Public Disclosure Copy
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- Godwin Thornton
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1 Public Disclosure Authorized SOUTH ASIA Nepal Energy & Extractives Global Practice IBRD/IDA Specific Investment Loan FY 2015 Seq No: 5 ARCHIVED on 28-Jun-2017 ISR28273 Implementing Agencies: Ministry of Finance, Kabeli Energy Limited, Department of Electricity Development, Investment Board of Nepal Public Disclosure Authorized Key Dates Key Project Dates Bank Approval Date:01-Jul-2014 Planned Mid Term Review Date:02-Oct-2017 Original Closing Date:30-Dec-2019 Project Development Objectives Effectiveness Date:20-Jun-2016 Actual Mid-Term Review Date:-- Revised Closing Date:30-Dec-2019 Public Disclosure Authorized Project Development Objective (from Project Appraisal Document) The project development objective is to increase hydropower generation capacity to supply NEA grid through public private investment. Has the Project Development Objective been changed since Board Approval of the Project Objective? No PHRPDODEL Components Name Kabeli-A Hydroelectric Project (KAHEP) Component:(Cost $ M) Ministry of Energy (MOE) Component:(Cost $2.00 M) Public Disclosure Authorized Investment Board of Nepal (IBN):(Cost $4.00 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Moderately Unsatisfactory Moderately Satisfactory Overall Implementation Progress (IP) Moderately Unsatisfactory Moderately Satisfactory Overall Risk Rating Substantial Substantial Implementation Status and Key Decisions 6/28/2017 Page 1 of 6
2 KAHEP component Technical issues Civil Works Package (including hydro-mechanical equipment): The project has executed construction contracts with Zhejiang Hydropower Construction and Installation Co., Ltd. (ZHCIC) based in Hangzhou (Civil and Hydro-mechanical works). The Owner s Engineer (OE) is TATA Consulting Engineers (TCE) of India. KEL has appointed Fichtner of Germany as the Lender s Engineer. An Environmental and Social Panel of Experts (POE) has now been formed, and a technical POE is being formed. On Sep 8, 2016 KEL signed a Limited Notice to Proceed (LNTP) with ZHCIC to start mobilization for access roads, camps & temporary housing, and detailed design of the project and adit tunnel. A ground breaking ceremony was held on 23 March 2017 to mark the start of construction on the Kabeli A Hydropower Project. The contractor has so far mobilized 17 workers (all skilled), has established part of their temporary labour camp near the power house site (to be further expanded as more workers come on board). and has also begun work on access road widening drainage and retaining structure works. Environmental issues EHS staffing and management systems: Although preliminary construction works are already underway, the project s Environmental, Health and Safety (EHS) systems are still being put into place. There are two key ongoing vacancies in the Kabeli-A Environment and Community Development Unit (KAECDU) the EHS Manager and the Health and Safety Officer. Other systems and staff capacity for implementation and monitoring are partially in place, but urgent strengthening is required, both for effective management of construction risks and impacts during the LNTP period, as well as to ensure appropriate E&S planning for forthcoming construction activities once NTP is issued. During the mission, KEL agreed to several measures to urgently strengthen EHS management capacity and systems. IESC E&S baseline gap assessment and first compliance review: AECOM, a external monitoring firm has so far completed an initial draft baseline assessment to assess potential changes since the original drafting of the project s core E&S studies and management plans, and related mitigation and management gaps. The mission reviewed the draft report and shared feedback to AECOM, as well as giving guidance for their first E&S compliance review of ongoing construction activities, which was agreed be completed by end of June Kabeli Transmission Line: NEA had been building the transmission and substations that will service the Kabeli-A project with support from the World Bank, under Kabeli Transmission Project. However, this separate World Bank project is closing in June While approximately 86% of towers have already been built, remaining works are still underway by NEA. Under World Bank safeguard policies, this project is not considered an associated facility or linked activity to the Kabeli-A Project, given that it would be constructed irrespective of the Kabeli-A project, and will provide power evacuation to a number of hydro projects in the Tamor-Kabeli watershed. Nonetheless, the Bank will recommend to NEA to continue implementation of the environmental and social management plans which were developed for its construction and operation under the separate