On Thursday, August 26, 2021, U.S. Ambassador Michael McCarthy toured the Liberia Electricity Corporation’s Bushrod Island facilities in order to better understand how U.S. assistance to the power sector has been used, and what the challenges are to the sector today. Earlier this year, the U.S. embassy and officials of the Liberian government celebrated the end of the Millennium Challenge Corporation Compact, a U.S.-funded US$257 million 5-year effort, which was primarily focused on rehabilitation of the Mt. Coffee Hydropower Plant, the largest source of power in the country and Liberia’s most valuable fixed asset. During his visit, the Ambassador learned that commercial losses (theft and unpaid bills) account for over 50 percent of the electricity produced by LEC, seriously threatening the financial viability of the organization.
Ambassador McCarthy hosted a press conference at the U.S. embassy in Monrovia following the visit. He noted, “I was both impressed and discouraged by what I saw and heard.” The LEC’s international management team has greatly improved LEC’s operational readiness and facilities. Even so, widespread power theft and unpaid power bills have placed LEC in a financial crisis from which it cannot recover without immediate intervention and support from the Liberian government.”
Ambassador McCarthy highlighted four main messages in a call-to-action for the Liberian people.
First, he emphasized that electricity generation, transmission and distribution is very expensive. “Utilities around the world invest large sums in infrastructure, operation, and maintenance in order to ‘keep the lights on’—and they receive very low returns on investment. Liberia’s power sector is no different, except that it is losing money every day.” He continued, “Nowhere in the world is electricity free. I pay an electric bill at my home in the United States. As Minister Tweah said last week, Liberia is no different: if you want electricity, you must pay for it. Nobody has ever promised free electricity to the people of Liberia.”
Second, Ambassador McCarthy pointed out that more than half of all electricity LEC generates is not paid for. He put it in clear terms: “Each connection that isn’t generating revenue is a step toward the collapse of the electric grid … About two-thirds of the electricity being generated by LEC does not result in revenue [due mostly to power theft]. Without that revenue, how can LEC fix the technical issues? How can they quickly respond to power interruptions? How can they continue to connect more of Liberia to the power grid?” He acknowledged that electricity is expensive in Liberia, but it will be difficult for that to change because “for each person that illegally connects to a power line, they are making everyone else underwrite the cost of power and making it harder to reduce the cost for those who do pay. They are also making all connections less reliable, which will lead to even more maintenance costs down the road. The only way to reduce the cost of electricity is for every LEC customer to be properly connected and to pay their electricity bills.”
Third, the Ambassador asked all Liberians to do their part to ensure that LEC can continue providing electricity: “Here and now, I call on every user of electricity in Liberia to pay their bills in order for the power sector to survive here.” He pointed out that there is not a single culprit, instead power is being stolen by individuals as well as some large users who are clearly using their political connections to keep from paying, and that the Government of Liberia (GOL) has much it must do to fix the problem. “It’s not enough to say that the power theft situation is complicated, or that it’s hard to fix. In order to protect our investments, and your future, and to set Liberia on the path to opportunity, we need to see action—payment of electricity bills, prosecutions, convictions—and we need to see substantial sentences and fines for power theft. This needs to be a systemic focus—nothing will improve without a strong response across the judicial system, supported at the highest levels of the Liberian government. In his speech commemorating the delivery of electricity to Peace Island, President Weah called for this as well.”
Finally, Ambassador McCarthy asked both the Liberian government and the Liberian people to take power theft more seriously. “Having invested so heavily in the power sector here, it’s not too much for the U.S. government to ask that the Liberian government do more to protect our investments and its own power sector. We have been told by multiple sources that there is a well-organized electricity theft cartel that benefits well-connected businesses and even government officials. We know that some LEC investigators trying to fix this problem have been harassed by some representing themselves as security officials. This is absolutely unacceptable. As major investors in Liberia’s power sector, we call on government officials to do everything possible to stop this corruption and prosecute the perpetrators, no matter how important they may be.”
Addressing and fighting corruption is a top priority for the Biden-Harris Administration, which has elevated corruption as a core U.S. national security issue, and today the U.S. embassy Monrovia is acting on this priority. President Biden, in a White House statement, said that “Corruption eats away at the foundations of democratic societies. It makes government less effective, wastes public resources, and exacerbates inequalities in access to services, making it harder for families to provide for their loved ones. Corruption attacks the foundations of democratic institutions, drives and intensifies extremism, and makes it easier for authoritarian regimes to corrode democratic governance. Corruption is a risk to our national security, and we must recognize it as such.”
The United States and Liberia have a long and enduring relationship, and, as Ambassador McCarthy noted during his remarks, “We plan on keeping it that way… Liberians sometimes refer to the United States as their big brother, but since we are 245 years old and you are 174 years old, I prefer the idea that we are old partners, and neither of us is perfect. Sometimes true partners need to deliver tough messages. That is why we are here today. Corruption prevents progress, and we are in the business of building futures together.”