Natural gas connections could bringsubstantial benefits to poor households in Colombia.comparedwith other fuels typically used for cooking, natural gas issafer, less expensive, and less environmentally damaging.But even though gas is more affordable, connection fees canput the cost of switching to this fuel out of reach for poorfamilies. The situation in Colombia, with families unable toafford connection fees but able to pay monthly gas servicebills, is well suited to the one-time use of outputmeasurable outputs. The Global Partnership on Output-BasedAid (GPOBA) subsidy is designed to make each connectioneconomically feasible while still requiring beneficiaryfamilies to make a substantial financial contribution. Theproject serves as a pilot program, demonstrating a modelthat regional gas distribution companies can replicatethroughout Colombia to speed access to piped natural gas forpoor households. By transferring performance risks toprivately held regional distribution companies, GPOBA'soutput-based subsidy approach provides incentives forquality work and timely project completion. GPOBA'seffort in Colombia is an example of how output-based aid canincrease accountability and leverage the strengths ofprivate firms to produce tangible results.
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