Document of The World Bank FOR OFFICIAL USE ONLY Report No. 8621 PROJECT COMPLETION REPORT BARBADOS POWER PROJECT (LOAN 1940-BAR) p APRIL 30, 1990 Infrastructure and Energy Operations Division Country Department III Latin America and the Caribbean Regional Office This document has a resticted ditibudon and may be used by redpient ony in the pedoname of their offkid dutie Its contents may not othewie be dsdosed witoWoWdd Bank autborzaitlm. TOR OFFCIAL USE ONLY THM WORLD SANK Wash,wton. DC 2043) U.S A OUv ad 0w.tmG.ua 0lo w onm-oto April 30, 1990 MENORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Completion Report on Barbados Power Project (Loan 1940-BAR) A.ttached, for information, is a copy of a report entitled "Project Completion Report on Barbados - Pover Project (Loan 1940-BAR)" prepared by the Latin America and the Caribbean Regional Office with Part II of the report contributed by the Borrower. No audit of this project has been made by the Operations Evaluation Department at this time. A '' a. Attachment Tb documnt ha a etricted dibuton and may be use by recimns on te peoance ofthw offcbW duds ItS cooteom may not oherw be dacblosd withot Wowld Bank authoi,tbn. FOR OMIAL USE ONLY PROJECT COMPLETION REPORT BARBADOS POWER PROJECT (LOAN 1940-BAR) TABLE OF CONTENTS pale Preface .............................................. 1 Evaluation Summary ................................... ii I. PART I Background ........................................... 1 Project Objectives and Description ................... 1 Project Design and Organization ...................... 3 Project Implementation ............................... 3 Project Results ...................................... 3 Project Sustainability ............................... 4 Bank Performance ..................................... 4 Borrower Performance ................................. 5 Project Relationships ................................ 5 Consulting Services .................................. 5 Project Documentation and Data ....................... 6 II. PART II Borrower's Report .................................... t Introduction ......................................... 11 Project Preparation and Analysis ..................... 15 Project Implementation, Operation and Costs .......... 30 Operating Performance ................................ 44 Financial Performance ................................ SO Institutional Performance ............................ 58 Conclusions .......................................... 61 Attachments III PART III Related Bank Loans ................................... 88 Project Timetable .................................... 89 Loan Disbursements ................................... 90 Project Implementation ............................... 91 Project Cost and Financing ........................... 92 Investment Program ................................... 93 Project Results . . 94 A. Direct Benefits ................................. 94 B. Economic Impact ................................. 94 C. Financial Impact ................................ 95 D. Studies ......................................... 96 Status of Covenants . . 97 A. Staff Inputs .................................... 98 B. Missions ........................................ 99 ANNEXES Annex 1. Calculation of IER ....................... 100 Annex 2. Financial Tables .......................... 101-104 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. PROJECT COMPLETION REPORT BARBADOS POWER PROJECT (LOAN 1940-BAR) PREFAC? This is the Project Completion Report (PCR) for the Power Project in Barbados for which Loan 1940-BAR in the amount of US$6.0 million was approved on June 1, 1981. The Loan was closed on June 30, 1987. The Loan was not totally disbursed and the last disbursement was on November 4, 1987. The PCR was jointly prepared by the Infrastructure and Energy Division, Country Department III of the Latin America and the Caribbean Regional Office (Preface, Evaluation Summary, Parts I and III) and the Borrower, (Part II). Preparation of this PCR is based, inter alia, on a mission to the field; the Staff Appraisal Report; the Loan, Guarantee, and Project Agreements; supervision reports; correspondence between the Bank and the Borrower; and internal Bank memoranda. - ii - PROJECT COMPLETION REPORT BARBADOS POWER PROJECT (LOAN 1940-BAR) EV'ALUATION SUMMARY Introduction 1. In the late 1970's the Government of Barbados requested Bank assistance in financing part of the capital investment of Barbados Light and Power Company Ltd (BLPC), in view of BLPC's weak financial position and difficulty In attracting sufficient capital from traditional commercial sources. The Bank participated in financing distribution works and a number of studies totalling an estimated US$6.0 million at the time of project appraisal. Multilateral, bi-lateral and suppliers' credit offers were used by BLPC in financing the generation and transmission additions included in BLPC's 1980-85 investment program (Part I, para. 1 and 2). These credit offers materialized after the Bank made a favorable appraisal of BLPC's investment program. Objectives 2. The project was part of BLPC's 1980-85 BLPC investment program, the principal obiectives of which were (Part I, para. 3)s (a) to expand the existing generation, transmission and distribution system to meet projected electricity demand growth; (b) to reduce fuel consumption by improving the average system plant heat rate; (c) to improve transmission and distribution system by utilitsiag economically designed power lines; (d) to improve system operation; and (e) to maximize use of indigenous energy resources. Implementation Experience 3. The 1980-85 investment program was well designed by BIPC on a moderate extrapolation (7.6Z) of the annual load growth achieved ptlor to 1980 (11%), but it was necessary for BLPC to quickly adjust the investment program to the sharp decrease of load growth (average 3.4X) in the period 1980-85 by delaying part of the power generation additions and some transmission and distribution facilities beyond 1985, (Part I para. 5.01 and 5.02). This also led BLDC to cancel US$2 million from the US$6 mdlllon Bank loan in 1986, and part of other bilateral and multilateral loos (Part 1, para. 5.03). - iii - 4. BLPC's performance was good during project implementation and the investment program was effectively completed at its revised level (Part I para. 9). The project financed by the Bank was completed with 2 years delay at a cost of US$2.78 million below the US$7.99 million estimated at appraisal (Part III, para. 5). Consulting firms performed well in carrying out the studies. As it turned out, the Government did not have occasion to avail itself of the recommendations made in the studies aimed at improving the Operations of the Public Utility Board and the criteria for fixing electricity tariffs (Part I, para. 6.04). This was because no Board hearings on the power sector have been held since 1982. Following the sharp increase of electricity rates approved by those hearings, BLPC's financial position remained good due to lower fuel prices and a reduced investment program compared to that expected at project appraisal. Therefore, no further increases were needed. However, BLPC implemented successfully most of the recommendations of the studies on energy conservation, tariff analysis, and power system planning (Part I, para. 6.03, 6.05 and 5.02). Results 5. BLPC's investment program achieved its principal objectives. The program helped to modernize BLPC's power facilities to efficiently meet the consumer demand for electricity with high service reliability. Demand for electricity grew at an annual average of 5.42, the plant average heat rate decreased by 71 and total electricity losses were kept below 91 (Part I, para. 6.01 and 6.02). Various measures were implemented by the Government and BLPC to improve energy efficiency (Part I, para 6.03). The financial position of BLPC was substantially improved as a result of the 451 step increase of average basic electricity rates in 1982, the steady decrease in oil prices after 1984, and the outstanding decrease of accounts receivable to a low 31 days in 1987 (Part III, para. 6.5). Since BLPC tariffs reflect the cost of service, the gains in efficient use of fuel and lower fuel prices have been passed through to the customers by decreasing electricity rates in real terms (Part III, para 6.5). 6. The financial rate of return of BLPC in the range 5-71, although below the 81 covenanted value was considered satisfactory by the Bank in view of the good financial position of BLPC. The internal financial rate of return achieved by the project was 221,which is substantially higher than the 13.2 estimated at appraisal. This is attributable to the lower fuel costs, the use of high-efficiency equipment and the reduced investment program (Part III, para. 6.4). Sustainabilitv 7. It is expected that the benefits of the 1980-87 power investment program will be maintained throughout the economic life of the facilities constructed under the program, because BLPC's very high standards of operation and maintenance practices have contributed to develop a highly reliable power supply system (Part I, para. 7.01). - iv - Findinzs and Lessons 8. The main lesson learnt is that a well managed power utility, by quickly adjusting the investment program and financial plan to meet slower demand growth than expected, can avoid overinvestment in its generation, transmission and distribution facilities (Part I, para. 5.02). This was made possible by the natur, of the BLPC investment program; the civil works were small and needed only shnrt lead times, readily allowing a flexible response. PART I PROJECT COZLETION REPORT BARBADOS POWER PROJECT (LOAN 1940-BAR) BARBADOS BARBADOS LIGHT AND POWER COMPANY LTD. (BLPC) LOAN 1940-BAR PROJECT COMPLETION REPORT POWER PROJECT PART I 1. Project Identity Project Name: Power Project Loan No. 1940 BAR Rvp Unit: LAC Country: Barbados Sector: Energy Subsector: Power 2. Background 2.01 In 1978, BLPC (an investor-owned company in which 60Z of the shares are held in Barbados) with the assistance of its consultants - Canadian International Power Services, Inc., prepared a generation, transmission and distribution program for the ten year period 1978 to 1987. At the time of the preparation of the program, BLPC's :inances were weak. Recognizing the difficulty of attracting sufficient capital from traditional commercial sources, Government requested Bank assistance in finauoing BLPC's capital investment program. 2.02 As a consequence, the Bank agreed to finance a part of BLPC's six year 1980-85 investment program. The largest part of the program consisted of generating units. BLPC received attractive supplier credit offers for the installation of low speed diesel units, and it was decided that, instead of participating in the financing of such units. Bank finance could best be used for distribution works in addition to a number of studies. 3. Proiect Objectives and Description 3.01 The project was part of the 80-85 investment program the principal objectives of which were: (a) Expansion of the existing generation, transmission and distribution system to meet projected energy demands of existing and new customers throughout the period; (b) improvement of the average system plant heat rate to reduce specific fuel consumption and relative cost per kWh generated; (c) improvement of the transmission and distribution systems by utilization of economic design to keep energy losses at a minimum consistent with projected demand and fuel prices; (d) improvement of system operations by developing an energy conservation program and developing long range generation and facilities planning; and Ce) maximization of the use of indigenous energy resources such as gas and bagasse. BLPC's 1980-85 capital investment program was planned to includes (a) the generation expansion program comprising the installation of two low-speed diesel units of 14 MW each (peaking capacity) in 1982/83, a third 14 MW unit in 1985 and commencement of work on a fourth 14 MW unit to be completed in 1987; Cb) the construction of 15 km of 59 kV transmission lines; (e) the construction of two 69124 kV substations, the acquisition of one mobile substation, and modifications to existing 24 kV substations; Id) the conversion of about 402 km of 11 kV primary feeders to 24 kV; Ce) the distribution expansion program including installation of about 60 MVA of distribution transformers, 23.8 MVAR of capacitors, 36,400 meters, 300 street lights and associated additions to the 240 V secondary circuits; and (f) improvements and additions to general property including transportation equipment, bulldings, land and right of ".y. The Bank-financed portion of the investment program was planned to include the following: (a) 24 kV Primary Feeders. Conversion of about 312 km of 11 kV primary feeders to 24 kV and replacement of about 21,200 kVA of existing industrial transformers associated with the conversion. (b) Distribution Transformers. Installation of about 42,300 kVA of 24 kV/120-240 V distribution transformers. (c) Service Drops. Installation of about 16,500 customer service connections consisting of about 450 km of 120-240 V conductors from the secondary pole line to the customers' meters. (d) Capacitors. Installation of about 16.5 MVAR of capacitors to maintain a system power factor of 0.90. (e) Studies. Consulting services for generation planning, energy conservation and tariffs, and for PUB operating procedures and PUB criteria for setting power rates. -3- 4. Project Design and Organization 4.01 Project design was well conceived. The 80-85 investment program was designed by BLPC and its consultants, CI Power Services, and was based on the least-cost solution after considering generation expansion alternatives based on low and medium speed diesel units, extension of the existing cteam plant and a new coal-fired steam plants. Following Bank recoumendations and, after further study, BLPC modified its proposed generation program to include three 12.5 KW low speed diesel units. These units operate at lower fuel costs than the higher speed units as they use low grade residual fuel. Suitable alternatives were also considered before determining the least-cost transmission and distribution program. 4.02 BLPC staff supervised the engineering design for the project equipment and works which was prepared by consultants. BLPC's staff was assisted by consultants in the preparation of bidding documents, bid evaluation and contract awards. BLPC staff performed the installation of equipment. These arrangements worked well. 5. Project Implementation 5.01 In the three years prior to project appraisal, the Barbados economy performed strongly, especially in tourism and manufacturing, and load growth averaged 112 per annum. The 1980-1985 investment program was based on a projected slower demand growth of 7.62 per annum. However, in 1980 there was a sharp decline in demand growth to 3.82 per annum and the average 1980 to 1985 load growth was only 3.4Z. The reduced demand growth was due to a worldwide recession mainly attributed to oil price increases. Between 1981 end 1985 industrial production and tourism in Barbados declined to levels below that of 1980. 5.02 The declining trend in demand was quickly responded to by BLPC and the nature of the program made it readily adjustable to incremental implementation. BLPC revised the 80-85 Investment program to the reduced load growth and in effect extended the implementation period by two years to 1987. The installation of a third 12.5 MW unit was deferred to 1987 and some transmission and substation components were deferred indefinitely. The completion period for the installation of primary feeders, and capacitors and service drops financed under the Bank loan was extended by periods of up to three and half years ending in December, 1987, and the length of the primary feeders was reduced. 