Public Disclosure Copy

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1 Public Disclosure Authorized LATIN AMERICA AND CARIBBEAN Haiti Energy & Extractives Global Practice IBRD/IDA Specific Investment Loan FY 2013 Seq No: 7 ARCHIVED on 28-Jun-2017 ISR27403 Implementing Agencies: EDH, UCP Energie, MTPTEC Public Disclosure Authorized Key Dates Key Project Dates Bank Approval Date:27-Sep-2012 Planned Mid Term Review Date:29-Sep-2017 Original Closing Date:31-Dec-2017 Project Development Objectives Effectiveness Date:06-Feb-2013 Actual Mid-Term Review Date:-- Revised Closing Date:31-Dec-2017 Public Disclosure Authorized Project Development Objective (from Project Appraisal Document) The objectives of the Project are to (a) strengthen energy policy and planning capacity, (b) to improve the sustainability and resilience of the electricity sector and to restore and expand access to reliable electricity services, and (c) provide financial assistance to the electricity sector in case of an emergency. Has the Project Development Objective been changed since Board Approval of the Project Objective? No PHRPDODEL Components Name Component 1: Sector Institutional Strengthening and Energy Access:(Cost $12.50 M) Public Disclosure Authorized Component 2: EDH Performance Enhancement and Infrastructure Rehabilitation and Expansion:(Cost $77.50 M) Component 3: Emergency Response Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Unsatisfactory Unsatisfactory Overall Implementation Progress (IP) Moderately Unsatisfactory Moderately Unsatisfactory Overall Risk Rating Substantial Substantial 6/28/2017 Page 1 of 14

2 Implementation Status and Key Decisions Despite sustained electricity sector dialogue within stakeholders, no substantial improvement occurred in sector Governance nor in State utility s commercial performance, which is correlated with project implementation delays and unachieved project overall objectives serving the same development purposes. This persistent lack of utility performance and unsatisfactory project progress for more than two years commend an upcoming restructuring. Main achievements to date are (i) four power distribution circuits in Port-au-Prince being completely rehabilitated and serving 30,000 households, (ii) more than 1000 solar street lights installed in urban poor areas (Delmas 32, Nazon) and rural towns (Milot, Dondon, Labadie), (iii) autonomous solar power plant with storage commissioned for the lighting of Champ de Mars patrimonial place of Port-au-Prince and (iv) capacity strengthening of the MTPTC Energy Cell to produce key sector studies (e.g., Haiti Renewable Energy Roadmap) and to advance Haiti s energy policy agenda. 6/28/2017 Page 2 of 14

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4 Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance -- High High Macroeconomic -- Substantial Substantial Sector Strategies and Policies -- Moderate Moderate Technical Design of Project or Program -- Low Low Institutional Capacity for Implementation and Sustainability -- Substantial Substantial Fiduciary -- Low Low Environment and Social -- Low Low Stakeholders -- Moderate Moderate Other Overall -- Substantial Substantial Results Project Development Objective Indicators 6/28/2017 Page 4 of 14

5 Strengthening of Government's oversight capacity and transparency in sector financial flows (Text, Custom) Oversight capacity is weak in utility EDH, non existent in MTPTC Ministry. Core team of MTPTEC Energy Cell (5 staff + 1 Coordinator) has been strengthened with 2 civil servants from EDH and BME. Energy Cell conducted public consultations on reform of Haiti's regulatory framework (in November 2015 and September 2016), with the objective to draft legal framework founding energy sector's institutions. During the postdisaster response period after hurricane Matthew hit Haiti in October 04, 2016, MTPTC Energy Cell has been recognized as the Government focal point for the Energy sector, and coordinated external assistance. Core team of MTPTEC Energy Cell (5 staff + 1 Coordinator) has been strengthened with 2 civil servants from EDH and BME, and 1 PhD student on Renewable Energy. Energy Cell drafted proposal to transform by decree the Energy Cell into a National Division for Energy (DNE). In June 2017, Energy Cell has organized Haiti's first national forum on Renewable Energy and Energy Access, gathering 350 participants of which 170 from the private sector. President of Haiti vows to staff by end August 2017 the Energy regulator (ANARSE) created under the 2016 decree. Oversight capacity strengthened Energy cell with clear mandate, capacity and demonstrated effectiveness (Text, Custom Breakdown) No entity is in place Indicator met. Energy Cell is now identified by all as entry point for Energy in Haiti Government, since the withdrawal of Ministry of Energy Security (in September 2014). Team of 6 local consultants has been strengthened in 2016 by 2 civil servants (from EDH Planning Division and BME). Energy Cell represented Haiti Indicator met. Energy Cell is now identified by all as entry point for Energy in Haiti Government, since the withdrawal of Ministry of Energy Security (in September 2014). Team of 6 local consultants has been strengthened in 2016 by 2 civil servants (from EDH Planning Division and BME). Energy Cell represented Haiti Government in Energy cell with clear mandate, capacity and demonstrated effectiveness is operational 6/28/2017 Page 5 of 14

