The World Bank Report No: ISR5680 Implementation Status & Results Nepal Nepal Power Development Project (P043311) Public Disclosure Copy Operation Name: Nepal Power Development Project (P043311) Project Stage: Implementation Seq.No: 17 Status: ARCHIVED Archive Date: 26-Jun-2011 Country: Nepal Approval FY: 2003 Product Line: IBRD/IDA Region: SOUTH ASIA Lending Instrument: Specific Investment Loan Implementing Agency(ies): Nepal Electricity Authority, Ministry of Energy, Alternative Energy Promotion Centre Key Dates Board Approval Date 22-May-2003 Original Closing Date 30-Jun-2009 Planned Mid Term Review Date Last Archived ISR Date 26-Jun-2011 Effectiveness Date 25-Mar-2004 Revised Closing Date 31-Dec-2012 Actual Mid Term Review Date 08-Jun-2007 Project Development Objectives Project Development Objective (from Project Appraisal Document) To increase access to electricity in rural areas; and improve the quantum and efficiency of electricity supply. Has the Project Development Objective been changed since Board Approval of the Project? � Yes No Component(s) Component Name Component Cost TA to MOE for power sector development 3.17 Microhydro village electrification programme 21.30 NEA - transmission, distribution and capacity building 140.00 Overall Ratings Previous Rating Current Rating Moderately Satisfactory Moderately Unsatisfactory Public Disclosure Copy Progress towards achievement of PDO Overall Implementation Progress (IP) Moderately Satisfactory Moderately Unsatisfactory Overall Risk Rating Implementation Status Overview Despite visible progress over the last few months in procurement and implementation of activities by NEA, the project is proceeding at a much slower pace than what is needed at this stage. Procurement of two major investment activities is still pending - conductor for the Hetauda-Dhalkebar-Duhabi transmission link (USD 20 million) and Kaligandaki-A rehabilitation (USD 20 million). Both of these are likely to be procured by end January 2012. Disbursements have improved from 32% in June 2011 to about 41% in December 2011, but remain woefully short of revised projections provided by NEA in September 2011. Among the key activities under the NEA component, Hetauda-Bharatpur transmission line is facing difficulties due to delays in obtaining forest clearance. The contract for the Bharatpur-Bardaghat transmission line has not been effective due to currency issues pertaining to the Letter of Credit. Work on the Khimti-Dhalkebar transmission line is in an advanced stage, but is now stalled due to compensation issues spanning across a short length of the Page 1 of 6 The World Bank Report No: ISR5680 transmission line. Progress on distribution and rural electrification projects is satisfactory. However, work on Kathmandu Valley Distribution Strengthening project needs to be expedited to ensure timely completion within the project closing date of December 31, 2012. On the whole, the implementation progress on the NEA component has gained some momentum over the last few months, even though some critical issues still need to be resolved. Public Disclosure Copy Implementation of the AEPC component continues to be satisfactory. Concerns over the slow progress in capacity building activities under the PDF component persist. The project implementation rating is being downgraded as "Moderately Unsatisfactory" because of slow implementation of the NEA component. With limited time before the project closing date of December 31, 2012, achievement of the Project Development Objectives is also difficult and therefore the rating on this is also being downgraded as "Moderately Unsatisfactory". Locations Country First Administrative Division Location Planned Actual Nepal Eastern Region Sunsari Nepal Central Region Sarlahi Nepal Eastern Region Saptari Nepal Western Region Rupandehi Nepal Central Region Nuwakot Nepal Central Region Lalitpur Nepal Far Western Region Kailali Nepal Central Region Kabhre Palanchok Nepal Central Region Dhading Nepal Mid Western Region Dang Nepal Central Region Chitawan Nepal Central Region Bhaktapur Public Disclosure Copy Nepal Mid Western Region Bardiya Nepal Central Region Dhanusa Results Project Development Objective Indicators Page 2 of 6 The World Bank Report No: ISR5680 Indicator Name Core Unit of Measure Baseline Current End Target AEPC - Number of additional rural households Text Value 0 households 38087 households 74,000 households with access to electricity generated by micro- Date 25-Apr-2003 