FOR OFFICIAL USE ONLY Report No: PAD00038 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT PROJECT APPRAISAL DOCUMENT ON A PROPOSED LOAN IN THE AMOUNT OF US$125 MILLION TO THE PLURINATIONAL STATE OF BOLIVIA FOR A BOLIVIA IMPROVING SUSTAINABLE ACCESS TO ELECTRICITY PROJECT– IDTR III (P180027) OCTOBER 25, 2023 Energy & Extractives Latin America And Caribbean 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. CURRENCY EQUIVALENTS (Exchange Rate Effective October 19, 2023) Currency Unit = Bs Bs 6.86 = US$1 FISCAL YEAR January 1 - December 31 Regional Vice President: Carlos Felipe Jaramillo Regional Director: Maria Marcela Silva Country Director: Issam A. Abousleiman Practice Manager (acting): Manuel Luengo Task Team Leader(s): Lucia Spinelli ABBREVIATIONS AND ACRONYMS AM Accountability Mechanism CAF Development Bank of Latin America CPE State Political Constitution CPF Country Partnership Framework ENDE National Electricity Company (Empresa Nacional de Electricidad) E&S Environmental and Social ESF Environmental and Social Framework ESMP Environmental and Social Management Plans GDP Gross Domestic Product GADs Departmental Autonomous Governments GAMs Municipal Autonomous Governments GBV Gender Based Violence GHG Greenhouse Gas GIZ German Agency for International Cooperation GoB Government of Bolivia GPOBA Decentralized Electricity for Universal Access Project GRID Green, Resilient and Inclusive Development GRS Grievance Redress Service HLO High-level Long-term Outcome IBRD International Bank for Reconstruction and Development IDB Inter-American Development Bank IDTR-I Decentralized Infrastructure for Rural Transformation project IDTR-II Access and Renewable Energy project IDTR-III Improving Sustainable Access to Electricity Project KfW Kreditanstalt für Wiederaufbau M&E Monitoring and Evaluation MHE Ministry of Hydrocarbons and Energies (Ministerio de Hidrocarburos y Energías) NDC Nationally Determined Contribution O&M&R Operation, maintenance and replacement Economic and Social Development Plan 2021-2025 (Plan de Desarrrollo Económico PDES y Social 2021-2025) PDO Project Development Objective PIUs Project Implementation Units Electricity Program for Living with Dignity (Programa de Electricidad para Vivir con PEVD Dignidad) POM Project’s Operational Manual PV Photovoltaic SA Isolated Systems (Sistemas Aislados) SDG Sustainable Development Goal SIN National Interconnected System (Sistema Nacional Interconectado) SHS Solar home systems SPC Shadow Price of Carbon Vice Ministry of Electricity and Renewable Energy (Viceministerio de Electricidad y VMEER Energías Renovables) The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) TABLE OF CONTENTS DATASHEET ............................................................................................................................ 1 I. STRATEGIC CONTEXT ....................................................................................................... 6 A. Country Context ...............................................................................................................................6 B. Sectoral and Institutional Context ...................................................................................................7 C. Relevance to Higher Level Objectives ........................................................................................... 11 II. PROJECT DESCRIPTION .................................................................................................. 12 A. Project Development Objective .................................................................................................... 12 B. Project Components ..................................................................................................................... 12 C. Project Beneficiaries ..................................................................................................................... 16 D. Results Chain................................................................................................................................. 17 E. Rationale for Bank Involvement and Role of Partners .................................................................. 18 F. Lessons Learned and Reflected in the Project Design ................................................................... 18 III. IMPLEMENTATION ARRANGEMENTS ............................................................................. 20 A. Institutional and Implementation Arrangements ......................................................................... 20 B. Results Monitoring and Evaluation Arrangements ....................................................................... 22 C. Sustainability ................................................................................................................................. 22 IV. PROJECT APPRAISAL SUMMARY .................................................................................... 23 A. Technical, Economic and Financial Analysis ................................................................................. 23 B. Fiduciary ........................................................................................................................................ 25 C. Legal Operational Policies ............................................................................................................. 26 V. GRIEVANCE REDRESS SERVICES ..................................................................................... 27 VI. KEY RISKS....................................................................................................................... 28 VII. RESULTS FRAMEWORK AND MONITORING ................................................................... 30 ANNEX 1: Implementation Arrangements and Support Plan................................................. 35 ANNEX 2: Sector Context ...................................................................................................... 39 ANNEX 3: Economic and Financial Analysis ........................................................................... 45 ANNEX 4: Gender Action Plan ............................................................................................... 51 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) @#&OPS~Doctype~OPS^dynamics@padbasicinformation#doctemplate DATASHEET BASIC INFORMATION Project Operation Name Beneficiary(ies) Bolivia Bolivia Improving Sustainable Access to Electricity Project (IDTR III) Environmental and Social Risk Operation ID Financing Instrument Classification Investment Project P180027 Substantial Financing (IPF) @#&OPS~Doctype~OPS^dynamics@padprocessing#doctemplate Financing & Implementation Modalities [ ] Multiphase Programmatic Approach (MPA) [ ] Contingent Emergency Response Component (CERC) [ ] Series of Projects (SOP) [ ] Fragile State(s) [ ] Performance-Based Conditions (PBCs) [ ] Small State(s) [ ] Financial Intermediaries (FI) [ ] Fragile within a non-fragile Country [ ] Project-Based Guarantee [ ] Conflict [ ] Deferred Drawdown [ ] Responding to Natural or Man-made Disaster [ ] Alternative Procurement Arrangements (APA) [ ] Hands-on Expanded Implementation Support (HEIS) Expected Approval Date Expected Closing Date 16-Nov-2023 31-Mar-2030 Bank/IFC Collaboration No Proposed Development Objective(s) Expand and improve access to sustainable electricity services in rural areas of Bolivia Components Component Name Cost (US$) Oct 25, 2023 Page 1 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) 1. Expand and improve access to sustainable electricity services in rural 132,000,000.00 areas 2. Strengthen the electricity sector 10,000,000.00 3. Project implementation support 5,687,500.00 @#&OPS~Doctype~OPS^dynamics@padborrower#doctemplate Organizations Borrower: Plurinational State of Bolivia Empresa Nacional de Electricidad (ENDE), Viceministerio de Electricidad y Energías Implementing Agency: Renovables @#&OPS~Doctype~OPS^dynamics@padfinancingsummary#doctemplate PROJECT FINANCING DATA (US$, Millions) Maximizing Finance for Development Is this an MFD-Enabling Project (MFD-EP)? No Is this project Private Capital Enabling (PCE)? No SUMMARY Total Operation Cost 148.00 Total Financing 148.00 of which IBRD/IDA 125.00 Financing Gap 0.00 DETAILS World Bank Group Financing International Bank for Reconstruction and Development (IBRD) 125.00 Non-World Bank Group Financing Counterpart Funding 23.00 Borrower/Recipient 1.00 Local Govts. (Prov., District, City) of Borrowing Country 16.00 Local Beneficiaries 6.00 Oct 25, 2023 Page 2 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) @#&OPS~Doctype~OPS^dynamics@paddisbursementprojection#doctemplate @#&OPS~Doctype~OPS^dynamics@padclimatechange#doctemplate PRACTICE AREA(S) Practice Area (Lead) Contributing Practice Areas Energy & Extractives CLIMATE Climate Change and Disaster Screening Yes, it has been screened and the results are discussed in the Operation Document @#&OPS~Doctype~OPS^dynamics@padrisk#doctemplate SYSTEMATIC OPERATIONS RISK- RATING TOOL (SORT) Risk Category Rating 1. Political and Governance  Substantial 2. Macroeconomic  Substantial 3. Sector Strategies and Policies  Moderate 4. Technical Design of Project or Program  Moderate 5. Institutional Capacity for Implementation and Sustainability  Substantial 6. Fiduciary  Substantial 7. Environment and Social  Substantial 8. Stakeholders  Moderate 9. Other  10. Overall  Substantial @#&OPS~Doctype~OPS^dynamics@padcompliance#doctemplate POLICY COMPLIANCE Policy Does the project depart from the CPF in content or in other significant respects? Oct 25, 2023 Page 3 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) [ ] Yes [✓] No Does the project require any waivers of Bank policies? [ ] Yes [✓] No ENVIRONMENTAL AND SOCIAL Environmental and Social Standards Relevance Given its Context at the Time of Appraisal E & S Standards Relevance ESS 1: Assessment and Management of Environmental and Social Risks and Relevant Impacts ESS 10: Stakeholder Engagement and Information Disclosure Relevant ESS 2: Labor and Working Conditions Relevant ESS 3: Resource Efficiency and Pollution Prevention and Management Relevant ESS 4: Community Health and Safety Relevant ESS 5: Land Acquisition, Restrictions on Land Use and Involuntary Resettlement Relevant ESS 6: Biodiversity Conservation and Sustainable Management of Living Natural Relevant Resources ESS 7: Indigenous Peoples/Sub-Saharan African Historically Underserved Relevant Traditional Local Communities ESS 8: Cultural Heritage Relevant ESS 9: Financial Intermediaries Not Currently Relevant NOTE: For further information regarding the World Bank’s due diligence assessment of the Project’s potential environmental and social risks and impacts, please refer to the Project’s Appraisal Environmental and Social Review Summary (ESRS). @#&OPS~Doctype~OPS^dynamics@padlegalcovenants#doctemplate LEGAL Legal Covenants Sections and Description The Borrower shall carry out the Project in accordance with the Implementation Arrangements set out in Section I, Schedule 2 of the Loan Agreement. @#&OPS~Doctype~OPS^dynamics@padconditions#doctemplate Conditions Type Citation Description Financing Source Oct 25, 2023 Page 4 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) The Operational Manual has been prepared and adopted by the Borrower, Effectiveness Article 5.01 (a) IBRD/IDA through PEVD, and ENDE in a manner satisfactory to the Bank The ESMF, IPPF, RPF, SEP, and LMP (including the grievance redress mechanism referenced in Section I.E.5 of Schedule 2 Effectiveness Article 5.01 (b) IBRD/IDA to the Loan Agreement) have been prepared, consulted, disclosed, and adopted as provided for under the ESCP Oct 25, 2023 Page 5 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) I. STRATEGIC CONTEXT A. Country Context 1. Bolivia made rapid economic and social progress over the decade and a half before the pandemic. Between 2006 and 2014, Bolivia’s economy grew at an average rate of 5.1 percent per year in real terms due to a rapid increase in public investment and social spending. 1 Consequently, Bolivia experienced one of the region's largest reductions in poverty and inequality. Between 2002 and 2014, the national poverty rate declined from 63 percent to 39 percent, extreme poverty from 39 percent to 17 percent, and the Gini coefficient from 0.60 to 0.48, while the population increased from 8 to 11 million. 2 Economic and social progress continued from 2014 to 2018, albeit at a slower rate following the collapse of oil prices in late 2014 and the end of the global commodities boom. 3 To sustain economic growth in a less favorable external context, Bolivia has maintained high levels of public investment and social spending in line with the Government’s state-led development model, alongside measures to grow domestic credit. This spending was financed, partially, by increased public debt and a drawdown on fiscal savings and international reserves. Nevertheless, despite the strong record of social progress, Bolivia remains one of the poorest countries in the region, with many poor households still unable to gain access to critical basic services such as affordable electricity, digital connectivity, and sewage. 2. The economy is gradually recovering from the 2020 COVID-induced recession. The pandemic hit Bolivia hard; the economy contracted by 8.7 percent in 2020, and there was a temporary increase in poverty and inequality, and a more protracted increase in informality. Growth recovered to 6.1 percent in 2021 and 3.5 percent in 2022, thanks to improving external conditions, easing mobility restrictions, and a recovery in public investment. Annual inflation remained at a low of 1.7 percent in December 2022, contained by a fixed exchange rate, subsidized fuel prices, and other price controls. The Government has refinanced the bulk of bonds due in 2022 and 2023, reducing rollover risks in the short term. Yet, possible limited access to funding in increasingly constrained international markets, declining gas exports, and weak private investment could limit growth in the medium term. 3. Although poverty declined after the pandemic-induced peak, some population segments have not made up for the lost ground and important service delivery gaps remain. In 2021, poverty fell below pre-pandemic levels, the middle class rebounded, and income inequality declined. Measured under the international poverty line of US$6.85 a day (2017 PPP), the poverty rate in 2021 was 15.2 percent, down from 17.3 percent in 2020 and 15.5 percent in 2019. 4 Still, poverty remains particularly high in rural areas (32 percent), among indigenous people (22 percent), and children under 14 years of age (23 percent). Urban unemployment also declined from a peak of 11.6 percent in July 2020 to pre-pandemic levels of 4.5 percent in December 2022, but there has been a rise in informality amidst slower employment growth and lower labor force participation. Higher food inflation after the end of pandemic-related emergency cash transfers has impacted households’ purchasing power; it is estimated that monetary poverty could have increased to 16.9 percent in 2022. 5 4. Vulnerability continues to loom over most households in Bolivia, exacerbated by climate change impacts which disproportionately impacts the poor. Over the long term, rising global temperatures are anticipated to reduce Bolivia’s GDP due to losses in agricultural productivity, 6 affecting rural populations the most. The Global Climate Risk Index 2021 1 Growth, unemployment, and inflation rates come from the National Statistics Institute. 2 Official poverty rates and Gini coefficients are from the National Statistics Institute; population figures come from the World Development Indicators. 3 World Bank. 2021. Rebalancing Inclusive and Sustainable Growth to Continue Reducing Poverty in Bolivia: Systematic Country Diagnostic Update. 4 Poverty figures estimates based on the international poverty lines come from the Socio-Economic Database for Latin America and the Caribbean. 5 World Bank’s staff estimates. 6 Rosón and Sartori. 2016. Estimation of Climate Change Damage Functions for 140 Regions in the GTAP9 Database, p. 20. Oct 25, 2023 Page 6 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) identified Bolivia as one of the ten countries most affected by climate change in 2019. 7 Over the past decades, the intensity and frequency of climate-related disasters have increased. According to the Emergency Events Database, around 84 extreme weather-related events (e.g., droughts, floods, wildfires, landslides, and extreme temperatures) occurred in Bolivia between 1965 and 2020, causing US$3.7 billion in damages (equivalent to 9 percent of the 2019 GDP). 8 B. Sectoral and Institutional Context 5. While Bolivia has started to diversify its energy mix, total energy production, supply and consumption are still dominated by hydrocarbons. Natural gas represents 80 percent of total energy production, 9 23,84 percent of domestic energy consumption, and a key source of exports, primarily to Brazil and Argentina. 10 Gas export proceeds drove a significant expansion of expenditures, including public investment and social transfers, and other social expenditures, helping growth in the previous decade. However, electricity consumption has grown from 2,781 to 5,583 kilo barrels of oil equivalent (kBOE) over the last two decades. 11 The electricity mix consists of natural gas (61 percent), hydroelectricity (30 percent), alternative energy (4.5 percent, including wind and solar), biomass (4 percent), and diesel oil (0.5 percent). Demand is driven by the residential sector (40 percent), followed by industrial and commercial sectors, both explaining 24 percent of electricity consumption. However, the country is responsible for just 0.27 percent (of which 16 percent were from the energy sector) of total global greenhouse gas (GHG) emissions and was the 47th largest emitter in 2020. 12 6. The country’s energy industry is led by the public sector with some limited private sector participation. The Ministry of Hydrocarbons and Energies (Ministerio de Hidrocarburos y Energías – MHE) plays a central role in the design and implementation of energy policy as well as in the management of key sector enterprises such as Yacimientos Petrolíferos Fiscales Bolivianos (YPFB) and the Empresa Nacional de Electricidad (ENDE). 13 The dominant player in the electricity market, ENDE owns and controls most generation, transmission, and distribution assets. The Vice Ministry of Electricity and Renewable Energy (Viceministerio de Electricidad y Energías Renovables – VMEER) within the MHE has been tasked with developing policies for the electrification and promotion of renewable energy and energy efficiency. The VMEER’s general directorate for renewable energy (Dirección General de Energías Renovables, DGER) is responsible for the implementation of rural electrification and renewable energy projects, including the Programa de Electricidad para Vivir con Dignidad (electricity program for living with dignity – PEVD). 7. Consumers are mostly served by 25 distribution companies 14 which hold geographic monopolies in their concession areas (the size of which can also be adjusted). 15 Of these companies, just eight 16 concentrate 92 percent of all electricity users. Distribution companies provide service to regulated consumers, while unregulated consumers (those who are not bound to purchases from regulated distribution entities) buy bulk energy directly from the wholesale electricity market (Mercado Eléctrico Mayorista – MEM). Distribution companies are regulated by the Autoridad de Fiscalización de Electricidad y Tecnología Nuclear (AETN), which monitors, controls, and supervises service provision and sets tariffs in four-year periods. As Bolivia’s Constitution established the right of equal access to basic services for all, 7 Eckstein, Künzel, and Schäferhttps. 2021. Global Climate Risk Index 2021, p. 8. 8 World Bank. 2021. Rebalancing Inclusive and Sustainable Growth to Continue Reducing Poverty in Bolivia: Systematic Country Diagnostic Update, p. 30. 9 Ministerio de Hidrocarburos y Energías. 2022. Balance Energético Nacional 2006 – 2021, p. 17. 10 Ibid, p. 21. 11 Ibid, p. 60. 12 Climate Watch. 2023. Historical Emissions. 13 World Wildlife Fund. 2020. Situación Energética de Bolivia y Desafíos, p. 2. 14 Including public and private companies participating in the National Interconnected System or in isolated systems. 15 Estado Plurinacional de Bolivia. 1994. Ley de Electricidad N° 1604 16 Compañia Eléctrica Sucre SA, Servicio Eléctrico Potosí SA, Electropaz, Empresa de Luz y Fuerza Eléctrica Cochabamba, ENDE del Beni SAM, ENDE Oruro S.A, Servicio Eléctrico Tarija and the Cooperativa Rural de Electrificación (CRE); ENDE owns different percentages of these companies except for CRE. Oct 25, 2023 Page 7 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) distribution companies have the obligation to connect users that request the service (within their respective areas) and are responsible for the operation, maintenance, and replacement of electricity provision infrastructure. 8. Vulnerable electricity users with consumption levels under 70 kwh per month benefit from a 25 percent reduction in electricity tariffs. This scheme, known as Tarifa Dignidad (“dignity rate”), has been in place since 2006 and benefits nearly 920,000 households. The scheme does not involve public sector expenditures as the remuneration scheme of the National Interconnected System is designed to fully cover such rate through revenue from utilities and other customers (effectively cross-subsidizing low-consumption households). However, electricity generation costs are impacted by natural gas subsidies. The high share of natural gas in the country’s energy sector and the fixed cost of US$1.3 per thousand cubic feet of natural gas (which fuels Bolivia’s electricity generation matrix) contributes to a low wholesale electricity cost. In 2022, overall fuel subsidies amounted to 3.7% of GDP; while direct electricity subsidies were negligible and did not put at risk the sustainability of key power sector entities. Still, further assessing overall tariff schemes could help address potential future challenges. 