"background": "The expansion and modernisation of power-distribution networks in sub-Saharan Africa require robust, data-driven frameworks for capital investment decisions. Existing cost-effectiveness analyses often lack methodological rigour and longitudinal empirical validation, particularly for equipment with long operational lifespans. ", "purpose and objectives": "This study aims to develop and apply a novel panel-data econometric methodology to evaluate the cost-effectiveness of key power-distribution equipment, specifically transformers and switchgear, within a national utility context. ", "methodology": "A balanced panel dataset was constructed from utility procurement, maintenance, and failure records. Cost-effectiveness was modelled as a function of capital cost, operational expenditure, and failure rate using a fixed-effects estimator: CE{it = \ + \1Cit + \2Oit + \3Fit +, where CEit is the cost-effectiveness index for equipment type i in year t. Inference is based on heteroskedasticity-robust standard errors. ", "findings": "The analysis reveals a significant negative relationship between initial procurement cost and long-term cost-effectiveness for a major equipment category, with a 10% lower capital cost associated with a 4. 2% improvement in the cost-effectiveness index (95% CI: 2. 1% to 6. 3%). This challenges the presumption that higher capital expenditure guarantees better lifecycle value. ", "conclusion": "The proposed panel-data method provides a superior, evidence-based tool for lifecycle asset evaluation. The results indicate that optimal equipment selection for the studied utility does not align with simply choosing the lowest upfront cost or the most expensive, purportedly premium, options. ", "recommendations": "Utilities should adopt panel-data estimation for ongoing asset performance monitoring and future procurement strategies. Regulatory frameworks should incentivise lifecycle cost-effectiveness over short-term capital cost minimisation. ", "key words": "asset management, distribution transformers, econometric analysis, fixed effects,
Wanjiku Mwangi (Wed,) studied this question.