ON AND AMENDMENT T IIERETO, TO ESTABLISH T I m 2015 ELECTRIClTY LA \V THERETO, TO F.:STABLJSII T H £ 2015 ELECTRICITY LA\V OF LIBERIA" OF LlBERlA" On motion, Bill read. On motion, the Bill was adopted on On motion, Bill read. On motion, the Bill was adopted on its first reading a nd sent to committee Room on Th ursday, its first reading and sent to Comm ittee Room on Tuesday, July 9,2015 at 12: 25 G.M.T. September 22, 20 15 @ 14:35 G.M.T. On motion, Bi ll taken from the Committee Room ror its On motion, 13111 taken from Committee Room for its second second readi ng. On motion, under the suspension of the reading. On motion, under the suspension of the rule, the rule, the second reading of the Bill constituted its third and second reading of the Bill Constituted its third and final final reading and the Bill was adopted, passed into the ful l read ing and the Bill was adopted, passed into the full force force or the law and ordered engrossed today, Thursday, of the law and ordered engrossed today, Thursday, September 17, 20 15@ 15: 09 G.M.T. September 24, 2015@ 13: 03 G.M.T. SECR ETARY, LI BE~SENATE, R. L. 1/{: fJLn q, IU.,vhn:rrn )T C HlEF CLERK, HOUSF, OF REPRE'st..1~ l AI l V l~~, KL. -:. a I I ~be 1.ibertan ~enate CAPITOL BUILDI G. CAPITOL HILL, \ 1ONROYIA, LIBERIA WEST i\FRICA ~.-m•ol: ,lneMhlibstn" hotmail.com 2015 FOURTH SESSION OF THE FIFTY-THIRD LEGISLATURE OF THE REPUBLIC OF LIBERIA. SCl--IEDULE OF SENATE'S ENROLLED BILL NO. 9 ENTITLED: "A ACT TO AMEND CHAPTER 85 OF THE 1973 PUBLIC AUTHORITY LA \V CREATING THE LIBERIA ELECTRICITY CORPORATlO AND AMENDMENT THERETO, TO ESTAB LISH THE 2015 ELECTRICITY LAW OF LIBERIA" PRESENTED TO THE PRESIDENT OF THE REPUBLIC OF LIBERlA FOR EXECUTIVE APPROVAL. cftJ',.j APPROVEDTIDS- - - -- -- DAYOF t)~f l)&CJ& A.D. 2015 ATTHEHOUROF SIS ' " ' THE PRESIDENT OF THE REPUBLIC OF LIBERIA