The development objectives of the Rural Energy Access Project for Republic of Yemen are to: (i) improve electricity access of rural populations in the selected project area in a financially sustainable manner; and (ii) demonstrate the feasibility of increasing the access to electricity for rural households in off-grid areas through the implementation of solar home systems. With the restructuring the bulk tariff rate by Public Electricity Corporation (PEC) will substantially increase, but will remain below PEC's current cost of supply. The capital cost of the project will also be provided as a grant. The consumer tariff level, by covering operating costs, will ensure the financial sustainability of the Rural Electricity Service Providers (RESPs), but will still be below the full cost of power generation, transmission and distribution. Thus, it is very difficult to demonstrate that electricity is provided in a financially sustainable manner without government subsidy; therefore the project development objective (PDO) is to be amended.