9. Bolivia has a high level of vulnerability to climate change and requires substantial investments to improve readiness to extreme weather events. 17 Power sector assets (generation, transmission, distribution) in Bolivia are exposed to several types of hazards: landslides, flooding, drought, and frost. On the generation side, climate change might have a negative impact on water availability for power generation and on current thermal infrastructure, located in landslides and flooding areas. Electricity transmission and distribution grids might also be affected by climate hazards; potential grid interruptions might result in power outages affecting critical facilities such as schools and health posts. Finally, electricity demand would be driven by extreme weather conditions such as very high or very low temperatures as heating and/or cooling equipment will be used more intensively. Therefore, climate change increases the vulnerability of the power sector; the possible adaptation measures are likely to be challenging and costly. 10. To facilitate its clean energy transition and help address climate change vulnerability, Bolivia submitted its first Nationally Determined Contribution (NDC) in 2016 18 and upped its climate change commitments with an updated NDC presented in April 2022, stressing the key role of universal electricity access. 19 Bolivia’s updated NDC maintains the ambition of the first document and commits to take actions aligned with a trajectory consistent with the global goal of limiting the increase in global average temperature to 1.5°C and with climate justice. 20 The NDC also announces Bolivia’s aims to “diversify its electricity generation capacity […], guarantee the capacity and resilience of the electricity system[…], promote access to energy and the interconnection of isolated populations […], improve energy consumption conditions, implementing energy efficiency measures and electrification of particular services in areas such as streetlights or the transportation sector and its mobilities” amongst other key sector goals. 21 The NDC is also aligned with the ambitious clean energy generation goals 22 presented in the 2025 Plurinational State of Bolivia Electricity Plan. 23 11. Despite a dramatic increase in households’ access to energy services , the latter remains lower in Bolivia than in most South American countries and particularly impacts vulnerable rural households. 24 Around 94.1 percent of all Bolivians had access to electricity by end 2021, 25 including roughly 99.2 percent of all urban households (up from 88.7 17 Notre-Dame Global Adaptation Initiative. 2023. ND-GAIN Matrix. 18 Estado Plurinacional de Bolivia. 2016. Contribución Prevista Determinada Nacionalmente del Estado Plurinacional de Bolivia. 19 Estado Plurinacional de Bolivia. 2022. Contribución Nacionalmente Determinada del Estado Plurinacional de Bolivia 2021-2030. 20 Ibid, p. XI. 21 Ibid, p. XIV. 22 Under which the expected power generation matrix would be 70 percent hydroelectric, 26 percent thermal, and 4 percent from other renewables. 23 Estado Plurinacional de Bolivia. 2014. Plan Eléctrico del Estado Plurinacional de Bolivia 2025, p. 127. 24 Ministerio de Hidrocarburos y Energías. 2022. Balance Energético Nacional 2006 – 2021, p. 129. 25 Ibid, p. 125. Oct 25, 2023 Page 8 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) percent in 2006) and 81.5 percent of all rural households (up from 36.9 percent). 26 However, close to 185,000 households still lack access to this basic service, almost 90 percent of which located in rural and dispersed areas. Figure 1: Households without access to electricity per Department (thousands, darker color means more households) 27 12. The lack of access to electricity in Bolivia has direct negative impacts on household welfare, as well as indirect impacts on the overall provision of other public services, livelihood opportunities and development. Lacking this basic service results in a lower quality of life, poor medical care and education, and limited opportunities for economic development, particularly in rural areas. Without electricity, for example, health clinics cannot count on appropriate lighting, water pumping, refrigeration (for drugs and vaccines), or even medical instruments, fans, or sterilizers. Furthermore, families that lack electricity services usually cover their energy needs with batteries (for flashlights and radios), kerosene burners and candles (for lighting) and wood (for cooking and heating), which increase low-income households’ expenditures and can result in health risks such as respiratory illnesses. Lack of access also impacts food preservation, family’s food consumption and the potential diversification of productive activities. Lack of access to quality electricity service also hampers educational and employment opportunities and participation in community affairs, including through the provision of digital connectivity. 13. Women are disproportionately vulnerable and have less access to energy services. Gender gaps in energy access affect women – particularly those in the rural context – more: Bolivian women devote an average of 6.8 hours to unpaid non-domestic work and 6 hours to unpaid domestic work, while men only dedicate 3.6 hours to the former and 4.3 to the latter. 28 In areas where there is a lack of fuel or energy resources in general, particularly in rural areas, women face extended work hours due to their household tasks and are responsible for obtaining fuel (firewood), especially for food preparation activities, which is estimated to require an average of between 2 and 20 hours per week. This use of their time minimizes women’s opportunities for paid work and development of skills. A study by Oxfam Bolivia revealed that 58% of Bolivian women would prefer to engage in paid work if not for the obligation to do unpaid household chores and caregiving. 29 Moreover, the prevalent use of batteries, kerosene burners, and wood for energy has disproportionately high costs for women and children. Women are also underrepresented in the energy sector. In the secondary sector, where energy is included, men constitute almost 74 percent of the employed population. Moreover, according to estimates made by the Energy Hub, women represent only 21.39 percent of those employed in electricity, gas, and water companies. 30 Nonetheless, to date, there is no large-scale study of women's participation in the sector. The main barriers to their participation identified by an exploratory study by Branisa, Cabero, and Guzmán (2020) are that social norms and 26 Idem. 27 Ministerio de Hidrocarburos y Energías. 2022. Balance Energético Nacional a Nivel Departamental 2021, p. 90. 28 Servicio Plurinacional de la Mujer y de la Despatriarcalización. 2022. Diagnóstico sobre el aporte al sistema económico del trabajo de cuidado en el nivel nacional, p. 54. 29 Oxfam Bolivia, 2019. Tiempo para Cuidar. Compartir el cuidado para la sostenibilidad de la vida, p. 64 30 Hub de energía. 2021. Porcentaje de mujeres que trabajan en las empresas de electricidad, gas y agua. Oct 25, 2023 Page 9 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) traditional gender roles discourage women to pursue careers in science, technology, engineering, and mathematics (STEM). 31 The sector is seen as an industry that is not adequate for women and therefore females suffer discrimination and difficulty in advancing to managerial positions. Its traditionally male working environment can also pose a threat of various forms of harassment and exploitation, in a country with already a high incidence of Gender Based Violence (GBV). 14. Bolivia is committed to achieving universal access by the end of the decade and increasing the production and consumption of sustainable energy sources. Since 2008, the Government has made increasing energy access a priority in the legal and policy frameworks and the country’s overall development agenda. Through its PEVD, launched in 2008, the Government of Bolivia (GoB) first operationalized such ambitions, seeking to reach universal access through investments in grid extension, and using clean energy technologies such as standalone photovoltaic (PV) systems, wind turbines, micro- hydropower plants and minigrids (mostly PV backed-up by diesel) systems. In its economic and social development plan (Plan de Desarrrollo Económico y Social 2021-2025 – PDES) Bolivia also set universal access to basic services as a key goal. The plan also identified distribution and transmission grids extension in urban and rural areas as vital 32 and further set the goals of reaching an overall access to electricity rate of 99.6 percent in the urban context and 95 percent in rural areas by 2025. 33 At the same time, the GoB has also made increasing the share of renewable energy in the grid by 75% by 2025 (from 2020 levels) a central aim of its development plan and climate commitments. 34 35 15. A large share of the dramatic increase in service has been facilitated by the PEVD (and supported and financed by the IBRD). Such efforts have reduced the use of fossil fuels and emissions in rural areas and communities, and enhanced the quality of services, inclusion, and gender-related improvements. Connection costs varied widely within these projects, averaging US$1,321 per connected household, and ranging from as low as US$377 per household in Oruro to as high as US$2,075 per household in Beni. 36 Ongoing efforts launched by the VMEER include – in addition to this operation – a new Inter-American Development Bank (IDB) loan for US$199 million for a Programa de Electrificación Rural III (PER III). Results from previous World Bank (WB) efforts are showcased in Box 1 below. Box 1: Key results from past IBRD access operations in Bolivia • Decentralized Infrastructure for Rural Transformation project (IDTR-I, P073367; closed in 2011): 37 o 10,174 photovoltaic systems installed. o 20,073 consumers connected to the grid. o 356 users were given access to photovoltaic systems for economic activities (wool shearing, poultry rearing, store lighting and machine tools). • Decentralized Electricity for Universal Access project (GPOBA, P102479, closed in 2013): 38 o 7,700 PV systems for rural households, schools, clinics, and micro and small enterprises installed. o 5,705 Pico-PV systems for lighting and basic ICT services for poorest households were distributed. • Access and Renewable Energy project (IDTR-II, P127837, closed in 2019): 39 o 756.25 kilometers of distribution lines were constructed or rehabilitated. o 24,030 people directly benefitted from the project activities. o 20,210 people were provided with access to electricity. 31 Branisa, B., Cabero, P., y Guzmán, I.R., 2020. Estudios Transversales: ¿Por qué tan pocas mujeres en Bolivia optan por carreras universitarias relacionadas con STEM (Ciencia, Tecnología, Ingeniería y Matemáticas) y qué podemos hacer para cambiar esta situación? La Paz: SDSN Bolivia, p. 13. 32 Estado Plurinacional de Bolivia. 2021. Plan de Desarrollo Económico y Social 2021-2025 p. 112. 33 Idem. 34 Ibid, p. 135. 35 Estado Plurinacional de Bolivia. 2022. Contribución Nacionalmente Determinada del Estado Plurinacional de Bolivia 2021-2030, pp. 15-18. 36 Fernández. 2022. Cobertura del Servicio de Electricidad en Bolivia a 2020, p. 1. 37 World Bank. 2012. Bolivia - Decentralized Infrastructure for Rural Transformation Implementation Completion Report Review, p. 3. 38 World Bank. 2014. Bolivia - Decentralized Electricity for Universal Access Implementation Completion Report Review, p. 3. 39 World Bank. 2020. Bolivia - Access and Renewable Energy Implementation Completion Report Review, p. 5. Oct 25, 2023 Page 10 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) 16. The proposed operation builds on lessons learned to help Bolivia achieve its goals of universal access to electricity services and increased sector sustainability by 2030. The Project will support the deployment of customized solutions to the country’s development challenges, by building upon past experiences, existing sustainability mechanisms, and regulatory frameworks. In addition to expanding access to cleaner energy sources (this is, connecting currently unserved households), the operation will also aim at improving access (connecting underserved productive uses or public institutions such as health and education centers). Such solutions will be further leveraged by improving and developing capacities and knowledge to scale up impact, influence behavior to improve energy use and efficiency, facilitate policy actions towards addressing climate change mitigation, and enhance the sector’s resilience and vulnerability to extreme weather events. As the Project creates new responsibilities – and demand – for distribution companies, it will also strengthen their capabilities and those of relevant implementing entities and partners. Furthermore, the operation will also help bridge potential sustainability gaps the sector may face and help assess existing remuneration schemes within the electricity sector to ensure key entities’ viability. Bolivia is counting on the World Bank’s support to increase energy access and produce knowledge and evidence for policymakers to foster the country’s just transition. C. Relevance to Higher Level Objectives 17. The proposed Project is consistent with the World Bank’s Country Partnership Framework (CPF) for the Plurinational State of Bolivia (FY23-FY26) (Report No. 181880-BO) 4041. The proposed Project development objective is relevant to support Bolivia’s rural development priorities and agenda – a core theme in the CPF – and is closely aligned to high-level long-term outcome (HLO) 3: Expanded access to quality public services and its Objective 3.2: Increase Access to Electricity and Renewable Energy, as the Project seeks to increase access to modern energy services, particularly relying on clean energy technologies. Furthermore, as the Project will support the crafting of key sector guidelines, enhancing knowledge and capacity for improving service provision and for a clean energy transition (including on topics such as energy efficiency, and utilities modernization), the operation will also address key priorities of Bolivia identified in the CPF, such as the country’s “broader plan to transition from thermal to renewable energy sources…[and]…greater energy efficiency and modernization of the utilities”. As the operation will also seek to incorporate a climate mitigation and adaptation approach, the Project will also contribute to other CPF HLOs, such as High-Level Outcome 1 (HLO 1) – Increased Climate and Economic Resilience. 18. The Project is consistent with the country’s NDC and its joint mitigation and adaptation goals. As stated in Bolivia’s updated NDC the country’s mitigation and adaptation objectives included providing universal access to electricity by 2030; increasing the share of renewables in the electricity mix and reducing GHG emissions from fossil fuels; increasing the resilience of productive systems; and improving livelihoods and enhancing society’s adaptive capacity. 42 The planned operation would directly support these goals through clean energy investments that would lead to a displacement of fossil fuels consumption (and thus a reduction in GHG emissions), by increasing access to clean electricity, and improving the resilience of infrastructure, while supporting activities – such as productive uses – to support local development, livelihoods and citizen welfare. 43 Delivering on these activities, with a particular focus on strengthening and developing capacities – as well as Bolivia’s overall climate commitments – would also support the Sustainable Development Goals (SDGs). Combined, all these efforts would help deliver on SDG 7 (“ensuring universal energy access, doubling progress on energy efficiency and substantially increasing the share of renewable energy”) and its goals 7.1: “by 2030, ensure universal access to affordable, reliable and modern energy services”, 7.2 “by 2030, increase substantially the share of renewable energy in the global energy mix”, and 7.3 “by 2030, double the global rate of improvement in energy efficiency”. 40 World Bank. 2023. Country Partnership Framework for the Plurinational State of Bolivia for the Period FY23–FY26. 2023. 41 The CPF was discussed by the Board of Executive Directors on May 26, 2023. 42 Estado Plurinacional de Bolivia. 2022. Contribución Nacionalmente Determinada del Estado Plurinacional de Bolivia 2021-2030, p. XIV. 43 Idem. Oct 25, 2023 Page 11 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) II. PROJECT DESCRIPTION A. Project Development Objective PDO Statement 19. The PDO is to expand and improve access to sustainable electricity services in rural areas of Bolivia. PDO Level Indicators a. PDO 1: Expand access to sustainable electricity services in rural areas of Bolivia: • Connections providing new electricity services. • People provided with expanded electricity services. • Net greenhouse gas emissions b. PDO 2: Improve access to sustainable electricity services in rural areas of Bolivia: • Connections providing improved electricity services. • People provided with improved electricity services. • Net greenhouse gas emissions B. Project Components 20. This Investment Project Financing will be implemented over 6 years, and focuses on the design, preparation, and implementation of sustainable energy access interventions for rural households and communities across Bolivia. Total financing will amount to US$148.00 million, including a US$125.00 million IBRD loan, US$6.00 million from beneficiaries and US$16.00 million from other sources (such as subnational entities or distribution companies), and US$1.00 million from the national Government (mostly in-kind). Table 1 details Project costs and financing sources. Table 1: Project costs and financing sources (in US$ million) Project Components Total IBRD GoB 44 Others 45 Beneficiaries 46 1. Expand and improve access to sustainable electricity services in rural areas 132.00 110.00 - 16.00 6.00 1.a. Grid extension for households 97.00 89.00 - 5.25 2.75 1.b. Grid extension for productive uses 3.75 3.00 - 0.50 0.25 1.c. Standalone PV systems 15.25 8.00 - 4.75 2.50 1.d. Minigrid systems 16.00 10.00 - 5.50 0.50 2. Strengthen the electricity sector 10.00 10.00 - - - 2.a. Policy support towards a just energy transition 8.00 8.00 - - - 2.b. Strengthening of the distribution sector 2.00 2.00 - - - 3. Project implementation support 5.69 4.69 1.00 - - 3.a. Project management and coordination 3.50 3.00 0.50 - - 3.b. Maximizing Project impact 2.19 1.69 0.50 - - Front-end fee 0.3125 TOTAL 148.00 125.00 1.00 16.00 6.00 44 This is an estimate of expected in-kind contributions from the GoB, which have been assessed by assessing staff time and effort to be devoted to the Project and not funded by the IBRD loan. 45 This includes estimates of O&M&R costs typically covered by distribution companies within their concession areas as per relevant contracts, as well as expected in-kind contributions from departments and municipalities (time and effort devoted to the operation). 46 Including time and efforts beneficiaries could potentially devote to facilitate Project activities (in-kind contributions). Oct 25, 2023 Page 12 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) 21. Component 1: Expand and improve access to sustainable electricity services in rural areas (US$132.00 million, of which US$110.00 million IBRD, US$6.00 million beneficiaries, and US$16.00 million others). This Component supports interventions to expand and improve access to electricity services for households, public institutions, and small-scale productive uses through grid extensions, and other technological solutions such as standalone PV, minigrid systems powered by renewable energy. 47Component 1 will include the following subcomponents: a. Grid extension for households (US$97.00 million, of which US$89.00 million IBRD, US$2.75 million beneficiaries, and US$5.25 million others): This subcomponent will seek to expand access to electricity by targeting unserved households and financing medium and low voltage grid extensions, including, inter alia, single-phase installations, transformers, grid densification and upgrading, as well as users’ connections. The subcomponent will include grid extensions within or beyond distribution companies’ current concession areas. The subcomponent would finance roughly 25,000 new connections, with an average cost of US$3,500 per household. b. Grid extension for productive uses (US$3.75 million, of which US$3.00 million IBRD, US$0.25 million beneficiaries, and US$0.50 million others): This subcomponent will aim at improving access to enhanced electricity supply by – inter alia – targeting productive activities in the agricultural, commercial, or industrial sectors in already serviced communities. The subcomponent will also seek to identify and support the provision of additional services in connection to electrification efforts, including, inter alia, three-phase and single-phase installations, transformers, grid densification and upgrading, as well as users’ connections, to facilitate services such as telecommunications, potable water, and other basic needs. The subcomponent could support close to 350 enhanced connections, each with a cost of roughly US$9,000 per productive use. 22. The grid extension subcomponents will have positive climate change mitigation and adaptation impacts. Planned activities will support the “greenfield transmission or distribution of electricity that increases the share of very- low-carbon electricity delivered” thus “increasing the share of non-nuclear very-low-carbon electricity use” 48 as evidenced by the GoB’s power sector goals of reaching a 75 percent share of renewable energy in the power grid by 2025 and 79 percent by 2030 and Bolivia’s electricity plan which expects a dramatic increase of clean energy generation from 2025 and onwards. The grid extensions will also contribute to climate change adaptation as these will seek to ensure financed transmission and distribution infrastructure use higher design standards to withstand climate-related hazards, increasing resilience to extreme weather events. a. Standalone PV systems (US$15.25 million, of which US$8.00 million IBRD, US$2.50 million beneficiaries, and US$4.75 million others): This subcomponent will finance the installation of second and third generation photovoltaic (PV) systems and batteries for public institutions – such as health and education centers – and households (SHSs) in dispersed rural communities. The subcomponent will include the financing of: i. Standalone PV SHSs for households and batteries to expand access to electricity and provide a service sufficient to power LED lighting fixtures and connection points to charge a cellphone, a radio, a television, and a DVD player. The subcomponent would finance roughly 9,000 SHS, with an average cost of US$700 per system. ii. Standalone PV systems to provide and improve access to electricity for public institutions such as schools and health centers, as well as batteries to provide electricity all day and to power LED lighting fixtures, a TV, and cellphone charging points as well as a DVD player, sound equipment, and computers in the case of schools and a modem, sterilizer, and radiocommunication equipment in the case of clinics. The subcomponent could support around 300 institutions, each system with a cost of roughly US$6,000. 