The getting electricity indicators measure the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tariffs index measures supply reliability, transparency of tariffs and the price of electricity. The most recent round of data collection for the project was completed in May 2019. See the methodology and webinar for more information.
Doing Business records all procedures required for a business to obtain a permanent electricity connection and supply for a standardized warehouse (figure 1). These procedures include applications and contracts with electricity utilities, all necessary inspections and clearances from the distribution utility as well as from other agencies, and the external and final connection works between the building and the electricity grid. The process of getting an electricity connection is divided into distinct procedures and the study records data for the time and cost to complete each procedure.
In addition, Doing Business measures the reliability of supply and transparency of tariffs index (included in the aggregate score and ranking on the ease of doing business) and the price of electricity (omitted from these aggregate measures). The reliability of supply and transparency of tariffs index encompasses quantitative data on the duration and frequency of power outages, as well as qualitative information on: (i) the mechanisms put in place by the utility for monitoring power outages and restoring power supply, (ii) the supervision of power outages by a regulator, (iii) the transparency and accessibility of electricity tariffs, and (iv) whether the utility faces a financial deterrent aimed at limiting outages (such as a requirement to compensate customers or pay fines when outages exceed a certain cap).
The ranking of economies on the ease of getting electricity is determined by sorting their scores for getting electricity. These scores are the simple average of the scores for all the component indicators except the price of electricity. If new commercial electricity connections are not issued in a given year, or if electricity supply is not provided during that period, an economy receives a “no practice” mark in the getting electricity indicators.
The data on getting electricity is collected through a questionnaire completed by experts in the electricity sector, including electrical engineers, electricians, electrical installation firms, as well as representatives from utility companies and energy regulators, and other public officials involved in this sector. To make the data comparable across economies, several assumptions about the business, the warehouse and the electricity connection are used.
Data on the reliability of supply are collected from the electricity distribution utilities or regulators, depending upon the specific technical nature of the data. The rest of the information, including data on transparency of tariffs and procedures for obtaining electricity connection, are collected from all market players—the electricity distribution utility, electricity regulatory agencies and independent professionals such as electrical engineers, electrical contractors and construction companies. The distribution utility consulted is the one serving the area (or areas) where warehouses are most commonly located. If there is a choice of distribution utilities, the one serving the largest number of customers is selected.