5.03 Responding to the reduced funding needs, BLPC cancelled a Caribbean Development Bank loan intended to finance 69 KV transmission lines. Construction of the lines was postponed indefinitely. Also, part of the European Investment Bank loan was cancelled. US$2 million was cancelled from US$6 million Bank loan in November, 1986. 6. Project Results 6.01 BLPC's 1980-1987 investment program, of which the project was a part, achieved its principal objectives (para. 3.01). The program helped to modernize BLPC's electric system and improved its generation and - 4 - distribution operations and also helped to reduce electricity rates. The program fully met consumer demand for electricity during the period. Energy sales grew from 282.1 GWh in 1980 to 388 GbWh in 1987, an average annual growth of 5.42. The number of customers grew from 67,662 to 79,312 during the same period. 6.02 There was an improvement in the average system plant heat rate of about 72 between 1980 and 1987. This was brought about by the installation of low speed generating units and the modification of some other units to operate on low cost residual fuel oil instead of distillate. The transmission and distribution 3ystem was expanded and line losses were kept below 92. These factors, combinied with sharply reduced oil prices, substantially contributed to a 302 reduction in real electricity rates between 80 and 87. 6.03 As a consequence of the recommendations of the energy conservation financed under t}.e Project study, various measures to improve energy efficiency such as a consumer education program, the use of electricity produced from bagasse and surplus natural gas and exhaust gas were implemented by Government and BLPC. Several hotels have changed their lighting fixtures and installed high efficiency lamps, while others have introduced devices to control airconditioners by disconnecting these when guests are not in their rooms. 6.04 Two studies relating to the Public Utilities Board (PUB) were completed under the project, the first to recommend ways to improve PUB's operating procedures and reduce decision-taking time, and the second to recommend criteria to be used by PUB for setting power rates. Although the studies were apparently discussed by various units of Government, no consensus could be reached as to their recommendations. This issue was raised regularly by Bank supervision missions. At the time of appraisal, there was some concern about delays experienced in obtaining PUB's approval for rate increases. It was expected that further tariff increases would be needed during project implementation. However, no PUB hearings relating to, the power sector have been held since those relating to the last rate increase in 1982 and it is not expected that any further hearings will be held in the near future. 6.05 The marginal cost tariff study of BLPC's tariff structure was completed in 1982. This study provided a useful basis when considering changes in BLPC's tariff structure. However, Government and BLPC have not considered it timely to implement any tariff structure changes up to now. 7. Project Sustainability 7.01 BLPC's operation and maintenance practices are of a very high standard. Plant outages are minimal. Consequently, it is expected that the benefits of the 1980-1987 investment program will be maintained throughout the economic life of the facilities constructed under the program. 8. Bank Performance 8.01 Although the US$6 million Bank loan represented only 42 of the finance required for BLPC's 1980-1987 investment program, it would have been difficult to attract adequate financing for the program without the Bank' s participation. As a result of the Bank's participation, other financial institutions such as the European Investment Bank, the Caribbean Development Bank and the Commonwealth Development Corporation were attracted to the financing of the investment program. 8.02 The Bank made some useful suggestions to BLPC, which assisted in the determination of the least-cost generation program and led eventually to the inclusion of low speed diesel units, using lower priced residual fuel oil, as part of the program. 8.03 There were six supervision missions during the 80-87 project implementation period. This number was adequate as there were no major imple=e-atation problems. 9. Borrower Performance 9.01 BLPC is a well organized company with a competent and effective management and well trained technical personnel. Much emphasis has been placed on employee training. 9.02 As expected, BLPC's performance was good during project implementation and the investment program was effectively completed. As noted in para. 5.02, BLPC promptly revised its investment program when it became clear that demand growth would be less than the appraisal forecast, and project construction as completed in accordance with the new implementation schedule. 10. Project Relationships 10.01 This was the first Bank loan in the Barbados Power Sector. Good working relationships were established between BLPC, the Government and the Bank in the early stages of Bank involvement. There was an atmosphere of mutual confidence and understanding between the Bank and BLPC which continued through project appraisal and implementation, and this was helpful in resolving the issues arising during this period. 10.02 Good relationships were also maintained between the Bank missions and Government officials. 11. Consulting Services 11.01 The five studies required under the Project were all satisfactorily carried out by consulting firms. Stone and Webster (USA) (a) Generating Planning; (b) Electric Energy Conservation; (c) Tariff Structure. -6- Peat, Harwick, Mitchell and Co. (Canada) (a) Operations of the Public Utility Board; (b) PUB criteria for Tariffs. 12. Project Documentation and Data 12.01 The project's legal agreements were adequate in reflecting the Bank's interest in achieving satisfactory project execution. The SAR was comprehensive and well prepared and was a useful reference document for the Bank and BLPC during project implementation. 12.02 BLPC prepared a Project Completion Report using the former Bank guidelines. This proved to be an extremely useful background document for the preparation of the PCR. BLPC promptly provided other more recent information required for the PCR. PART II BORROWER'S REPORT BARBAOS PROJECT COMPLETION REPORT POWER PROJECT (LOAN 1940-BAR) - 8 - THE BARBADOS LIGHT & POWE CO., LTD. SYSTEM EXPANSION PROGRAMME 1980-85 PROJECT COMPLETION REPRT I -9- THE BARBADOS LIGHT AND POWER COMPANY LI[ITRD PROJECT COMPLETION REPORT I. INTRODUCTION 1. General 2. History II. PROJECT PREPARATION AND ANALYSIS 1. Origin 2. Preparation and Justification 3. Loan Covenants 4. Rate Adjustment 5. Project Description III. PROJECT IMPLEMENTATION.-OPERATION AND COSTS 1. Project Start-up 2. Revision 3. Implementation Schedule 4. Procurement 5. Costs and Disbursements 6. Operations 7. Performance of Consultants, Contractors and Suppliers. TrV. OPERATITNG PERFORMANCE 1. Market 2. Project's Role 3. Other Factors V. FINANCIAL PERFORMANCE 1. Tariffs. 2. Sales Volume 3. Revenues and Operating Expenses 4. Net Fixed Assets Service 5. Revaluation of Assets 6. Depreciation Rates 7. Liquidity Problems 8. Debt Equity Ratios 9. Rate of Return 10. Construction Expenditure - 10 - 11. Debt Service Coverage 12. Extent of Financing of Construction Expenditure through Internal Cash Generation and Equity Contribution 13. Inflation and Exchange Rates 14. Exchange Rates 15. Tariff Structure VI. INSTITUTIONAL PERFORMANCE 1. Management and Organisational Effectiveness 2. Growth 3. Staff Recruitment, Training and Development VII. CONCLUSIONS ATTACHMENTS TABLE 1 - Project Implementation Schedule TABLE 2 - Expansion Programme Suamary Report TABLE 3 - Capacity and Energy Balance TABLE 4 - Actual and Projected Energy and Power Requirements. TABLE 5.1 - BLPC Key Financial Indicators TABLE 5.2 - BLPC Income Statements TABLE 5.3 - BLPC Sources and Uses of Funds TABLE 5.4 - BLPC Balance Sheets FIG: 1 - Projected System Development FIG: 2 - Actual System Development - 11 - THE BARBADOS LIGHT AND POWER COMPANY LIMITED SYSTEM EXPANSION PROGRAMME 1980 - 85 PROJECT COMPLETION REPORT INTRODUCTION 1 . General The Barbados Light and Power Company is an investor owned electric utility with 60 %-of its shares being held by more than 2800 Barbadian investors. The Company generates and distributes electricity and provides ancillary services to some 78,000 domestic, industrial and commercial users, and operates a non- exclusive franchise which is embodied in the Electric Light and Power Act of the Laws of Barbados. The non- exclusive franchise, which was extended for a period of 42 years from 1986, gives the Company the right to distribute and sell electric energy throughout the is- land of Barbados. Electricity rates are set by a - 12 - Public Utilities Board in accordance with the Public Utilities Act. As at December 31, 1986, the Company had total assets valued in excess of $307 million, with $69 million of interest bearing long-term debt outstanding. Total operating revenue for the 12 month period ended Decem- ber 31, 1986 was $99 million resulting in a net income after taxes of $5.1 million. 2. HistorY The Barbados Light and Pover Company Limited was incor- porated in the Islaud of Barbados on May 6, 1955, to acquire by an agreement dated March 19, 1955, from the Barbados Electric Supply Corporation Limited, the latter's rights to the business of supplying electricity in the Island of Barbados. On July 1, 1955, all the assets of the Barbados Electric Supply Corporation Limited were transferred to the Company. In 1963 Canadian International Power Company purchased a majority share interest in The Barbados Light and Power Company. At that time power was generated by diesel engines and two small steam turbines with com- .- 13 - bined installed generating capacity of 13,581 kilowatts. There were 26,400 customers using 45 mil- lion kWh per annum with a combined peak demand of 10,850 kilowatts. Many improvements were introduced to increase the ef- ficiency of the Company's operations. Line construc-. tion and reinforcement work was carried out and gener- ating plant additions were made as needed to cater to growth in the use of electricity averaging 15 percent per annum. While the decade of the 60's was very good for the Com- pany, the 1970's were difficult years highlighted by continuously rising costs and a series of unusual en- gineering problems. The October 1973 World Fuel Crisis, subsequent temporary fuel shortage and high es- calating fuel prices had a great impact on the Company's operations. In 1974 the reduced availability of fuel for power generation and the reduction in demand of electrical power through public appeal resulted in a negative growth rate for sale of electri- cal energy from the Company's system. In 1976 a new 40,000 kW steam plant at Spring Garden -14- went into operation. Before the start up of the new steam plant, the Company experienced a series of mechanical failures on its diesel generators as well as on a gas turbine generator. This reduced the Company's available generating capacity from 60,600 kilowatts to 30,000 kilowatts which was 4,500 kilowatts short of the island's peak demand. As a result, the Company was forced to institute a power rationing programme. Ea- gineering difficulties in the initial operations of the new generating plant caused a series of service inter- ruptions of recurring annoyance to customers. The year 1977 was an unusually difficult one. New rates, determined by the Public Utilities Board, proved insufficient to provide the necessary cash flows for capital expenditures. The Public Utilities Board accepted the Company's proposed reduction in fuel charges made possible by the new steam plant, but granted less than the applied-for increases in basic rates. The Company's requested in- crease was cut from 3 cents to 1 cent for Domestic and from 5 cents to 3- cents for Industrial and Commercial users. - 15 - The rate increase granted by the Public Utilities Board in 1977 failed to give the Company the relief which was urgently needed at that time. The financial position deteriorated and by 1979 a critical state had been reached where the Company could not meet the mini- mum earnings coverage terms of its Debenture Trust Deed. Accordingly, the Company was unable to raise loans for urgently needed expansion, and essential equipment could not be purchased. Further, the rate problems during 1977 - 1979 resulted in postponement of essential construction work. This loss of valuable construction time affectAd. the Company's ability to provide its normal high quality service. In November of 1979, the Company was required to enforce a period of power rationing due to major generating problems. II PROJECT PREPARATION AND ANALYSIS 1. 2gOr.in In 1978 the Company with the assistance of its consult- ants, C.I. Power Services Ltd., prepared a generation - 16 - planning report covering the ten year period 1978 to 1987, but in view of the poor financial position in 1978, due to the inadequate rates, it was not possible to obtain financing from traditional commercial sources for any expansion work. Following discussions with the government concerning the Company's financial and engineering difficulties, the International Bank for Reconstruction and Develop- ment hereinafter called the World Bank was approached for a loan. 2. Preparation and Justification The World Bank indicated that due to sectoral and country priority considerations, any involvement on their part would be limited. As discussions proceeded it became apparent to Company management that if the World Bank, as a development financing institution, ap- proved a loan to the Company it could be expected that their involvement would go well beyond commercial financing matters. Moreover , the benefit of World Bank appraisal of the project and committment to its financ- ing, even with a relatively small amount, together with - 17 - certain country guarantees and covenants in accordance with its charter, would reassure other lenders who would then be attracted to the project. Other development financing institutions - the European Investment Bank, the Caribbean Development Bank, and the Commonwealth Development Corporation - were ap- proached and they all indicated interest in World Bank participation and in providing financing assistance for an expansion programme. The Company obtained commitments for loans to help finance an expansion programme on a project basis sub- ject to eligibility, having regard to the different charters, restrictions and policies of the banks, and on condition that loans be arranged for all projects included in the programme with approximately 70 percent of the cost being funded by external loans and ap- proximately 30 percent with counterpart financing from local sources. The banks indicated that commitments would also be expressly conditional .pon confirmation that all - l8 - parties to the agreements including the guarantors would fulfil their obligations, and that the Company would seek rate relief in accordance with financial covenants to be negotiated. a In February 1980 the Company sought a further rate review. Due to inadequate earning., the Company was unable to meet certain coverage tests for new equipment loans. In its decision of May 1980, the Public Utilities Board ordered an increase in customer basic