47 These systems would replace existing diesel-powered minigrids with solar PV generation or by piloting micro-hydropower technologies as discussed below. 48 Common principles for Climate mitigation finance tracking, 2021, p. 16. Oct 25, 2023 Page 13 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) b. Minigrid systems (US$16.00 million, of which US$10.00 million IBRD, US$0.50 million beneficiaries, and US$5.50 million others): This subcomponent will seek to provide and improve access to electricity by financing the construction of new, upgrade of old, or replacement of existing diesel-fueled minigrids with: (i) solar PV systems (some of which may be backed up by the pre-existing diesel generation); (ii) fully solar PV-powered systems (only backed up with batteries); (iii) or through the piloting of micro-hydropower generation technologies, 49 all in communities located far away from the grids (either SIN or SA). 50 The subcomponent will fund the power generation systems, batteries, and the distribution grids (as needed). It is expected that 6 minigrid systems will be financed with an average cost of US$1,7 million each. Activities will include: i. Solar PV plants, battery banks, smart meters, and distribution grids (as needed), all designed to meet local necessities and estimated demand. ii. Micro-hydropower generation subprojects, and the upgrading or construction of medium or low voltage distribution grids, as needed, as well as accompanying smart meters. 23. Both standalone PV and minigrid systems subcomponents will have positive climate change mitigation and adaptation impacts. Planned activities will either support: (i) the “generation of renewable energy with low lifecycle GHG emissions to supply electricity” 51, or (ii) the “joint use of renewable energy and fossil fuel to supply electricity”. Thus, both cases will result in “substantially lower than corresponding GHG emissions from fossil fuel generation” under which “examination of GHG emissions is not necessary for forms of energy that are widely recognized to have very low lifecycle emissions, such as solar”. The subcomponents will also help reduce power outages at critical facilities (such as schools and health posts) due to extreme weather events from the provision of improved electricity by standalone systems or minigrids, resulting in enhanced adaptation outcomes. 24. Access to energy provided by activities in this Component will reduce time spent on domestic activities for women, as well as the possibility of carrying them out at night. This will enable women to have greater efficiency in the productivity of their day, allowing them to participate in paid work, education, or training, according to their interests and priorities. It will also eliminate the need to collect firewood. In addition, this new or improved energy supply can also provide economic opportunities for women in their households. They may be able to expand their productive activities or try to develop new microenterprises. Beneficiaries will receive training on the use of this technology, during which trainers will reinforce the economic benefits of sharing the burden of domestic chores. These sessions will take into consideration the places and times in which women can participate and offer temporary care services for children. The impact of such activities will be assessed by measuring the change in the time women spend on domestic/unpaid care work. 25. Component 2: Strengthen the electricity sector (US$10.00 million IBRD). This Component will focus on strengthening the VMEER’s capacities by supporting analytical work to enhance the overall sustainability, climate mitigation and resilience and decarbonization of the energy sector. It will finance assessments to inform energy sector guidelines – particularly in the distribution sector – and improve evidence for policymaking including by assessing key energy infrastructure’s climate risks and ways to address them. The Component will also benefit private actors acting as contractors or suppliers of key services as well as by fostering sectoral assessments that may spur clean energy transition and decarbonization efforts. The Component will include two subcomponents: 49 If deemed appropriate and sought, the potential micro-hydropower interventions to be piloted would represent a minute share of overall investments. Their deployment would be limited to entirely national basins, rivers, and their tributaries (i.e., those not located in international waterways as defined in the World Bank’s Operational Policy 7.50 Projects on International Waterways). 50 This activity will support the replacement of diesel-fueled minigrids with PV-powered systems, backed-up – when necessary – by diesel generation. 51 Common principles for Climate mitigation finance tracking, 2021, p. 11. Oct 25, 2023 Page 14 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) a. Policy support towards a just energy transition (US$8.00 million IBRD): This subcomponent will support the development of knowledge and evidence for policymaking to strengthen Bolivia’s climate mitigation and resilience, decarbonization of the power sector and just energy transition. The subcomponent will include topics such as clean energy access, fostering on grid renewable energy investments, energy efficiency, inputs to enhance sectorial adaptation and resilience to climate change – as key infrastructure is particularly exposed to extreme weather events –, and any other relevant studies in the context of the country’s clean and just energy transition. Activities to be supported could assist in – inter alia – developing knowledge outputs such as policies, sectoral planning, and regulations to continue improving clean energy access, strengthening planning capacities within the VMEER and other relevant stakeholders to integrate variable renewable energy and other innovative technologies; or labeling and standards programs to enhance energy use and increase energy efficiency. b. Strengthening of the distribution sector (US$2.00 million IBRD): This subcomponent will seek to strengthen distribution companies’ capacities to incorporate new electrification assets. It will support knowledge outputs to increase financial sustainability of the segment, awareness and improve service reliability as well as its resilience and adaptation to climate change. Activities could include – inter alia – the preparation of knowledge outputs and training to improve utilities tariff schemes, asset management, operation, maintenance, and replacement (O&M&R) procedures, knowledge exchanges between distribution companies, the development of information systems, the training and qualification of personnel, or the development of public awareness campaigns to foster demand in an efficiency way. 26. Component 3: Project implementation support (US$5.69 million, of which US$4.69 million IBRD, and US$1.00 million GoB). This Component will support overall Project management and facilitate resources within the PEVD and ENDE for the implementation of Components 1 and 2. The Component includes 2 subcomponents: a. Project management and coordination (US$3.00 million IBRD, and US$0.50 million GoB): This subcomponent will provide support and capabilities for overall Project management, including coordination, implementation, technical design, procurement, financial management and fulfillment of all fiduciary obligations; environmental and social management (as per the Project Environmental and Social Commitment Plan, and its related instruments), monitoring, and evaluation; and engagement with targeted populations and beneficiaries to foster behavioral change (including the implementation of the Project Stakeholder Engagement Plan, and its Grievance Redress Mechanisms). The subcomponent could devote resources for both Project Implementation Units (PIUs) to be located in PEVD and ENDE and could include actions to improve the mitigation of adaptation to climate change, such as providing technical assistance to increase capacity of the utility sector to reduce climate and disaster risks to energy infrastructure as well as to develop overall capabilities to implement planned GHG emission reductions actions. 27. The subcomponent will also aid in developing, supporting, and tracking implementation of a Gender Action Plan, which identifies measures the Project will include to contribute to the reduction of gender gaps, summarized in Annex 4. As mentioned, women are underrepresented in the sector. Given that data is critical to design policies aimed at addressing these gender barriers, a diagnosis on women’s participation in employment in the energy sector will be carried out under this subcomponent. This assessment can assist in the development of policies to promote greater female professionalization in the sector. Furthermore, training will be provided for women to develop a specific set of skills or knowledge in the energy sector, such as sustainability, energy efficiency, which will also help ensure the Project’s long- term success. Women’s participation in the design of interventions will also be encouraged, including new hires in Component 3, aiming for female participation to account for 10 to 30% in such teams. Oct 25, 2023 Page 15 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) 28. Gender Based Violence (GBV) risk will be mitigated through a GBV action plan, a project level GRM that facilitates the separate handling of registered cases and binding codes of conduct for personnel on the Program at the different levels. Other measures will be set out in the Environmental and Social Management Plans (ESMPs) and the overall Labor Management Plan (LMP) applicable to all Project activities. Trainings and awareness raising session will also be held around GBV, sexual exploitation and abuse as well as sexual harassment for all workers (including Project personnel and contractors). Leaflets with a description of the resources available to women who are victims of GBV will be sent along with the electricity bills. b. Maximizing Project impact (US$1.69 million IBRD, and US$0.50 million GoB): This subcomponent will raise awareness among targeted populations on the benefits of obtaining a greater access to energy and on potential energy efficiency measures to be implemented together with the access interventions, including by developing communication campaigns to increase awareness on energy consumption and its impact on households, commercial or public institutions finances, health and the environment, itinerant education programs and courses in schools and other behavior change-related activities. The subcomponent will seek to support activities to address both adaptation and mitigation to climate change such as to develop and implement policies that enhance productivity/competitiveness by preparing the energy sector to respond to climate change or to inform the preparation of regulations that require consideration of climate change risks in the construction of energy infrastructure, or by supporting the drafting of policies dedicated to improving energy efficiency. 29. The subcomponent will also develop a pro-active citizen and stakeholders’ engagement strategy that incorporates the principles of using the feedback from beneficiaries (especially women) collected in consultations on Project design and implementation and communicating those decisions and changes back to the beneficiaries. The strategy will focus on sensitizing the population on behavioral changes that could help households and targeted entities to seize the opportunities brought by electricity access. It will also showcase ways to use such energy in an efficient manner and seek to develop engagement strategies to inform targeted populations and institutions on the benefits, as well as risks and impacts, of the planned interventions and to “close the loop” by including their feedback and preferences. Project monitoring will track the number of beneficiaries and their satisfaction, and their feedback will be included and reported upon during Project implementation. C. Project Beneficiaries 30. The Project will target households, public institutions and productive uses lacking access to electricity services in rural areas of Bolivia. Such direct beneficiaries will obtain a modern and reliable electricity service which shall improve their livelihoods, facilitate access to other services and foster economic, environmental and health co-benefits, particularly for women. Beneficiaries will also receive training on the use of installed technology, during which trainers will reinforce the economic benefits of adopting appropriate energy use measures. The Project is expected to benefit 140,000 people with new or improved electricity services (through Component 1), as well as over 200,000 beneficiaries of communication and behavior campaigns and training activities under Components 2 and 3. 31. Planned activities will help reduce the time spent on domestic work, which in turn could allow women to use it for diverse occupations, including participating in the workforce. The provision of electricity will also provide economic opportunities for women as the new or enhanced service could foster an expansion of productive activities or permit the development of new microenterprises. The impact of such activities will be assessed, inter alia, by measuring the change in the time women spend on domestic or unpaid care work. And as energy policies have differentiated effects on men and women due to gender roles, women are to represent 10% of participants in the design of subprojects in Component 1. Oct 25, 2023 Page 16 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) 32. The Project will also result in greater social inclusion and productivity. As the operation helps provide electricity services that meet not only households’ energy needs but can power other productive activities, it will help improve the quality of life of rural inhabitants and local economic activity and services. The Project will also benefit private actors beyond those acting as contractors or suppliers, as it will help incorporate new clients into Distribution Companies’ areas of operation, fund investments in these zones to serve these new customers, and overall expand their operations and eventual sales. The operation will also create further economic activity in the clean energy sector, spurring new investments – as well as productive uses – and reactivating growth in the access technologies segment. 33. Additional beneficiaries of the Project will include central Government entities, including the VMEER, Departments and Municipalities, ENDE, distribution companies and health and education authorities. The health and education sectors will see an enhancement of their current facilities and services, while distribution companies will receive new assets that will not only expand their customer base but also provide additional demand at the residential and commercial, industrial, agricultural, and public services levels. The GoB, ENDE and other relevant actors in the overall energy policy context will benefit from the assessments, training activities and capacity building activities the Project will support. These key actors will be better informed and policymaking in the country could be improved. Finally, the Project will help address climate change mitigation and adaptation to extreme weather events. The operation will overall deliver global public goods emanating from the climatic, environmental, social, and overall development co-benefits of reduced emissions and increased energy efficiency. D. Results Chain Figure 2: Theory of Change of the Project Oct 25, 2023 Page 17 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) E. Rationale for Bank Involvement and Role of Partners 34. Public sector financing is warranted as the long-run societal benefits of access provision are positive even when the private benefits of such investments are not. Large-scale electrification investments imply high upfront capital costs with low margin, particularly in less densely populated areas, making them unattractive to private investors. As the proposed Project will roll out the electrification plan (grid and off-grid) towards more remote, rural areas, the need for public financing is critical to make service provision affordable for low-income populations living in these areas. Public service provision and financing will be required to ensure social inclusion and equity in the rural or urban, ethnicity, gender, and income level contexts. The proposed Project also brings forward a focus on strengthening public institutions that provide further benefits and increase the positive impact of the operation to the public at large. 35. The World Bank brings global knowledge to the electrification agenda. The Bank has the unique capacity to incorporate best practices and technologies for geospatial planning, implementation of replicable business models at scale, sustainability, social inclusion, high quality technology and innovation, cost efficiency, enhanced impact, and robust monitoring systems. Moreover, the World Bank leverages internal and external partnerships to bring expertise, technical assistance, and financing to support the Government’s access agenda. It fosters synergies with other sectors such water, agriculture, health, education, governance, social to ensure enhanced and inclusive impact of the electrification programs. 