The World Bank Implementation Status & Results Report Indonesia Sustainable Least-cost Electrification-1 (ISLE-1) Program (P174350) Indonesia Sustainable Least-cost Electrification-1 (ISLE-1) Program (P174350) EAST ASIA AND PACIFIC | Indonesia | Energy & Extractives Global Practice | Requesting Unit: EACIF (358) | Responsible Unit: IEAE1 (9259) IBRD/IDA | Program-for-Results Financing | FY 2023 | Team Leader(s): Sabine Mathilde Isabelle Cornieti, Puguh Imanto, Claire Marion Nicolas Seq No: 2 | Archived on 20-May-2024 | ISR00480 | Created by: Sabine Mathilde Isabelle Cornieti on 07-May-2024 | Modified by: Sabine Mathilde Isabelle Cornieti on 17-May-2024 1. PROJECT DEVELOPMENT OBJECTIVE 1.1 Development Objective Original Development Objective (Approved as part of Approval package on 25-Jun-2023) To increase access to sustainable and lower-cost electricity in Maluku and Nusa Tenggara regions, and strengthen the operational capacity of the electric utility 2. OVERALL RATINGS Name Previous Current Progress towards achievement of PDO Moderately Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Moderately Satisfactory Moderately Satisfactory Overall Risk Rating Substantial Substantial 3. KEY ISSUES & STATUS 3.1 Implementation Status and Key Decisions The ISLE-1 Program is not yet effective. 4. DATA ON FINANCIAL PERFORMANCE 4.1 Disbursements (by loan) Loan/Credit/TF Status Original Revised Cancelled Disbursed Undisbursed % Disbursed May 20, 2024 Page 1 of 12 The World Bank Implementation Status & Results Report Indonesia Sustainable Least-cost Electrification-1 (ISLE-1) Program (P174350) Not IBRD-95570 500.00 500.00 0.00 0.00 500.00 0% Effective 4.2 Key Dates (by loan) Loan/Credit/TF Status Approval Signing Effectiveness Orig. Closing Rev. Closing Not IBRD-95570 26-Jun-2023 30-Jun-2029 30-Jun-2029 Effective 4.3 Program Action Plan 1. PLN shall develop guidance to increase technical standards that would encompass Action Description location-specific climate hazards for grid infrastructure. Source DLI# Responsibility Timing Timing Value Status Technical NA DIV TEK Due Date 31-Dec-2024 In Progress Completion guidance developed by TEK Measurement Comments PLN is in the process of hiring the consultants 2. PLN shall hire an Independent Verification Agent (IVA), with experience, independence Action Description and capacity and under the terms of reference acceptable to the Bank. Source DLI# Responsibility Timing Timing Value Status Revised Technical 11 PLN Due Date 29-Dec-2024 Date Completion Contract with the IVA signed Measurement The date will be revised to 31 December 2024 with a small restructuring after signature of Comments the legal agreements 3. PLN shall adopt a streamlined investment review process to allow budget decision Action Description documents to be made available on time for the ISLE Program units, to avoid delays in implementation. Source DLI# Responsibility Timing Timing Value Status DIV ANG, SDT MRO, Fiduciary Systems NA Due Date 31-Dec-2025 In Progress DIV RSD, DIV MKJ May 20, 2024 Page 2 of 12 The World Bank Implementation Status & Results Report Indonesia Sustainable Least-cost Electrification-1 (ISLE-1) Program (P174350) Completion Letter issued by PLN informing the Bank that a new investment review process has been Measurement adopted. Comments ongoing 4. PLN shall establish and implement centralized payments under Vendor Invoice Portal (VIP) Action Description covering ISLE Program units (UIW NTB, UIW NTT, UIW MMU UIP NUSRA, and UIP MPA). Source DLI# Responsibility Timing Timing Value Status Fiduciary Systems NA DIV PBH Due Date 31-Dec-2025 In Progress Completion Letter issued by PLN informing the Bank that centralized payments under the VIP has been Measurement established and implemented. Comments ongoing 5. PLN shall prepare accurate procurement monitoring reports quarterly, based on data in Action Description the e-procurement plus SAP integrated system. Source DLI# Responsibility Timing Timing Value Status DIV PPI, DIV MRP, Fiduciary Systems NA Recurrent Quarterly In Progress DIV MEB Completion procurement monitoring report prepared and submitted quarterly, based on data in the e- Measurement procurement plus SAP integrated system Comments ongoing 6. PLN shall use open competitive bidding and participation for procurement of new Action Description technologies and new expertise. Source DLI# Responsibility Timing Timing Value Status DIV PPI, DIV MEP, Other NA Due Date 31-Dec-2023 In Progress DIV MEB Completion Letter issued by PLN informing the Bank that PLN has used open competitive bidding and Measurement participation for procurement of new technologies and expertise. Comments It became an effectiveness condition and will be met by June 2024. 