Armenia's power sector has sufferedmany setbacks: in the late 1980s an earthquake that took itsmajor nuclear plant off-line, and in the early 1990s thecollapse of the Soviet Union, economic blockade, andrepeated sabotage of a new gas pipeline-all of whichseverely disrupted fuel supply. The government set out toreform and privatize the sector, persevering throughsetbacks and learning from initial failure. Its persistencepaid off: today the system runs efficiently and deliverspower 24 hours a day.The following lessons can be learnedfrom Armenia's example:Political will is paramount;champions matter; initial failure may be better than nottrying at all; frequent, substantive communications withbidders helps; a comprehensive, cross-sectoral approach toreform is beneficial; reform should start beforeprivatization; donors should provide the right mix ofsupport; and service quality matters most.