6 Government in international conferences and events (Peru Rural Electrification workshop, Caribbean Renewable Energy Forum, Global Energy Access workshop in Nairobi), and communicate good practices from other countries in Energy. international conferences and events (Peru Rural Electrification workshop, Caribbean Renewable Energy Forum, Global Energy Access workshop in Nairobi), and communicate good practices from other countries in Energy. Monitoring of budgetary transfers to electricity sector: publication of monitoring table (Text, Custom Breakdown) Last table covered the period until May 2012 Table published every month from April 2016 to September 2016 on MEF website. Complementary work on power sector monitoring has been conducted by MEF, to better control IPPs bills, and better monitor EDH revenue flows. Ongoing work has been undertaken by Bank team to have a more simplified and functional dashboard. Table was published every month from April 2016 to September 2016 on MEF website. Since new Government took office (March 2017), table is not published any more. Work on power sector monitoring initiated in 2016 has not been completed nor put in application (better control IPPs bills, and better monitor EDH revenue flows) Publication of monitoring table at least every six months Availability of EDH updated financial outlook and forecasts for future budgetary transfers needed (Text, Custom Breakdown) No financial outlook As part of the Electricity Masterplan exercise, an updated and improved version of EDH Financial Model (version 2014) has been delivered to EDH in August This version includes strong baseline data on power supply and As part of the Electricity Masterplan exercise, an updated and improved version of EDH Financial Model (version 2014) has been delivered to EDH in August This version includes strong baseline data on power supply and demand, but is not well Availability of EDH updated financial outlook and forecasts for future budgetary transfers needed 6/28/2017 Page 6 of 14

7 demand, but is not well suited to forecast the incoming 3-4 fiscal years (due to uncertainty on development plan versus service improvement); it should however help to run simulations on the period covered by the masterplan ( ). suited to forecast the incoming 3-4 fiscal years (due to uncertainty on development plan versus service improvement); it should however help to run simulations on the period covered by the masterplan ( ). Draft regulatory framework for the sector agreed with stakeholders (Text, Custom Breakdown) No regulatory framework National workshop on Energy sector reform took place in October 27, 2016, with external moderator (UNDP) and active participation of all the sector stakeholders (including Parliamentarians). Concensus of the workshop was on the creation of a dedicated institution to manage the sector (direction of ministry) and the urgent need of a modern law regulating the renewable energy sector (in complement with legal framework adopted on February 03, 2016). National workshop on Energy sector reform took place in October 27, 2016, with external moderator (UNDP) and active participation of all the sector stakeholders (including Parliamentarians). Concensus of the workshop was on the creation of a dedicated institution to manage the sector (direction of ministry) and the urgent need of a modern law regulating the renewable energy sector (in complement with legal framework adopted on February 03, 2016). Draft regulatory framework for the sector agreed with stakeholders Cash Recovery Index (Percentage, Custom) 6/28/2017 Page 7 of 14

8 Direct project beneficiaries (Number, Custom) , , , Female beneficiaries (Number, Custom Supplement) , , , Overall Comments Intermediate Results Indicators Government entity responsible for the energy sector adequately staffed (Text, Custom) No Government entity exists to oversee the energy sector in Haiti 2 permanent staff allocated to support MTPTEC's Energy Cell, composed with consultants funded under the project (5 technical experts and 3 administrative consultants). 2 permanent staff allocated to support MTPTEC's Energy Cell, composed with consultants funded under the project (5 technical experts and 3 administrative consultants). 5 permanent staff are working for this unit 6/28/2017 Page 8 of 14