36. Only multilateral development banks financing and building on their previous efforts can help bridge the financing gap of US$780 million for investments identified by the GoB to deliver on Bolivia’s universal access goals. Previous efforts, such as the IDTR I, GPOBA, IDTR II projects as well as IDB financed PER I and II projects, can help unlock resources, experience, and know-how to release multiple developmental benefits. GoB is currently preparing two access operations for US$324 million (WB US$125 million, IDB US$199 million) to help close the access gap. Additional resources will also come from the government, the Departmental Autonomous Governments (GADs) and the utilities and new MDBs will be convened to close the access gap. The WB is perfectly situated to partner with and support the GoB based on its extensive on-the-field experience and its state-of-the-art knowledge and expertise. The Bank has collaborated extensively with the GoB, VMEER, ENDE and GADs as well as other key players from the Bolivian energy context and can bring further lessons learned from similar operations in Bolivia and elsewhere, especially those focusing on access and producing knowledge for policymaking, such as: a. Renewable Energy for Rural Areas project for Argentina (PERMER II, P133288) which is providing and enhancing access to modern energy services in selected rural areas of Argentina, while also targeting solar thermal energy provision as well as conducting market studies to determine potential energy demand and technologies in the country, which will be of use to the proposed operation. b. Argentina Clean Energy for Vulnerable Household and Communities project (P178553) which seeks to improve access to and the quality of electricity services in dispersed rural communities and the most vulnerable populations by targeting households and public institutions, developing training and capacity building activities; performing assessments to inform energy sector guidelines and supporting technical assistance. F. Lessons Learned and Reflected in the Project Design 37. Through past IBRD operations, the GoB and the IBRD have gained significant experience and knowledge on rural access efforts, challenges, and barriers. The proposed operation incorporates such lessons learned, including: Oct 25, 2023 Page 18 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) a. Project implementation arrangements have been planned and coordinated in advance among the multiple players based on the experience of other rural electrification programs. Past experiences show the need to clearly define from the get-go key issues such as demand identification, subprojects technical design, E&S permits due diligences, ownership of assets, operation and maintenance schemes, and tariffs. This is particularly relevant when two agencies (such as the PEVD and ENDE) share implementation and fiduciary roles. The Project will seek to address these issues during project preparation so obligations are clear to all parties and that relevant units can be fully operational from the early stages (to minimize delays). b. Project design provides for flexibility to adapt to changing administrations, partners, or implementation priorities. A large-scale access project is a medium- to long-term effort that requires a flexibility in how project financing is used. Building on the lessons learned from IDTR I, GPOBA and IDTR II operations, the Project has a national scope (even if five departments will be prioritized, though interventions will be selected as they comply with selection criteria), includes several technological solutions and mechanisms under the same Component to adapt to evolving circumstances and priorities and will be implemented over 6-years, allowing for potential responses to arising challenges to be appropriately addressed and project mechanisms updated. c. The Project is working together with partners such as the IDB to ensure implementation models are not contradictory and deliver similar quality services. Previous operations have demonstrated that development partners need to ensure all potential delivery models are coordinated across the country. When several international financial institutions are supporting a similar objective (such as rural electrification), the GoB and all partners should work in unison to ensure efficiency, complement resources and most importantly, avoid beneficiaries’ disappointment and dissatisfaction with different outputs from parallel initiatives. d. After assessing previous experiences in Bolivia and other countries in the region, the Project will rely on electricity utilities to assure O&M&R. Sustainability of stand-alone solar home systems operation is more a logistical challenge than a technical task. The main challenge at the operational level is to provide, at a reasonable cost, effective maintenance and customer service to users that are widely dispersed and often located in rugged terrain. Utilities are best situated to serve such dispersed customers given their presence throughout the country and long experience dealing with rural areas. e. The Project will facilitate, in a single step, the supply of all assets required to provide access and ensure final connections to the grid (including dwellings’ electricity connections). Past efforts demonstrate that direct government support in access operations is necessary and that such support should ensure the whole technological solution is appropriately funded. When certain parts or assets are left to be financed or procured by users separately and at their own pace, targeted beneficiaries fail to connect and access operations falter. f. The Project will finance connections to productive users both to increase their access to electricity but also to encourage and increase consumption, eventually creating a market and demand that can contribute to the financial sustainability of distribution companies. Productive uses can incentivize potential beneficiaries to connect to the grid while improving the financial sustainability of grid extensions. Providing connections to productive efforts and enterprises has triggered interest from further potential beneficiaries and has also contributed to coordinate joint connections request minimizing administrative costs for beneficiaries. On the utility side, increases in demand improve the sustainability of the investments in the short run. g. Project design includes activities under Component 2 to strengthen synergies between electrification investments and policies to increase Project impact and leverage additional resources. Accompanying increased Oct 25, 2023 Page 19 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) access efforts with support for policymaking (including activities such as those expected to be developed under Component 2) would scale up the impact of the infrastructure interventions, help lock in the benefits of the investments and facilitate the introduction of further energy transition efforts, including on energy efficiency and overall decarbonization. h. Considering the challenges witnessed in previous and ongoing projects in Bolivia, a dedicated focus will be placed on overall E&S supervision and on gender aspects, including addressing gender-based violence (GBV). Both implementing units will be adequately staffed with E&S specialists to ensure all relevant E&S management aspects are covered in an adequate manner during subprojects’ design and implementation. Special attention will be paid to gender considerations, and in particular GBV prevention and mitigation, throughout the construction and implementation of the local-level interventions. This comprehensive strategy will not only promote gender- sensitive designs but also outline specific measures for addressing potential GBV cases. From the Bank’s perspective, the supervision team will comprise specialists with proven experience in social inclusion in energy access projects in the region. III. IMPLEMENTATION ARRANGEMENTS A. Institutional and Implementation Arrangements 38. The overall Project will be implemented and coordinated by the PEVD, within the VMEER of the MHE and supported by or coordinated with different partners such as ENDE, particularly to facilitate the implementation of Component 1 as well as the procurement of goods, works and services and their installation. The operation will be national in scale and will be implemented based on local demand and requests (from GADs and GAMs) on a rolling basis. It is expected that five initial departments will be prioritized and ready to support and request support for key project activities: Beni, Pando, Potosí, Santa Cruz, and Tarija. Implementation will rely on the signing of collaboration agreements between key partners, including: (i) Departmental Intergovernmental Agreements, to be signed between ENDE and each participating department to – inter alia – delegate energy access responsibilities to the utility; (ii) Municipal Intergovernmental Agreements, to be signed between ENDE and relevant municipalities for – inter alia – the carrying out of solar PV interventions or minigrids; and (iii) O&M&R contracts with relevant distribution companies, including a framework contract per department and specific contracts per subproject. To ensure the operations’ readiness for implementation, the preparation of subprojects and template agreements and contracts is already underway, and the signing of the latter will be pursued before Project approval. 39. The PEVD and ENDE staff have substantial experience in implementing rural access projects financed by the World Bank – including the IDTR I, GPOBA and IDTR II – and other international and bilateral financial institutions such as Development Bank of Latin America (CAF), German Agency for International Cooperation (GIZ), Kreditanstalt für Wiederaufbau (KfW), and IDB. Overall, the PEVD has trained staff and robust experience with the implementation of access initiatives and ENDE is currently implementing other operations financed by other international financial institutions (such as the IDB). Further capacity strengthening will be supported by the Project to ensure the appropriate deployment of the electrification solutions envisioned and all Project Components. The World Bank will also develop training activities to ensure compliance with relevant regulations and the environmental and social framework (ESF). Further details on specific implementation arrangements are described below. 40. Component 1 will be implemented by PIUs in the PEVD and ENDE. GADs or Municipal Autonomous Governments (GAMs) will identify – in coordination with and supported by distribution companies – and present rural electrification Oct 25, 2023 Page 20 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) needs to the VMEER or PEVD for their review, and the eventual – if applicable – design, approval, and implementation of relevant subprojects (under all eligible technologies and subcomponents) to address such needs. The PEVD’s PIU will lead the pre-investment phase and conduct assessments of the potential electrification solutions to be deployed through the Component. This will include – inter alia – validating municipalities or departmental requests for electrification support, reviewing compliance with eligibility criteria, sizing and defining the electrification technologies to be implemented and designing the electrification subprojects as well as ensuring all relevant E&S authorizations are issued. ENDE’s PIU will then be responsible for executing the relevant subproject and carrying out the procurement of goods, works and services and their installation, as needed. In the case of grid extension investments, the connection of beneficiaries will be coordinated with the respective distribution companies in accordance with current regulations and will be financed directly by the Project, which may cover – inter alia – any goods, works, services or their installation as required. 41. All electrification solutions will be managed, operated, and maintained by the relevant distribution companies in the targeted area, which will take possession of the Project-financed assets once implemented. This will be reflected through an agreement between ENDE and the relevant distribution companies. Beneficiaries will be charged a basic (“social”) tariff per month to cover the replacement of parts of the system (such as batteries or panels) throughout their lifetime. Other costs will be covered by the distribution companies (effectively providing cross-subsidies from existing clients or by relevant GADs and GAMs, per the respective regulatory frameworks). All activities will be implemented with the involvement of the local municipality, beneficiaries, and subprojects operators to ensure sustainability. 42. The Project has defined a set of general eligibility criteria for key activities to be supported. Project interventions eligible for financing under Component 1 will be those that have been prioritized by the MHE, through the VMEER-PEVD, in accordance with its integrated planning of all activities in this and other projects and programs. Eligibility criteria to select potential subprojects will be further defined in the Project’s Operational Manual (POM) and may include issues such as the individual connection cost per dwelling. As the operation would first focus on the five prioritized departments mentioned above, subprojects within additional departments may be targeted under specific and additional eligibility criteria to be set in the POM. Beneficiaries to be targeted under the Project may include: a. Subcomponent 1.a – grid extension for households: Unserved or underserved potential electricity users within the concession areas of the relevant distribution companies or those assessed to be viable to be connected – even if beyond the current concession areas – without exceeding the cost per connection to be set in the POM. b. Subcomponent 1.b – grid extension for productive uses: Underserved entities developing productive uses within the concession areas of the relevant distribution companies or those assessed to be viable to be connected – even if beyond the current concession are – without exceeding the cost per connection to be set in the POM. c. Subcomponent 1.c – standalone PV systems for households and public institutions: Potential areas not expected to be connected to the grid (or through minigrids) in the next 5 years given the low technical feasibility or poor cost-effectiveness of grid extension solutions. Targeted subprojects costs shall not exceed an average connection cost to be set in the POM. d. Subcomponent 1.d – minigrid systems: Isolated communities with grouped households, located far from the grid and with unit connection costs not exceeding the limits to be set in the POM. 43. Components 2 will be executed by the PIU at the PEVD and Component 3 will be executed by both PIUs. ENDE’s PIU may provide support to or benefit from planned activities under Component 2, and could facilitate relevant technical assistance, training and staffing tasks, as needed. The PIUs will launch bidding processes for the procurement of required human resources, equipment, or activities, including training and capacity building activities and assessments as well as for any goods, works, or services linked to these analyses. As activities under these Components could also be carried out with or for other entities beyond the MHE and to test new methodologies and technologies, ad-hoc collaboration agreements could be sought, if needed. Oct 25, 2023 Page 21 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) B. Results Monitoring and Evaluation Arrangements 44. The Project builds upon existing structures and capacities developed through past and ongoing activities with Bolivia. The operation will support Monitoring and Evaluation (M&E) tasks as well as overall Project management, implementation, supervision, and reporting through Component 3 and include support for: (a) the design and deployment of assessments, systems, indicators, reports, remote monitoring or data gathering technologies such as the Geo-Enabling initiative for Monitoring and Supervision (GEMS), and other instruments as needed; and (b) data and information gathering by the PEVD, ENDE and relevant stakeholders. Specific tasks to be conducted to fulfill M&E obligations include: a. Design and deployment of a Project specific M&E, supervision, and monitoring system, to be led by the PEVD. b. Reporting of Project development and intermediate indicators every 6 months, with data to be gathered mostly by ENDE (component 1 activities) and the PEVD (component 2). c. Generation by the PEVD of additional impact, results, or performance indicators, and data during implementation. d. Implementation of an overall Project management system to be managed by the PEVD; and e. Crafting by the PEVD of baseline, midterm, and implementation assessments to evaluate impact. 45. The PEVD and ENDE PIUs and the World Bank will carry out a mid-term review by 2027 to take stock of Project performance and make relevant decisions regarding its future. Once the operation closes, the PEVD PIU will be responsible for preparing and submitting to the World Bank its own implementation completion report and assisting with the preparation of the Bank’s implementation and completion results report. C. Sustainability 46. The Government has strong ownership of access interventions. The Project is aligned with Bolivia’s development goals as well as with efforts coordinated with other international financial institutions and organizations. This provides a strong basis for the Government to continue its support to increased energy access in the rural context. 47. The proposed operation relies on the existing regulatory framework and proven institutional arrangements to guarantee adequate implementation and sustainability over time. From the point of view of sustainability, electricity grids are managed by regulated distribution companies; grid extension efforts would thus fall under an existing framework for tariffs and the operation, maintenance, replacement, and expansion of these systems. Similarly, minigrid systems would also be developed within a set of regulatory guidelines that mandate distribution companies to operate and maintain such assets once developed. Furthermore, the use of cleaner energy sources further ensures sustainability by both lowering generation costs and emissions. Finally, photovoltaic systems’ sustainability is assured as direct beneficiaries become invested – as past experiences have shown – in ensuring their upkeep and functioning over time. To ensure further buy-in and sustainability the Project will also work to identify and ensure adequate funding through additional counterpart resources when needed. This will include the tariffs expected to be paid by beneficiaries as well as the in-kind contributions from relevant stakeholders and support from distribution companies (per their obligation to facilitate electricity services in their areas of operation). In addition, the operation will also seek to strengthen distribution companies’ capacity to deal with the increased demand and responsibilities associated to rural electrification efforts. 48. The operation will engage and empower beneficiaries through consultations on the Project design and implementation and communication campaigns to become one of the major sources of sustainability. Ensuring beneficiaries participate in all stages of subproject preparation, fully understand the interventions once deployed, and realize how they can fully benefit from them, such as through higher quality of service and better affordability, is one of Oct 25, 2023 Page 22 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) the priorities of the operation. A dedicated stakeholder engagement and communications effort will be implemented with beneficiaries accordingly. IV. PROJECT APPRAISAL SUMMARY A. Technical, Economic and Financial Analysis 49. Increasing and improving access to reliable, clean, and affordable electricity can have important economic and development impacts and improve the quality of life of Bolivians. Implementing energy access measures would result in multiple social and development benefits, such as improving the living conditions of the poorest, contributing to economic growth, improving the quality and access to social services, increasing resilience to climate change, closing the gender gaps, and improving overall quality of life. Replacing diesel and other fossil fuels with clean energy sources would also deliver environment and health impacts, also achieving GHG emission reductions. Ensuring new energy infrastructure – in urban or rural contexts – is adapted to extreme weather events would also reduce climate vulnerabilities and support resilience to climate change. 50. Interventions and technologies to be supported and deployed (including for grid extension, standalone PV systems and minigrid systems) are well-known to relevant stakeholders and implementation agencies. The PIUs have already gained the necessary experience and technical expertise to implement all Component 1 activities through the IDTR I, GPOBA and IDTR II projects. The PEVD and ENDE have trained staff and experience in dealing with such technologies and will support any stakeholders that may need help dealing with such equipment or installations. 51. The operation is aligned with the goals of the Paris Agreement on both mitigation and adaptation: a. Assessment and reduction of mitigation risks: The Project presents no risk of having a negative impact on the country’s low-emissions development pathways or create GHG lock-ins. The Project’s objectives are to expand and enhance access to energy, reduce the consumption of fuels with negative impacts (including on climate, health, and livelihoods) and increase clean energy generation, all aligned to climate change mitigation goals. Planned investments will only support an improved consumption of energy from the grid (which has a lower emissions factor than currently used energy sources) or from new and cleaner energy sources (such as solar or minigrids). Even after increasing energy provision, the Project will result in emission reductions of 127,000 tCO2. 52 The Project will also support the development of knowledge and evidence for policymaking to help decarbonize Bolivia’s economy through work on issues such as energy efficiency which could help reduce energy demand. b. Assessment and reduction of adaptation risks: In terms of adaptation, the inherent risk was assessed to be moderate as climate change and extreme weather events such as floods potentially resulting in landslides, drought and frost could potentially impact energy generation or distribution assets supported or facilitated under the Project. To mitigate such risks, the operation will: (i) plan and deploy investments using design standards to withstand extreme climate events; (ii) monitor such interventions’ performance using available technologies; and (iii) help reduce power outages (particularly at critical facilities such as the targeted public centers). In addition, through its support for productive uses and vital public institutions (such as education and health centers), the Project will help increase Bolivia’s resilience and adaptation to climate change, by improving the resilience of 52 As Bolivia’s grid is still heavily reliant on natural gas-powered generation and the largest subcomponent is devoted to grid extension, over 20 years, the project will result in net emissions (economic lifetime, tCO2e) of -127,000, gross emissions (economic lifetime, tCO2e) of 231,000, and net emissions (annual average, tCO2e/year) of -7,750. Oct 25, 2023 Page 23 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) productive systems and overall livelihoods. Technical assistance activities will also support the development of knowledge and evidence for policymaking to assess and address adaptation climate challenges in the sector and improve planning abilities of key stakeholders (such as utilities) to improve their climate resilience. Considering these measures and Project-supported interventions, the residual adaptation risk is deemed acceptable. 52. The economic and financial analysis focused on assessing most activities to be funded under Component 1, representing roughly 90 percent of the IBRD loan and overall Project. Given the analytical constraints associated with benefits that cannot be measured in monetary terms and where information is not available – including those under Components 2 and 3 focusing on providing support for policymaking and Project management, respectively – were not included in the analysis but will be fundamental for the development of the overall operation. Project outcomes were assessed by comparing “with” and “without” scenarios for five key types of interventions and investments (grid extension targeting households and productive uses, standalone PV systems for both households and public institutions, and minigrid systems – mostly in isolated communities) and their cost-effectiveness. The economic analysis estimated and presented the costs and benefits (avoided cost of energy purchases, improved energy service and avoided CO2 emissions) from Project-enabled activities (either grid-connected or off-grid) such as replacement of kerosene lamps, batteries, candles, diesel, and other fossil fuels use. 53 The economic costs of the Project include the new equipment and materials to be funded (grid wires, poles, PV panels, and minigrid components and any other connection costs), and the O&M&R costs for the deployed infrastructure when applicable. Further details have been included in Annex 3. 