Estimating the employment creation effect: the Bugoye example Subtitle if needed – 21pt Arial reg Andrew Scott – Research Fellow 17 September 2015

Bugoye Hydro Power Project Small hydropower plant: 13 MW Run of river On-grid Kasese, Western Uganda Began operation Oct 2009 Study was in 2012/13 Total investment $63.6 million $31.7 million debt finance from EAIF (PIDG)

The results Number of Jobs Number of Person Years Direct 1,079   Number of Jobs Number of Person Years Direct 1,079 2,333.92 Indirect 109 2,678.37 Induced 82 – 90 2,054.21 – 2,256.84 Secondary 8,434 – 10,256 210,850 – 256,400 Total 9,704 – 11,534 217,967 – 263,718

The context Rural location Low level of electrification National generation capacity shortage Unreliable grid

The overall approach Broadly followed IFC approach – direct, indirect, induced and secondary employment Categorisation from PIDG – project-related and users of electricity Limited data – so adaptations Focus on changes in productivity as the pathway to job creation Enterprise and household survey data plus information from stakeholders

Job creation effects conceptually

Steps to estimate induced job creation

The employment multiplier Multiplier needed to estimate secondary job creation Based on household expenditure data and GDP share Broad sectors: industry, services, agriculture Skilled and unskilled earnings Additional expenditure attributable to the project

Reflections Data limitations can be worked around Qualitative aspects of job creation can be relevant Approach may be appropriate for other small projects Approach may be appropriate for context of unreliable power

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