9 Date 12-Dec Sep Jun Dec-2017 Electricity sector financial model and energy sector database (Text, Custom) No model exists for the sector. Model is utilized to prepare budget proposal to MEF (each year, in May) for incoming fiscal year, and to simulate impact of commercial recovery actions on EDH financial sustainability (done in March and August 2015, by EDH Financial Division). Model has been updated as part of the masterplan study, linking long term prospective with tariff structure. No Energy sector database has been created yet, Technical Assistance of OLADE is being prepared to assist EDH with the Electricity database. Model is utilized to prepare budget proposal to MEF (each year, in May) for incoming fiscal year, and to simulate impact of commercial recovery actions on EDH financial sustainability (done in March and August 2015, by EDH Financial Division). Model has been updated as part of the masterplan study, linking long term prospective with tariff structure. No Energy sector database has been created yet, Technical Assistance of OLADE is being prepared to assist EDH with the Electricity database. Database and financial model updated Date 31-Dec Sep Jun Dec-2017 Sample PPA and retail tariff (Text, Custom) No sample Power Purchase Agreement (PPA) exists, and current existing PPA signed with private producers do not comply with standard documents in such agreements. No update of Energy Commision formed in October 2015 to renegotiate PPAs with the three private power producers did produce a common format of PPA, to be adopted by Energy Commision formed in October 2015 to renegotiate PPAs with the three private power producers did produce a common format of PPA, to be adopted by the current IPPs and the PPA agreed by Government and EDH 6/28/2017 Page 9 of 14

10 the Haiti electricity tariff structure has been conducted since the current IPPs and the potential next ones. In May to August 2016, IDB provided technical assistance to EDH, to negotiate a transitional 1 year PPA with the IPP Haytrac, operating without contract since October 2014; negotiation, that was intended to ensure smooth transition until a new IPP is awarded competitively, could not end up with an agreement. As part of the Electricity Masterplan analysis, a tariff reform has been proposed, to reflect the current context faced by the utility (electricity tariffs have not been revised since 2008). EDH has to provide formal endorsement of the masterplan study and reports submitted, and requested the Bank team assistance to review them.. potential next ones. In May to August 2016, IDB provided technical assistance to EDH, to negotiate a transitional 1 year PPA with the IPP Haytrac, operating without contract since October 2014; negotiation, that was intended to ensure smooth transition until a new IPP is awarded competitively, could not end up with an agreement. As part of the Electricity Masterplan analysis, a tariff reform has been proposed, to reflect the current context faced by the utility (electricity tariffs have not been revised since 2008). EDH has to provide formal endorsement of the masterplan study and reports submitted, and requested the Bank team assistance to review them.. Date 31-Dec Sep Jun Dec-2017 Offgrid access to electricity for collective uses (street lighting, schools etc.) (Number, Custom) /28/2017 Page 10 of 14

11 Offgrid connections to electricity (Text, Custom) , External audits of EDH accounts (Text, Custom) No audit conducted since Request for Proposals to conduct EDH audit was submitted for internal procurement on October 03, Several firms expressed interest. EDH to select six firms to invite them to submit detailed offer by end November 2016 Request for Proposals to conduct EDH audit was submitted for internal procurement on October 03, Several firms expressed interest. EDH to select six firms to invite them to submit detailed offer by end November offers received in June 2017, after several EOIs. Request for a detailed offer sent to firms by end June External audit of accounts available Average Daily Service Availability (Hours, Custom) /28/2017 Page 11 of 14

12 Average Daily Service Availability- metropolitan area (Hours, Custom Breakdown) Average daily service availability- provinces (Hours, Custom Breakdown) Restored connections (Number, Custom) , , , People provided with new or improved electricity service (Number, Corporate) , , , /28/2017 Page 12 of 14

13 People provided with access to electricity by hhold connections-grid (Number, Custom Breakdown) , , , Technical and non technical losses (Percentage, Custom) Date 30-Jun Sep Jun Dec-2017 Distribution lines rehabilitated (Kilometers, Custom) Overall Comments Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P IDA-H8060 Effective XDR % Key Dates (by loan) 6/28/2017 Page 13 of 14

14 Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P IDA-H8060 Effective 27-Sep Nov Feb Dec Dec-2017 Cumulative Disbursements Restructuring History There has been no restructuring to date. Related Project(s) There are no related projects. 6/28/2017 Page 14 of 14