53. As the Project’s objectives are, by nature, economic, social, and environmental, it is not expected that planned interventions would be viable in financial terms, and activities will be subsidized by the GoB (by fully funding all key assets and interventions). Thus, the financial analysis sought to assess if: i) the GoB’s subsidies are sufficient to ensure O&M&R, ii) the Project would negatively impact the finances of distribution companies and direct beneficiaries; and iii) electricity tariffs would need to be set at a higher level if these had to fully compensate GoB’ investments. 54. The economic and financial analyses used a set of general parameters across the five key types of interventions. The Project proceeds in US dollars were converted to local currency at an exchange rate of US$ = Bs 6.86. A discount rate of 5 percent 54 was used for the economic assessment, and discount rates of 12 and 10.1 percent 55 were used for the economic sensitivity and the financial analyses, respectively, to test the robustness of the operation. Different electricity costs and tariffs were used to quantify the benefits of Project activities, including a typical residential tariff of US$0.096, the Dignidad residential tariff (a discount of 25 percent for households consuming less than 70 kWh per month), and a typical general tariff (applicable to other consumers such as productive uses or public institutions) of US$0.191. The assessment also estimated the economic value of the additional electricity service at US$1.447/kWh, reflecting consumers’ willingness to pay for the improved access and reduced expenditures in traditional energy sources. As the analyses assumed the interventions would have a 15-year operational lifetime (starting in year 1) and the installation of deployed technologies would be done over 6 years (starting in year 0), the overall lifetime of the operation would be 22 years. The value of the operation’s environmental benefits has been calculated using the WBG guidance on the Social Cost of Carbon. 56 Emissions avoided were multiplied by a shadow price of carbon (SPC) for each year in the Project’s lifetime. 53 Estimating social and environmental benefits from electrification efforts, even if commonly recognized, are difficult to quantify. These include improved health services and education where the benefits often extend long beyond the project lifetimes, improved communications and connectivity, potential improved access to water through electric pumping (with improved health and increased agricultural productivity), improved lifestyle, potentially more business and income-generating opportunities, improved public security or improved health outcomes from the reduced use of polluting fossil fuels. 54 As the World Bank forecasts a 2.5 percent real GDP growth rate in for Bolivia in 2023, a 5 percent discount rate was applied; see the World Bank’s “Discounting Costs and Benefits in Economic Analysis of World Bank Projects” guidance (2016) for further details. 55 Social discount rate established by the Bolivian public investment system and market discount rate, respectively. 56 World Bank. 2017. Shadow price of carbon in economic analysis: Guidance Note. Washington DC: World Bank. http://pubdocs.worldbank.org/en/911381516303509498/2017-Shadow-Price-of-Carbon-Guidance-Note-FINAL-CLEARED.pdf. Oct 25, 2023 Page 24 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) The SPC used for each year was calculated as the average between the low and the high case scenarios, starting in year 0 with a value of 77 US$/tonCO2eq (average of suggested high and low values for 2024). 55. The economic analysis shows the Project would result in positive results, driven by the social and environmental benefits expanding and improving access to sustainable electricity would deliver. The aggregate economic internal rate of return (ERR) for the overall operation is estimated at 22.5 percent and its net present value (NPV) at US$157 million. A sensitivity analysis considering the alternate discount rate of 12 percent, as well scenarios in which costs increased by 20 percent and benefits decreased by the same percentage, and in which the economic value of additional electricity provided was halved, were performed. In all, the overall Project results remained positive, further demonstrating the need for the GoB’s intervention in the access agenda and showing the relevance and robustness of the operation. 56. The financial analysis sought to assess if the Project would create positive outcomes for beneficiaries and distribution companies under the previously discussed assumptions. Overall, the scenarios prepared for this assessment, suggest the existing residential, Dignidad or general tariffs could be sufficient to cover the O&M&R costs used in this exercise, especially since all capital expenditures would be fully subsidized by the GoB. Furthermore, the analysis suggests such tariffs could be enough to cover analyzed distribution companies’ operational costs. Under the scenarios, most beneficiaries provided with new or enhanced access would also see savings arising from the low tariffs and reduced energy expenditures. Finally, the model assessed that for the interventions to be fully financially viable (without any subsidies from the GoB), the tariff per kWh would need to be set at roughly US$0.50 per kWh, which – combined with the expected benefits described above – further makes the case for the GoB’s subsidy of planned interventions. 57. Expected Project results are summarized below. Table 2: Aggregate Project lifetime results Grid extensions Standalone PV systems Minigrid RESULTS TOTAL Households Productive uses Households Institutions systems Connections (#) 37,000 25,500 500 9,000 500 1,500 Beneficiaries (#) 141,000 79,000 1,000 28,000 25,500 7,500 Energy provided (MWh) 382,500 309,000 10,500 18,500 10,500 34,000 Energy savings (M USD) 55.50 50.00 -1.50 9.50 -1.00 -1.50 Baseline emissions (tCO2) 358,000 257,000 1,000 68,500 9,500 22,000 Typical baseline emissions (tCO2/yr) 16,250 11,700 50 3,100 400 1,000 Gross Project emissions (tCO2) 231,000 192,000 4,500 18,500 2,500 13,500 Net emissions (tCO2) -127,000 -65,000 3,500 -50,000 -7,000 -8,500 Typical net emissions (tCO2/yr) -7,750 -4,000 250 -3,000 -500 -500 B. Fiduciary (i) Financial Management 58. A Financial Management (FM) Assessment was carried out in accordance with OB/BP 10.00, the FM Manual for World Bank Investment Project Financing, and Bank Directive Investment Project Financing IPF, and FM Manual for IPF Operations to evaluate the adequacy of the PEVD and ENDE FM arrangements. Based on the information available at this stage, the FM residual risk is substantial. The main FM risks identified for the proposed Project relate to: (i) weaknesses in the public sector to attract and maintain qualified staff and the subsequent high staff rotation, which could adversely impact Project implementation; (ii) different paces and execution capacities between the PEVD and ENDE due to the specific responsibilities and tasks assigned to each and the need for both to work in parallel without delaying each other; Oct 25, 2023 Page 25 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) and (iii) the need to set in place the processes and internal controls for the recording, reporting and monitoring of subprojects financing. Identified risks are to be mitigated by: (i) reducing fiduciary staff rotation by setting at least annual contracts and hiring additional staff; (ii) creating separate Designated Accounts (DA) for both PEVD and ENDE; and (iii) the PEVD’s implementation and use of the VISUAL system to register, monitor and produce financial reports as well as ENDE’s continued use of the ENDESIS financial system. All responsibilities and processes will be described in the POM and reviewed by the Bank. 59. The implementation of the envisaged mitigation measures will allow an adequate response to Project demands. The Bank’s fiduciary team will follow up project implementation progress by reviewing semiannual financial reports, annual audit reports and project action plans. In addition, fiduciary specialists will participate in supervision missions to assess the achievement of agreed actions, the continuing adequacy of systems, to monitor risks and review and/or update the mitigation measures, accordingly. (ii) Procurement 60. Procurement will be conducted according to the World Bank’s Procurement Regulations for IPF Borrowers, fifth edition of September 2023, for the supply of Goods, Works, Non-Consulting Services and Consulting Services. The application of the ‘Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants’, dated October 15, 2006, and revised in January 2011 and as of July 1, 2016 (World Bank’s ACG), and sanctions procedures will continue to be ensured through the Bank’s model legal agreements for IPF operations, which require that provisions apply to the ultimate recipients of IBRD funds. The Bank's Standard Procurement Documents will govern the procurement of contracts under the International Market Approach. For procurement involving the National Market Approach, the Borrower may use their own procurement documents, acceptable to the IBRD. All Standard Procurement Documents as well as model contracts will be attached to the Project’s Operational Manual. C. Legal Operational Policies @#&OPS~Doctype~OPS^dynamics@padlegalpolicy#doctemplate Legal Operational Policies Triggered? Projects on International Waterways OP 7.50 No Projects in Disputed Area OP 7.60 No 61. The Environmental and Social (E&S) risk is rated substantial based on the Project’s scope covering the entire national territory, including protected areas, the limited social information currently available, and the borrower's limited experience in managing E&S risks according to ESF standards. The classification responds mainly to the activities described in Component 1, which could potentially have a national scope (included protected areas) and consist of infrastructure works of medium to small scale, with impacts expected to be site-specific, predictable, temporary, easily manageable with existing management measures, and without a significant risk to harm communities or the environment. Potential environmental risks and impacts identified preliminarily will occur mainly during the construction stage and are related to (i) nuisance to communities and impacts on the environment due to generation of noise, dust, and atmospheric emissions, (ii) vegetation clearing and/or disturbance of natural habitats, (iii) sourcing and use of timber for wooden posts, (iv) generation of electrical, hazardous and other waste that could impact the soil or nearby water bodies, (v) risks to health due to use of hazardous materials, (vi) occupational health and safety risks from working at heights and with high voltage Oct 25, 2023 Page 26 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) equipment, life and fire safety risks, (vii) risk of accidents in the community due to traffic alteration or use of detours, and (viii) impacts of potentially unsustainable sourcing of other materials. In the case of Protected Areas, Biodiversity Management Plans will probably have to be designed and implemented in case they are affected. During the operation and maintenance, potential environmental risks and impacts preliminarily identified are related to: (i) inadequate management of electronic and hazardous waste, and (ii) occupational health and safety risks from working at heights and with high voltage equipment, in addition to the assembly of electrical parts. A preliminary environmental and social assessment has been prepared and will feed an Environmental and Social Management Framework (ESMF) which will provide guidance to further analyzes of potential direct, indirect, and cumulative impacts for each subproject to propose appropriate measures to avoid, reduce and mitigate potential environmental risks and impacts in a manner consistent with the ESF. The ESMF will also consider measures to monitor the health of workers and prevent communicable diseases. 62. Based on the limited information currently available, the social risk classification of the Project is deemed to be substantial. Potential social risks of the Project preliminarily identified include: (i) risk of elite capture and potential exclusion of vulnerable populations and groups whose interests could be under-represented from Project benefits, such as indigenous women, elders, youth, persons with disabilities, and sexual and gender minorities, if targeted strategies to ensure their engagement are not incorporated in the preparation and implementation of the Project, particularly in an institutional context with a limited level of coordination between the multiple entities expected to be involved, and the decentralized offices of these entities, the different levels of energy users groups and organizations, subnational governments, and others; (ii) minor labor influx risks associated with the civil works, especially if codes of conduct are not followed, even though project efforts will focus on promoting local hiring of community workers; (iii) potential increase or intensification of underlying local tensions and even of conflicts if stakeholder engagement processes are not properly carried out in rural areas; (iv) use of areas with potential economic or social alternative uses to build the family or community energy systems, creating an opportunity cost for the local population; (v) temporary access restrictions and increased of traffic; (vi) land acquisition and/or temporary or permanent restrictions on land use, among others; and (vii) inconvenience to locals due to air pollution from dust and noise from the works and safety risks (communicable diseases, increased incidents of road accidents). As the Project involves procurement of solar panels (solar minigrids and PV systems), there is a risk of forced labor in the global supply chain for solar panels and solar components that require specific mitigation measures. To mitigate this risk of forced labor, the Bank requires the borrowers to strengthen solar- related procurement processes by including forced labor bidder declarations, qualification requirements and strengthened contractual provisions in procurements involving financing of solar panels/solar components. In this sense, the Project (i) acknowledges the alleged forced labor risks in the supply chain, (ii) will provide a statement of the ESS2 provisions on forced labor risks in primary suppliers in the A-ESRS, and (iii) describe in summary from the enhanced procurement mitigation measures, specifically the two declarations and prior review by the Bank. These risks could be more pronounced as a result of a sensitive context associated with the fading COVID-19 pandemic, which could pose health challenges for project workers and communities. The Bank’s due diligence will continue during Project implementation and the relevant information and analysis will be reflected in the A-ESRS. V. GRIEVANCE REDRESS SERVICES 63. Grievance Redress. Communities and individuals who believe that they are adversely affected by a project supported by the World Bank may submit complaints to existing project-level grievance mechanisms or the Bank’s Grievance Redress Service (GRS). The GRS ensures that complaints received are promptly reviewed in order to address project-related concerns. Project affected communities and individuals may submit their complaint to the Bank’s independent Accountability Mechanism (AM). The AM houses the Inspection Panel, which determines whether harm occurred, or could occur, as a result of Bank non-compliance with its policies and procedures, and the Dispute Resolution Oct 25, 2023 Page 27 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) Service, which provides communities and borrowers with the opportunity to address complaints through dispute resolution. Complaints may be submitted to the AM at any time after concerns have been brought directly to the attention of Bank Management and after Management has been given an opportunity to respond. For information on how to submit complaints to the Bank’s Grievance Redress Service (GRS), visit http://www.worldbank.org/GRS. For information on how to submit complaints to the Bank’s Accountability Mechanism, visit https://accountability.worldbank.org. VI. KEY RISKS 64. The overall residual risk rating associated with the proposed operation is Substantial. The section below presents the assessment and discussion of the key risks. 65. Political and governance risk is assessed as Substantial. Presidential elections are scheduled for 2025 and an early start of political campaigns may shift sector and/or geographical priorities as well as implementation mechanisms. Furthermore, changes in authorities could affect project teams and cause delays in decision making and implementation, as seen in previous operations. However, it is expected that such risks would be mitigated by the fact that the provision of basic services and closing existing access gaps should remain a priority across the political spectrum and across administrations and staff changes. In addition, the Project will ensure key staff and institutions develop capabilities to communicate the relevance and benefits of the operation to any new authorities and decision-makers, so as to seek their buy-in of key planned activities. It is likely this risk could delay the Project during implementation as mitigation measures may not fully address it. 66. Macroeconomic risk is assessed as Substantial. The high fiscal deficit (7.1 percent of GDP in 2022) and resulting lack of fiscal space could impact counterpart staffing as well as subnational governments capacities to identify project activities, beneficiaries and demand for support under the operation’s Components. Additionally, with 3.1 months of imports in international reserves in December 2022, external imbalances could complicate project programming and implementation, making key inputs expensive or difficult to access. The impact of these risks on project implementation are partially mitigated by: (i) the fact that most imports of goods for grid extension efforts (which represent close to three quarters of all project costs) will be carried out directly by regional subsidiaries of the state-owned power utility; and (ii) the possibility of carrying out direct payments to suppliers of standalone PV and minigrid systems (which represent roughly 15 percent of project funds). As these mitigation mechanisms cannot fully address the macroeconomic challenges posed to the Project, the residual risks could delay project implementation. 67. The institutional capacity for implementation and sustainability risk is rated Substantial. The inherent risk is the implementing entities limited capacity to deal with all the processes needed to be carried out simultaneously to implement the Project (such as having one PIU designing potential subprojects under a subcomponent, while the other PIU implements another Project activity, while the operation also performs other preparatory work). In addition, the need for PIUs to develop consistent, common, and coordinated communications with GAMs, GADs, and potential beneficiaries could delay implementation. The risks posed by such complex coordination will be mitigated by the development of local capacities for implementation which will build upon previous engagements such as the IDTR I, GPOBA and IDTR II projects (and efforts with other international financial institution, such as ENDE’s experience implementing the PER II, an IDB financed access project). The Project will ensure the PIUs have a core cadre of qualified staff to manage simultaneously most monitoring, evaluation, reporting, communication, environmental, social, procurement and financial management activities and their capacity will be further increased given the magnitude of the proposed operation. Such increased capabilities will ensure that both PIUs can advance key tasks in parallel (such as design of different subprojects, preparation of templates, etc.) as much as possible, thus avoiding that delays in one unit impact progress from the other Oct 25, 2023 Page 28 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) and simplifying implementation. Finally, the PEVD and its PIU will seek to design a communications strategy that clearly showcases project benefits to beneficiaries, implementation arrangements to key participating entities, and preparation and implementation tasks to vital partners, to facilitate syncing-up all efforts. It is likely this risk could delay project implementation given the need to improve local capabilities to deal with all coordination requirements. 