rates. An appeal to the Supreme Court-against tha May 1980 decision was made by an objector to the rate changes. Following a hearing in July 1980, this appeal. was disallowed by the Court. Meanwhile the Company discussed its plans for gener- ation and distribution expansion with the World Bank and also held discussions with suppliers of equipment. A generation expansion study was performed utilizing General Electric's Optimized Generation Planning (O0P) programme on their large computers in Schenectady, New York. This programme combines system reliability cal- culatious, and operating, maintenance and investment costs to determine the least cost expansion programme -19 - for a target loss-of-load probability (LOUP). Sen- sitivity studies were performed for variations in fuel costs, load growth, investment costs and systen reliability. A revised generation expansion plan, based on a projected load growth of about 8S per year, recommended the installation of two 14 MW low speed diesels in 1982/83, and a third in 1985. A study was also carried out of the transmission and distribution system with the assistance of the consult- ants, C.I. Power Services, and an expansion plan developed for the period 1980-8.5. The overall system expansion proposals were designed to meet the following principle objectives: (a) Expansion of the existing generation, transmission and distribution system to meet projected energy demands of existing and new customers throughout the period; (b) Improvement of the average system plant heat rate to reduce specific fuel consumption and relative - 20 - cost per kWh generated; (c) Improvement of the transmission and distribution system by utilization of economic design to keep energy losses at a minimum consistent with proJected demand and fuel prices; (d) Improvement of system operations by developing an energy conservation programme and developing long range generation facilities planning; and (e) Maximize the use of indigenous energy resources such as gas and bagasse. The capital investment programme which was developed for the period 1980 - 1985 included the following: (i) The generation expansion programme comprising the installation of two low-speed diesel units of 14 MW each (peaking capacity) in 1982/83, a third 14 MW unit in 1985 and commencement of work on a fourth 14 MW unit to be completed in 198?; (ii) The construction of 15 km of 69 kV transmission lines; - 21 - (iii) The construction of two 69/24 kV substations, the acquisition of one mobile substations and modifications to existing 24 kV substations; (iv) The conversion of about 402 km of 11 kV primary feeders to 24 kV; (v) The distribution expansion programme including in- stallation of about 60 MVA of distribution trans- formers, 23.8 MYAR of capacitors, 36,400 meters, 300 street lights and associated additions to the 115/230 V secondary circuits; and (vi) Improvements and additions to general property in- cluding transportation equipment, buildings, land and rights-of-way. The estimated cost of the overall expansion programme was almost US$ 100 million (BdsS 200 million). With the participation of the World BDank in the Company's financing plan and the support of the Govern- ment of Barbados, a series of loan agreements were con- - 22 - cluded. The World Bank reviewed the Company's expansion programme and agreed that it met all aspects of the Bank's "Lowest Cost Alternative" criterion (tbat is, the most economical plan consistent with the purchase of appropriate equipment). The Bank invited repre- sentatives of the Company and the Barbados Government to meet in Washington to negotiate terms of a loan con- tract, the Government of Barbados acting as guarantor of the loan. Following the necessary approvals of the Public Utilities Board, and the Exchange Control Authority, the World Bank loan agreement for US$6 mil- lion was approved in 1980 and signed in Washington D.C. on February 19, 1981. Also in 1980, agreement was reached with the European Investment Bank for a loan of five million units of ac- count, approximately equal to BDS$1l million. Under this terms of this agreement the European Investment Bank provided an interest subsidy to be used to assist with- rural electrification according to certain criteria agreed between the Bank and the Company. In 1081, an agreement was signed with Svenska Rand- - 23 - elabanken of Sweden for a 12-year loan of U.S.S26.6 million, approximately equal to BDSS53.2 million at 9.1 percent interest to finance 85 percent of the cost of generating plant. . It was a condition of the availability of the funds that guarantees be provided to Svenska Handelsbanken as a continuing security for the Company's oDligations in respect to the first 16 repayment installments together with interest. The Royal Bank of Canada (London) Limited agreed to act as agent for a number of prime commercial banks who provided these guarantees. The Commonwealth Development Corporation gave approval in 1981 to a loan of five million pounds sterling to assist with the financing of the distribution expansion programme and for general corporate purposes. To con- clude the financing package, an agreement was entered into in 1985 with Sparbankernas/Swedbank of Sweden for a loan of US$8.5 million for 70% of the cost of ex- tending generating plant as planned for in the expan- sion programme. - 24 - 3. Loan Covenants The loan which has been agreed between the Company and IBRD (World Bank) carries the unconditional guarantee of the Government of Barbados, and in addition to its obligations as primary obligor under the guarantee, the Government has covenanted that it will not take any ac- tion which would prevent or interfere with the perfor- mance of the Company's obligations under the loan agreement (some of which are.summarised in (a) through (d) below) and will take or cause to be taken all reasonable action necessary or appropriate to enable BLPC to perform its obligations under the loan. (a) The Company covenanted to take all necessary actions, including implementation of tariff adjustments to produce revenue sufficient to yield an annual rate of return on the net value of fixed assets in operation which is satisfactory to the World Bank. Cb) The Company covenanted to continue to main- tain the fuel adjustment cost component of its tariffs, which enables it to recover - 25 - through tariff variations any costs resulting from fuel price increases. (c) The Company covenanted to offer shares for sale to nationals or residents of Barbados, or to the Government of Barbados. Addi- tionally, under the guarantee instrument, the Government of Barbados agreed to take up al- lotments of shares not subscribed for through the public offering for the new share issues. (d) It will be an event of default under the loan agreement, should any change be made in the Electric Light and Power Act which would materially affect the business of the Com- pany, its management, operations, etc. 4. Rate AdJustment A further application for increased rates was filed with the Public Utilities Board on January 29, 1982, to cover rising operating costs and to generate internally sufficient funds to contribute to the expansion programme. In August 1982 this application was turned down, on the grounds that - 26 - the Company had not proved its case. The Company filed a now application on September 10, 1982. In May 1983 the Public Utilities Board ordered an increase of 7.5 cents per kWh on Basic electricity rates, effective November 15, 1982. The effect on consumer bills was moderated by increasing use of residual fuel to generate electricity with a con- sequential reduction in fuel charges on electricity bills. At the time of preparing this report these rates were still effective. 5. ProJect Description The programme was separated into various project packages suitable for the financing available from various agencies: (a) Generatint Plant - Sunnliers Credit through Svenska Handelabanken of Sweden. Two 14 MW Low Speed Diesel Generating Units in 1982/83, a third in 1985 and a fourth in 1987. - 27 - The first 2 units were to be proceeded with, for commissioning in 1982/83. Final deci- sions on subsequent units would be made later depending on load growth during the period. (b) 69 kV Transmission Lines - Caribbean Development Bank 15 km of 69 kV transmission lines from Spring Garden Generating Station to two new 69/24 kV Substations near the Port in Bridgetown, and at Wotton, Christ Church. (c) Substations and SCADA Equipment - Euronean lavestment Bank. Construction of two 69/24 substations at Port and Votton and development of a 69 kV substa- tion at Spring Garden Generating Plant. Ex- pansion and modification of existing 24 kV substations. Acquisition of a 69/24/11 kV mobile transformer to back-up the power transformers at the main substations. In- stallation of a Supervisory Control and Data Acquisition system (SCADA) to provide control - 28 - and monitoring, from a central Control Room at Garrison, of feeder Circuit Breakers and equipment at distribution substations throughout the island. (d) Distribution and General - Commonwealth Development Bank Routine distribution work not specifically defined but including purchase of meters, construction of primary and secondary dis- tribution lines, strengthening of existing lines, and acquisition of transport and con- struction equipment. Miscellaneous generation and general property. (e) Distribution and Studies - World Bank The World Bank agreed to fund a project comprising distribution conversion and expan- sion, together with certain studies as described herebelow. - 29 - (i) 24 RV Primary Feeders. Conversion of about 312 km of 11 kV primary feeders to 24 kV and replacement of about 21,200 kVA of existing industrial transformers associated with the conversion. (ii) Distribution Transformers. Installation of about 42,300 kVA of 24 kV/120-240 V distribu- tion transformers. *iii) Service Drops. Installation of about 16,500 customer service connections Consisting of ab6ut 450 km of 115-230 V conductors from the secondary pole line to the customers' meters. (iv) Capacitors Installation of about 16.5 MVAR of capacitors to maintain a system power factor of 0.90. (v) Studies Consulting services for generation planning. energy conservation and tariffs (60 staff months), and for PUB operating proce- dures and PUB criteria for setting power rates (15 staff months). - 30 - III PROJECT IMPLEMENTATION4 OPERATION ANn COSTS 1. Pro3iect Start-Un The World Bank loan agreement was signed on February 19, 1981. The project had been clearly identified during the appraisal process and work was already in progress on the preparation of the specifications and tender documents. for procurement of materials. One of the conditions for effectiveness of the loan agreement was that the Company had signed a contract satisfactory to the Bank for two base load low speed diesel units. Tenders had been invited in June 1980 and after careful evaluation a letter of tntent had been issued on October 28, 1980, to Gotaverken Motor AB of Sweden for the turnkey supply of a 25 MW low speed diesel power plant. The formal contract was signed on February 27, 1981. - 31-w 2. Revision The expansion programme had been prepared in 1979 based on a projected load growth of ap- proximately 8% per year. Almost imediately there was a steep increase in the world oil prices by the OPEC cartel and economic condi- tions worldwide went through a depressed period during the early 1980'.. Barbados did not escape this situation and as the economy suffered so did the sales of electricity. Average growth between 1979 and 1985 was 3.5*. This trend was quickly identified, the programme reviewed and projects rescheduled. The 69 kV transmission lines and associated substations were deferred and have not been necessary to date. Additional low speed diesel generating units had been projected for 1986 and 1987. These were reviewed and the third 12.5 MV unit was deferred to early 1987. A new expansion - 32 - study will identify the need for future gen- erating plant. Distribution line conversions under the World Bank project were also rescheduled. The Wil- dey, Banks, and Salter/Dukes feeders whicb had been planned for early in the programme were completed but others have been deferred. The remaining Bank items proceeded basically as scheduled with the routine distribution transformers, capacitors and service drops being extended with the Bank's approval beyond 1985 to include 1986 and 1987. 3. Implementation Schedule The implementation schedule for the World Bank financed projects was as shown in Table I. 4. Procurement Materials for World Bank and BIB financed projects were purchased according to the pro- cedures set out in the banks' Guidelines for - 33 - Procurement. The Company's previous purchas- ing procedures were generally to request com- petitive bids from 3 - 5 selected suppliers with whose products the Company was familiar. This method only required specifying techni- cal details and other basic information and has been found quick and efficient. The Bank's procedures requiring international competitive bidding mean that a lot more ef- fort is needed in the procurement process. Detailed specifications and bidding documents have to be prepared. Notification and adver- tisement of up-coming contracts have to be made to the international community involving all member countries of the Bank (or EITD. The need for the Bank's procedures is ap- preciated since they ensure competitive bid- ding and equal opportunity to tender by sup- pliers from all member countries. For this project however, the Bank financed items generally were relatively small quantities of routine distributioL material. Prices ob- - 34 - tained were not generally better than under the Company's previous purchasing arrange- ments and the process was more involved ard time consuming. The procurement of the Low Speed Diesel Plant was by competitive tenders from selected bid- ders. There are few low speed diesel licen- sors. These firms were -issued a briet guideline specification giving the general design parameters, output requirements, site details and fuel specification and requested to submit tenders for turnkey contracts, in- cluding a five year maintenance agreement for the equipment. The Bank recommended the turnkey approach and the Company has been very pleased with the results of this form of contract. 