7. PLN shall conduct annual procurement audits of 10% of all contracts at UIWs and UIPs, Action Description and submit reports to the Bank. Source DLI# Responsibility Timing Timing Value Status Fiduciary Systems NA SPI Recurrent Yearly In Progress May 20, 2024 Page 3 of 12 The World Bank Implementation Status & Results Report Indonesia Sustainable Least-cost Electrification-1 (ISLE-1) Program (P174350) Completion Procurement audits completed and reports submitted to the Bank. Measurement Comments ongoing 8.PLN shall comprehensively assess the capacity of local manufacturers for substation, Action Description transmission & distribution lines to meet PLN’s projected volumes for the Program activities. If qualified manufacturer number is inadequate, mitigation is needed. Source DLI# Responsibility Timing Timing Value Status Other NA DIV MRP Due Date 31-Mar-2024 In Progress PLN shared the report with the Bank, and in case of inadequate number of qualified Completion manufacturers, PLN agreed with the Bank on steps for expanding the list of registered Measurement manufacturers. See PAD annex for full PAP Comments It became an effectiveness condition and will be met by June 2024. 9. PLN shall issue notification letter to its procurement units to ensure that no contract Action Description under the Program is awarded to a firm or individual that is under debarment and/or temporary suspension by the Bank. Source DLI# Responsibility Timing Timing Value Status Fiduciary Systems NA DIV MRP Due Date 31-Dec-2023 In Progress Completion Notification letter issued with guidance to procurement units Measurement Comments It became an effectiveness condition and will be met by June 2024. 10.PLN shall check the Bank’s debarment and temporary suspension lists and record the Action Description verification in the bid evaluation report before contract award to ensure that no contract under the Program is awarded to a firm or individual present on the list. Source DLI# Responsibility Timing Timing Value Status DIV PPI, DIV MEP, Fiduciary Systems NA Recurrent Semi-Annually In Progress DIV MEB, DIV MRP Bi-annual reports provided to the Bank on the verification and the results to ensure that Completion guidance provided to procurement units is implemented and no such contract under the Measurement Program is awarded no later than Q1 & Q3 of the given year,starting in 2024 Comments Ongoing May 20, 2024 Page 4 of 12 The World Bank Implementation Status & Results Report Indonesia Sustainable Least-cost Electrification-1 (ISLE-1) Program (P174350) 11. PLN shall inform the Bank promptly of all credible and material allegations or other Action Description indications of fraud and corruption in connection with the Program that come to its attention, together with the investigative and other actions. Source DLI# Responsibility Timing Timing Value Status Fiduciary Systems NA DIV PKP, SPI Recurrent Semi-Annually PLN informed the Bank promptly. Semi-annual reports provided to the Bank on allegations of Completion fraud & corruption under the Program received or registered during such period, as well as Measurement any related investigations no later than Q1 & Q3 of the given yr [] Comments no comments 12. PLN shall adopt and maintain throughout the Program implementation period an Action Description Environment and Social Management System (ESMS), including (but not limited to) guidelines on the critical E&S issues for ISLE and an E&S capacity development plan Source DLI# Responsibility Timing Timing Value Status Environmental and DIV TEK, DIV OKI, NA Due Date 11-Sep-2023 In Progress Social Systems DIV PPI, DIV MEB Letter issued by PLN, attaching the agreed ESMS, confirming to the Bank PLN’s adoption of Completion the ESMS, and PLN’s commitment to apply the ESMS to the Program. See PAD annex for full Measurement PAP. Comments It became an effectiveness condition and will be met by June 2024. 13. PLN shall establish and maintain an ESMS Steering Committee with a technical team, in Action Description accordance with the details set forth in the ESMS, that will oversee the ESMS implementation. PLN shall appoint three experts to be in charge of E&S management. Source DLI# Responsibility Timing Timing Value Status Environmental and NA DIV TEK Due Date 11-Sep-2023 In Progress Social Systems Completion Letter issued by PLN informing the Bank of the establishment of the ESMS Committee and Measurement its technical team, and the appointment of the three experts. See annex for the full PAP Comments It became an effectiveness condition and will be met by June 2024. 