68. The Fiduciary risk is rated as substantial. This rating is based on the magnitude of the proposed operation, the large scale of the decentralized renewable energy interventions, high dispersion of grid works, remote locations with difficult access, and the limited knowledge on financial management and procurement by PEVD and ENDE staff. The risk rating also considers the fiduciary and governance issues faced in a previous and similar operation financed by the Bank, the above-mentioned IDTR II. Further challenges faced by the Project include the nature of transactions (high and geographically dispersed number of expected contracts or the procurement of PV systems); and the lack of sufficient staff and experience – due to turnover and the scale-up the proposed operation represents– to carry out procedures under the Bank’s Procurement Regulations (even though the PEVD and ENDE have implemented projects financed by CAF, GIZ, KfW and IDB). Mitigation measures will include increasing fiduciary staff with relevant knowledge and experience to strengthen these units, train the fiduciary staff, and prepare an Operational Manual that includes the processes and procedures to respond adequately to the Project’s demands. In terms of procurement, the PPSD also includes a strengthening plan for both PIUs, which identifies needs, required staff qualifications, trainings activities calendar, supports of external consultants, etc. On the financial management side, risks will be mitigated by the strategies mentioned above, such as (i) reducing staff rotation; (ii) creating separate designated accounts for both PEVD and ENDE; and (iii) the use of financial software by the PEVD and ENDE. 69. The Environmental and Social (E&S) Risk is rated Substantial. Based on the scope of the entire national territory, including protected areas, limited social information currently available, and the likely temporary or permanent restrictions on land use, as well as and the borrower's weak experience in managing E&S risks according to ESF standards. In the case of Protected Areas, Biodiversity Management Plans, and resettlement protocols will have to be designed and implemented in case they are affected. Oct 25, 2023 Page 29 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III)(P180027) VII. RESULTS FRAMEWORK AND MONITORING @#&OPS~Doctype~OPS^dynamics@padannexresultframework#doctemplate PDO Indicators by PDO Outcomes Baseline Period 1 Closing Period Expand access to sustainable electricity services in rural areas of Bolivia Connections providing new electricity service (Number) Jan/2024 Feb/2027 Mar/2030 0 12,000 34,500 People provided with new or improved electricity service (Number) CRI Jan/2024 Feb/2027 Mar/2030 0 69500 107000 Net greenhouse gas emissions (Metric ton) Jan/2024 Feb/2027 Mar/2030 0 -40,000 -115,000 Improve access to sustainable electricity services in rural areas of Bolivia Connections providing improved electricity service (Number) Jan/2024 Feb/2027 Mar/2030 0 500 2,500 People provided with new or improved electricity service (Number) CRI Jan/2024 Feb/2027 Mar/2030 0 22000 34000 Net greenhouse gas emissions (Metric ton) Jan/2024 Feb/2027 Mar/2030 0 -2,400 -12,000 Intermediate Indicators by Components Baseline Period 1 Closing Period 1. Expand and improve access to sustainable electricity services in rural areas Generation capacity of energy constructed or rehabilitated (Megawatt) CRI Oct 25, 2023 Page 30 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III)(P180027) Jan/2024 Feb/2027 Mar/2030 0 0.6 1.9 Distribution lines constructed by grid extensions under the Project (Kilometers) Jan/2024 Feb/2027 Mar/2030 0 350 1,000 Change in the time women spend on domestic/unpaid care work (Percentage) Jan/2024 Feb/2027 Mar/2030 0 -6 -7 2. Strengthen the electricity sector Personel of key sector entitites trained to strengthen the distribution sector (Number) Jan/2024 Feb/2027 Mar/2030 0 160 250 Knowledge outputs and evidence produced to improve the sustainability of the power sector (Number) Jan/2024 Feb/2027 Mar/2030 0 3 10 3. Project implementation support Level of satisfaction of stakeholders with consultation and engagement processes (Percentage) Jan/2024 Feb/2027 Mar/2030 35 50 60 People trained on sustainable electricity issues (Number) Jan/2024 Feb/2027 Mar/2030 0 130,000 200,000 Of which women (Number) Jan/2024 Feb/2027 Mar/2030 0 65,000 100,000 People targeted under improved energy use specific campaigns (Number) Jan/2024 Mar/2030 130,000 200,000 Oct 25, 2023 Page 31 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) Monitoring & Evaluation Plan: PDO Indicators by PDO Outcomes Expand access to sustainable electricity services in rural areas of Bolivia Connections providing new electricity service (Number) This indicator measures the number of connections to provide new access to electricity under the Project. The baseline Description value for this indicator is zero. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection People provided with new or improved electricity service (Number) CRI This indicator measures the number of people that have received an electricity connection under the Project via new Description connections. The baseline value for this indicator is expected to be zero. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection Net greenhouse gas emissions (Metric ton) Net greenhouse gas emissions are calculated as the difference between Project gross (absolute) emissions aggregated Description over the economic lifetime 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. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection Improve access to sustainable electricity services in rural areas of Bolivia Connections providing improved electricity service (Number) This indicator measures the number of connections to provide improved access to electricity under the Project. The Description baseline value for this indicator is zero. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection People provided with new or improved electricity service (Number) CRI This indicator measures the number of people that have received an electricity connection under the Project via Description enhanced connections. The baseline value for this indicator is expected to be zero. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection Net greenhouse gas emissions (Metric ton) Oct 25, 2023 Page 32 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) Net greenhouse gas emissions are calculated as the difference between Project gross (absolute) emissions aggregated Description over the economic lifetime 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. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection Monitoring & Evaluation Plan: Intermediate Results Indicators by Components 1. Expand and improve access to sustainable electricity services in rural areas Generation capacity of energy constructed or rehabilitated (Megawatt) CRI This indicator measures the capacity of generation installed under the Project, including all technologies deployed. The Description baseline value is expected to be zero. It measures outputs under subcomponents 1.c. Standalone PV systems and 1.d. Minigrid systems. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection Distribution lines constructed by grid extensions under the Project (Kilometers) This indicator measures the length of the distribution lines constructed under the Project. The baseline value for this sub- Description indicator is zero. This indicator measures outputs under subcomponents 1.a. Grid extension for households and 1.b. Grid extension for productive uses. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection Change in the time women spend on domestic/unpaid care work (Percentage) This indicator measures how much time women spend on domestic and/or unpaid work prior to Project activities and Description compare it with the time devoted for the same activities after rural electrification or improved service efforts have been undertaken, as these should help reduce the time for such tasks. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection 2. Strengthen the electricity sector Personel of key sector entitites trained to strengthen the distribution sector (Number) This indicator measures the number of people trained on sustainable electricity and distribution sector issues under the Description Project. It includes relevant stakeholders from the distribution segment as well as from PEUs, different levels of government and other public or private sector institutions, as needed. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Oct 25, 2023 Page 33 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) Responsibility for Data MHE Collection Knowledge outputs and evidence produced to improve the sustainability of the power sector (Number) This indicator measures the number of studies, assessments, guidelines, and any other knowledge outputs and/or Description evidence financed under the Project and to support the design of public policies to strengthen the power sector's sustainability in general, and distribution companies in particular. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection 3. Project implementation support Level of satisfaction of stakeholders with consultation and engagement processes (Percentage) This indicator measures the percentage of stakeholders that report to be satisfied with the Projects’ consultation and Description engagement process, which would be reflected through surveys performed on such occasions. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection People trained on sustainable electricity issues (Number) This indicator measures the number of people and beneficiaries that are trained on sustainable electricity issues under Description the Project. It includes relevant beneficiaries as well as government officials, staff from energy-sector companies university students, entrepreneurs, local technicians, departmental or municipal staffers, amongst others. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection Of which women (Number) This sub-indicator measures the number of women that are trained on sustainable electricity issues under the Project. It Description includes relevant beneficiaries as well as government officials, staff from energy-sector companies university students, entrepreneurs, local technicians, departmental or municipal staffers, amongst others. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection People targeted under improved energy use specific campaigns (Number) This indicator measures the number of people targeted under energy efficiency, energy conservation, energy savings, Description and overall improved energy use campaigns launched in connection to the Project. Frequency Annual Data source MHE and ENDE Methodology for Data The PIUs will gather information on the supported activities and present it through the monitoring systems and Project Collection reports. Responsibility for Data MHE Collection Oct 25, 2023 Page 34 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) ANNEX 1: Implementation Arrangements and Support Plan Plurinational State of Bolivia Bolivia Improving Sustainable Access to Electricity Project (IDTR III) Implementation Support Plan 1. The World Bank will provide capacity building and training as needed to the PEVD and ENDE PIUs on fiduciary, environmental, and social aspects to ensure appropriate project implementation. Other stakeholders – such as GADs, GAMs, or distribution companies – could also be targeted, including under Components 2 or 3. Training on fiduciary matters (such as procurement or financial management) would be provided to the PEVD and ENDE PIUs as well as to other technical teams and stakeholders if necessary to ensure compliance with relevant policies. As the proposed operation will be the first one for the Bolivian energy sector institutions to be implemented under the World Bank’s Environmental and Social Framework (ESF), training on relevant processes and policies will be provided. Furthermore, capacity strengthening measures on environmental and social management have already been identified and reflected in the Environmental and Social Commitment Plan (ESCP). Overall, the World Bank technical, ESF, procurement and FM teams will be available on a just-in-time basis to support, guide and help resolve any related issues that may arise during Project implementation. Further details on the approach for implementation support on FM, procurement and ESF issues are discussed below. Financial Management 2. This section details the main features of financial management arrangements, mainly based on the PEVD’s and ENDE’s existing capacities and performance. 3. Use of Country Public Financial Management (PFM) Systems. Like other operations in the Bank’s Bolivia portfolio, the proposed Project will be fully integrated and executed into the national planning and budget arrangements, and will benefit from the use of well-functioning PFM elements including SIGEP for PEVD and ENDESIS at ENDE. In addition, the TSA will support such units when needed to ensure that Project needs, and risks are adequately addressed, mainly as they relate to internal controls, financial reporting, and auditing. Within this framework, the following sections describe some specific arrangements. 4. Organizational arrangements and staffing. Each entity will have a PIU that will coordinate with relevant line agencies and units and be responsible for Project implementation. Each PIU will have a financial management specialist to deal with FM responsibilities for its respective Components, including budgeting, accounting, treasury, preparing the IFRs and SOEs (subject to confirmation of the flow of funds arrangements) and contract the financial audit. In the specific case of ENDE, two accountants may be necessary for Project activities. Staff will be financed out of loan proceeds as needed. In such case, FM specialists and accountants will be hired under terms of reference agreed with the Bank and relevant procurement procedures. 5. Programming and Budget. The preparation of the annual program and budget will follow local regulations established by the Ministry of Economy and Public Finance (MEFP), as well as instructions issued by the Viceministry of Public Investment and External Finance (VIPFE), as applicable. The Project’s budget will be part of the national budget, and its execution will be centrally and fully integrated into the country’s integrated financial management system (SIGEP) for the PEVD side. On the ENDE side, the budget and its execution will be registered in the ENDESIS financial system. Disbursements will be processed through the TSA by providing direct bank transfers from the account managed by PEVD Oct 25, 2023 Page 35 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) and ENDE to contractors or suppliers’ bank accounts in the financial system. This would permit an agile and simple flow of funds without additional and unnecessary layers. 6. Accounting – Information systems. The PEVD has to comply with the governmental accounting standards. Therefore, the proposed Project would use the chart of accounts established by the Accountant General’s Office (Dirección General de Contabilidad Fiscal). On ENDE’s side, the ENDESIS financial system will register and report execution by Component/subcomponent and categories. The proposed Project will benefit from the use of SIGEP and the STA (in US dollars and local currency) to process payments, including payments to contractors and suppliers under the subprojects. From thereon, Project execution will be fully integrated into the central government accounting. On the PEVD side the use of SIGEP will be complemented with the VISUAL financial system to allow recording, control, reporting and monitoring of subprojects implementation. The VISUAL system will allow recording the Project transactions following the classification by Component/subcomponent and categories for further issuance of financial reports and statements of expenditures. The proposed Project’s transactions and preparation of financial statements will follow the cash basis of accounting. 7. Processes and procedures. Overall, PEVD and ENDE should comply with local requirements related to administrative and control systems (SAFCO Law), which are partially integrated into the operation of SIGEP and ENDESIS, as they relate to budget preparation and execution. All the Project supporting documentation will be archived in PEVD and ENDE according to the Components/subcomponents that each PIU is responsible for implementing. All these tasks will be included in the POM and will be reviewed by the Bank to ensure adequate controls are in place. 8. Financial reporting. It is expected that the interim financial reports (IFRs) will be directly issued from the VISUAL and ENDESIS financial systems, respectively. IFRs will include: (i) sources and uses of funds, reconciling items, and cash balances, with expenditures classified by Project Component; (ii) a statement of investments, classified by Project Component/subcomponent and Loan category, reporting the current semester and the accumulated operations against ongoing plans, as well as footnotes explaining the important variances; and (iii) a subproject statement which will present the individual amount approved, executed, and outstanding balances, accordingly. The IFRs would include Loan proceeds. The IFRs would be prepared and submitted to the Bank by each Entity on a semiannual basis no later than 45 days after the end of each calendar semester. The IFRs would be prepared in local currency and US dollars. On an annual basis, PEVD and ENDE will also prepare Project financial statements including cumulative figures, for the year and as of the end of the fiscal year (December 31). 9. Audit. Annual audit reports on Project financial statements, including the management letter should be submitted to the Bank, within six months of the end of the Borrower’s fiscal year (December 31). The audit should be conducted by an independent private audit firm acceptable to the Bank and under terms of reference approved by the Bank. Audit costs would be financed out of the Loan proceeds and selection would follow standard Bank procedures. The scope of the audit would be defined by PEVD and ENDE in agreement with the Bank, based on Project specific requirements and responding as appropriate to identified risks, including review of compliance with agreed processes and procedures, as well as on-site revision of a sample of subprojects. Audit TORs will specifically require that the internal control report clearly identifies the issues related to both implementing entities. In accordance with WBG’s Access to Information Policy, the audited annual financial statements will be made publicly available through PEVD and ENDE websites. Audit requirements would include the following: Table A1.1: Audit reports due dates Audit Report Due date Project financial statements June 30 Management Letter June 30 Oct 25, 2023 Page 36 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) 10. Internal Audit. PEVD and ENDE both have Internal Audit Units that are part of the internal control framework, and which would include the Project in its annual work plan. 11. Flow of Funds and Disbursement Arrangements. Following the general practice of the current portfolio, the following disbursement methods may be used to withdraw funds from the proposed Loan: (i) reimbursement, (ii) advance, and (iii) direct payment. Under the advance method, and to facilitate Project implementation, a Designated Account (DA) in US dollars will be opened by each implementing entity (PEVD and ENDE). Funds deposited into the DAs as advances would follow Bank disbursement policies and procedures, as described in the Financing Agreement and in the Disbursement and Financial Information Letter (DFIL). In keeping with current arrangements established by the Viceministry of Treasury and Public Credit for the operation and use of a Treasury Single Account in US dollars, the DAs would be opened and maintained as a separate Libreta within the TSA in US dollar. Following the existing treasury arrangements, funds from TSA in US dollars will be periodically transferred to both TSA in Bolivianos into a separate Libreta(s) under the Project name, from which all payments and disbursements to beneficiaries’ bank accounts will be processed. Considering that the Project will be executed by two implementing entities – PEVD and ENDE, it would require agreeing on the responsibility and authorized signature for the DAs, accordingly. 12. Supervision Plan: The World Bank plans to perform at least two support missions per year to the extent possible, while also reviewing the annual audit reports and the IFRs. Considering that there are still some important issues to be defined, an action plan has been developed to finalize the pending actions: Table A1.2: Action Plan Action Responsible Definition of policies, procedures and rules for the Project to be included in the POM. PEVD and ENDE Description of the register of the subprojects how they will be controlled and reported (advances, ENDE payments and outstanding balance). Pending meeting with PEVD Internal audit to understand the function, capacity, responsibilities and Confirmed tasks assigned and how this could contribute to strengthen the Project internal control procedures. Procurement 13. All Project procurement will be carried out in accordance with the “World Bank Procurement Regulations for IPF Borrowers” fifth edition of September 2023, herein referred as “Procurement Regulations”. Bank’s Standard Procurement Documents shall be used for all contracts under international market approach, and the Systematic Tracking of Exchanges in Procurement (STEP) is to be used for Procurement Plans, clearances, and monitoring. Procurement Plans will be updated at least semi-annually or as required to reflect the actual Project implementation needs and improvements in institutional capacity. 14. The assessment concluded that the PEVD has experience executing Bank-financed projects, and the ENDE does not have experience in the implementation of IBRD-financed projects. The current staff of both entities do not have experience on Bank’s Procurement Regulations. Both PEVD and ENDE have extensive experience contracting and supervising similar contracts to those planned in this Project. The activities financed by the Project are foreseen to consist of small and medium value contracts. The overall project risk for procurement is Substantial. The IBRD will provide necessary capacity building to PEVD and ENDE to conduct procurement activities. 