Project. Social issues KEL social staff at site office includes Social Officer, Senior Public Relation officer, two Assistant Public Relation Officers and one Livelihood officer. KEL has also appointed Social Panel of Expert (POE). Public Information Center (PIC) has been established at site.the Project s GRM system is also in place and seems to be functioning satisfactorily. The Bank team has identified some issues that require attention from the project. Some gaps in implementation of mitigation measures to the directly affected households due to permanent land acquisition were noted. The KEL should check and ensure that all the provisions in the entitlement matrix are followed. Consultation and information dissemination on ongoing activities and potential impacts has not been carried out. The KEL should carryout consultations and awareness programs throughout the construction phase on a regular basis. The KEL is yet to start implementation of other social safeguard activities in the SAP like local development, trainings, rural electrification, etc. Among these activities, local employment should be given utmost priority particularly given that some construction works are ongoing and major works will start post monsoon. Thus the KEL should start preparation of survey of local labor force and training requirements immediately. Several mitigation measures identified by CESHMP are yet to be implemented. The project should manage risks to and impacts on local communities due to temporary influx of labor into the project area. The Project team should avoid child labor, risk of social conflict, and gender-based violence among others. DOED Component DOED is currently conducting the technical and financial evaluation of proposals received from shortlisted firms for the Cumulative Impact Assessment and E&S Capacity Building consultancy. They will submit the technical selection report to WBG for No-Objection by June 1, IBN Component Project Review Panel (PRP) and Project Monitoring Unit (PMU): There is uncertainty whether IBN will form a PRP for each project to assist IBN in reviewing critical technical, environmental and social issues as per the PDA. For the PMU, IBN has submitted a draft TOR for the Bank s review. For Tamakoshi 3, IBN is seeking to hire a firm to the gap analysis in costing and safeguards studies. A draft TOR will be submitted by June 1, /28/2017 Page 2 of 6
3 Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance -- Moderate Moderate Macroeconomic -- Moderate Moderate Sector Strategies and Policies -- Moderate Moderate Technical Design of Project or Program -- High High Institutional Capacity for Implementation and Sustainability -- High High Fiduciary -- High High Environment and Social -- Substantial Substantial Stakeholders -- Substantial Substantial Other Overall -- Substantial Substantial Results Project Development Objective Indicators PHINDPDOTBL Generation Capacity of Hydropower constructed or rehabilitated under the project (Megawatt, Custom) Value Date 23-Sep Dec Dec Dec-2019 PHINDPDOTBL Generation Capacity of Hydropower constructed under the project (Megawatt, Custom Breakdown) Value Date 23-Sep Dec Dec Dec-2019 Overall Comments 6/28/2017 Page 3 of 6
4 Intermediate Results Indicators Public-private financing mobilized (Amount(USD), Custom) Value Date 01-Jul Dec Dec Dec-2019 Progress in construction of dam, tunnel and powerhouse (Percentage, Custom) Value Date 01-Jul Dec Dec Dec-2019 Signing of HIDCL consortium agreement (Text, Custom) Value Financing agreements As per the meeting with Nepal Rashtra Bank (NRB) on Dec 21, 2016 NRB s regulatory committee will decide if as per Banks and Financial Institutions Act of 2006 HIDCL can on-lend without a consortium. The financing agreements to be signed between HIDCL, KEL, NIC Asia and IFC Financing agreements consisting of: 1. master security agreement 2. accounts agreement 3. inter creditor agreement. Date 01-Jul Dec May Jun /28/2017 Page 4 of 6
5 Guidelines for CIA (Text, Custom) Value No guidelines No guidelines No guidelines Adopted by GoN Date 01-Jul Dec Dec Sep-2017 Guidelines for Resettlement (Text, Custom) Value No guidelines No guidelines No guidelines Adopted by GoN Date 01-Jul Dec Dec Sep-2017 Number of PDA signed with private hydropower developers (Number, Custom) Value Date 01-Jul Dec Dec Dec-2019 Overall Comments Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P IDA Effective XDR % P IDA-H9000 Effective XDR % 6/28/2017 Page 5 of 6
6 Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P IDA Effective 01-Jul Nov Jun Dec Dec-2019 P IDA-H9000 Effective 01-Jul Nov Jun Dec Dec-2019 Cumulative Disbursements Restructuring History There has been no restructuring to date. Related Project(s) There are no related projects. 6/28/2017 Page 6 of 6
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