31-Mar-2011 31-Dec-2012 Public Disclosure Copy hydro schemes. Comments In addition to completed MH schemes, another 140 MH schemes that will benefit an estimated 47,000 households are in various stages of preparation. NEA - Transmission and distribution losses Text Value 28% aggregate distribution Reduction in the transmission reduced. Transmission and distribution losses (2007). and distribution losses in 9 expansion enhanced. distribution centers by 1.6%. Date 31-Dec-2007 19-Dec-2011 31-Dec-2012 Comments Baseline data from 2007 for Distribution System the 9 distribution centers to be Rehabilitation Project is under examined during next review implementation. All supply in August 2011. packages have been completed except one while all construction contracts have been awarded. Number of additional rural households with Text Value 0 65,000 Households access to grid-connected electricity. Date 25-Apr-2003 19-Dec-2011 31-Dec-2012 Comments Distribution and Rural Only about 25,000 Electrification Project and households expected through Distribution System current activities. Additional Rehabilitation Project are activities need to be taken up now in an advanced stage of to achieve the target of implementation. 65,000. Sindhuli rural electrification is being proposed by NEA as a contingency project for this Public Disclosure Copy purpose. Increased transmission capacity Text Value 0 1,505.6 MW Date 25-Apr-2003 19-Dec-2011 31-Dec-2012 Comments Contracts for 3 transmission End target likely to be lines and 2 sub-stations under achieved. implementation. Increased generation capacity (MW) Text Value 24 MW 46.4 MW Date 31-Dec-2008 19-Dec-2011 31-Dec-2012 Page 3 of 6 The World Bank Report No: ISR5680 Indicator Name Core Unit of Measure Baseline Current End Target Comments Rehabilitation of Multifuel Power Plant and Hetauda Public Disclosure Copy Diesel Center. Contracts under implementation. Increased energy generation (GWh) Text Value 620 GWh 790 GWh Date 31-Dec-2008 19-Dec-2011 31-Dec-2012 Comments Kali Gandaki "A" HEP rehabilitation. Technical documents and bid documents have been prepared by consultants. Procurement to be initiated shortly. However, completion of rehabilitation works within the remaining project period is unlikely. Reduced distribution losses in distribution Text Value 18.8% aggregate distribution Reduction in aggregate centers in Kathmandu Valley losses losses in 9 distribution centers by 6% points. Date 31-Dec-2008 19-Dec-2011 Comments Procurement for this activity has largely been completed. Intermediate Results Indicators Indicator Name Core Unit of Measure Baseline Current End Target Number of distribution centers under Number Value 0.00 24.00 18.00 rehabilitation Date 19-Dec-2011 31-Dec-2012 Comments Contracts under implementation by NEA Public Disclosure Copy Total kW capacity of new micro-hydro village Text Value 0 3679 8109 schemes (off-grid) Date 31-Dec-2007 19-Dec-2011 31-Dec-2012 Comments End of project target is likely to be met. Data on Financial Performance (as of 16-Dec-2011) Financial Agreement(s) Key Dates Page 4 of 6 The World Bank Report No: ISR5680 Project Loan No. Status Approval Date Signing Date Effectiveness Date Closing Date P043311 IDA-37660 Effective 22-May-2003 09-Jul-2003 25-Mar-2004 31-Dec-2012 P043311 IDA-46370 Effective 18-Jun-2009 21-Aug-2009 19-Nov-2009 31-Dec-2012 Public Disclosure Copy P043311 IDA-H0390 Effective 22-May-2003 09-Jul-2003 25-Mar-2004 31-Dec-2012 P043311 IDA-H5060 Effective 18-Jun-2009 21-Aug-2009 19-Nov-2009 31-Dec-2012 Disbursements (in Millions) Project Loan No. Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P043311 IDA-37660 Effective XDR 36.80 36.80 0.00 12.28 24.52 33.00 P043311 IDA-46370 Effective XDR 49.60 49.60 0.00 11.92 37.68 24.00 P043311 IDA-H0390 Effective XDR 18.40 17.88 0.52 16.99 0.89 95.00 P043311 IDA-H5060 Effective XDR 10.50 10.50 0.00 6.21 4.29 59.00 Disbursement Graph Public Disclosure Copy Key Decisions Regarding Implementation Owing to the significant progress in preparation and procurement of Kaligandaki-A rehabilitation project, the need for contingency projects is no longer there. Hence the contingency projects which were prepared over the last few months would not be covered under the PDP project. Restructuring History Board Approved on 15-Feb-2008, Board Approved on 18-Jun-2009 Page 5 of 6 The World Bank Report No: ISR5680 Related Projects P116190-NP Power Add Financing Public Disclosure Copy Public Disclosure Copy Page 6 of 6