15. Procurement of Goods, Works, and Non-Consulting Services. The open international competitive bidding approach should be applied when the Procurement Plan establishes it, while for small contracts the open national competitive bidding approach is supported by the availability of bidders in the local market. The Borrower can specify Oct 25, 2023 Page 37 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) detailed requirements to which bidders respond by offering bids; the Request for Bids or the Request for Quotations would be the selection methods for these contracts. Procurement for works will be processed with documents including complete technical specifications and final designs, under Force Accounts selection arrangement or as it will be accorded in the Procurement Plan. 16. Procurement of Consulting Services, Technical Assistance, designs, supervision services, and other studies. Considering that these will be small and medium value contracts, the suitable market approach would be an open competition in the national or international market approach, while the Quality-Cost- Based Selection or the Consultant’s Qualification Based Selection (considering the nature of the services and the need to take into account the quality of the proposals based on the evaluation of the different solutions and the cost of the services), or Direct Selection (when a sole firm consultant with needed capabilities is identified and justified) would be the selection methods. 17. Project implementation support personnel. Individuals contracted to support project implementation (Project staff), other than individual consulting positions identified in the Legal Agreement, may be selected by the Borrower according to their personnel hiring procedures for such activities, as reviewed, and found acceptable by the Bank and described in the Project’s Operational Manual. 18. Individual consultants. Individual consultants will be selected for an assignment for which: (i) a team of experts is not required; (ii) no additional office support is required; and (iii) the experience and qualifications of the individual are of paramount requirement. The evaluation shall be based on the relevant qualifications and experience of the individual consultant in accordance with the provision of paragraphs 7.34 to 7.39 of Section VII of the Procurement Regulations. 19. Frequency of procurement implementation support. Contracts subject to post review will be reviewed by the IBRD once a year. Additionally, semi-annual supervision visits will take place to carry out reviews of procurement actions. Procurement staff of the PEVD, the ENDE, and the IBRD will meet annually to review the implementation of the Procurement Plan and to carry out Post Reviews. Based on the findings of these reviews and the proposed ratings, the IBRD may determine the revision of the prior review requirements. Environmental and Social 20. VMEER, PEVD and ENDE rely on continuous supporting consultancies to develop a sound Environmental and Social Assessment and SEP by Appraisal, and to draft the other relevant E&S management instruments in the context of the World Bank’s ESF throughout program preparation, including ESMF and the LMP, RPF and IPPF. The ESCP will provide further detail on the following aspects identified in the A-ESRS: (i) Establish and maintain a Project Implementation Unit(s) with qualified E&S staff and resources to support the management of E&S risks and impacts of the Project. (ii) Define clear roles, responsibilities, and authority, as well as designate specific personnel to be responsible for the implementation and monitoring of the E&S risk management instruments. (iii) Capacity building to all implementing agencies on environmental and social risk management. (iv) Regular monitoring reports on the environmental, social, health and safety (ESHS) performance of the Project, including stakeholder engagement activities during Project execution, and the functioning of the grievance mechanism. (v) Deadlines for the ESCP, SEP, preliminary and final versions of the ESMF, and the LMP, RPF and IPPF, together with the Battery Management Plan and Biodiversity Management Plan, if required. (vi) Requirements to carry out screening for proposed subprojects and depending on its results, develop site specific ESMPs/checklists for each subproject, depending on their characteristics, and to include construction related requirements into bid documents prior to their issuance. (vii) Requirements for implementation, supervision and monitoring of site-specific ESMPs and other subproject-level instruments as needed. (viii) Incidents and accidents notification. (ix) Requirements for solar panel procurement based on the guidance note for IPF on Solar Procurement Bidder Declaration on Forced Labor. Oct 25, 2023 Page 38 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) ANNEX 2: Sector Context Plurinational State of Bolivia Bolivia Improving Sustainable Access to Electricity (IDTR III) 1. Energy production and supply in Bolivia declined for most of the last decade (since 2014 and 2016, respectively) and the partial recovery seen since 2021 has fallen short of pre-pandemic levels. 57 However, even if energy consumption dropped both in 2019 and 2020 due to political turmoil and the COVID-19 crisis, it almost completely recovered by end 2021. 58 Transport has been the main driver behind this growth as it now accounts for over half of total final energy consumption (up from close to a third in 2006), followed by the industrial (21 percent), residential (15 percent), agricultural, fishing and mining (4 percent), and commercial, services and public (3 percent) sectors. 59 Figure A2.1: Bolivia's Primary Energy Production, Transformation and Consumption, 2006-2021 60 (kilo barrels of oil equivalent – kBOE) 160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 - 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Production Transformation Consumption 2. The country’s power grid is dependent on the country’s abundant natural gas (which fuels roughly 60 percent of total power generation), while hydropower satisfies another 30 percent of the country’s power needs. Solar and wind power (4 percent in aggregate) and biomass (another 4 percent) complement the power matrix. 61 The residential sector is the largest driver of power consumption (around 40 percent) followed by the industrial, and the commercial, services and public sectors (24 percent each). 62 Such distribution has barely changed in the last 2 decades, except for 2020, when the residential sector represented roughly 45 percent of total demand (due to pandemic-related measures and lockdowns). 63 Total installed capacity in the country has grown from 1,410 MW in 2006 to 4,136 by end 2021, with natural gas representing roughly 70 percent, followed by hydropower (another 20 percent) and wind and solar (3 percent each). 64 57 Ministerio de Hidrocarburos y Energías. 2022. Balance Energético Nacional 2006 – 2021, p. 42 58 Idem. 59 Ibid, p. 27. 60 Ibid, p. 26. 61 Ibid, p. 60. 62 Ibid, p. 62. 63 Idem. 64 Ibid, p. 125. Oct 25, 2023 Page 39 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) Figure A2.2: Bolivia's Electricity Generation by Technology 65 and Consumption by Sector 66 2021 (share – %) Commercial, Agricultural, Hydropower, 29.75% Renewables (wind services & fishing and & solar), 4.32% public, mining, 7.67% 24.31% Biomass, 4.18% Industry, Construction & Diesel, 24.39% others, 2.98% 0.42% Transport, Natural gas, Residential, 0.28% 61.33% 40.37% 3. Three companies represent 70 percent of total generation in the country : Compañia Boliviana de Energía Eléctrica (COBEE), Empresa Eléctrica Guaracachi (EGSA) and Empresa Eléctrica Corani (CORANI), with the two latter being ENDE subsidiaries. Four transmission companies operate the high-voltage system (Sistema Troncal de Interconexión, STI), with ENDE owning a large majority. The MHE has direct responsibility over the national load dispatch committee (Comité Nacional de Despacho de Carga – CNDC), which seeks to ensure a reliable and secure power supply. The CPE also gave Departmental Autonomous Governments (GADs) and Departmental Autonomous Municipalities (GAMs) key roles in electrification matters, assigning GADs the obligation of fostering energy generation in isolated systems and rural electrification projects, and tasking GAMs with developing clean energy projects and providing public services such as public lighting or promoting productive activities, all in coordination with distribution companies. Figure A2.3: Bolivia's power grid map 67 65 Idem. 66 Idem. 67 67 Ministerio de Hidrocarburos y Energías. 2022. Balance Energético Nacional 2006 – 2021, p. 144. Oct 25, 2023 Page 40 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) 4. Most of the generation assets, including thermal (gas), hydropower, solar, wind, and transmission and distribution systems are concentrated in the south and southwest regions, and most of the diesel generation plants are concentrated in the northeast regions. A significant share of the backbone transmission system as well as of the hydropower plants are in the central region, which is prone to landslides. Segments of the transmission system in the central-west regions are in areas with medium risk of flooding and high risk of localized flooding. Some hydropower plants are in the central region that is exposed to medium risk of drought, which affects much of the southern half of the country. Much of the transmission system as well as some hydropower plants are in the central to southern regions, which are exposed to frost. Bolivia’s updated NDC (see table A2.1 below) showcases the country’s increased ambition to address climate risks, especially when compared to its first submission. Table A2.1: Bolivia’s 2022 68 & 2016 69 NDCs key energy-related commitments Commitment 2022 NDC 2016 NDC By 2030, 100% Universal Access to electricity coverage will be Reduced the Unsatisfied Basic Needs (NBI) for electricity Access achieved coverage from 14.6% in 2010 to 3% by 2025 By 2030, users are expected to produce approximately 76.9 Increased participation of renewable energy to 79% by 2030 GWh of electricity demanded nationwide (37 MW of installed from 39% in 2010. capacity) By 2030, 79% of the energy consumed will come from Increased participation of alternative energy and other renewable energy plants (50% of installed capacity). energy (steam combined cycle) from 2% in 2010 to 9% in Renewable 2030 in the total electrical system, which implies an increase energy By 2030, 19% of the energy consumed will come from power of 1,228 MW by 2030, compared to 31 MW in 2010. plants based on alternative energies (13.25% of installed capacity). By 2030, 8 Isolated Systems will be hybrid, including renewable sources in their generation matrix 5. Distribution companies need to strengthen their capacity to incorporate new assets and infrastructure into their networks and within and surrounding their current concession areas. These entities companies are in need of improved analyses on service reliability, operation and maintenance, enhanced strategies to implement remote payment and increase efficiency based on lessons learned from similar experiences in the region and elsewhere, improved assessments on technical and non-technical losses, regulatory gaps and technical specifications for smart meters and other loss reduction measures. 6. Most – close to 97 percent – of the 3.61 million total households in Bolivia (including from both urban and rural contexts) are connected to the grid, either through the national interconnected system (Sistema Nacional Interconectado – SIN) or through isolated systems (Sistemas Aislados – SA) 7071. Solar home systems (SHSs) 72 cover around 1.6% of served 68 Estado Plurinacional de Bolivia. 2022. Contribución Nacionalmente Determinada del Estado Plurinacional de Bolivia 2021-2030, pp. 15-18. 69 Estado Plurinacional de Bolivia. 2016. Contribución Prevista Determinada Nacionalmente del Estado Plurinacional de Bolivia, pp. 8-9. 70 The SIN supplies electricity to the largest cities covering eight of nine departments (La Paz, Oruro, Potosi, Cochabamba, Chuquisaca, Tarija, Santa Cruz and Beni). The population in the northern part (Pando) of the country remains disconnected from the national grid and is either served by Isolated Systems (SA) or has no access to electricity at all. 71 Fernández. 2022. Cobertura del Servicio de Electricidad en Bolivia a 2020, p. 14. 72 Standalone SHSs are photovoltaic systems for isolated and individual household use. Two types of systems are most common: (i) second generation systems which use lead acid batteries and accounted for 40 percent of all installations between 2005 and 2011; and (ii) third generation systems (relying on lithium batteries) and which represented 60 percent of total installations between 2010 and 2021. Oct 25, 2023 Page 41 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) households (around 55 thousand houses), while hybrid systems or minigrids 73 represent another 0.05% (close to 2 thousand homes) and self-supply (through motors or batteries) and additional 2.2% percent. 74 Roughly 69 percent of all households are located in urban settings and the remaining 31 are in rural areas 7576 and 71 percent of the country’s dwellings are concentrated in three Departments: La Paz, Cochabamba and Santa Cruz Departments. 77 Figure A2.4: Bolivia's Access to Electricity by Department and Area 78 (rate – %) 100% Total access rate 50% Urban access rate 0% Rural access rate Potosí Pando Chuquisaca Cochabamba Oruro Beni Bolivia La Paz Santa Cruz Tarija 7. Access to energy services varies across Departments, yet most face – different – challenges to address this inequity. Departments like Potosí and Pando still have access rates below 90 percent – the lowest in the country – while highly electrified Santa Cruz has the largest number of households without access to this basic service (over 40 thousand). Beni (and Pando) have the lowest rural access rate in the country – 71.2 and 72.4 percent, respectively – and Tarija (together with Pando and Santa Cruz) has one of the lowest urban access rates in Bolivia – 98.4 percent (as well as 98.1 and 99 percent, respectively). 79 Figure A2.5: Households access to electricity rates (percent, darker color represents higher access rate) 80 8. It is estimated that roughly 240 municipalities have not yet achieved universal access to electricity in the rural context. Although the Project will have a national scope, it is expected that most of the Project's efforts will be developed in the municipalities that still have such access gaps and are located in the five priority departments for this operation: Beni, Pando, Potosí, Santa Cruz, and Tarija. The selection, as well as the interventions and specific characteristics of the 73 Hybrid systems are isolated grid systems that use a combination of solar and diesel energy for electricity generation and distribute it through minigrids. There are currently 4 rural hybrid systems in operation with PV capacity ranging from 60 kWp to 420 kWp. The operators of these hybrid systems are distribution companies regulated by the AETN. 74 Fernández. 2022. Cobertura del Servicio de Electricidad en Bolivia a 2020, p. 11. 75 Rural households are those or located in populations centers of less than 2,000 inhabitants. 76 Fernández. 2022. Cobertura del Servicio de Electricidad en Bolivia a 2020, p. 4. 77 Ibid, p. 5. 78 Ibid, p. 5. 79 Ministerio de Hidrocarburos y Energías. 2022. Balance Energético Nacional a Nivel Departamental 2021, p. 90. 80 Idem. Oct 25, 2023 Page 42 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) activities that the operation will support, will be determined based on the processes established in the institutional arrangements and the eligibility criteria to be detailed in the Project’s Operational Manual, which will also indicate the procedures to follow in order to develop activities in the other four non-priority departments for this Project. The municipalities with rural electricity access rates below 100 percent in Bolivia in the five priority departments (in blue), followed by municipalities in the other four departments (in yellow) are listed below. Table A2.2: municipalities with rural electricity access rates below 100 percent (percentage) Municipio Tasa Municipio Tasa Municipio Tasa Beni 79.8 Potosí (cont.) 76.0 Santa Cruz (cont.) 76.0 Exaltación 91.9 Ckochas 51.7 El Torno 76.5 Guayaramerín 68.4 Colcha "K" 85.2 Fernández Alonso 98.6 Loreto 98.8 Colquechaca 52.5 Gutiérrez 87.0 Puerto Siles 72.6 Cotagaita 98.4 Lagunillas 99.5 Reyes 92.2 Mojinete 42.0 Mineros 88.1 Riberalta 60.4 Ocurí 75.7 Montero 82.7 Rurrenabaque 88.7 Pocoata 87.4 Okinawa Uno 97.1 San Andrés 58.9 Potosí 79.4 Pailón 98.8 San Borja 69.0 Puna 96.4 Pampa Grande 76.9 San Ignacio 81.3 Ravelo 85.9 Porongo 99.2 Santa Ana del Yacuma 84.6 San Agustín 81.0 Portachuelo 89.4 Santa Rosa 96.1 San Antonio de Esmoruco 73.0 Postrer Valle 93.4 San Pablo de Lípez 89.5 Pucara 66.5 Municipio Tasa San Pedro de Buena Vista 66.4 Puerto Quijarro 66.2 Pando 70.6 San Pedro de Quemes 87.8 Puerto Suárez 79.3 Bella Flor 86.8 Tacobamba 62.2 Roboré 92.1 Bolpebra 63.6 Tahua 78.9 Saavedra 94.3 Cobija 100.0 Tinguipaya 88.0 Saipina 96.1 Filadelfia 76.8 Tomave 72.6 San Antonio de Lomerío 94.7 Ingavi 70.8 Toro Toro 70.5 San Carlos 85.3 Nueva Esperanza 64.3 Tupiza 73.7 San Ignacio de Velasco 83.3 Porvenir 68.4 Uncía 60.6 San Javier 65.3 Puerto Rico 64.1 Urmiri 86.8 San José de Chiquitos 91.6 San Lorenzo 67.0 Uyuni 58.0 San Juan 81.3 San Pedro 58.4 Villa de Sacaca 57.7 San Julián 89.2 Santa Rosa del Abuná 90.0 Villazón 60.5 San Matías 97.7 Santos Mercado 59.8 Vitichi 94.9 San Miguel de Velasco 63.9 Sena 26.1 Yocalla 93.2 San Rafael 55.0 Villa Nueva (Loma Alta) 82.5 San Ramón 54.0 Municipio Tasa Santa Rosa del Sara 91.3 Municipio Tasa Santa Cruz 88.7 Urubichá 96.3 Potosí 76.0 Ascensión de Guarayos 85.1 Vallegrande 86.8 Acasio 79.8 Buena Vista 95.3 Yapacaní 95.1 Arampampa 55.1 Carmen Rivero Torrez 72.6 Atocha 89.0 Charagua 66.4 Municipio Tasa Betanzos 72.4 Colpa Bélgica 90.1 Tarija 95.4 Caripuyo 58.2 Comarapa 88.6 El Puente 87.1 Chaquí 82.8 Concepción 80.9 Tarija 82.8 Chayanta 72.0 Cuatro Cañadas 88.2 Uriondo 90.5 Chuquiuta 78.4 El Puente 45.2 Yunchará 97.9 Oct 25, 2023 Page 43 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) Municipio Tasa Municipio Tasa Municipio Tasa Chuquisaca 87.8 La Paz 85.4 La Paz (cont.) 85.4 Azurduy 64.3 Achacachi 96.7 Papel Pampa 59.9 Camargo 98.3 Alto Beni 67.3 Patacamaya 100.0 Culpina 81.2 Ancoraimes 93.8 Pelechuco 77.9 Huacareta 89.3 Apolo 82.2 Puerto Acosta 83.6 Huacaya 88.3 Aucapata 69.3 Puerto Carabuco 95.6 Icla 95.0 Ayata 59.8 Puerto Pérez 80.1 Incahuasi 55.9 Ayo Ayo 67.7 Quiabaya 81.6 Macharetí 68.6 Batallas 92.2 Quime 66.2 Monteagudo 93.3 Cairoma 92.5 San Andrés de Machaca 68.3 Padilla 99.9 Calacoto 70.8 San Pedro de Curahuara 66.2 Poroma 51.9 Calamarca 90.7 San Pedro de Tiquina 75.1 Presto 74.9 Catacora 90.0 Santiago de Callapa 55.6 San Lucas 89.4 Chacarilla 58.8 Santiago de Huata 76.8 Sopachuy 88.4 Charaña 42.1 Santiago de Machaca 95.8 Tarvita 94.1 Chua Cocani 70.2 Sapahaqui 89.9 Villa Charcas 70.8 Chulumani 91.3 Sica Sica 99.7 Villa Vaca Guzmán (Muyupampa) 96.8 Chuma 98.3 Sorata 94.3 Collana 81.0 Tacacoma 63.9 Municipio Tasa Colquencha 73.7 Taraco 93.2 Cochabamba 83.4 Colquiri 81.9 Teoponte 73.8 Aiquile 72.6 Comanche 65.9 Umala 75.6 Alalay 62.1 Coripata 98.8 Viacha 84.4 Arbieto 99.5 Coro Coro 84.2 Villa Libertad Licoma 92.3 Arque 77.7 Coroico 99.2 Yaco 66.9 Ayopaya (Villa de Independencia) 66.6 Curva 57.7 Yanacachi 85.0 Bolívar 69.2 Desaguadero 81.4 Capinota 66.9 El Alto 18.7 Municipio Tasa Chimoré 63.1 Escoma 67.4 Oruro 81.6 Cocapata 86.0 Guanay 85.7 Antequera 81.6 Colomi 72.3 Guaqui 86.1 Belén de Andamarca 95.2 Entre Rios 77.2 Huarina 75.5 Carangas 88.3 Mizque 72.6 Huatajata 82.3 Huanuni 98.7 Morochata 69.6 Humanata 60.8 Huayllamarca 66.0 Pasorapa 95.3 Ichoca 69.1 Machacamarca 81.6 Pojo 89.9 Inquisivi 78.0 Pampa Aullagas 76.0 Puerto Villarroel 87.4 Irupana 95.7 Pazña 86.1 RAQAYPAMPA 67.4 Ixiamas 43.7 Poopó 60.5 Sacabamba 81.6 Jesús de Machaca 85.0 Sabaya 92.8 Shinahota 72.8 La Asunta 100.0 Salinas de García Mendoza 94.1 Sicaya 73.2 La Paz 55.8 Santiago de Andamarca 55.4 Tapacarí 58.3 Luribay 78.1 Santiago de Huari 72.3 Tiraque 85.7 Mapiri 87.8 Santuario de Quillacas 65.8 Totora 88.6 Mocomoco 59.6 Toledo 84.8 Vacas 89.5 Nazacara de Pacajes 42.5 Totora 79.4 Vila Vila 66.7 Palca 93.0 Turco 95.7 Villa Tunari 79.1 Palos Blancos 84.9 Yunguyo de Litoral 59.1 Oct 25, 2023 Page 44 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) ANNEX 3: Economic and Financial Analysis Plurinational State of Bolivia Bolivia Improving Sustainable Access to Electricity (IDTR III) Assumptions & Project activities 1. Key assumptions used to perform the economic and financial analyses and estimate electricity expenditures, beneficiaries and emissions across all assessed technologies are showcased below. Table A3.1: Key assumptions, tariffs, beneficiaries and emissions factors used Concept Value Unit Discount rate 5.0% Percent Sensitivity discount rate (GoB’s social rate) 12.0% Percent Financial discount rate (market rate) 10.1% Percent Annual inflation 2024-2045 2.0% Percent Value added tax 13.0% Percent Exchange rate 6.86 Bs/US$ Residential tariff (≥71 kWh/mo) 0.66 Bs/kWh Dignidad tariff (≤70 kWh/mo) 0.50 Bs/kWh General tariff 1.31 Bs/kWh Monomic price 59.15 US$/MWh Economic value of the additional electricity service 1.45 US$/kWh Ex ante emissions factor (consumption ≤0.055 MWh/yr) 6.8 tCO2/MWh Ex ante emissions factor (consumption ≥0.055 MWh/yr) 1.3 tCO2/MWh Grid emissions factor 0.42 tCO2/MWh Beneficiaries per household 3.1 ppl/hh Beneficiaries per institution 81 ppl/inst Key activities 2. Activities per subcomponent may vary but the expected costs and benefits of the five types of interventions presented below are expected to be standardized. Even if the specific characteristics of each subproject may vary according to local demand, needs and available resources, typical interventions have been delimited and assessed based on past projects and experiences. Table A3.2: Key types of interventions assessed Intervention Target Unit Cost Unit Grid extensions for households 25,480 households (hh) 3,493 US$/hh Grid extensions for productive uses 341 productive uses (prod) 8,788 US$/prod Standalone PV SHS 9,012 hh 677 US$/hh Standalone PV systems for institutions 312 institutions (inst) 6,090 US$/inst 6 Minigrid systems Minigrid systems 235 hh/minigrid 1,666,667 US$/minigrid 6 inst/minigrid Oct 25, 2023 Page 45 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) Assumptions per activity 3. The expected implementation timeline is discussed below as well as further details and assumptions for each type of intervention. Table A3.3: Implementation timeline Year Intervention 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 Grid extension construction 5% 10% 20% 30% 25% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% Grid extension operation 0% 5% 15% 35% 65% 90% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 95% 85% 65% 35% 10% Standalone PV systems construction 5% 10% 20% 30% 25% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% Standalone PV systems operation 0% 5% 15% 35% 65% 90% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 95% 85% 65% 35% 10% Standalone PV systems replacement 0% 0% 0% 0% 0% 5% 10% 20% 30% 25% 10% 5% 10% 20% 30% 25% 10% 0% 0% 0% 0% 0% Minigrid systems construction 5% 10% 20% 30% 25% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% Minigrid systems operation 0% 5% 15% 35% 65% 90% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 95% 85% 65% 35% 10% Minigrid systems replacement 0% 0% 0% 0% 0% 5% 10% 20% 30% 25% 10% 5% 10% 20% 30% 25% 10% 0% 0% 0% 0% 0% 4. Grid extensions for households: The model assumes households electricity consumption will increase fivefold and continue growing 1.5 percent per year. O&M cost be roughly US$1 per month per household connected and there would be no relevant replacement costs associated to this intervention. Households would now pay the Dignidad tariff instead of the close to Bs100 hh/mo currently spent in highly polluting energy sources. 