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Infrastructure blog

IPW: World Bank finances hydropower, and infrastructure charging impacts New Zealand households

Date
20 June 2024

In this week’s Infrastructure Policy Watch, $1bn approved for renewable energy in Pakistan, and New Zealand researches infrastructure charging systems.

IPW: World Bank finances hydropower, and infrastructure charging impacts New Zealand households
The New Zealand Infrastructure Commission looking at how the country’s infrastructure is funded and priced. Image credit: Shutterstock

World Bank finances hydropower project in Pakistan

The World Bank has approved $1bn in financing for the Dasu hydropower project to support the expansion of renewable electricity supply in Pakistan.

This significant funding will support the construction and development of a major power plant, aimed at boosting energy security.

The project is expected to generate considerable economic and environmental benefits by providing a reliable and sustainable energy source, potentially reducing power shortages and promoting renewable initiatives.

The ICE’s view

The ICE’s Enabling Better Infrastructure (EBI) programme sets out guidelines for policymakers to consider the short and long-term affordability of infrastructure.

It highlights the benefits countries like Pakistan will receive from longer-term project pipelines.

The ICE has also developed a case study on the Ghazi-Barotha hydropower project in Pakistan, funded by the World Bank and Asian Development Bank.

The ICE has also previously made the case for the importance in investing in infrastructure to support economic growth and improve public services.

Research shows how ways of charging for infrastructure impact New Zealand households

The New Zealand Infrastructure Commission (Te Waihanga) has published research showing how different ways of charging for infrastructure affect New Zealanders.

The research found that increases to fixed charges can have the greatest impact on those on low incomes.

It examined the effectiveness, efficiency and equity of different charging mechanisms, and how these could be applied to various types of infrastructure, including transportation, utilities and public services.

The findings emphasised the importance of transparent, fair and sustainable charging systems to adequately finance and maintain infrastructure while minimising financial burdens on users.

The ICE’s view

The latest research is part of a wider programme by the New Zealand Infrastructure Commission looking at how the country’s infrastructure is funded and priced.

It raises difficult questions that all governments around the world must face of who pays for infrastructure and what trade-offs people are prepared to accept.

Governments are increasingly concerned about ensuring using the cost of infrastructure is fair.

This is especially true as governments seek to make progress towards net zero, which will require engagement with, and support from the public, as outlined in the ICE’s work on public behaviour and net zero.

The EBI programme also sets out guidelines for policymakers to consider the short- and long-term affordability of infrastructure, including taxation and user charges.

In case you missed it

  • Yemi Martins, policy manager at the ICE