14. PLN shall develop and provide to the WB an annual investment list for Action Description substations,transmission lines & solar project w activity description and indicative E&S data to demonstrate that planned activities are in the Program boundary as per the POM Source DLI# Responsibility Timing Timing Value Status May 20, 2024 Page 5 of 12 The World Bank Implementation Status & Results Report Indonesia Sustainable Least-cost Electrification-1 (ISLE-1) Program (P174350) Environmental and DIV TEK, DIV MEB, NA Recurrent Yearly In Progress Social Systems DIV MKJ, DIV RSD, Annual Investment List with necessary activity descriptions and E&S information submitted Completion to the Bank. See the full PAP inn he PAD annex. Measurement Responsibility: DIV TEK, DIV MEB, DIV MKJ, DIV RSD, DIV RST, UIW NTB, UIW NTT, UIW MMU, UIP NUSRA, UIP MPA Comments It became an effectiveness condition and will be met by June 2024. 5. KEY DATES Key Events Planned Actual Approval 26-Jun-2023 26-Jun-2023 Effectiveness 28-Aug-2023 Mid-Term Review No. 01 20-May-2026 Operation Closing/Cancellation 30-Jun-2029 6. SYSTEMATIC OPERATIONS RISK-RATING TOOL Rating at Approval Last Approved Rating Risk Category Approval Package - ISR Seq. 01 - 10 Nov Proposed Rating 26 Jun 2023 2023 Political and Governance Moderate Moderate Moderate Macroeconomic Moderate Moderate Moderate Sector Strategies and Policies Moderate Moderate Moderate Technical Design of Project or Program Substantial Substantial Substantial Institutional Capacity for Implementation and Substantial Substantial Substantial Sustainability Fiduciary Substantial Substantial Substantial Environment and Social Substantial Substantial Substantial May 20, 2024 Page 6 of 12 The World Bank Implementation Status & Results Report Indonesia Sustainable Least-cost Electrification-1 (ISLE-1) Program (P174350) Stakeholders Moderate Moderate Moderate Other Substantial Substantial Substantial Overall Substantial Substantial Substantial May 20, 2024 Page 7 of 12 The World Bank Implementation Status & Results Report Indonesia Sustainable Least-cost Electrification-1 (ISLE-1) Program (P174350) 7. RESULTS 7.1 PDO Indicators by PDO Outcomes Increase renewable energy in Eastern Indonesia Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Generation capacity of 0.00 Jul/2021 0 07-Nov-2023 600.00 Jul/2026 energy constructed or rehabilitated (Megawatt) DLI Renewable energy 0.00 Jul/2022 0 07-Nov-2023 600.00 Dec/2027 generation capacity (other than hydropower) constructed under the project (Megawatt) 0.00 Jul/2021 0 07-Nov-2023 608584.00 Dec/2027 Net greenhouse gas (GHG) Comments on Project net greenhouse gas (GHG) emissions are calculated as an annual average of the emissions (Metric achieving targets difference between project gross (absolute) emissions aggregated over the economic lifetime tons/year) DLI of the project and the emissions of a baseline (counterfactual) scenario aggregated over the same time horizon. They are reported in metric tons of carbon dioxide equivalent per year. Average Generation Costs in 0.00 Jul/2021 0 07-Nov-2023 20.00 Oct/2028 the Maluku and Nusa Comments on expected reduction by an average of US$ 30 per MWh by 2030 compared to BAU under 2019 Tenggara Regions achieving targets RUPTL across the 10 islands (Percentage) DLI Increase access to electricity Indicator Name Baseline Actual (Previous) Actual (Current) Closing Period May 20, 2024 Page 8 of 12 The World Bank Implementation Status & Results Report Indonesia Sustainable Least-cost Electrification-1 (ISLE-1) Program (P174350) Value Month/Year Value Date Value Date Value Month/Year People provided with new or 0.00 Jul/2021 0 07-Nov-2023 1924000.00 Jul/2028 improved electricity service (Number) DLI People provided with 0.00 0 962000.00 new or improved electricity service - Female (Number) Enhance PLN's operational capacity Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Implementation of a new No Jul/2022 No 07-Nov-2023 Yes Dec/2027 integrated strategic IT Comments on Implementation of a new integrated strategic IT solution including a new Enterprise Resource solution including a new achieving targets Plan (ERP) Enterprise Resource Plan (ERP) (Yes/No) DLI 7.2 Intermediate Results Indicators by Results Areas Results Area 1: Increased access and resilience