The World Bank Report No: ISR13835 Implementation Status & Results Armenia Energy Efficiency Project (P116680) Public Disclosure Copy Operation Name: Energy Efficiency Project (P116680) Project Stage: Implementation Seq.No: 4 Status: ARCHIVED Archive Date: 04-Apr-2014 Country: Armenia Approval FY: 2012 Product Line: Global Environment Project Region: EUROPE AND CENTRAL ASIA Lending Instrument: Specific Investment Loan Implementing Agency(ies): Key Dates Board Approval Date 27-Mar-2012 Original Closing Date 30-Jun-2015 Planned Mid Term Review Date 08-Jan-2014 Last Archived ISR Date 04-Sep-2013 Effectiveness Date 10-Aug-2012 Revised Closing Date 30-Jun-2015 Actual Mid Term Review Date 31-Jan-2014 Global Environmental Objectives Global Environmental Objective (from Project Appraisal Document) The project development objective is to reduce energy consumption of social and other public facilities. The global environmental objective is to decrease greenhouse gas emissions through the removal of barriers to the implementation of energy efficiency investments in the public sector. Has the Project Development Objective been changed since Board Approval of the Project? Yes No Component(s) Component Name Component Cost Energy efficiency investments in public facilities 6.00 Technical assistance 1.96 Overall Ratings Previous Rating Current Rating Progress towards achievement of GEO Moderately Satisfactory Satisfactory Public Disclosure Copy Overall Implementation Progress (IP) Moderately Satisfactory Satisfactory Overall Risk Rating Moderate Moderate Implementation Status Overview The overall implementation progress of the project is satisfactory. In the eighteen months since project effectiveness, the R2E2 Fund (the project implementing entity), has made tremendous progress in developing a sustainable financing and business model for energy efficiency in the public sector. This transformation required the R2E2 Fund to develop a new model for financing energy efficiency retrofits in public facilities that used to rely on grant financing from the state budget or from different donor funded projects. The R2E2 Fund tested and developed an innovative contract mechanism (Energy Service Agreements), piloted a new procurement method (based on evaluation criteria of net Page 1 of 4 The World Bank Report No: ISR13835 present value factoring both investment cost and energy saving potential), and introduced repayment obligations based on energy savings. This has already led to ten successfully commissioned sub-projects, which in all cases exceeded the preliminary energy savings estimates with payback periods of four to eight years. Locations Public Disclosure Copy No Location data has been entered Results Global Environmental Objective Indicators Indicator Name Core Unit of Measure Baseline Current End Target CO2 emission reductions in retrofitted social Metric ton Value 0.00 7930.00 50549.00 and other public facilities through energy Date 03-Jul-2012 31-Jan-2014 30-Jun-2015 efficiency investments Comments Cumulative CO2 reductions The experience of over 20-year useful life of commissioned sub-projects investments suggests that the original target indicators for emission reduction will be achieved bythe closure of the project. Energy savings in retrofitted social and other Gigawatt-hour Value 0.00 32.30 215.69 public facilities (GWh) Date 03-Jul-2012 31-Jan-2014 30-Jun-2015 Comments Cumulative energy savings The substantial increase of over 20-year useful life of gas (18.2%) and electricity investments (26.7%) tariffs and higher actual savings (than estimated in the bidding documents) has increased the financial viability of energy efficiency investments as demonstrated by the outcomes of the first six commissioned projects where measurement and verification Public Disclosure Copy works are completed. Therefore, despite the slow initial implementation progress, the project is on track for achieving the energy savings target by the closure of the project. Intermediate Results Indicators Page 2 of 4 The World Bank Report No: ISR13835 Indicator Name Core Unit of Measure Baseline Current End Target Regulations, legislative amendments, Yes/No Value No No Yes guidelines to further promote energy efficiency Date 03-Jul-2012 31-Jan-2014 30-Jun-2015 Public Disclosure Copy Comments Up to present the R2E2 Fund Based on the findings of the has assessed the completed assessment, the implementation progress of R2E2 Fund will initiate and the first Energy Efficiency complete the preparation of Action Plan (2011-2013), and the second National Energy identified legal, regulatory, Efficiency Action Plan for financing and institutional 2015-2020. gaps that would be addressed by the second Action Plan. Number of public sector projects commissioned Number Value 0.00 19.00 85.00 Date 03-Jul-2012 31-Jan-2014 30-Jun-2015 Comments During the eighteen months of Based on the revised project implementation, investment target and the energy efficiency retrofits in average size of implemented nineteen public buildings have sub-projects, the number of been implemented. projects commissioned is revised from 121 to 85. Cumulative investments in social and other Amount(USD) Value 0.00 2348121.00 6000000.00 public facilities Date 03-Jul-2012 31-Jan-2014 30-Jun-2015 Comments Cumulative investments of Based on the implementation fourteen sub-projects for progress of the first eighteen which the R2E2 Fund has months, the investment target signed Energy Service for the project closure is Agreements. revised from US$8.7 million to US$6.0 million. However, this will not impact the originally set target outcome indicators for energy saving and emission reduction. Public Disclosure Copy Data on Financial Performance (as of 30-Dec-2013) Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date P116680 TF-12163 Effective 20-Apr-2012 20-Apr-2012 10-Aug-2012 30-Jun-2015 30-Jun-2015 Disbursements (in Millions) Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed Page 3 of 4 The World Bank Report No: ISR13835 P116680 TF-12163 Effective USD 1.82 1.82 0.00 0.62 1.20 34.00 Disbursement Graph Public Disclosure Copy Key Decisions Regarding Implementation In part due to the steep learning curve in using Energy Service Agreements, the R2E2 remains behind the original implementation schedule, although it is on track to achieving the project development objective of energy savings and CO2emission reductions. To achieve the project development objective over the remaining eighteen months of the project, the R2E2 Fund will: (i) intensify its marketing to publicize the success of commissioned projects and boost demand for its services; (ii) initiate critical policy and technical studies to fully utilize the GEF Grant and seek resolution to critical barriers; and (iii) develop an Action Plan to ensure that the competencies and functions developed under the project can be sustained and even scaled-up. Restructuring History Public Disclosure Copy There has been no restructuring to date. Related Projects There are no related projects. Page 4 of 4