5. Grid extensions for productive uses: Productive uses electricity consumption would also increase five times and continue growing at a rate of 1.5 percent per year as well. O&M costs would be roughly US$2.5 per month per connected entity and there would be no relevant replacement costs associated to the intervention. As targeted commercial entities would already be connected – yet underserved – electricity costs may rise, though these added expenditures would be more than fully compensated by the increased benefits of the additional energy provided. Table A3.4: Grid extension assumptions Value Unit Value Unit Concept Households Productive uses O&M cost 1 US$/hh/month (mo) 2.5 US$/prod/mo Ex post consumption 50 kWh/hh/mo 126 kWh/prod/mo Ex post consumption change 1.5% %/yr 1.5% %/yr Ex ante consumption 10 kWh/hh/mo 25 kWh/prod/mo Ex ante expenditures 99 Bs/hh/mo 33 Bs/prod/mo Ex ante emissions 38 kCO2/hh/mo 11 kCO2/prod/mo 6. Standalone PV SHS: It was assumed households’s electricity consumption would more than double, while also reducing expenditures and avoiding emissions. Typical interventions would have an installed capacity of 50 watts per household and provide the equivalent of 6 hours of service per day. O&M was estimated at around US$2 per household per month and replacement costs were projected at roughly 15 percent of capital expenditures, every five years (and to be done twice during the interventions’ lifetime so they can reach the planned 15 years of operation). 7. Standalone PV systems for institutions: Similarly, these interventions would see at least a doubling of the energy provided as well as savings and reduced emissions. The typical installed capacity per intervention would be around 0.6 kilowatts. O&M costs were estimated at around US$18 per institution per month and replacement costs were projected at roughly 15 percent of capital expenditures, every five years (also to be done twice during the interventions’ lifespans). Oct 25, 2023 Page 46 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) Table A3.5: Standalone PV systems assumptions Concept Value Unit Value Unit Households Institutions O&M cost 2 US$/hh/mo 18 US$/inst/mo Replacement costs 15% intervention cost 15% intervention cost Ex post consumption 9 kWh/hh/mo 146 kWh/inst/mo Ex ante consumption 4 kWh/hh/mo 68 kWh/inst/mo Ex ante expenditures 42 Bs/hh/mo 89 Bs/inst/mo Ex ante emissions 29 kCO2/hh/mo 113 kCO2/inst/mo Installed capacity 50 W/hh 0.6 kW/inst Service 6 hrs/day 8 hrs/day 8. Minigrid systems: This activity was projected to finance the installation of roughly 220 kilowatts of solar PV capacity per system, to replace or be added to pre-existing diesel fuel generators of roughly 240 kilowatts each. The new system would reduce the use of fossil fuels and increase available electricity, allowing consumption to double and continue increasing g at an annual 1.5 percent rate. Expenditures and emissions would drop significantly and O&M cost around US$23,000 per minigrid per year while replacement costs (at years 5 and 11 of construction) would represent 15% of investment costs. Table A3.6: Minigrid systems assumptions Concept Value Unit 235 hh/minigrid Interventions 6 inst/minigrid O&M cost 54,429 US$/minigrid/yr Replacement costs 15% intervention cost Ex post consumption 258,112 kWh/minigrid/yr Ex post consumption change 1.5% %/yr Ex ante consumption 127,755 kWh/minigrid/yr Ex ante expenditures 330,639 Bs/minigrid/yr Ex ante emissions 166 tCO2/minigrid/yr Ex ante installed capacity 236 kW/minigrid Ex post installed capacity 454 kW/minigrid Ex post emissions 78 tCO2/minigrid/yr Economic analysis Grid extensions 9. The economic analysis demonstrates the robustness of the grid extension subcomponents. The targeting of both households and productive uses would result in positive NPVs and EIRRs. This is the result of: (i) relatively low investment (and operational) costs; (ii) the expected positive effects of providing abundant and additional energy (from the grid); (iii) the lowered households expenditures (given the high cost of procuring energy from inefficient sources such as kerosene, diesel, batteries or candles); and (iv) the reduced emissions (due to the high CO2 content of replaced fuels and the relatively low emissions factor of the Bolivian grid). Even if discount rates are increased, higher prices and lower benefits are used, or the economic value of the additional energy provided is halved, the results remain mostly positive as shown below. Oct 25, 2023 Page 47 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) Table A3.7: Grid extension economic analysis (in US$ million) Grid extension for households Grid extension for productive uses Scenarios Costs Benefits NPV EIRR Costs Benefits NPV EIRR Base case: w/ 5% discount rate $89 $235 $146 24.7% $3 $6 $3 16.5% Case 1: w/ 12% discount rate $71 $124 $53 24.7% $2 $3 $1 16.5% Case 2: w/ 20% higher costs & 20% lower benefits $107 $188 $81 15.0% $4 $5 $1 8.8% Case 3: w/ halved value of electricity $89 $134 $45 12.0% $3 $2 -$1 1.0% Standalone PV systems 10. The standalone PV systems would also produce robust NPVs and EIRRs even if not as positive as those of the grid extension for hosueholds subcomponent. As in the previously discussed activities, the (i) relatively low investment costs, (ii) additional energy provided, and (iii) displacement of polluting and extensive fuels with clean energy sources would produce positive economic impacts, despite the higher O&M&R costs. However, as the sensitivity analysis shows, planned activities will need to ensure costs remain low and activities are effective as under certain (worst-case scenarios) these may not produce the expected positive impacts, as shown below. Table A3.8: Standalone PV systems economic analysis (in US$ million) Standalone PV SHS Standalone PV systems for institutions Scenarios Costs Benefits NPV EIRR Costs Benefits NPV EIRR Base case: w/ 5% discount rate $8 $16 $7 20.6% $3 $4 $1 14.2% Case 1: w/ 12% discount rate $6 $8 $2 20.6% $2 $2 $0 14.2% Case 2: w/ 20% higher costs & 20% lower benefits $10 $13 $2 9.9% $3 $3 -$0 4.6% Case 3: w/ halved value of electricity $8 $12 $4 13.3% $3 $2 -$1 -2.3% Minigrid systems 11. The analysis shows this subcomponent would also result in a positive NPV and EIRR. However, as the sensitivity analysis shows, this type of interventions may not be as robust. This responds to three main factors: (i) the relatively higher investment and O&M&R costs; (ii) the relatively lower emission reductions (due to the fact subprojects could potentially continue using a reduced amount of diesel, which has a lower emissions factor than other energy sources commonly utilized in the rural context); and (iii) the fact these types of interventions are to be done when and where a relatively good energy provision already exists ( even if fully diesel-powered), thus reducing the positive effects of the additional electricity provided. Results are summarized below. Table A3.9: Minigrid systems economic analysis (in US$ million) Minigrid systems Scenarios Costs Benefits NPV EIRR Base case: w/ 5% discount rate $14 $14 $0 5.3% Case 1: w/ 12% discount rate $10 $7 -$3 5.3% Case 2: w/ 20% higher costs & 20% lower benefits $16 $11 -$5 -2.4% Case 3: w/ halved value of electricity $14 $7 -$7 -8.6% Aggregate Project results 12. Aggregate planned interventions would also result in positive and robust economic NPV and EIRR. Such Project- wide results would be driven mostly by the grid extension subcomponents, which represent roughly 70 percent of total loan and Project costs. Key findings are summarized below. Oct 25, 2023 Page 48 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) Table A3.10: Aggregate Project economic analysis (in US$ million) Scenarios Costs Benefits NPV EIRR Base case: w/ 5% discount rate $117 $274 $157 22.5% Case 1: w/ 12% discount rate $91 $145 $53 22.5% Case 2: w/ 20% higher costs & 20% lower benefits $141 $220 $79 13.1% Case 3: w/ halved value of electricity $117 $157 $40 10.2% Financial analysis 13. The financial analysis sought to assess if the Project would create positive outcomes for beneficiaries and distribution companies under the previously discussed assumptions. Overall, the scenarios prepared for this assessment, suggest the existing residential, Dignidad or general tariffs could be sufficient to cover the O&M&R costs used in this exercise, especially since all capital expenditures would be fully subsidized by the GoB. Furthermore, the analysis suggests such tariffs could be enough to cover analyzed distribution companies’ operational costs. Under the scenarios, most beneficiaries provided with new or enhanced access would also see savings arising from the low tariffs and reduced energy expenditures, with electricity bills only expected to increase slightly in cases in which the electricity service was dramatically improved (and in which the benefits would more than fully compensate such increment). Finally, the model assessed that for the interventions to be fully financially viable (without any subsidies from the GoB), the tariff per kWh would need to be set at roughly US$0.50 per kWh, which – combined with the expected benefits described above – further makes the case for the GoB’s subsidy of planned interventions. GHG emissions 14. Net Project emissions were estimated following existing guidelines and frameworks. Based on the Guidance Manual on Greenhouse Gas Accounting Methodology for Energy Access Investment Operations, the assessment assumed that: (i) ex ante emissions from households (consuming under 0.055 MWh/yr) were 6.8 tCO2/MWh; (ii) ex ante emissions from productive uses and institutions were 6.8 tCO2/MWh for the first 0.055MWh consumed and 1.3 tCO2/MWh for the remaining energy consumed per year; and (iii) the ex ante and ex post emission factors for diesel-powered generation (appliacable to minigrids assessments) was 1.3 tCO2/MWh. In addition, the analyses assumed that “direct project GHG emissions are zero if the new individual system or new/rehabilitated minigrid is renewable” which applies to standalone PV systems, while “in the case of new or rehabilitated hybrid individual systems, direct project GHG emissions will include emissions associated with the diesel use of the system”, which have been estimated using the above-mentioned factor. In the case of grid extension interventions, the analysis used the grid emissions factor of 0.42 tCO2/MWh. 15. The assessments concluded the Project will result in net emissions (economic lifetime, tCO2e) of -127,000, gross emissions (economic lifetime, tCO2e) of 231,000, and net emissions (annual average, tCO2e/year) of -7,750 in a typical year. Expected results per type of intervention are presented below. Table A3.11: Project emission reductions per type of intervention Grid Grid PV PV Minigrid Concept TOTAL extensions extensions for systems for SHS systems for households productive uses institutions Baseline emissions (tCO2) 358,000 257,000 1,000 68,500 9,500 22,000 Typical baseline emissions (tCO2/yr) 16,250 11,700 50 3,100 400 1,000 Gross Project emissions (tCO2) 231,000 192,000 4,500 18,500 2,500 13,500 Net emissions (tCO2) -127,000 -65,000 3,500 -50,000 -7,000 -8,500 Typical net emissions (tCO2/yr) -7,750 -4,000 250 -3,000 -500 -500 Oct 25, 2023 Page 49 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) 16. Such emission reductions are deemed substantial per the Interim guidance on demonstrating substantial net greenhouse gas (GHG) emissions reduction in line with the revised Joint MDB Mitigation Methodology. On aggregate, annual emission reductions are estimated to be close to 50 percent lower than (annual) baseline emissions (or even 100 percent lower as in the case of standalone PV systems). All activities were also deemed eligible as per the Common principles for Climate mitigation finance tracking, which establish that: a. “10. Greenfield transmission or distribution of electricity that increases the share of very-low-carbon electricity delivered” are eligible if “the electricity system is increasing the share of non-nuclear very-low-carbon electricity use”, which “shall be reflected in the most recent power system development plan covering a planning horizon of up to 10 years”; b. “1. Generation of renewable energy with low lifecycle GHG emissions to supply electricity” as an eligible activity whose emissions shall be “substantially lower than corresponding GHG emissions from fossil fuel generation” and under which “examination of GHG emissions is not necessary for forms of energy that are widely recognized to have very low lifecycle emissions, such as solar”; c. “2. joint use of renewable energy and fossil fuel to supply electricity, heat, mechanical energy or cooling” is eligible and “the criteria for renewable energy with low lifecycle GHG emissions in activity 1 above shall apply”; 17. Finally, emissions avoided were multiplied by a shadow price of carbon for each year in the Project's lifetime. The price used for each year was calculated as the average between the low and the high case scenarios, starting in 2024 with a value of 77 US$/tonCO2eq. Table A3.12: Shadow price of carbon used in the analysis Scenarios 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 CO2 a vera ge va l ue 77 79 81 83 85 87 89 90 93 95 97 99 101 103 106 108 111 113 116 119 121 124 CO2 l ow va l ue 52 53 54 56 57 58 59 60 61 63 65 66 67 69 71 72 74 76 77 79 80 83 CO2 hi gh va l ue 103 105 108 111 113 116 118 121 124 126 129 132 135 138 142 144 148 151 155 158 162 165 Oct 25, 2023 Page 50 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) ANNEX 4: Gender Action Plan COUNTRY: Plurinational State of Bolivia Bolivia Improving Sustainable Access to Electricity (IDTR III) 1. A. Gender Action Plan (GAP) has been prepared and published by the GoB, which seeks to mainstream the gender perspective in the Project. The main gaps identified in the country's energy sector were: the double workload for women (productive - reproductive role), women’s participation in the sector and GBV. Below is a summary of the actions that will be undertake as part of the GAP. Table A4.1: GAP activities, indicators, and responsible parties METHODOLOGY FOR DATA RESPONSIBLE GAP ACTIVITIES INDICATOR COLLECTION PARTY Incorporation of a gender Training on new A gender/social specialist will be hired PEVD (in The productive - perspective session in the technologies, incorporating as part of Component 3 to develop the coordination with reproductive role socialization on the gender perspective content of these sessions (and ENDE) and the double technologies to be carried Baseline: 0 coordinate, in each case, the workload out as part of the Project. Target: 1 per year per temporary care services for children in This session will reinforce subproject zone these sessions). the advantages of shared responsibility in domestic and unpaid care tasks. These sessions should take into account the places and times in which women can also participate (due to their caregiving tasks) and/or offer care services (such as a double room, where in one room the training takes place and in the adjacent space there are one or two people in charge of taking care of the children). Access to electricity Change in the time women Ex-ante vs. ex-post comparison of the PEVD (ex-ante) through activities in spend on domestic/unpaid results of a socioeconomic survey and ENDE (ex- Component 1 will generate care work conducted among a sample of post) a change in women’s use of Baseline: 0% beneficiary women and men. time. Workshops will Target: -7% (Reduction of at The following questions will be reinforce the advantages of least 7 percent compared to included in the survey: shared responsibility for the baseline). 1. How many hours do you spend on unpaid household and care average per week on unpaid work tasks. (caring for household members; domestic; unpaid for other households, community, volunteer)? 2. How many hours do you spend on average per week in paid work or work for which you are currently or in the future seeking remuneration? Oct 25, 2023 Page 51 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) METHODOLOGY FOR DATA RESPONSIBLE GAP ACTIVITIES INDICATOR COLLECTION PARTY 3. How many hours per week on average do you spend on personal activities (education; use of media; recreation; personal care)? Ex-ante: The survey will be carried out to beneficiaries at the time at subproject design. Ex-post: The survey will be carried out again six months and one year after the delivery of the system or the completion of the minigrid. Women establishing a local Ex-ante vs. ex-post comparison of the PEVD and ENDE business or microenterprise results of the socioeconomic survey Baseline: 0 conducted on a representative sample Target: 500 of women and men (previously proposed). The following questions will be included in the survey: 2.b. Is this paid work of type: i. self-employed, personal or family? -> if yes: is it a local business or micro- enterprise? -> if yes: is it at home? ->if yes: what service or good do you provide? ii. employed? iii. none of the above GBV Preparation of leaflets with Leaflets sent with electricity Preparation of brochures for ENDE (in information on the bills with resources available dissemination through the coordination with prevention of gender- to women who are victims of social/gender specialist. distribution based violence and the gender-based violence companies) critical route of attention in Baseline: No Coordination with distribution cases of violence against Target: Yes companies for dissemination and women, advertised sending these together with electricity together with the bills. electricity bills. Contractors will socialize (training indicator) ENDE the Codes of Conduct (to be adopted for the prevention of gender- based violence) for beneficiaries, implementing units and other interested parties. Drafting of a specific GBV plan for the Project, focused on how to prevent GBV and mitigate its effects, if any. Women’s Elaborate a diagnosis on Diagnosis on the Quantitative and qualitative data PEVD and ENDE participation in the participation of women participation of women in collection on a representative sample the Energy sector in employment in the employment in the energy in coordination with regional energy sector. sector. institutional organizations. Oct 25, 2023 Page 52 of 53 The World Bank Bolivia Improving Sustainable Access to Electricity Project (IDTR III) (P180027) METHODOLOGY FOR DATA RESPONSIBLE GAP ACTIVITIES INDICATOR COLLECTION PARTY Baseline: No Survey prepared by the Project's Target: Yes gender/social specialist, to be sent to relevant organizations in the sector. Provide Project trainings Women trained in technical By implementing units PEVD and ENDE aimed at women to issues in electricity and develop specific renewable energy knowledge in the energy Baseline: 0 sector. Target: 1000 These trainings should take into account places and times where women can also participate (due to their caregiving tasks) and/or offer care services (such as a double room, where in one room the training takes place and in the adjacent space there are two caregivers). Incorporate women in the Percentage of women By implementing units PEVD and ENDE general design of participants in subproject subprojects design Baseline: 0% Target: 10% Hiring of women in Percentage of women hired By implementing units PEVD and ENDE implementing unites by the Project under Component 3 Baseline: 0 % Target: 30% Meeting of women on Meeting of women leaders For beneficiaries to exchange PEVD and ENDE leadership issues on the to exchange experiences experiences sector Baseline: 0 Target: 4 Incorporation of a gender Cross-cutting to all PEVD and ENDE perspective in the design of interventions the Project's informative material. Oct 25, 2023 Page 53 of 53