5. Costs and Disbursements A summary of projects, and their costs, during ,the period of the expansion programme is given in Table 2. - 35 - Drawdown of the World Bank loan was as shown below: LOAN DISBURSEMENT SCHEDULE EQUIV DATE $US $CDN SBDS 1982-12 639,594.67 663,511.06 2,182,244.00 1984-05 641,468.25 858,125.22 2,597*561.00 1984-10 267,763.45 168,344.95 786,963.00 1986-02 291,666.20 11,517.40 597,982.00 1986-11 0.00 415,861.00 596,858.00 TOTALS 1,840,482.57 2,017,362.63 6,761,608.00 6. Operations Performance of all items in the expansion programme have been very satisfactory. - 36 - The Company has a mix of different types of generating plant. Steam turbines, a gas tur- bine, low speed diesels, medium speed diesels, and high speed diesels take care of the various loads and coDditions that will occur. Generally speaking the steam plant, and the low speed diesel plant which burn low grade residual fuel are used to supply base load. These base load units ar. high capital cost units with the lowest fuel and maintenance c-osts. They can operate continuously for long periods. These units are run 24 hours a day to supply the base load requirements of the system. The intermediate load plant are the older and less efficient base load plant which have- been superceded by more efficient plant and are now used on a daily basis for say 8 - 14 hours a day when the system load exceeds the base load capacity. - 37 - Peaking plant, such as the gas turbine, have high fuel cost but low capital cost and are normally on stand-by but can be started rapidly in an emergency if needed. The Company is noW in a position to produce almost ail of the electricity consumed in Barbados from residual fuel burning gener- ating plant, and Barbadian consumers are now enjoying electricity at prices which are among the lowest in the Caribbean. The low speed dienel generating units have operated reliably and efficiently. They are the most fuel efficient units on our system, using the same low grade residual fuel oil as burnt in the steam plant boilers but at about two thirds the specific fuel consumption. Over the first four years of operation these units have achieved an 87 percent availability record with a forced outage rate of less than 2 percent. Operations of these units have significantly reduced the Company's fuel costs. - 38 - In March 1985 an 1100 KW Waste Neat Turbo- Alternator Generating Unit was added to the Low Speed Diesel Plant to utilise steam produced by the exhaust gases from the diesel engines. This increased the electricity gen- erated by this plant by about 4X at no addi- tional fuel cost. The SCADA equipment has been of tremendous benefit in the operations of the Distribution Department. It has improved response to problems on the system, reduced outage times following feeder trips, and by providing in- formation on feeder loading and voltage levels has led to more efficient operations. A new substation at Wotton, in Christ Church, and the expansion of other substations have improved the capacity of the system and, with the conversion of some distribution feeders from 11,000 volt to 24,000 volt operation, losses have been reduced from 9.7% of net generation in 1980 to 8.8% in 1986. Procurement of the mobile substation trans- _ 39 - former has provided a back-up unit for all the major power transformers on the system. It is a stand-by unit and to date there has not been a failure of a substation trans- former requiring it to be employed. However it has proved very useful during planned maintenance of substation transformers and substation expansion work. During the appraisal stage the Bank team had queried the possibility of the sugar industry producing electricity from excess bagasse. This was discussed with Barbados Sugar In- dustries Ltd. and a pilot scheme initiated at Foursquare Factory in St. Philip. Three sugar factories are now feeding electricity into the grid. They are paid the equivalent of the Company's fuel adjustment charge for electricity supplied. In 1986 almost 2.5 million kwh produced by the sugar industry from excess bagasse were purchased by the Company. In 1980 the Company completed modifications to the Steam Plant boilers to enable up to - 40 - approximately 1.5 million cubic feet of natural gas per day to be burnt in the boilers. The National Petroleum Corporation's supply of natural gas at times exceeds the demaud of their regular cus- tomers. BLPC's use of this gas reduces vent- ing of the excess gas and lowers fuel oil im- ports. The World Bank project included a number of studies. The generatioi expansion study com- pleted in 1982 by S',ne and Webster Manage- ment Consultants Inc. confirmed the 1979 recommendations by C.I. Power Services regarding the types of plant but with a- revised implementation schedule based on a lower load forecast. Additional base load low speed diesels were recommended in 1986 and 1987 with coal-fired steam units in the 1990's. A study on energy conservation assessed the potential for the conservation of electrical energy in Barbados, and made recommendations for the implementation of a conservation - 41 - programme in the island . The Company developed brochures and handouts for con- sumers, with the theme "Use Energy Wisely", as part of a customer education and public awareness programme. The Government set up an Energy Conservation Unit with assistance from overseas consultants and this unit was also active in the public awareness campaign. It carried out energy surveys of industries and gave specific advice on energy conserva- tion measures recommended. Courses were given for maintenance and operating personnel from industry in energy management. The Marginal Cost Tariff Study was completed in late 1982 and provided an indication of tariff levels based on Long Range Marginal Cost Analysis. Two studies, on the Public Utility Board's Procedures and the Criteria for Setting Electricity Rates, were performed for the Government. The Government was responsible for these studies, engaged the consultant and managed the projects. The Company re- - 42 - imbursed the Government for the cost of the studies. 7. Performance of Consultants. Contractors.and SugDliers . The consultants, C.I. Power Services Ltd. (CIPS), assisted with the development of the expansion programme and continued to provide services during the project period. They helped with the prepara- tion of specifications and tender documents for materials procurement, evaluation of tenders, and monitoring and expediting purchase orders. CIPS provided design and project management services for the SCADA system and were appointed Rngineer to monitor the contractor's performance on the turnkey contract for the Low Speed Diesel PIlant. Distribution line conversions and construction, and the erection and expansion of substations were supervised and managed by BLPC engineers and tech- nical staff. Other consultants carried out the studies which were completed during the project. Stone and Webster did the System Expansion Study, Energy - 43 - Conservation Study, and the Marginal Cost Tariff Study, while Peat Marwick performed the studies on Criteria for Setting Power Rates, and the Operat- ing Procedures of the Public Utilities Board for the Government, funded by BLPC. The performance of the contractor for the Low Speed Diesel Plant Project was very impressive. Relations with the engineer, client and sub- contractors were co-c irative and the project was completed on schedule and within budget. Suppliers generally performed satisfactorily, delivering materials in accordance with the specifications at the times promised. The con- tract for one year's supply of distribution trans- formers was supplied by a manufacturer in Taiwan and an order for overhead line conductor was from Thailand. Delivery of these shipments took con- siderably longer than normally expected from North American or European suppliers. In view of the distances involved this was understandable. - 44 - IV. OPRRATING PERFORMANCE 1. Market At the time of project appraisal, load growth over the three years 1977, 1978 and 1979 had averaged 11 percent per year. The forecast for the period 1980 - 1985 was for an average load growth of 7.8 percent per year and the expansion programme was developed to satisfy this projected demand. In late 1979 the large increase in oil prices triggered a recessionary reaction on the world economic scene. Tourism and industrial production suffered and over the 1980 - 1985 period actual electricity load growth averaged only 3.4 percent per year. However in 1986 there was an increase of 6.5 percent in electricity sales and this rate of growth may be exceeded in 1987. Figures prepared by the Barbados Statistical Serv- ice for tourist arrivals and the index of in- dustrial production for the period 1976 - 1986 are - 45 - as follows: YEAR TOURIST ARRIVALS AVERAGE LENGTH INDEX OF OF STAY(NIGHTS) INDUSTRIAL PRODUCTION 1976 224,314 8.5 140.7 1977 269,314 9.0 144.8 1978 316,883 8.7 150.9 1979 370,916 9.6 151.7 1980 369,915 9.8 167.2 - 46 - YEAR TOURIST ARRIVALS AVERAGE LENGTH INDEX OF OF STAY(NIGHTS) INDUSTRIAL PRODUCTION …___ ---------------- -------------- --------- 1981 352,565 9.6 151.0 1982 303,795 8.3 145.1 1983 328,338 7.7 146.1 1984 367,652 7.1 140.1 1985 359,135 6.3 1%O.0 1986 369,770 6.5 160.0 - 47 - 2. Prolect'8 Role The principle objectives of the expansion programme as stated under Section I.2. (a) - (e) above, have been successfully achieved. Generation, transmission and distribution facilities were expanded to meet customer demand for electricity during the period and to allow for continued growth. Installation of the new low speed generating plant, which burns low grade residual fuel oil both reliably and efficiently, bas had a benefi- cial impact on the average system plant heat rate which has been reduced by seven percent from 12005 STU/gross kWh in 1979 to 12083 BTU/gross kWh in 1986. Modifications to the Mirrlees R Major medium speed diesels have permitted the operation of these engines on Bunker C fuel rather than the more expensive distillate fuel, and improvements to the boiler controls and installation of addi- tional sootblowers in the steam plant boilers have improved the efficiency and reliability of these - 48 - units. In 1986 only 7% of the fuel used was dis- tillate, with 93% being residual fueloil. The corresponding figures for 1979 were 24% and 76%. Conversions of distribution feeders from 11,000 volt to 24,000 volt operation, re-conductoring of feeders, and construction of new lines and substa- tions have allowed system losses to be contained at below 9% of net generation. The system planning study by Stone and Webster in 1982 recommended that the Company should maintain two generation sites to ensure reliability of service. Over the past 20 years all new plant had been installed at the Spring Garden site and with retirement of old equipment at Garrison Hill the capacity at the latter site had been reduced to less than 7% of total installed capacity. In 1986 the five General Motors package diesels were relo- cated from Spring Garden to Garrison Hill and have increased the capacity at this site from 7700 kW to 18200 kW. Remote control of distribution substations via the SCADA equipment from a central control room at - 49 - Garrison Hill has dramatically reduced feeder outage times following a system disturbance and improved operating flexibility. Prior to SCADA, personnel had to be despatched to substations to effect switching and, depending on the location -and traffic conditions, this typically took be- tween 15 minutes and an hour. With SCADA , feeders are monitored continuously and are generally reclosed within 5 minutes of a distur- bance. 3. Other Factors The preparation and justification of the expansion plan for the World Bank's appraisal team intro- duced the Company to the Loss-of-Load-Probability (LOLPI method of planning for generating plant. Previously the Company had generally considered firm capacity as being installed capacity less the two largest units on the system. The LOLP method allowed an assessment to be made of the con- sequences of various levels of reliability and an optimisation of the cost-benefit relationship of the target level of reliability. One day-per-year loss-of-load probability was selected for Bar- - 50 - bados. V. FINANCIAL PERFORMANCE The following schedules are attached as appendices to this report:- - BLPC Key Financial Indicators 1974-1986 (Table 5.1) Appen- dix A. - BLPC Income Statements 1977-1986 (Table 5.2) Appendix B. BLPC Source and Uses of Funds 1977-1986 (Table 5.3) Appen- dix C. - BLPC Balance Sheets 1976-1986 (Table 5.4) Appendix D. The actual results varied slightly from the forecast due principally to the deferment in the construction programme resulting from a drop in the actual electricity demand. The deviations are explained more fully in Section 1 below. 1. Tariffs The actual basic tariff for the period 1980 - 1985 was - 51 - 17.7 cents per RwH which was very much in line with the 18 cents per KwH forecast. The actual fuel tariff for the same period amounted to 12.3 cents per KwH against the forecast of 15.6 cents per KwR. This reduced ac- tual fuel tariff resulted from the reduction in the cost of fuel which was immediately passed on to the consumer through the fuel adjustment clause. 2. Sales Volume The sales forecast for the period 1980 to 1985 was based on an assumed cumulative growth rate of 7.5% per annum. This rate was consistent with the actual growth rate of the 1970's. The actual growth rate for the period 1980 to 1985 was 3.5X per annum. The reduction in the rate of growth was affected by the economic dlownturn of the Parbados economy. 3. Revenues and Overating Exnenses The overall revenue projected for the forecast period did not materialise due to the lower sales growth and drop in the fuel tariffs. Operating costs were however reasonably well contained and the actual operating ratio for 1980 - 1985 was 84.7% compared to the - 52 - forecast of 83.2%. 4. Net Fixed Assets Service The 1980/1985 forecast anticipated the value of the net fixed assets in service to rise to $380 million for the 1985 year. The actual value for that year was 27% less at $277 million. The difference of $103 million is accounted for through the reduction in the planned construction programme, lower asset revaluation indices and an increase in the annual depreciation rates. 5. Revaluation of Assets A revaluation study was prepared by the appraisal divi- sion of Stone and Webster Management Consultants Inc. as at December 31, 1983. The resulting valuation which was adopted by BLPC produced a lower value than had been anticipated in the forecast. The appraisal in- dicies for the year 1984 and 1985 were also lower than anticipated with the actual indices being 2.2% and 1.6X respectively against a forecast index of 8.8w for each of the two years. - 53 - 6. Denreciation Rates The actual overall depreciation rates charged for the period 1980 - 1985 amounted to 4.44$ on revalued fixed assets compared to the 4.13% which was forecast. 7. LiQuidity Problems BLPC experienced some cash difficulties up to 1982 when its overdraft facility had been fully utilised and there was a threat of it being exceeded. However, the rate increase granted towards the latter end of 1982 enabled this position to be rectifie4. The overall current ratio for the period 1980-1985 was 1.7 compared to the forecast of 1.8. The liquidity position was assisted by better credit control of accounts receivable. This was consistently reduced to 31 days outstanding up to the 1985 year, against a forecast of 51 days. 8. Debt EQuity Ratios The actual debt/equity ratio for the period 1980 to -.54 - 1985 was 38/62 compared to the forecast of 31/69. The resulting lower equity portion would have been sig- nificantly affected by the large reduction in the ap- praisal surplus which was caused by the lower revalua- tion indicies. 9. Rate of Return The rate of return for the years 1982 - 1985 was forecast to provide 8 on revalued fixed assets. The actual result was slightly under that amounting to an average of 6.7 per annum for the same period.. 10. Construction Expenditure Tlhe overal'l expansion programme, 1380-1985, as forecast at project appraisal was for a capital expenditure of BDS$191 million, excluding interest during construc- tion. Due to load growth being below the forecast levels the expansion programme was reviewed and res- cheduled, as mentioned in Section III, 2. Actual construction expenditure for the period 1980- 1985 was BDS$129 million, and for 1980-1986 totalled - 55 - BDS$161 million. 11. Debt Service Coverage The actual ratio for debt service coverage for the period 1980 to 1985 was 1.6 compared to a forecast ratio of 2.2 . This decrease resulted from lower earn- ings as explained above which was not fully compensated for the reduction in the construction programme. 