of households Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year 67.00 Jul/2021 67 07-Nov-2023 99.00 Nov/2027 Share of female-headed households provided with Comments on the percentage of female-headed households in the rural areas of Indonesia with access to new or improved electricity achieving targets new or improved electricity services as a result of the project. Given the gap identified in services (Percentage) energy access equity would be achieved if FHHs are connected at the same rate as MHHs. Therefore, under the project a target has been set of reaching 15 percent which is the May 20, 2024 Page 9 of 12 The World Bank Implementation Status & Results Report Indonesia Sustainable Least-cost Electrification-1 (ISLE-1) Program (P174350) prevalence of FHHs in the rural areasf Indonesia. The baseline is listed as zero as the gap has been identified above but the baseline for the chosen location is unknown. Focus will be placed on cross-validating the post-electrification findings through possible surveys and focus- group discussions to track project. Grievances received and 0.00 Jul/2021 0 07-Nov-2023 90.00 Nov/2026 addressed through the Comments on Percentage of grievances received and addressed through the project’s Grievance Redress project’s Grievance Redress achieving targets Mechanism Mechanism within the specified timeframe (Percentage) Results Area 2: Increased readiness of the grid to integrate renewable energy resources Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year 0 MWh per Jul/2021 0 07-Nov-2023 786,298 MWh Nov/2028 Increased energy production year per year of renewable energy Comments on MWh lifetime over 25 years of solar generation thanks to the project (component 1) (Text) DLI achieving targets MWh of new battery storage 0.00 Jul/2021 0 07-Nov-2023 0.32 Jul/2026 equipment installed and Comments on The project is supporting the deployment of battery storage. The indicator is reporting on the operating in the Maluku and achieving targets installed battery capacity under the project Nusa Tenggara Regions (Gigawatt-hour (GWh)) DLI Reporting of new jobs No Jul/2021 No 07-Nov-2023 Yes Nov/2027 created through the Comments on Reporting on job creation for women. PLN to request number of female per type of jobs as investments by type of job achieving targets part of its EPC contract (i.e. permanent/temporary) (Yes/No) Results Area 3: Strengthened PLN’s operation readiness for energy transition Indicator Name Baseline Actual (Previous) Actual (Current) Closing Period May 20, 2024 Page 10 of 12 The World Bank Implementation Status & Results Report Indonesia Sustainable Least-cost Electrification-1 (ISLE-1) Program (P174350) Value Month/Year Value Date Value Date Value Month/Year No Jul/2022 No 07-Nov-2023 Yes Dec/2026 ERP hardware and software Comments on Software and hardware required for the ERP implementation have been installed and ready installed (Yes/No) achieving targets for operation by not later than FY2026. 7.3 Disbursement Linked Indicators (DLI) Actual (Previous) Actual (Current) PBC Name Baseline Closing Period Value Date Value Date 1:Expanded access Value 0.00 0 to electricity Allocated 07-Nov-2023 services (Number) 0.00 0.00 0.00 Amount Value 0.00 0 0.00 2:SCADA systems Allocated 07-Nov-2023 (Number) 0.00 0.00 0.00 0.00 Amount 3:Improved GHG Value 0.00 0 2.00 emission intensity Allocated 07-Nov-2023 (Percentage) 0.00 0.00 0.00 2,000,000.00 Amount 4:Battery storage Value 0.00 0 0.18 (Gigawatt-hour Allocated 07-Nov-2023 (GWh)) 0.00 0.00 0.00 45,037,234.00 Amount Value 0.00 0 07-Nov-2023 0.00 May 20, 2024 Page 11 of 12 The World Bank Implementation Status & Results Report Indonesia Sustainable Least-cost Electrification-1 (ISLE-1) Program (P174350) 5:Upgrading of and Allocated new transmission 0.00 0.00 0.00 0.00 Amount lines (Meter(m)) 6:New or upgraded Value 0.00 0 0.00 substations Allocated 07-Nov-2023 (Number) 0.00 0.00 0.00 0.00 Amount 7:Reduction of Value 0.00 0 0.00 generation cost Allocated 07-Nov-2023 (Percentage) 0.00 0.00 0.00 0.00 Amount Value 0.00 0 227.00 8:VRE integration Allocated 07-Nov-2023 (Megawatt) 0.00 0.00 0.00 20,808,209.00 Amount Value 0.00 0 296000000.00 9:Private generation Allocated 07-Nov-2023 (Amount(USD)) 0.00 0.00 0.00 11,115,000.00 Amount Value Obsolete ERP No n/a 10:Operational Allocated 07-Nov-2023 Capacity (Text) 0.00 0.00 0.00 0.00 Amount 11:Hiring of an Value No IVA in place No n/a Independent Allocated 07-Nov-2023 Verification Agency 0.00 0.00 0.00 0.00 (IVA) (Text) Amount May 20, 2024 Page 12 of 12