The World Bank Ulaanbaatar Clean Air Project (P122320) REPORT NO.: RES37838 DOCUMENT OF THE WORLD BANK RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF ULAANBAATAR CLEAN AIR PROJECT APPROVED ON APRIL 3, 2012 TO MONGOLIA ENERGY & EXTRACTIVES EAST ASIA AND PACIFIC Regional Vice President: Victoria Kwakwa Country Director: Martin Raiser Senior Global Practice Director: Riccardo Puliti Practice Manager/Manager: Jie Tang Task Team Leader: Yun Wu The World Bank Ulaanbaatar Clean Air Project (P122320) I. BASIC DATA Product Information Project ID Financing Instrument P122320 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 03-Apr-2012 30-Jun-2019 Organizations Borrower Responsible Agency Mongolia UBCAP Project Management Unit Project Development Objective (PDO) Original PDO The development objective (PDO) is to enable consumers in ger areas to access heating appliances producing less particulate matter emissions and to further develop selected medium-term particulate matter abatement measures in Ulaanbaatar in coordination with development partners. Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-50390 03-Apr-2012 04-Apr-2012 18-Dec-2012 30-Jun-2019 15.00 14.09 .13 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No I. SUMMARY OF PROJECT STATUS AND PROPOSED CHANGES The World Bank Ulaanbaatar Clean Air Project (P122320) A. Summary of Proposed Changes This restructuring paper seeks Regional Vice President’s (RVP) approval for the extension of the Ulaanbaatar Clean Air Project (UBCAP) closing date by 6 months from current closing date of June 30, 2019 to December 31, 2019. This will be the third extension of the closing date cumulatively reaching 30 months of extension. The extension will provide additional time to finalize processing of the Additional Financing (AF) to UBCAP, which was requested by the Government of Mongolia (GoM) in April 2018, and to also complete implementation of the project activities. B. Project Status and Proposed Changes UBCAP was approved on April 3, 2012 with an International Development Association (IDA) credit of SDR$ 9.7 million (US$ 15 million equivalent). The project became effective on December 18, 2012 and the original project closing date was June 30, 2017, which was later extended to June 30, 2018, and then to June 30, 2019. The objective of the project is to enable consumers in ger areas to access heating appliances producing less particulate matter emissions and to further develop selected medium-term particulate matter abatement measures in UB in coordination with development partners. This objective is to be achieved through three components: (A) Ger Area Particulate Matter Mitigation; (B) Particulate Matter Mitigation in Central Ulaanbaatar; and (C) Public Awareness Raising, Program Coordination, and Project Management. Progress towards achieving PDO and overall project implementation continues to be satisfactory. After seven years of project implementation, the targets for all PDO indicators and most intermediate indicators have been achieved. Most activities have been completed and the remaining activities under Component A and C are being finalized. The end target of Component A to implement a stove replacement program by providing subsidies and technical assistance has been reached and new standards for stoves and low-pressure boilers have been issued. All four medium-term abatement studies under Component B have been completed and endorsed by relevant political agencies. Under Component C, the remaining activities, program coordination and public awareness support, and project management and Monitoring and Evaluation, are being finalized. As of June 2019, total disbursement rate has reached 99%. The GoM continues to be fully committed to finding coherent and sustainable solutions to achieve desired air pollution reduction objectives. UBCAP has demonstrated success through the promotion of low emissions heating appliances, development of medium-term abatement measures, and facilitating coordination among stakeholders on air pollution abatement. It will continue to support government’s program through implementing its remaining activities and the proposed activities under AF. The rationale for the proposed extension is to allow time to finalize preparation of an Additional Financing to Ulaanbaatar Clean Air Project that was requested by GoM in April 2018. It will also allow to finalize ongoing technical assistance activities including the development of building standard in ger area and the national standard for electric thermal storage heaters and more generally support the Bank’s continued engagement with GoM’s clean air initiatives in close coordination and collaboration with other development partners. The Project Management Unit has prepared a detailed work plan, which provides reasonable assurance that the remaining activities will be completed within the extended project period. The project is in full compliance with legal, safeguard and fiduciary requirements. There are no outstanding audit reports. Project procurement, financial management, and safeguard performance have consistently been rated satisfactory or moderately satisfactory throughout the project life time. The World Bank Ulaanbaatar Clean Air Project (P122320) II. DETAILED CHANGES LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications 30-Jun-2018, 30-Jun- IDA-50390 Effective 30-Jun-2017 31-Dec-2019 30-Apr-2020 2019