12. Extent of Financins of Construction Exnenditure-throuth Internal-Cash Generation and Eguitv Contribution. The actual capital expenditure for the period 1980 - 1985 amounted to $136 million. Funding was effected through loans of $101 million (74O) share issue of $5.8 million (4%) and the remainder by internal cash gener- ation (22%). This compares to the forecast financing which comprised loans of 70X, share issue of 5X and internal cash gen- eration of 256. - 56 - 13. Inflation & Exchange Rates Inflation was forecast to rise at an annual rate of 8% over the period 1980 to 1985. The actual rate realised for this period was slightly under 9X per annum. However, there was a declining trend with the rate dropping from 14.5X in 1980 to 3.91 in 1985. The expected inflation rates did not produce any dras- tic surprises but had the effect of eroding earnings over time. This was offset by the increase in sales of 3.5% per annum. 14. Exchange Rates During the period i980 to 1985 there was a consistent decline in the value of two of the Company's major E funding currencies. The Pound Sterling dropped from 4.70 to 2.60 and the Canadian Dollar from 1.70 to 1.50. There was no change in the US Dollar to which the Bar- bados Dollar is tied at 2.00 : 1.00. There was little effect on the loan position of the company resulting from these changes as the majority of its debt is in US dollars. - 57 - The Company chooses to use the US dollar as its prin- ciple currency for trading in the international market. It is therefore largely sheltered from fluctuations in exchange rate due to the tie of the Barbadian and US dollars. However, in general terms the cost of importing materials would have been reduced due to the strength of the US dollar over the last six years. This would have been a contributing factor to the lower inflation rates for the Barbadian economy over this period. 15. Tariff Structure A cost of service study was prepared by Stone and Webster Inc. based on the audited results for the year ending December 31, 1981. This indicated that the rate of return for each of the customer categories was as follows: Domestic Service (1.53)% General Service 6.59% - 58 - Secondary Voltage Power 6.07X Large Power 12.19X Street Lighting (0.86*) Employee (9.12X) Total 4.67X The subsequent rate increase of 7.5 cents per RwE granted in 1982/1983 was applied as an additional charge to all customer categories. VI. INSTITUTIONAL PERFORMANCE 1. Management and Organisational Effectiveness An Administrative Services Department was set up, reporting to the Secretary/Treasurer, responsible for legal, insurance and personnel matters. The Company had introduced a Data Processing Department in 1972, and this centralised operation primarily serv- - 59 - ices the customer billing operations, stock inventories and the general ledger. Recently a number of personal computers have been introduced in the accounting and operating departments. Programs are being developed by the users themselves for a variety of accounting, record keeping and statistical systems. The growing computer awareness created pressures for an improvement in the Company's overall data processing systems and a Computer Review Committee has recently been set up. This Committee is to identify the Company's data processing needs and ways in which these may be satisfied in the most effective and efficient way in the future. In 1986 an Organisation Review of the Company was made by management consultants, Coopers and Lybrand As- sociates. This confirmed that the existing organisa- tion was basically sound. Suggested changes are minor in nature. These are being discussed and will be implemented as and when appropriate. 2. growth Growth in sales, customers, system capacity, and finan- - 60 - cial areas have been dealt with previously in this report. Employees have increased from a total of 428 at the end of 1979 (412 permanent + 16 temporary) to 474 by the end of 1986 (442 permanent + 32 temporary) an increase of 10.7%. 3. Staff Recruitment. Training and Development The Company recognises that training and the develop- ment of appropriate skills, attitudes and behaviour of its employees are fundamental to efficient operations. Its policy is to pr-ovide employees with appropriate training to improve job performance and prepare for fu- ture changes in organisation or technology. Specific training has been carried out, such as for the introduction of the Low Speed Diesel Plant, or SCADA equipment, when engineers and supervisors received training at the suppliers' plants overseas during manufacture of the equipment, and then on-the-job for all related staff during construction, commissioning, and initial operations. - 61 - On an ongoing basis, training is arranged within departments in various areas. These include customer relations, linesman training, generating plant main- tenance, etc. VII. CONCLUSIONS A small island utility, such as The Barbados Light and Power Co., Ltd. does not have the possibility to inter- connect with, and purchase power from other electric utilities when mechanical plant has to be shut down for maintenance, overhaul or because of equipment failure. Being thus isolated from any form of outside help, the Companj should always have enough plant reserve based on past experience -to maintain a high standard of rclinbility and minimize service disruptions. Expansion of the Company's generation, transmission and distribution facilities must necessarily depend on growth of the Barbados economy and customer demands. An important objective in design of the facilities is to improve the generating plant rate of fuel consump- t.an and to keep transmission and distribution energy losses to a minimum in order to help keep the price of - 62 - electricity at reasonable levels. The three low speed diesel generating units which have been installed have enabled the Company to produce the majority of electricity consumed in Barbados from residual fuel oil. Residual fuel oil is substantially lower in price than lighter diesel fuel and all of the savings from the use of residual fuel are passed directly to our customers through the operation of the Fuel Adjustment Charge. The Fuel Adjustment Charge automatically increases and decreases the price of electricity as the cost of fuel to the Company goes up and down. There has been a sus- tained reduction in the Fuel Charge since it reached a peak of 17 cents per kWh in April 1981. The Fuel Charge fell to 5 cents per kWjh by December 1986, but it is expected that it will start increasing again as the fuel suppliers have advised that they will be increas-. ing the price of fuel in 1987. The Supervisory Control and Data Acquisition System which has been install d at the Garrison enables trans- mission lines and main distribution feeders to be monitored and operated from one control point. - 63 - The voltage levels of primary distribution feeders are being converted from 11,000 volts to 24,000 volts to help overcome impedance losses. This will be done in a phased manner as required by feeder loads and by back- up requirements to maintain acceptable levels of reliability. A milestone was passed in 1985 as electricity reached the last rural settlements in Barbados awaiting serv- ice. There are always new customers within the network to be served, while existing customers are connecting up more and more electrical devices to the system. In the Company's report to shareholders for 1986, the Directors referred to the high level of customer satis- faction resulting from enhancement of service quality and a decline in the price of electricity. The expan- sion and improvement programme, started *in 1981, which has received finanial support from the World Bank, other financing institutions and commercial lenders, has contributed substantially to the modernisation of the Barbados electric system, improvement in generation and distribution operations and reduction in electricity prices. - 64 - BARBADOS - POWER PROJECT TABLE 1 PROJECT IMPLEMENTATION SCHEDULE KEY DATES Issue First Bifs or Phase Start cOpiet Item Tms of Contrat Material wonstuctic/ Onstucton/ Referenc Award Delivery rt Ccntzat 1. wRYwn Pi'm - A. 24XV Lns 4/81 2/82 6/82 7/82 12/87 B. TransfoIxes 4/81 1/81 9/82 10/82 12/83 Ift n -m -M -.- -- L4/81 11/81 6/82 7/82 12/87 3. Cpciutns 4/81 12/81 8/82 9/82 12/87 4. S.zwloe Mm 4/81 5/82 7/82 8/82 12/87 5. inns mTDO A. Generaticm Planning 2/81 6/81 - 6/81 8/82 B. i2ergy Conservaticn 7/81 7/81 _ 9/81 7/82 C. Tariff Study 7/81 3/82 _ 3/82 1/83 D. PUB Operating _ _ _ _ 7/81 E. Criteria for _ _ _ - 11/84 Rates - 65 - THE BARBADOS LIGHT AND POWER COMPANY LIMITED EXPANSION PROGRAMME SUMMARY REPORT TABLE 2 PROJECTS COMPLETED PROJECT PROJECT PROJECT FINAL YEAR OF FINANCING ESTIMATE COST COMPLETION -------------------------------------------------------------__----------- 1. 26 MW Low-Speed SHB,CDC, 72.500,000 71,524,653 1982 Diesel Plant RBC 2. Relocation of Diesel Oil Tank and Diesel and Gas Turbine Controls Internal 599,200 611,000 1983 3. Marhill Street Sub -Expansion Internal 300,000 564,533 1982 4. Spring Garden 24KV Substation Expansion SIB 432,000 569,588 1982 5. Belmont Sub- station Expansion EIB 448,400 400,700 1983 6. Mobile Transformer BIB 700,000 708,200 1983 7. Salters Feeder Conversion (11,000 to 24,000 V) IBRD 671,700 987,200 1983 8. Bank's Feeder Conversion IBRD 930,000 579,700 1983 9. Wildey Feeder Conversion IBRD 1,324,600 551,324 1981 10. Replacement of 11,000 V U/G Cable from Garrison Hill to Jemmotts Lane Internal 401,200 391,400 1983 - 66 - PROJECT PROJECT PROJECT FINAL YEAR OF FINANCING ESTIMATE COST COMPLRTION ----------------------------------------------------------------__-__- 11. Distribution Dept. Office at Garrison Internal 1,884,400 1,221,100 1983 12. Garrison Drainage System Internal 208,800 231,000 1983 13. Generation Planning Study IBRD 310,000 320,000 1982 14. Energy Conservation Study IBRD .152,678 147,934 1982 15. Marginal Cost Tariff Study IBRD 165,622 162,280 1983 16. Public Utilities - Board Operating Procedures IBRI 100,000 66,800 1981 17. Criteria for Setting Rates IBRD 245,000 216,200 198,5 18. Soot Blower for Steam Unit Internal 179,300 246,600 1984 19. Notton 24Kv Sub-station RIB 877,300 894,700 1985 20. Stores Warehouse at Garrison Internal 378,000 424,600 1985 21. Turbine Generator in Low Speed Diesel Plant Internal 2,542,000 2,328,000 1985 22. Supervisory Control .and Data Acquisition System BIB 1,497,500 1,658,500 1985 - 67 - PROJECT PROJECT PROJECT FINAL YEAR OF FINANCING ESTIMATE COST COMPLETION …--------------_-_----_--------------------------------------__-------- 23. Sub-station Marshalling Panels for SCADA Internal 127,700 203,500 1985 24. Distribution Transformers IBRD/ Budgeted 5,252,100 (1981 - 1986) Internal Annually 25. Meters and Services IBRD/ Budget.d 4,264,500 (1981 - 1986) .Internal Annually 26. Street Lighting (1981 - 1986) Internal Budgeted 977,900 Annually 27. Line Extensions Internal/ Budgeted 15,382,400 and strengthening CDC Annually (1981 - 1986) 28. Rural Extensions Internal/ Budgeted 1,016,700 (1981 -1986) ErB Annually 29. Vehicles and Construction Internal Budgeted 3,894,700 Equipment Annually (1981 - 1986) 30. Garrison 44,OOOV Substation EBI 1,035,000 1,649,800 1985 31. 24KV OCB at Belmont for Garrison Line EIB/ 117,000 98,700 1985 Internal - 68 - PROJECT PROJECT PROJECT FINAL YEAR OF FINANCING ESTIMATE COST COMPLETION -------------------------------------------------------------__-------- 32. Admin Buildings Internal 1,347,400 3,205,787 1986 Garrison Hill 33. Extension of Swedbank/ 35,000,000 28,572,792 1987 Low Speed Diesel Internal Plant, Unit D12 34. Old Works Internal 1,035,000 850,001 1987 Substation 35. Relocate G.M. Internal 1,098,000 997,700 1986 Units from Spring Garden to Garrison Hill PROJECTS IN PROGRFSS PROJECT PROJECT PROJECT EXPNDISTURI TO FINANCING ESTIMATE 1985-1l-30 REMARKS …--------------------------------------- _--------------------_____ 1. Central 1 and 2 24,000 volt lines, strengthening IBRD 518,000 Central 1 line is completed. Central 2 line 90* completed. 2. Reconductoring Held pendin St. Thomas realignment 24KV line IBRD 380,200 of Highway realignment 2A. _7n- PROJECTS DEFERRED PROJECT PROJECT PROJRCT REMARKS FINANCING ESTIMATE …__________________________________________________________________ 1. 69.000 V Transmission Line, Spring Garden to Wotton CDB 8,910,000) All 69,000 Volt ProJects have 2. 69,000 V Transmission been deferred Line, Spring Garden due to load to Port CDB 1,697,000) growth.being below forecast 3. Wotton 69,000 V levels. Substation EIB 2,900,000) 4. Spring Garden 69,000 V Substation. EIB 2,000,000) S. Port 69,000 V Substation EIB 2,850,000) 6. Cement Plant Substation Internal 437,000) ABBREVIATIONS CDB - Caribbean Development Bank CDC - Commonwealth Development Corporation RBC - Royal Bank of Canada SHB - Svenska Handelsbanken EIB - European Investment Bank IBRD - International Bank for Reconstruction and Development (World Bank) Swedbank - Sparbankernas Bank/Swedbank BARBAWS - R Ra7P T LE 3 ciractv and EherBv Ralaie 1979 1980 1981 1982 1983 1984 198S 1986 Peak Demwd 51.0 52.5 54.7 58.2 S9.7 61.7 64.2 67.9 Genaratjn Plant va4 ,at~i at erdof year) Garrison Diesels 8, 9, 12-15 5.0 4.4 3.2 3.2 3.2 3.2 3.2 3.2 Garrismn diesels GM1, 2 and 3 (3 x 1.65 NO0 4.9 4.9 4.9 4.5 4.5 4.5 4.5 4.5 Spring Garda Diesels 1-5 (5 x 2.1 NO 10.5 10.S 10.S 10.5 10.5 10.5 10.S 10.S Spring Garde DIesels 6 -9 (4 x 4.5 Mi) 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 Gas Turbine 17.5 17.5 17.5 17.5 17.S 17.5 17.5 17.5 Stem Uhiits I and 2 (2 x 20 6n) 40.0 40.0 40.0 40.0 40.0 40.0 40.0 40.0 Low Sped Diesel unit 1 I/ - - - 12.5 12.5 12.5 12.5 12.5 Low Speed Diesel Unit 2 1/ - - - 12.5 12.5 12.5 12.5 12.S Waste tbat Tubi1ne 2/ - - - 1.1 1.1 I.ow qeed Diese Unit 3 3/ - - - - - - - - Total 95.9 95.3 94.1 118.7 118.7 U18.7 119.8 119.8 NGY BWWa (G) Gwss Generation 315.4 331.5 348.6 356.5 37s.0 382.4 388.7 414.0 Generatlm by Plant: Garrismn & pring Gurden Diesels 73.3 68.9 59.2 46.4 52.1 40.1 s8.5 Gas Turbine 7.2 12.1 8.3 7.1 8.3 1.1 1.8 Steam Units 1 and 2 251.0 267.6 2S9.8 171.7 18S.9 205.2 203.6 Low Veed Diesels 29.2 149.8 136.1 142.3 150.1 1/ Cuuissioned Septaier 1982 2/ Cmuuissicned March 1985 3/ 12.5 tW Set OmCusslmed in Februan, 1987 Actual and Projected Thernv and Power Rguiznents TABLE 4 1979 1980 1980 1981 1981 1982 1982 1983 1983 1984 1984 1985 1985 1986 Actual F cast Actual F'cast Actual F cast Actual F'cast Actual F cast Actual F cast Actual Actual BewSales-(GWh) DlmestLc 79.3 82.7 83.0 88.0 86.7 93.5 91.8 99.3 93.8 105.6 95.8 112.2 99.6 107.3 Cieneral Service 17.6 17.8 20.7 19.1 20.0 20.4 20.0 21.9 19.2 23.4 18.7 25.1 16.8 16.4 large and Secxmdary Poawer 170.9 188.1 173.6 204.0 189.2 221.1 192.9 239.4 199.0 259.1 207.8 280.2 212.4 226.5 Other S.0 5.0 4.8 5.1 5.2 5.2 5.4 5.3 5.4 5.4 5.6 5.S 5.5 5.8 Tbtal 272.8 293.6 282.1 316.2 301.1 340.2 310.1 365.9 317.4 393.5 327.9 423.0 334.3 356.0 Transmission * Distributin losses (t of net generatitn) 8.35 9.00 9.70 9.00 8.36 9.00 7.59 9.00 10.41 9.o0 9.31 9.00 8.61 8.78 Net Generaticn (GWh) 297.6 322.6 312.3 347.5 328.6 .373.8 335.6 402.1 354.3 432.4 361.6 464.8 365.8 390.3 Station Service (t of gross 5.65 6.00 5.79 6.00 5.75 6.00 5.85 6.00 5.52 6.00 5.73 6.00 6.29 6.32 geeraticn) Gross GYenration (Gwh) 315.4 343.2 331.5 369.7 348.6 397.7 356.5 427.8 375.0 460.0 382.4 494.5 388.7 414.0 Annual load Factor (O) 70.6 69.5 70.0 69.5 70.6 69.5 70.0 69.5 71.7 69.5 71.0 69.5 69.4 70.0 r Peak DemaAn 0Y) 51.0 56.4 52.5 60.7 54.7 6S.3 58.2 70.3 59.7 75.6 61.7 81.2 64.2 67.9 Omber of Ostamars Domestic 59255 61280 60800 63241 62509 65265 63768 673S3 65330 69508 66060 71733 67567 69527 Other 6522 6445 6862 6619 7204 6795 7436 6978 7632 7169 7710 7365 7722 7934 Ibtal 65777 67725 67662 69860 69713 72060 71204 74331 72962 76677 73770 79098 75289 77461 -73- THE BARBADOS LIGHT & POWER CONPANY LID - WORLD 9ANK COPLETION REPORl BI.B 5.1 Page l of 3 Actual Actual Actuat Actual Actual Actual 1974 1975 1976 197 1978 1979 .... .... . .... .... . . .... ...... ... ........ lable 5.1. ILPC Key finaiast Idicators Rate of Return Average not fixed assets: book value of assets 58,084 58,326 77,099 94.554 93.614 93,852 (1000 0DS) fully revalued C estimate) (1000 BS) 137,818 151,1?5 Rate of return t on partially revalued assets (2) 7.1 7.0 5.6 6.1 4.7 5.5 s on fully revatlud assets (1) 4.402 3.20M 3.402 Rate of retum on caimon quity (2) 7.10Q 7.602 6.80X 5.20X 2.402 3.002 Earninos per share and dividends: eamings CeDc/share) 112 112 99 84 31 38 : dividends (tDc/share 40 40 40 40 40 40 Operating ratio (2) 84 86 86 85 89 90 Current ratio (times) 2.0 1.3 0.9 0.8 0.9 0.7 Debt service coverape gross debt service (3$ 1000) 2,950 3.878 5,627 7.287 7,802 7,946 Ratio ( times) 2.5 1.8 1.4 1.7 1.3 1. Dabt /equity ratio :- Debt 0.00 0.00 0.43 0.40 0.35 0.33 - Equity 0.00 0.00 0.57 0.60 0.65 0.67 Receivables (days) S6.0 48.0 45.0 41.0 49.0 59.0 Depreciation (2 of prior years gross fixed assets 3.432 3.472 4.1211 4.772 4.22X 3.65S excluding w.i.p.) Contribution to investment Construction reqairemnts (3081000) 13.402 21,099 12.833 5,010 5,091 5,682 Intenal contribution to investmnt (2) U.O 31.02 4.OX 61.02 -36.02 39.02 Average revenue Current prices (BDc/kth) 14.1 15.3 1S.7 16.7 15.8 18.6 Constant 1979 prices (tOcI/kh) 23.9 21.6 S 1.1 20.7 17.9 18.6 Average cot of fuel (current BftIkOh sold) 6.9 7.8 7.6 7.4 7.6 10.3 Incre in consrmr price index (2) 39.02 20.32 5.0% 8.3S 9.S 13.22 THE BARBADOS LIGHT & POWER COM4PANY LID * WORLD BANK COMPLETION REPORT BTR 5I1 PaXqe 2 of 3 Forec"t Forecat Forecast Forfecast Forcst forect 1980 1981 1982 1983 1984 1985 Table 5.1. BLPC Key Financial indicators Rate of Return Averase net fixed "ssets: 60di value of ssets 112,320 (1000 SDS) fully relued t estlastO) (1000 SDI) 16,734 U3,685 221,170 28,31 334,602 39,762 Rate of return : an partiatly rwalued assets It' 115 : an fully rvlued assets () 7.702 7.202 8.001 8.002 8.002 5.002 Rate of return an cenwon equity (X) 0.503 3.002 3.502 4.302 4.902 6o.50 Earnings per share aNd dividends: earnins (UDe/sbare) (6) S4 106 143 168 264 s dividens (Sc/shre 40 40 40 40 40 40 Operating ratio (2) 83 86 84 81 82 83 Current ratio (tims) 1.2 1.5 1.8 2.1 2.1 2.2 Debt service coverage Gross debt service (3 1000) 9,094 10,780 13,011 21,603 23,15 23.763 Ratio ( times) 2.2 2.1 2.1 1.7 1.8 2.1 Debt /equity ratio :- Debt 0.27 0.30 0.35 0.32 0.31 0.28 Equity 0.73 0.o 0.6S 0.68 0.69 0.72 Receivables (days) 66.0 S8.0 51.0 51.0 51.0 S1.0 Depreciation (I of prior,-ears gross fixed asts 5.142 4.96f 3.672 3.672 3.672 3.6?1 etLuding ui.i.p.) Contribution to lwgttint Construction requirements (8DS1000) 15,874 45,819 46,652 32,061 3S,38 24,976 Internal contribution to irwsastnt (2) 31.ox 24.02 33.02 30.02 58.0 103.02 Average revmt Current prices hOce/klWh) 2S.9 28.9 32.6 33.0 38.0 42.4 Constant 1979 prices (BDO/O ) 23.4 24.0 25.1 23.7 25.5 26.6 Average cost of fuet (Current DOClkWh sold) 14.2 16.3 18.3 16.8 18.6 20.9. inerease In consmer price index (2) 10.52 9.0X 8.02 7.0X 7.0x 7.02 -75 - THE SARIDOS LIONT 6 PWER COWAN LTD - LD UAUK COWLETION REPORT MN 5.1 3 of 3 Actul Actual AItSi Actul fAtual ActUal ActUat 1980 1981 1982 196 964 1965 1906 ~~~~~~~~~~~.... .... . .... ...... ... ........ ... ........ Teble S.1. BUC Key Financsl indilestOr Rate of Retum Averg net fixed oetss book value of assets (1000 O0N) fulty revalued estimet) (1000 NS) M - 206.622 30.9 2770,o3 276.612 Rate of return: an partltlty realued aets (M) t an fultly rtlued asts () 0.001 0.001 4.9M 6.5 6.80 S.M S.-" Rate of retur an cm o eu ity (1) 3.9 1.98x 1.19X 4.91 4.2 2.131 2.6 Eaminp per share nd dividends: eanings (clshare) 45 37 34 67 60 55 51 s divdens (5Icleswo 31 40 40 39 50 50 3 operating ratio (B) 88 69 8 r 6 a6 84 Current ratio (tims) 1.3 - 2.1 1.3 1.9 2.3 1.S 1.4 Debt service oeorag Gross debt srvice (W0 1000) 9.063 10.870 14,720 31n 25,65 18U.44 1?.811 Ratio C time) 1.9 1.6 1.3 1.5 1.5 1.8 2.0 Debt /equity ratio s- Debt 0.25 0.45 0.51 0.4 0.30 0.28 0.30 Equity 0.75 0055 0.49 0.52 0.70 o.J 0.70 Reeivabes (day) 5 44 41 43 41 31 29 Deprecition (lof prior Yoa gross fixed aSets 5.14X 3.61X 4.376 3.JU0 5.641 4.09X 4.M55 ecluding U.S.p.) Contribution to inmestmnt Constructfon reqiremnts (1OSO1O) 9.536 50,130 37,701 9,299 12,831 16,696 33.779 Internal contribution to investoent (1) 218.86 14.76 3.28 86.61 65.76 100.41 39.9X Average Current priems (3DC/k9) 26.6 27.7 28.2 33.0 33.3 31.3 27.7 Constent 1979 prices (Ipo/SW ) 23.2 21.1 19.5 216 20.9 18.9 16.5 Avrge cost of fuel (current OOdiM sald) 15.4 16.6 16.1 14.J 14.7 12.6 9.1 Incrase In eonsumer price index (C) 14.51 14.6 10.35 5. 44.61 3.91 1.31 _76- TABZ5S.2 Page 1 ofr 3 IN! BAI* LIGHT S POM CO. L ACUst Astwi Actmat Actual Actintm UL SOm cOWLuTIUI Km 195 1976 197 19 1979 .... .... .... ..... .. . ...... ... Te S.2. 8C Ir_m *te flines s6.e1 (SI) 223.0 24.0 m.8 ... ..... ..... Averae Tertiff Revs (ejlb) a s"Jc 9.55 11.08 11.50 full elaus 7.19 4.n 7.10 Total 16.73 15.81 13.59 .;.... ..... ..... Orting tevemis I 21.2l8 270V 31.39 hotl sem 16082 11,542 19,35M 1IteeU sus 124 86 2 ....... ......... ....... .......... Totat 7.440 30.646 50.956 awatins~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~... ...........i ...... .......... ....... Opttirv f_pnss a ta 16,53 ' 18,500 25.035 opqatlum a mi _ wu 9.010 10.3U2 12,#1 ohpr.sietIm 5,50r 4,9U3 4,2s7 Otr __t-sub 107 100 100 Taxa: Csrpsratia, 0 Other 450 424 615 ,......... ....... .............. lowa 31,60 34,289 45,2 =......... ....... .......... ... operati Ig S,0 4,m3 5,130 Plus$ I t lIn 11 S 11 ee1s (1oa) an aewe SS 520 449 I et. tax sreot l ef. c_s ltttbsn drwg .......... ....... .............. met Incm before inteet 6.346 4,902 S,590 Le's s lnt. an Ion tes det ege to tepetiom 3,431 3.386 3,658 Intest an oadraf ....... ......... ....... .......... - ebt ime. 2,71S 1,516 19'2 Arciatlems Dlvldw1m (1,301) (1,84) (2,007) Tram. to Pref. dwe u re tIen ree. 0 (125) (125) Trafer to speci at rs" 0 0 Cepelatimtlln ot rtlned earnigp 0 (3,135) 0 Prla vor adju_ nt 0 0 0 Adds trons. of oppalia elemet InSId in dsprOn oft. 0 0 0 Retined Eanmins egning of. yr 4.315 5,558 2.170 d otf yer' 5,79 2,170 1I970 Calaulatin of rsteeof*reMM operating Issues 5,70 4,37 5,13 late of eturn(S) a an ftuly revaue a_tr in S19745. 4.45 3.25 3.40 -77 TA-S - ~ ~ ~ ~ ~ ~ ~ -7 Paqe 2 of 3 VWE iUIWA0 LIIGT 4 PER CO. LTD fOes05: Forecaut forerat fore t Forest forcut - WORLD SANK COMPLETIOI REPORT 1960 1951 19a2 1983 191 19l5 .... .... . . .... .... . .... .... ............ ......... ......... Tablo 5.3. 8LPC Incom Statents final Sales (SAh) 293.6 '316.2 340.2 36e.9 393.5 423.0 ..... ...... ..... ....... ..... ....... .. ........... .. Averag Tariff Rev (lDcJiH): lasic 14.13 14.58 16.49 18.28 21.2 23.26 fuel clause 11.60 14.28 16.14 14.74 16.75 19.1S ..... ...... ..... ....... ..... ....... .. ........... .. Total 25.93 28.86 32.63 33.02 36.02 42.41 _ ~~~~~~~~~~~~~~~~~~..... ..... ....... ..... ....... .. ........... .. Operating Rwoiw a sai 41.476 4.102 S,608 e66,66 A3.70 98,403 fuel clause 34.6" 45,160 54,m 53,919 65.918 81,003 liscoLe 24S 257 70 2 297 312 ....... ......... ....... .......... ....... .......... ... ................ ... Totat 76,363 91.519 111,251 121.086 149.921 179,718 ~~~~~....... ......... ....... ........................ ..... .............. Operating Een : Fuet 41,760 51,S 62,319 61,345 73.344 88,429 operatin & mintenine 1444 7,2 20,470 23.211 26,347 29., Depreciation 6,195 3,36 9,417 12,005 15.263 17,063 Other non-cash 201 200 81 SO 45 Tax"es: Corpoation 0 * - 6,047 11,79 other 920 943 1,270 1,645 2,090 2.200 = ~~~~~~~~~~~~~~~~~....... ....... .......... ....... .......... ....... ..... .............. total 63.516 76.355 93n,s5 96,26 123146 149,337 .................... ......... ....... .......... ....... .......... ....... Operating In : 12,847 13.1t 17,694 22,830 26,7 30,381 Plus: Investmnt InceI 1t It 11 t1 11 Gain (tloss) on exchan 218 217 215 21S 189 99 Lses- Deterred tes (,76) (2,436) 4,15) (4,34) (4,331) (3,750) invnst. tax credit def. (1,216) (3,3SO) (3.066) (1,914) (2,116) (1,079) Caellation Chargs ....... ......... ....... .......... ....... ......... .................... . met Incm before Interest 4,094 7,606 O0.7 16,776 20,530 25,662 Lass Int. on log term debt haged to operatios 2,605 3,665 4.363 8,208 9,40 6.O Interest on rordraft 1,469 734 437 24? 176 57 ....... ......... ....... .......... ....... .......... ... ................ ... Net Incom 20 3,157 5,903 8,241 10.874 16,95 Apprpiatioant Dividwd (2,106) (2,406) (2,406) (2,SO6) (2,806) (2,06) Irw.s. to prof. shre redption re. (12S) (12S) (125) 125) (125) (125) Trwnfer to speciae 0 0 0 0 0 0 CapitatiatIon of retained earnings a 0 0 0 0 0 Prior yor dJstnt0 0 0 0 0 0 - sAdd tran. of appriesal eltent incld in deprn chs. 0 0 0 0 0 0 Retained Earnings: lgiming of year 1.970 (241) 385 3,757 9,367 17.310 End of yer - (241) 385 3,5 9,367 17,310 31,144 Calculotion of rate.of-return: Operating inco 12.647 13,164 17,694 22.530 26,M 30,31 Rate of return(%) s on fully revalued assets In 1977-5 T.7 X 7.522 8.00 8.0 8.002 5.o00 -78- TMIB 5.2 MM= S.2 Pamfl 3 (bf 3 THt 4ARADOS LIGHT 4 POWEt CO. LtD Actual Astual Actuatl Actut Aetult Actul actu - VoRLO 5WR K amCILETIu R£PORT 1980 1981 19a2 198S 1984 1985 1984 .... .... . .... .... . .... .... . . .... .. ...... ...... .. Tablo 5.2. SLPC Income Stat_amte Flirl Sales (VA,) 282.1 301.1 307.? 317.4 327.9 334.3 356.0 ......... ...,......... .._ ...... ....... ..... ....... ..... Avwrag Tariff Savem- (OWkUh) s ae 13.7 13.80 14.77 21.39 21.28 21.30 21.35 fuel clause 12.69 13.94 13.47 11.57 12.0S 9.96 6.42 Total 26.56 2V.74 28.24 32.96 33.33 31.27 27A?6 , ~~~~~~~~~~~~~~..... ..... .. ..... ..... .. ..... .................. .......... OFerating Revene:s Saabe 39,115 41,551 4S,439 67,83 69,76? 71,219 75,d0 Fuel clous 35,811 41,967 41.444 36,718 39,56 33,309 22,065 _ slfuettieou 262 255 368 46? 744 547 797 ........ ........ ........ ........ ........ .............. Total 75.18e 833,M 87,251 105,068 110.037 105,075 99.312 .......;........ ................. ..... ........... ........ Operating Ezpnsa h ouel 43,310 49.0439 49,494 45,16" 48.132 42,19 32,263 Oprtlona & mintenance 14.282 1,81? 17T 23.63S 25.4SS 25,"5 27.905 Daweclation. 6,199 6.276 7,?41 9,S46 14,060 15.49 17,101 Ot-er nu-sab Tms: Corporation 1.284 0 0 0 1,5? 4.180 3.230 Other 76 77 1.124 1,136 2,184 197S 1,991 ........ ........ ........ ........ .. .............. ........ Total 6s.841 74,710 76?,33 79,483 91,938 9SS3 83,2"9 * ~~~~~~........ ........ ........ ........ ........ ........ ........ operating Inoe 9,34? 9,0D3 11,118 25,585 18,099 15,57 16.013 Plus Investmnt incom 1S 9 140 Ss 205 3 16 Gain (loss) on excan 295 542 586 609 383 66 23 Lass: Oeferre twa (2.256) M (1,389) (9,605) (5,151) (3,609) (2,354) Invet. tax credit def. (659) (4,044) (2,319) (267) (310) (650) (1,455) Cnceltlation charg (412) ........ ........ ........ ........ ........ ........ ........ INt Inc before Intest 6,742 6.363 7.724 16,357 13,226 12,042 12,26 Loee tlnt. on lon tem debt dc d to owratians 2,307 3.327 5,406 10.668 1,606 7,36 6*763 - intest on ovedraft 185S 881 331 727 19 115 373 Net Income 2,580 2.15S 1,97 4.962 4.451 4.0N 5,107 Aepprieations: Divid (2.054) (2,23) (2,639) (3,119) (3,96) (3.969) (3.9rt Tres. to prof. hre radption ra. (12S) (1U5) (125) (125) (125) (13S) (125) Tranfw to special reerv 0 0 0 (2,453) (2,62?) (3,224) (3.741) Capitalization of retained earning (1.970) 0 0 (13432) Prior yr adjsntment - Ad trn. of Waiatal *tnt incl'd in depr'n chg. 2SSS 2,402 2,93S 2.423 7,096 7f6r5 11,015 Rtained Enngs: gimntrg of yt 4,927 5,913 7,722 9,810 11,56 16,396 20.804 -Ed of yer S,913 ,72 9'8.m 11568 16,396 20; I5,57 Catcutation of rate-of-returns oprating Incoe 10,291 22.858 18,607 16.301 16,052 Rate of returnc2) i on ful rVlmed wasets In 1977-5s 4.932 8.59X 6.86S 5.88t 5.o7 -79 _XZ 5.3 PEM 1 of 3 THt 363100U LOST & PEII CO. LTD Mtd Actual ctual A Mto i actmi Acul - fIIOR161K CaUmPLETUS RP? 1974 195 1976 19" 17 1979 .... .... .... .... .... .... Table 5.3. BLPC Souer ad We of FuS Internal Seuree Not in befor interst 66 49.902 5.590 Oel eatlon 5.507.0 4.943 4*257 Othr non-cash aoapenes 1t0 100 100 Deferred tae ad l smnt ta crdits 0 0 0 Amlizatlon of deferred echag gains (575) (519) (558) Custimr contributias .. 1.0t6 so9 Total ........................ 12.174 10.478 10.38B _ ~~~~~~~~~~~~~~~~~~~~~........ ........ ........ Opertlonal requiroet Chames in other a*st. iabititiel 140 (61) (214) Amortization of debt 3S,62 4*360 4,39 Intetest en lON- teo debt charged to eperatiane 3.401 3.36 3.S6 Interest an overdraft Dividend 1.301 1.694 2.007 ....... .................. Total * 634 9.S79 9.710 - Met Internal Cash Genration 3.540 9 s Working Capitat lRquiremmeit- Changes In working epital excludin overdraft 500 2,732 2,756 Decrease tincre ) In ordraft (1,649) M1M 7) O(1262) Increase (dereae ) in teprrr cash wsrpus St&btotet (1,149) 634 (5.506) Construct on Requirements Prqpsd project Other works 4,916 5.035 5.653 Interet dorNg cntruetion 94 56 29 Sth.totat 5.010 5,091 5,682 Total orkig Capital wnd Construction Rpequre 3. 61 5,S45 176 Blanc to f I 321 S05.2 (3M) Fint ed by: Lom E"Aty ° 5.000 ........................... Totat 282 5010 0 Other applications (Sourcs) (39) 52) 32 - emOrandu Ites Contribution to Inveetmuut X 612 .3 n3x Debt sevice coveag (time) 1.7 1.3 1.3 Acsmtlated tea orary cash srFpus (deficit) - - TAMLE 5.3 Paqe 2 of 3 1mH ARBADOS LIGHT a POWER CO. LTD Forecast Forecast Foreeast Fectaest Forecast Forecast - tIORLo eANm COMPLETION REPORT 1980 1961 1982 1983 1984 198S .... .... . .... ......... l.bl* S.3. gLPC Souress snd Uses of funds Internal Sources net income betore Interest 4,094 y,606 1O,703 16,776 20,S30 25,662 Deprectation 6,1 8,364 9,417 12.00S 15,2Z3 17,063 Other non-cash expenses 201 200 81 50 4S 0 Deferred gaes and Invest_ nt tax credits 8.982 5$,76 7,21T 6,2b0 6,44? 4,629 Amortization of deferred exchon gains (348) (217) (315) (21S) (169) (9) - Customer contributions 999 1.139 1.27 1t,45S 1,644 1,857 Total *------ ....... .. . ........ . ........ 20,123 22,878 28,490 36,351 43,760 49,312 ........ ........... ........ ........... ........ ............ ........... ........ Operationsl requirm_nts Chanoes in other assts end liabilities 0 Amortization of debt 4,946 4,816 4,573 11.569 13,415 12,979 Interest on lo-terom debt charged to operations 2.605 3,66S 4,363 0.268 9,480 0.640 Interest on oevrdraft 1,469 784 437 247 176 st Dividends 2,106 2,406 2.406 2.506 2.860 2,806 ................................................................ ......... Total 11.121 11.673 11,779 22,610 2s,877 24.482 o ...... .................... ............ ........ ........... ........ ........ Net Internal Cash Generation 8,995 11.205 16.711 13.741 17,883 24.t30 Vorking Cpitl aU Rqfuir nts Changes In working capital excluding overdraft 3,350 62 1,217 4,045 (2,S55) (804) Decres (increase) in overdraft 7,289 3.500 3,800 200 1,300 1,200 Increase (decrease) in tasprary cash surplus 21? 485 (1,496) 711 6,057 12,092 Sa-totetl 10,856 4,047 3.519 4,956 6,802 12,436 Construction Requirements Proposed project 3,723 S.037 3.519 3.716 0 Other works 15.802 40,643 37,977 27,043 30.821 22 .89 Interest during construction 72 1.S13 3,38 1.499 844 2,087 SUb-total 15,874 4,079 46,6S2 32,061 35,383 24,976 Totatl Urking Capital and Construction Requirements 26,730 49,926 50,171 37.017 42.15 37,414 Batane to fin nce 17,735 38,721 33,460 23,276 24,302 12,584 finsnced by: Loan 12,7M 38,721 33,460 18,276 24,302 12,584 Equity 5,000 5,000 Total 17,735 38,721 33,460 23.276 24,302 12,5t4 Other aptications (soure) Norurnm Iteas Contribution to Invwes'nt X 313 24S 333 30X S83 103$ Debt Service coerage itims) 2.2 2.1 2.1 1.7 1.6 2.1 Accumulated temporary cash surplts (deficit) 217 70 (96) (65) 7,972 20,064 TABLE 5.3 Page 3 of 3 TIKE AO OS LIGHT S PWER CO. LTD Actuat Actual Actual Actual Actual Actual Actual - AORLD AK COMPLETION REPORT 1980 1981 1982 1983 1984 198S 1984 .... .... . . .... .... . .... ........ ..... ..... ..... Table 5.3. UPC Seurces en Us" of Funds internal Soures Hot incos before interest 6.T72 6,363 7.724 16.3S7 13,224 12,042 12,2U3 Depciation 6,19 6,276 7.721 9.54 14,630 15,459 17,910 - Other ncn-ceh expense 316 316 374 1,440 1,68 894 1,273 Deferred taxes nd investwnt tax credits 2,91S 3.251 3,703 9,872 S.61 4,259 3,809 mrtization of deferred exchange gains (377) (529) (622) (525) (499) (1,04) (219) - Cue t, r cntributions 1,034 1,553 951 1.432 1,S90 1,560 1,293 Total ........ ........ ........ ........ ........ ........ ........ 16,89 1.230 19,856 38,122 36,046 33.169 36,309 ........ ........... ........ ............ ........ ............ ........ ........... .......... ............ Operational requ irmnts Changs in other asets ad liabilitie 653 2.467 2.627 2S9 18S 1,393 371 Amortiation of debt 4,818 4.784 4,19 14,711 14,707 10,209 9,o60 Intret on tlng-tera debt charged to operations 2,307 3,327 5,406 10,668 ,606 7,836 6,763 Interest on overdraft 1.855 881 331 727 169 11S 373 Dividends 2.O54 2.623 2,639 3.119 3.967 3,969 3,971 ,........... ........ ........... ........ ........... ........ ........... ........ ........... .... total 11,687 14,082 15,198 29.484 27,634 23.S22 21,138 ,........... ........ ........... ........ ........... ........ ................ ........... ........... Net Internal Cash Genration 5,142 3.148 4.6S8 8,638 8,412 9.647 15.171 Working Capital *eqjirements Changes In working capital excludirw overdraft 2,394 (4,220) 3,462 581 (24) (T.117) 1,695 Decrease (increase) In overdraft 6,012 9,718 (8,074) 4,95S 2.78 89 (2,860) Increts (decrse) In teq2rry cash surplus 0 0 0 0 0 0 a .... ...................... ...... .......... ....... ........ ........ ........... ........ ........ Su.-totat 8,406 5.498 (4,612) 5,536 2,174 (7,028) (1,165) Contruction Requmreants Proposed project 0 0 3.656 1,155 1,179 404 653 Other works 9,453 48,2S2 29.260 8,077 11,289 16,004 32,111 Interest cjring eomtruction 83 1,878 4,78 67 363 288 1,015 .... .................................. ........ ............ ........ ........... ........ ........ Su-totat 9.536 50,130 37.704 9,299 12,831 16,696 33.779 Total Working Capital and Constrution Requirents 17.942 55.628 33,092 14,835 15,605 9.668 32,614 alance to finace 12.800 52,480 28,434 6,197 7,193 21 1T,443 financed by: Loaa 7,800 51,750 28,434 6,197 7,173 0 17,418 Equity S,000 750 20 21 2S .... .................................. ........ ............ ........ ........... ........ ........ Total 12.800 52,480 28,434 6,197 7,193 21 17,443 Other picationc (Souces) nessran~aa Ite contribution to Investment X 29m 152 32 87S 662 100l 402 Debt serie coverag (tims) 1.9 1.6 1.3 1.5 1.5 1.8 2.0 Accumutated t mory cash surplus (deflcit) 0 0 0 0 0 0 0 -82- .rZ 5.4 Paas I of 3 TIN MARO LIGHT & PER CO. LTD Acta ActAl ActaN Actual Acuat Act - VO" SN COWPLTIS REPS 1974 195 1 1977 1978 1979 Table 5.4. UKPC Setace etA - mASST Plat In oprtion 115,5U4 117,03S 116.46 120,599 Lees a iatei dep ecation (19,97) (I5s01) (no.055) (26.52) Net fixed aets 95,570 93,537 "969 94,013 Mak In rore 1 2,210 1.J22 1.691 CurrOnt Ats: Cash: Oprtitmi requiremt 247 339 89 105 Toworary surptus (deficit) Accoats recaivablt 3,80 4,23S Sl85 8.2" Naterials ad sqpplles 3.88 4,521 5,688 6,000 Prepid exp s 44 40 67 156 ....... ......... ....... .............. .......... _Totl l8,5 9,155 11,029 15.305 Deferred cres 64t 548 440 s Othe deferred t 26 8 17 9 ........................ ....... ..-W....... ....... 67 601 612 670 TOTAL AS 1,40 1O5,S10 106,5 t11169 LIASILITIES Equity: capital stock 16,740 16,740 .24,924 24,924 Shae edieption 125 250 Apaisal value 31.118 31,118 31,118 31,118 Spcial 0 a 0 0 Retaired anip 4,374 5,8 2,170 1,970 Total 52,232 53.64T 58.,W 58,262 Leo-ter debt 39,616 36,4)7 31,745 28,477 Curet Liabilities: Ic overdraft 5,50 7,149 9,027 17,289 - AcCoots Payabte & aesrud liabilties 2,961 4,160 3,719 5.217 Other Current 957 418 21 43 Corpation tax patb ae 2 20 0 total 9,43 11,74? 12.767 22.549 Deferrd credits Accsawlated defetd tax 0 0 0 0 Acoulated ivetw t tax credit) Unrealised exchug gans 4.170 3,493 3.454 1.905 Catis centrihuton 166 18 351 486 - Past serfee penion tlibitity 118 0 0 4.454 3.679 3.5 2,M91 ..... ........ ........ ........ TOTAL LIUILITIS 105,740 105.510 106.654 M11.679 -onw imwin emmm - _e ~ Ratio t - DOM 0.43 0.40 0.35 0.33 *Euit 0.57 0.60 0.65 0.67 - Avee net fie at urefautwd 94.554 93.6% 93,8S2 fulty evaluwd 137.818 1s1,11 -~~ - 83 - ¶3ZABL3 5.4 - lU3Pow 2 of 3 TM EARIADOS LIONT & POSER CO. LTD Forecarecst Forest Forecst Fore_at Forecast WORLsD UlKE CNPIEtIu R"PMRT 1980 1981 1982 193 1984 1985 .... .... . .... .... . .... ........ ..... .. tabl 5.4. UKPC Balance ts ASSTS * Patnt In operation 168,493 256,595 337.115 416,423 464,941 55M4,5U Lenss accuulatd d p etation (37,867) (63,.59) (17,776) (55*19)(117*142)(142,858O ....... ......... ....... .......... ....... .............. ..... .............. Not fixed asaets 130,462 193.000 249.339 321,404 3.7,.9 411,7124 work In progress 12,820 50.279 50*500 19,335 41,4?! 15. 3 * Current Assets: - ¢Cah: Operatiot reirt 119 135 153 173 195 65 teapwery surplus (dicit) ar 702 (796) (85) 77m 20,064 Accunts receivable 13.745 14.643 1S.S3 16.92 20.989 25,161 _ materials and suppies 7293 8,211 10.468 13.326 14,8T 17.755 Prepaid epensa 156 156 156 156 156 156 ., w ............................. ....... .......... ....... .......... ....... Total 21,530 23.847 25,518 .30522 ",I490 ",7at Deferred charges 376 176 ff 45 0 0 other deferred assets 93 93 n 93 93 93 : ~~~~~~~~~~~~~~~....... ........ ....... ...!.... ....... ............ ................. 469 269 88 138 93 93 TOTAL ASStS 165.453 267.395 32S.545 371.399 433,555 490.97S -as= wave== wspu -ae sewfin LBILtlIEti Equity: Capital stock 29,924 29,924 29,924 34,924 34.924 34.924 Shae rodeption 375 so5 625 75 s75 1000 Appraisal value 70.027 133.476 1S4.087 176,386 206,463 23.234 sweisl reser 0 0 0 0 0 Retained earnings (241) 385 3.757 9.367 17.310 31,34 Total 00,oS5s 164.285 188.393 221.427 259.572 305,502 9 Long-term debt 36.994 70,89? 99.784 106.491 117,375 116.903 Currant Liabilities: h" overdraft 10,000 6.500 2.700 2.500 1.200 0 Accounts Payable & accrued liabilities r,8o 9.6s, a 1 11.838 1 130,ss 16.558 other Currant 50 50 50 50 50 50 Corporation t" payble 0 0 0 0 6.047 11.79 ....... .......... ....... .......... ....... .............. ..................... Total 17.918 16.181 14.340 14,388 21.254 28,407 - Ofrred credits AcsAutated deferred tames ) ,982 14.768 21.985 28,265 34,12 39,51 Acculatated inve tment tax credit) Unrea led eick we gans 988 m 55r 342 153 54 Customers cen .-itns 486 486 486 4E6 486 46 Past serviee pension liability 0 0 0 0 0 0 ....... ......... ....... .......... ....... ..................... ... ...... ... 10,456 16.025 23.028 29.093 35,351 40,081 TOnAL LIASILITIES 165.453 267,35 325,545 371,399 433,555 490.9?! Nmsncanu - Ratio s * ODbt 0.27 0.30 . 0.35 0.32 0.31 0.20 *quity 0.73 0.70 0.65 0.68 0.69 o.n A Aveae net fixed assets unrevalued 112.320 futly reval 1664.3 183.685 221.170 285,372 334,602 379.762 -84- TAMIE 5.4 ~~~~~~~~~~ ~~~~~~~~Pawe 3 91 3 TME BARGAIS LION & POW CO. LIP Actual Actual ActUal Actuat Atult Actl Actuat _ WORU SANK CMLgEtIO EMT 1981 1962 19 194 195 16 Tlas 5.4. ULC alance shsts ASSETS Plent In opration 173.8i5 176,594 251.036 259.408 3.93 393.79 404S554 Loses accueltted dpecistlon (42.364) (4".80) (49.536) (5,M).102,S60)(114,9M125,i69) ........ ........... ........ ............ ........ ............ ........ ............ ....... ................ Not flxed asts 131.521 129,M7 201,500 201,65 M.403 27.76 26,6a ark In pmrr 3,682 47, 4,960 3,179 7,20? 7,. 29,031 Current Asets: Cash: Operationa rlrts 119 695 16 153 142 140 394 Temporary surplus (deficist Accounts receivable 11,370 10,056 9,740 12,343 12,228 6,"62 ?,R02 Materilse and suppt I. 12,3S0 9*4J3 14,2U 12.596 12,792 12,340 12,533 Prapaid expenses *166 268 1,331 117 514 472 315 ...... ......... ................. ........ ................. Total 24.213 20,522 25.512 25.209 25,676 21,794 21,044 - Deferred charwe 1,005 3,15S 5,410 4.230 3,509 4,005 3,474 Othew d.frred ests . ~~~~~........ ........ ........ ........ ........ ........ ........ 1-006 3,1S5 S,410 4,230 3,509 4.008 3,476 TOTAL ASSEtS 160.422 201.246 237,402 234.273 11,79 312,13 332,416 - - - - - - - - - - - - --- LIASILITES8 Equity: Capitot stock 31,084 32.644 32.644 40.024 40,043 40,065 53,S22 Share redeeptin . 375 S00 625 7S0 875 1.000 1,125 Appraisal value 56.809 54,407 51.472 49.049 123.662 120.009 116,324 Special reserve 0 0 0 2,S3 5.081 6.305 12.047 Retained ernings 5.916 7,723 10.622 4,931 9.758 14,16 9,016 ,................ ........ ........ ........ ........ ........ Total 94,994 ss,274 9S,363 97,207 179.419 183,62S 192,036 Lena-tem debt 31.916 77,483 98,725 66,199 76.687 71,081 60.361 Current Liabilitless S" overdraft 11.277 1,SS9 9,633 4,676 1,W0 1,791 4,651'- _ IAccmts Payable & accrued liabilities S,366 8.094 9,622 6,736 7692 8.604 9,019 Othr Current Crporation tax pyable 2,197 0 0 0 1,537 3,860 1.000 ........ ........ ........ ........ ........ ........ ........ Total 16.642 9.653 19,2S! 10416 11Jo1 14,255 14,670 Deferrd eredit: Accwlated defred ta ) 12,213 11.420 12,810 22.415 27,S.6 31,175 33,529 AccAmalat.d ifrvetment tea credit) 1,050 505 6,673 6.940 7,251 7.90o 9.356 Uwuallsad exchae gIns 1071 1,919 4.29m s.7 9,186 3.S39 1.778 Custome cntributiw 336 402 281 316 s57 5 46 Pest srvice psion liability ................... ........ ........ ........ ........ ........ ................. _ 14.670 18,636 24,059 3S.4S1 44,S80 43.176 4S,32 TOTAL LIAUILITIes 160.422 201,26 237.42 234,273 311.,M 31.137 332.416 - _ - - -B IMh_en- Ratio s - Dbt 0.25 0.45 0.51 0.46 0.30 0.28 0.30 - Equity 0.75 0.55 0.49 O.S2 0.70 o.7 0.70 - Avera net flied asts: vetlud fully revel - 20.622 26S,998 M,196 277,0 M,12 - 85 - PART III PROJECT COMPLETION REPORT BARBADOS POWER PROJECT (LOAN 1940-BAR) - 86 - PROJECT COMPLETION REPORT BARBDAOS BARBADOS LIGHT AND POWER COMPANY LOAN 1940-BAR PART III 1. Related Bank Loans Loan Year of Title Purpose Approval Status Comments Technical 1. Agricultural 1982 Completed Project resulted Assistance Diversification 1985 in energy conser- (Loan 2115-BAR) vation unit being formed in Ministry (USS2.5m) 2. Assist Govmt. in of Finance and establishment of assisted in energy conservation determining energy plan, and implementa- pricing policies tion unit, financing and energy energy conservation efficiency program, and project improvements preparation. B - 87 - 2. Project Timetable Date Date Date Item Planned Revised Actual Preparation mission 3/79 Appraisal Mission 12/79 Reappraisal 1/ 4/80 Loan Negotiations 11/80 Board Approval 1/81 Loan Signature 2/81 Loan Effectiveness 11/81 Loan Completion 6/30/85 6130/86 2/ 6/30/87 6/30187 21 6/30/87 PCR Mission 12185 12/87 4/89 1/ Reappraisal required because of changes in financing plans. 2/ The Loan closing date was extended twice to allow BLPC to disburse in accordance with the revised lower investment program, which was prepared in consultation with the Bank. - 88 - 3. Loan Disbursements Cumulative Estimated and Actual Disbursements (millions of US$'s equivalent) Actual Actual as IBRD Disburse- Appraisal 2 of Appraisal Fiscal Year ments Estimate Estimate 1981 0.0 0.4 0 1982 0.0 2.4 0 1983 1.1 4.1 27 1984 2.4 5.4 31 1985 2.8 6.0 47 1986 2.8 6.0 52 1987 3.4 6.0 57 1988 3.7 6.0 62 Closing Date: June 30, 1987 plus 6 month grace period. Date of Final Disbursement: December 14, 1987 Comment Actual loan disbursement was lower than US$6.0 million because US$2.0 million were cancelled from the loan in November 1986 to account for a lower investment program, and later cancellation of an undisbursed remanent of US$0.31 million in the loan account at final closing date in December 1987. - 89 - 4. Project Implementation Start Complete Contract Construction/ Construction/ Item Award Contract Contract SAR Actual SAR Actual SAR Actual 1. Primary Feeders A. 24 Kv Lines 4/81 2/82 8/81 7.82 7/84 12/87 B. Tran 'ormers 4/81 1/81 1182 10/82 9/84 12/83 2. Distribution Transforme : 4/81 11/81 11/81 7/82 9184 12/87 3. Capacitors 7/81 12/81 3182 9/82 10/84 12/87 4. Service Wire 4/81 S/82 11/81 8182 12/84 12/87 5. Engineering Studies A. Generation Planning 3/81 6/81 4/81 6/81 12/81 8/82 B. Energy Conservation 5/81 7/81 6/81 9/81 3/82 7/82 C. Tariff Study 5/81 3/82 6/81 3/82 3/82 1/83 D. PUB Operating Procedures 12/80 - 1/81 late 80 4/81 7/81 E. Criteria for Rates 8(81 - 9/81 mid 84 6/82 11/84 Comment Project implementation was postponed In accordance with revised demand projection, in consultation with the Bank. - 90 - 5. Proiect Cost and flnancina A. Proiect Costs SAR Estimate Actual (millions of US$'s) Prolect Comoaoent Foreian Local Total Foreign Local Total 24 KV Feeders 1.75 0.61 2.36 1.40 0.50 1.80 Distribution Trnsfonmers 1.31 0.24 1.55 1.90 0.50 2.40 Service-Vire 0.36 0.19 0.55 0.16 0.20 0.36 Capacitors 0.02 0.01 0.03 0.07 0.03 0.10 Studies 0.75 0.11 0.86 0.43 0.45 Total Base Cost 4.19 1.16 5.35 Physical Contingsncies 0.34 0.09 0.43 Price Contiqencies l.S0 0.71 2 -2 Total Project Cost 6.03 1.96 7.99 3.98 1.23 5.21 B. Proiect Financing SAR Estimate Actual (millions of US$'s) Foreign Local Total 2 Foreiz Local Total S IBRD loan 6.00 - 6.00 75 3.68 - 3.66 71 Internal cash-5neration 0.03 1.66 1.99 25 0.30 1.2S 1.53 29 6.03 1.66 7.99 100 3.98 1.23 5.21 100 Comment The Project cost partallly financed by the Bank decreased by US$2.78 mdllion due to lower lnvestmnt progrm caused by lower expected demand growth. - 91 - C. Investment Program Actual % SAR 2 1980-87 1980-87 (millions of US$'s) INVESTMENT REQUIREMENTS Construction requirements 81.4 88 95.6 78 Interest during construction 4.4 5 4.8 4 85.8 93 100.4 82 Change in Working Capital 6.7 7 21.3 18 Total 92.5 100 121.7 100 FINANCING International Bank for Reconstruction and Development 3.7 4 6.0 5 Caribbean Development Bank 0 0 6.0 5 Commonwealth Development Corp. 9.2 10 11.7 10 European Invest. Bank 2.4 3 7.1 6 Supplier Credits 0 0 33.2 27 Svenska Handelsbanken 26.6 29 - - Sparbankernas I Swedbank 8.7 9 - - Other Loans 0 0 5.9 5 Royal Bank of Canada 8.5 9 - - Sale of Shares 5.0 5 5.0 4 Internal Cash Generation 28.4 31 46.8 38 92.5 100 121.7 100 Comment The total 1980-1987 investment program decreased by US$29.2 million because of lower total investment required to meet lower than expected demand growth. This caused cancellation of the CDB loan, and part of the European Investment Bank, CDC, and IBRD loans. - 92 - 6. Project Results A. Direct Benefits 6.1 The principal direct benefits of the project arose from the additions to generation and distribution facilities which enabled BLPC to meet the growing demand for electricity as shown by the followings A C T U A L SAR I/ Increase Increase 1980 1987 z 1985 2 Energy sales (GWh) 282.1 388.6 37.8 423.0 30.0 Net Generation (GWh) 312.3 426.1 36.4 -- - Peak Demand (MW) 52.5 73.8 40.5 81.2 54.7 Number of customers Domestic 60,800 71,128 17.0 71,700 17.9 Other 6,862 8,184 19.3 7,400 7.9 T o t a 1. 67,662 79,312 17.2 79,100 11 SAR figures were prepared to 1385 only and were based on a projected average annual 1980-85 growth of 7.62 per annum compared to an actual average annual growth rate of 3.52 during the same period. B. Economic Impact 6.2 The IERR was calculated in the SAR for the 1980-85 investment program. The IERR was recalculated on the same basis as the SAR using actual investment costs, incremental fuel and operations and maintenance costs, and incremental energy sales related to the investment program. However, as the investment program was extended to adjust a lower demand growth, and Bank financed components were not completed until 1987, the IERR was calculated for the 1980 to 1987 period. 6.3 Costs and benefits were converted to constant 1979 Barbados Dollars (BD$'s) using the Unit Value Index of Manufacturing Exports (MUV Index prepared by the Bank for foreign costs and the Consumer Price Index published by the Central Bank of Barbados for local costs. - 93 - 6.4 The IERR is recalculated at 21.72 (Annex 1) compared to the SAR estimate of 13.5?. The higher return is mainly attributable to lower fuel costs, and the use of new high-efficiency equipment in electricity generation. This more than offset the reduction in incremental sales caused by the lower than expected load growth. C. Financial Impact 6.5 Comments BLPC's actual financial performance is compared with the appraisal forecast in Annex 2. BLPC managed its cash resources well during project implementation so that timely finance was available to meet its investment needs. Cash resources were tight in 1982, but a rate increase boosted basic average tariff revenues (excluding the fuel clause adjustment) by around 452. Mainly as a result of this increase and the growth in kWh sold, no further tariff increases were needed during project implementation. Total average electricity rates in 1987 were in current terms only about 6? higher than those for 1980. The Barbados Consumer-Price Index increased by about 50S during the same period. Real electricity prices were reduced because of lower fuel surcharges resulting from reduced oil prices and lower fuel usage for electricity generation. BLPC's cash flow was accelerated by effective revenue collections which reduced the number of days outstanding receivables from 55 at the end of 1980 to a low of 31 in 1987. Rates of return on revalued net fixed assets between 1980 and 1987 ranged from a low of 52 in 1982 to a high of 8.6? in 1983. In 1988 BLPC financed its capital spending of about US$7 million from internal cash generation and eliminated its bank overdraft. Debt service coverage and the debt/equity ratio were at strong levels of 2.1 and 18/82 in 1988. - 94 - D. Studies StudZ Purpose as Defined at Status Impact of Study Appraisal To render advice and Completed Assisted in revision Generation Planning recommendations to of generation program. BLPC concerning technical and economic aspects of generation schemes. Energy Conservation To assist country in Completed Company undertook its goal to reduce consumer education dependance on imported resulting in petroleum. improvements through such measures as better insulation, controls on air- conditioning systems and use of more energy efficient appliances. Tariffs To assist in Completed Government and BLPC developing marginal did not consider cost-based tariff. revisions imperative, but will consider the recommendations in any future structural changes in tariff. Public Utilities To provide Completed No consensus could be Board (PUB) recommendations for reached in Govt. as to operating procedures speeding-up PUB recommendations. No and criteria for decision-making PUB hearings have been determining power process. To provide held since 1982 rates. recommendations for because BLPC good criteria to be used in financial position did determining level and not require tariffs structure of tariffs. review by the Government. - 95 - 7. Status of Covenants Loan Agreement (LIA) Guarantee Agreement (G/A) Subiect Status 5.09 BLPC to issue two One million shares issued at (L/A) million shares, to BD$5 each as condition of nationals or residents effectiveness. Issue of in Barbados, one million remaining one million shares by December 31, 1983. postponed to August 87 in accordance with BLPC's cash needs. 3.02 (b) Government to furnish Bank comments on draft prepared G/A Bank with study on by consultants were submitted criteria for operating early 1982. However, despite procedures of the Public Bank requests, the final study Utilities Board. (which was completed in 1984 including Bank's comments) was not furnished. Apparently, no consensus was reached by Government on recommendations of study and no official position was taken on tis recommendations. 5.05 (L/A) Rate of Return Bank accepted rates of return of 5 to 7Z which were lower than the 8Z covenanted because they were adequate for BLPC's cash needs. Also, BLPC's overall financial performance was generally good during project implementation. - 96 - 8. Use of Bank Resources A. Staff Inputs From project identification in FY79 to completion of supervision in FY87 a total of 121.8 staff weeks were expended on the project as follows: Stage of Project Cycle Number of staff weeks Percentage Up to appraisal 6.5 5 Appraisal through Board approval 70.9 58 Supervision 44.4 37 T o t a 1 121.8 100 In the absence of precise information, estimated allocations have been made of the time spent on activities up to Board approval. _ 97 w B. Missions Special Performance Stage of Month/ No. of Days in ization Rating Type Proiect Cycle Year Persons Field Represented Status of Problem Preparation 2178 1 5 E - do - 2/79 3 5 E/PA/DDC Pre-appraisal 7/79 3 11 E/VAIES Appraisal 11179 2 10 E/FA Re-appraisal 4180 2 10 E/FA Supervision 1181 1 5 FA 1 - do- 10/81 2 9 E/VA 1 - do - 11/82 2 7 B/VA 2 Financial - cash shortage - do - 1184 2 5 E/VA 1 - do - 7/84 2 4 E/PA 1 - do - 3/87 1 4 FA 1 PCR 4189 1 7 VA 1 E - Engineer FA F Pinancial Analyst DDC - Deputy Division Chief ES - Energy Specialist - 98 - iwaotmd code ro*tm (alm 19MM _~i Rupwt C WIallam i _ Iwtunt 0.t tinaumitul Incuut |11~ ~ uI IS rati 4X Nit 1wutu ft Lwan Farsip Tow CMt WaltmI bWft Ito is ts 3.f6 Tariff __du. of 17 i 30 x it) M3k h) I1 2314 134 7446 -744 IM1 1204 306 40 11 1101 4017 -39760 19.0 21.14 195 74 p419 m -340 -174 SW -21CM 21O 19.51 i13 1712 2 4 -p16 3043 74 5621 3.3 21.63 193 7364 42 -7.3 9 972 4W 45.8 20.90 15 2924 9799 127 -2M1 3041 9019 a4 52.2 111 1% 415 1799 2734 -16o 412 1170 249 739 14" 17 264 0 1 -16 431 173 2MI20 10 14.27 193 -1409 43 23 =1 12.0 t4.2 ih -149 41 256 3 3 13.9 146 i19 -1604 4171 63 3 1. 14.27 191 -1694 43t Zia 76 15.9 14.21 192 -1609 4V7 5 3 13.9 16.27 i -19 4W71 236 3 13L. 14.2 199 -104 W41 36 3 13.9 4.2 19 -14 4671 25i3 M A11.9 1427 1994 -16094 471 MU 34 1. 14.7 1"7 -1 4 W61 ; 0 31 15.9 I.2 19 -109 4371 6 34 159 14.7 199 -160 4671 2:33 361 1M.9 16.27 200 -1604 671 M 34 1359 14.2 2001 -16 461 2 5 3 115.9 1627 2053 -"A" 4671 2tl 36 19 .7.n 203 -169 61 25D 3W 159 16.27 4 -1604 467I 5365O am 1. 14.27 205 09 179 204 -1409471 2 S 39 15.9 1647 20 102 24 53 -1609 461 2M IM 1359 14.2 2007 571 1II 2172 -1604 67 253 14414 11L9 14.27 200 103 317 425 -1609 467 36 3611 1559 11.27 20w -137 -7m - 1 -16094 41 2 4 9M7 19 1447 Ilntuu7 rib d rutn 0.U7G9 oWbaos, Lit an POW Cany Incu Statements 1990-1998 (thusands of crrent 04) 1990 1991 1992 1983 1981 1915 1986 1997 1B St* ktual SW Actual SkR Actual k Actual SI Atual S t Atul ktua ctal Final sales (A) 293.6 282.10 316.2 301.1 340.2 307.7 365.9 317.4 393.5 327.9 423 334.3 36 399.6 411.1 Aeage Tariff Renue 14.13 13.87 14.59 13.90 16.49 14.77 18.20 21.39 21.27 21.28 23.26 21.30 21.25 21.10 21.18 basic 11.90 12.69 14.28 13.96 16.14 13.47 14.74 11.57 16.75 12.05 19.15 9.96 6.42 7.06 5.73 Fuel clause 25.93 26.56 29.86 27.76 32.63 29.24 33.02 32.96 38.02 3333 42.41 31.26 27.67 28.24 26.91 Total Operating Revenes Basit 41476 39115 46102 41551 5609 45439 66894 67 93708 69767 9403 71219 7i50 912311 8707 Fuel Clause 34642 311 45160 41967 54893 41444 5S919 .6719 65918 39526 81I03 33309 22965 274U 232 Miscellmeous 245 262 257 255 270 368 283 467 297 744 312 547 797 903 meG Total 763 75198 91519 83773 111251 872SI 121086 105068 149923 1100H 7 179718 105075 99312 110550 111507 Operating Expenses Fuel 41760 43310 51558 49839 62319 49494 61345 45166 73344 48132 88429 42194 32263 3770 344 Operations & Mainteance 14440 14292 17298 17917 20470 17794 23211 23M3 26347 25455 2846 25695 27905 30091 29499 Depreciation 6195 6199 364 6276 9417 M7 12005 954 15283 1460 17J63 15459 17910 15230 1710 Othr non-cash 201 200 91 50 45 Taxes-Corperatien 1294 0 0 0 6047 1537 1179 4190 3230 32 29 -Other 920 766 945 779 1270 1124 1645 1136 2090 2184 2200 1975 1991 1997 3562 Total 63516 65841 79355 74710 93557 76133 995 7"93 123146 91938 1497 E93 329 80310 91488 Operating Income 12947 9347 13164 9f3 17694 11118 22930 25505 26777 180 30381 15572 16013 22232 2D019 Plus Invetent Incame If IS 11 9 11 140 11 35 11 2099 6 52 16 -1 In SainkLoss an exchange 218 295 217 542 215 596 215 609 189 383 39 676 23 -161 -2929 Less: deferred taxes -7766 -2256 -2436 793 -4151 -139 -4346 -9605 -4331 -5151 37 360 2354 -47 -29 Invest.tax cred. deferral -1216 -65 -3350 -4044 -3066 -2319 -1934 -267 -2116 -310 -1079 -65 -1455 211 -106 Cancellation charges -4k Net Income before interest 4094 6742 7606 6363 10703 M4 16776 1637 20530 13226 25662 12042 12243 17590 167 Less Intersest charged to operations 2605 2307 3665 3327 4363 5406 9299 10668 9490 9064 7 M 6763 8125 7260 Overdraft interest 1469 I1S9 784 891 437 331 247 727 176 169 57 115 373 1147 Zs Met Income 20 2580 3157 2155 5903 1997 8241 4962 10874 4451 16965 4091 5107 8318 9369 Barbados Light and Power Cc:pany Sorces and Uses of Fuds 1901998 (thousands of current BDSs) 1980 1991 1992 1983 1984 1915 1996 1997 1999 SAR Atual SM Aktual SM Aktual SP Actual SAR Actual SAR ktual ktual ktual Actual Interna' Sources Net Incee bef. interest 4094 6742 7606 6363 10703 M4 16776 16357 20530 13226 25662 12042 12243 17590 165 Depreciation 6195 6199 M364 6276 9417 Ml 12005 9546 15233 14630 17063 15459 17910 t53 17188 Other non-cash ovpense 201 316 200 316 91 374 50 1440 45 1638 0 094 1273 1560 1533 Def.tax and inv tax cred 2 2915 576 32I 7217 3709 6280 9972 647 5461 4829 4259 3 4496 2935 Aort of exch. gain -349 -377 -217 -29 -215 -2 -215 -525 -189 -499 -99 -1045 -219 9 132 Custows contributions 99 1034 1139 153 1287 951 1455 1432 1644 1590 1957 1560 1293 2023 1947 Total 20123 16629 22979 17230 28490 199 36351 39122 43760 .604 49312 33169 36309 408 40592 0perational Requirements Chanes in other assets & liabs 653 2467 2627 259 195 1393 371 463 -13D4 Debt Aortization 494 4618 4818 4784 4573 4195 11569 14711 13415 14707 12979 10209 9660 10759 11953 Interest charged to Operations 2605 2307 3665 3327 4363 5406 89 10668 9490 M BUO 7856 6763 8OM 7260 Overdraft interest 1469 t1o5 794 8B1 437 331 247 727 176 169 57 115 373 1147 229 Dividends 2106 2054 2406 2623 2406 2639 2506 3119 2906 3967 2806 3969 3971 4510 4711 Total 11129 1167 11673 14092 11779 15198 22610 29484 25877 27634 24482 23522 21138 29204 22748 Met Internal cah generation 9995 5142 11205 3148 16711 4658 13741 99 17993 8412 24830 964 15171 1168 17814 - lorking Capital Requireents Changes in orking capital except overdraft 3350 2394 62 -4220 1217 3462 4045 591 -2955 -24 -9 -7117 1695 2558 -599 Oerease (Inrease1 in overdaft 7299 6012 350 9719 3800 -9074 200 4955 1300 2799 100 99 -290 1370 321 increase (decrease) in temprary cash surplus 217 485 -1498 711 857 12092 Sub-total 108S6 9406 4047 5499 3519 -4612 4956 SS36 6402 2774 12438 -7028 -1165 39NA 262 Construction requiremnts Proposed Project 0 0 3723 0 5037 3656 3519 1155 3716 1179 0 404 653 Othe Works 15902 9453 40643 48252 37917 20 27043 9077 M023 1128 22889 1600 32111 14279 15191 Interest during construction 72 93 1513 1979 3638 4798 149 67 844 363 2097 299 1015 303 Sub-total 15974 9536 45979 50130 46592 37704 32061 9299 353 12i31 24976 16696 3377m 14201 15191 Total working capital ad Construction Requiremnts 26730 17942 49926 556 50111 33092 37017 14935 41785 1505 37414 966 3614 1959 17173 Balance to finance 17735 12800 3721 52490 33400 28434 23276 6197 23902 7193 12584 21 17443 6925 29 Finaned by: loans 7735 7900 39721 52480 33400 2B434 23276 6197 23902 7173 12584 0 17418 1806 s Equity 5000 20 21 25 5019 29g X Total 17735 12900 39721 52480 33400 29434 23276 6197 23902 7193 12584 21 17443 61M5 29Y arDados L3gnt and PoWer LOIMy Balance Sheets -190-1988 ithousands of current DOSs) 1980 1981 1982 1903 1984 1985 199b 1997 IS SR Aktual SAR Atual SAR ktual SAR Actual SM ktual S A c ktual ktual kctual Actual ASSETS Plant in Operation 168493 173M85 256593 176594 327115 251036 416423 259408 4b4941 m963 55452 393739 404554 457205 489347 Less: ccumulated Depreciation 37867 42364 63593 4t805 77776 49536 95019 57753 117142 102560 142858 114977 125691 140000 161770 Net fixed assets 130626 131521 193000 129799 249339 201500 321404 201655 347799 275403 4112r4 2707b2 27863 31!20B 327577 Work in Progress 12928 3682 50279 47780 50500 4990 19335 3179 41473 7207 15'75 7573 1344 1344 2463 Current Assets Cash: required for operations 119 119 135 695 153 159 173 153 195 142 645 140 394 441 4334 :temporary surplus 217 702 -796 -85 7972 20W4 Akcounts receivable 13745 11370 14643 10056 15537 9740 16952 12343 20989 12228 25161 S,42 79(2 10624 10736 Iaterials & Supplies 7293 12558 9211 9483 10468 14293 13326 12596 14878 12792 17755 12340 IZ33 2 I51 5 Prepaid Expenses 156 166 156 288 156 1331 156 117 156 514 156 472 315 1444 282 Total 21530 24213 23847 20522 25518 '5512 522 25209 44190 76 63M781 214 2104 25060 30 Other Assets Deferred Charges 376 1006 176 3155 95 5410 45 4230 93 3509 4008 3478 10104 6217 Other Deferred Assets 93 93 93 93 93 TOTAL ASSETS 365453 160422 267395 20124b 325545 237402 371399 234273 433555 311795 490973 312137 304729 348713 36617 LIARILITIES Equity: Capital Stock 29924 31894 29924 32644 29924 32644 34924 40024 34924 40043 34924 40065 522 59542 5WWI1 Appraisal Surplus 70027 56809 133476 5407 154087 51472 176386 49049 206463 1323 238234 120099 116324 It75 1308PI Retained Earnings -241 5916 385 7723 3757 10622 9367 7384 17310 14839 31344 22471 21065 31683 43U6 Share edeeWtion reserve 375 375 500 500 625 625 750 750 875 875 1000 1000 1125 1250 1375 Total 10085 94994 164285 95274 198393 95363 221427 97207 2592 179419 305502 183625 192036 2 6 234407 Long-term debt 36994 31916 70897 77483 99784 98725 106491 83199 1131B 76687 116983 71081 8038 76btS 63872 Current Liabilities cconts payable & accrued liabs 7868 5368 9638 8094 11590 9622 11838 9738 13957 7692 16558 9604 9019 10146 1291 Corporation taxes payable 2197 67 1537 11799 80 1000 1331 47 Other current 50 50 50 50 50 Overdraft 10000 11277 6500 1559 2700 9633 2500 4678 1200 1890 0 1791 4651 3281 0 Total 17919 18842 16198 9653 14340 19255 14388 13416 21254 11109 28407 14255 14670 14759 1706 Deferred taxes & investment tax 8992 13263 14768 16515 21985 19483 28265 29355 347:2 34817 39541 39075 42995 47381 50317 credit Other Liabilities Unrealized Exchange gain 9B3 1071 771 1919 557 4295 342 5780 153 9186 54 3539 1779 Customer contributions 486 336 486 402 486 281 486 316 486 577 486 562 666 690 645 Oarbados Light and Power CospanV Are 2 Key financial indicators 1990-1999 Table 4 1980 1981 1982 1983 1994 1995 1996 1981 1998 SA Actual SAP Aktual SAR ctual SAR kctual SAR Actual SAR ktual ktual Actual Actual Rate of return X 7.2 9.00 5.3 8.00 4.93 8.00 9.59 8.00 6.86 8.0 5.e8 5.76 7.52 6.26 Operating Ratio % 83 8 86 89 84 87 8 76 82 94 g3 95 84 s 82 Current Ratio 1.2 1.3 1.5 2.1 1.8 1.3 2.1 1.9 2.1 2.3 2.2 1.5 1.4 0.9 1 Debt service coverage 2.2 l.t 2.1 1.6 2.1 1.3 1.7 1.5 1.8 1.5 2.1 1.9 2 2 2.1 Debt/Equity ratio 27/73 22/75 30/n0 45/55 35/65 49/51 32/68 49/52 31/69 30/70 2M 28m 3070 24/76 18M2 Receivables (days) 66 55 58 44 St 41 S1 43 St 41 Sl 31 29 31 5 Contribution to investment 37 29 24 15 33 3 30 97 o 10; 100 40 62.6 121.4