Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) LATIN AMERICA AND CARIBBEAN | Mexico | Energy and Mining Global Practice | Global Environment Project | Specific Investment Loan | FY 2006 | Seq No: 19 | ARCHIVED on 09-Apr-2015 | ISR18301 | Implementing Agencies: SENER Key Dates Key Project Dates Board Approval date:29-Jun-2006 Effectiveness Date:18-Apr-2007 Planned Mid Term Review Date:14-Jun-2013 Actual Mid-Term Review Date:02-Jul-2013 Original Closing Date:30-Jun-2014 Revised Closing Date:30-Apr-2016 Global Environmental Objectives Global Environmental Objective (from Project Appraisal Document) The global objective of the project is to reduce greenhouse gas emissions (GHGs) and remove barriers to the development of renewable energy technologies and markets, per the Global Environment Facility Operation Progam 6. To assist Mexico in developing initial experience in commercially-based grid-connected renewable energy applications by supporting construction of an approximately 101 MW IPP wind fram, while building institutional capacity to value, acquire, and manage such resources on a replicable basis. Has the Global Environmental Objective been changed since Board Approval of the Project Objective? No Components Name Financial Mechanism:(Cost $20.40 M) Technical Assistance:(Cost $3.90 M) Project Management:(Cost $0.70 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of GEO  Moderately Satisfactory  Moderately Satisfactory Overall Implementation Progress (IP)  Moderately Satisfactory  Moderately Satisfactory Overall Risk Rating  --  Low 4/9/2015 Public Disclosure Copy Page 1 of 14 Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) Implementation Status and Key Decisions The La Venta III wind power plant has been operating since October 2012 and numerous technical assistance activities are being developed. Average capacity factor (October 2012 - January 2015) is 31.5%, in line with revised expectations. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance  --  --  Low Macroeconomic  --  --  Low Sector Strategies and Policies  --  --  Low Technical Design of Project or Program  --  --  Low Institutional Capacity for Implementation and Sustainability  --  --  Low Fiduciary  --  --  Low Environment and Social  --  --  Moderate Stakeholders  --  --  Low Other  --  --  -- Overall  --  --  Low Results Global Environmental Objective Indicators PHINDGEOTBL  Generation Capacity of Renewable Energy (other than hydropower) constructed(Megawatt, Core) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 102.85 102.85 100.00 Date 18-Apr-2007 21-Mar-2014 31-Mar-2015 30-Apr-2016 Comments 4/9/2015 Public Disclosure Copy Page 2 of 14 Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) The project achieved 102.85% of target through the commissioning of la Venta III (102.85 MW installed capacity) in October 2012. PHINDGEOTBL  Generation Capacity of Renewable Energy constructed – Wind(Megawatt, Core Breakdown) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 102.85 102.85 100.00 Date 18-Apr-2007 21-Mar-2014 31-Mar-2015 30-Apr-2016 PHINDGEOTBL  Increase electricity supply to national system from renewable energy sources, over baseline. (GWh/yr)(Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 282.412 GWh 255.294 GWh over April 270.3 GWh annually 7.36 from January to 2013-March 2014. (257.5 min) December 2014 Date 18-Apr-2007 11-Mar-2014 31-Mar-2015 30-Apr-2016 Comments Accumulated 621.164 GWh from October 2012 (commissioning) to December 2014; The project achieved 104.5% of target in 2014. PHINDGEOTBL  Increase total installed renewable capacity, over baseline (MW).(Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 101 MW (expected 2 wind farms -- 102.85 MW operations) Date 18-Apr-2007 19-Dec-2012 31-Mar-2015 30-Apr-2016 Comments The project achieved 102.85% of the target in October 2012, when La Venta III was commissioned. 4/9/2015 Public Disclosure Copy Page 3 of 14 Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) PHINDGEOTBL  Emisions reduced (tons/year), over baseline (CO2, NOx, SOx, and particulates).(Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 174,248.22 tCO2e 157,516 tCo2 from April 166,769 tons per 0 from January to 2013-May 2013. year of operation December 2014. Date 18-Apr-2007 16-Jun-2014 31-Mar-2015 30-Apr-2016 Comments Accumulated avoided emissions for 383,258 tCO2e from October 2012 (commissioning) to December 2014. The project achieved 104.5% of target in 2014. PHINDGEOTBL  Barrier Removal results described below under PDO.(Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value Baseline values Barriers greatly -- Barriers removed described in PAD reduced Date 18-Apr-2007 09-Oct-2013 31-Mar-2015 30-Apr-2016 Comments Barriers have been greatly reduced, as shown by the strong development of wind power in recent years (approximately 1,750 MW of installed capacity in Oaxaca), as reported by Asociación Mexicana de Energía Eólica (AMDEE). Development of wind power projects remains strong and AMDEE estimates that additional 12,000 MW will be installed in Mexico between 2020-2022. 4/9/2015 Public Disclosure Copy Page 4 of 14 Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) PHINDGEOTBL  Established CFE system short-run marginal cost-based Reference Price combined with agreed maximum U.S. 1.1 cent GEF tariff support sufficient to attract bids, investment, construction and operation(Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value System None -- System established established Date 18-Apr-2007 14-May-2010 31-Mar-2015 30-Apr-2016 Comments 2 bids received and one contract for 100 MW awarded (target achieved) PHINDGEOTBL  Subsequent POISE include plans for additional wind IPP procurement at higher reference price and/or lower incentive support level (subject to availability of subsidy funds - GEF or other).(Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value None -- 8 POISE includes > 1 Date 18-Apr-2007 11-Mar-2014 31-Mar-2015 30-Apr-2016 Comments The project has achieved 800% of target, as POISE (2012-2026) includes 8 new wind plants which are expected to start operation between 2014-2019: Sureste III, IV and V (908 MW), Rumorosa I, II, III (300 MW) and Tamaulipas I, II, III (600 MW) - none of which benefits from additional tariff support. Overall Comments Intermediate Results Indicators PHINDIRITBL  Functioning mechanism for the auctioning of tariff subsidy support through competitive bidding established, with incremental tariffsupport provided by GEF. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Mechanism is Value None -- Achieved in place and functioning Date 18-Apr-2007 22-Jun-2009 31-Mar-2015 30-Apr-2016 Comments 1 contract awarded for 100 MW through competitive bidding. Tariff support mechanism in place and with monthly disbursements since October 2012. 4/9/2015 Public Disclosure Copy Page 5 of 14 Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) PHINDIRITBL  Operational Manual for the auctioning mechanism finalized with CFE sign-off, and adopted by CFE. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Operational Value None -- N/A manual adopted Date 18-Apr-2007 26-Sep-2013 31-Mar-2015 30-Apr-2016 Comments N/A since the auctioning mechanism is in place. PHINDIRITBL  Regional Environmental Assessment is completed and made available for the La Venta III bidding package. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Regional Environmental Value None -- Partially achieved Assessment completed Date 18-Apr-2007 22-Jun-2009 31-Mar-2015 30-Apr-2016 Comments An environmental assessment was prepared prior to the bidding but it did not include a regional review. The SESA, which was recently completed, includes a review of the cumulative environmental and social impacts of wind development on the Tehuantepec area. 4/9/2015 Public Disclosure Copy Page 6 of 14 Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) PHINDIRITBL  CFE base solicitation allowing for locations other than the currently identified for La Venta III, including those that would require a change in transmission lines. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Authorization to change location Value None -- Achieved included in the bidding documents. Date 18-Apr-2007 22-Jun-2009 31-Mar-2015 30-Apr-2016 Comments Such flexibility was included in the bidding documents. PHINDIRITBL  Number of qualified bids received from tender. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target At least three Value None -- Achieved qualified bids received Date 18-Apr-2007 22-Jun-2009 31-Mar-2015 30-Apr-2016 Comments 2 technical bids and 1 financial bid PHINDIRITBL  IPP solicitation for at least 70 MW of wind power. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target IPP solicitation for at least 70 Value None -- Achieved MW of wind power. Date 18-Apr-2007 22-Jun-2009 31-Mar-2015 30-Apr-2016 Comments IPP wind contract for 100 MW awarded 4/9/2015 Public Disclosure Copy Page 7 of 14 Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) PHINDIRITBL  Only those bids proposing development in sites identified as environmentally suitable for development are accepted as eligible. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Only those bids proposing development in sites identified as Value None -- Achieved environmentally suitable for development are accepted as eligible Date 18-Apr-2007 22-Jun-2009 31-Mar-2015 30-Apr-2016 Comments Environmental authorization obtained by CFE for the site. If a different site were chosen, bidder would have been responsible for obtaining the authorization. PHINDIRITBL  Co-financing provided by private entities and export credit agencies by way of capital investments. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Co-financing provided by private entities and export Value None -- Achieved credit agencies by way of capital investments. Date 18-Apr-2007 22-Jun-2009 31-Mar-2015 30-Apr-2016 Comments Iberdrola, a private firm, was awarded the contract. PHINDIRITBL  Mechanism for payments to ejidos, indigenous communities, and small landowners, with established process through which landowners or ejidos can verify revenue and requisite payments. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Mechanism for payments to ejidatarios, Value None -- Achieved indigenous communities, and small landowners, 4/9/2015 Public Disclosure Copy Page 8 of 14 Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) with an established process through which landowners or ejidatarios can verify revenue and requisite payments. Date 18-Apr-2007 08-Nov-2010 31-Mar-2015 30-Apr-2016 Comments Mechanism for payments in place and agreements signed. PHINDIRITBL  Funds disbursed to ejidos, indigenous communities, and small landowners. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Funds disbursed to ejidatarios, indigenous MXN 11.388 million paid Value None -- communities, in 2014 and small landowners as indicated in agreements. Date 18-Apr-2007 11-Mar-2014 31-Mar-2015 30-Apr-2016 Comments Funds for 2014 have been fully paid. This is an ongoing activity. PHINDIRITBL  Significant avian/bat mortality is avoided. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Avian/bat mortality is Value None -- In progress within acceptable ranges. Date 18-Apr-2007 26-Sep-2013 31-Mar-2015 30-Apr-2016 Comments - In the latest progress report (second half of 2014), CFE reported monitoring of avian/bat mortality only during 6 days per season (as opposed to every month). Additionally, the information for the Fall 2014 has not been included, which is crucial to estimate mortality since significant migration is observed precisely during the fall. - The team will update this indicator as soon as CFE provides the missing information. Such information will be compared against la Venta 4/9/2015 Public Disclosure Copy Page 9 of 14 Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) II (another wind farm in the region, one which monitors avian and bat mortality throughout the year) to assess whether avian mortality in La Venta III is within acceptable ranges. - The team will also request information regarding unscheduled stops due to significant avian migration periods as evidence of efforts to reduce avian/bat mortality. PHINDIRITBL  CFE purchase tariff proposed for Phase II which reflects SRMC plus RE capacity value and energy portfolio diversification value. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target CFE purchase tariff proposed for Phase II which reflects SRMC plus RE Value None -- N/A capacity value and energy portfolio diversification value Date 18-Apr-2007 11-Oct-2013 31-Mar-2015 30-Apr-2016 Comments There will be no phase II since no subsidies are required anymore for wind power development PHINDIRITBL  CFE purchase price tariff proposed for Phase II which requires reduced GEF subsidy from Phase I. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target CFE purchase price tariff proposed for Phase II which Value None -- N/A requires reduced GEF subsidy from Phase I. Date 18-Apr-2007 11-Oct-2013 31-Mar-2015 30-Apr-2016 Comments There will be no phase II since no subsidies are required anymore for wind power development 4/9/2015 Public Disclosure Copy Page 10 of 14 Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) PHINDIRITBL  Least-cost methodology for calculation of renewable energy procurement reflecting System Marginal Cost developed. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Least-cost methodology for calculation of renewable energy Value None -- Achieved procurement reflecting System Marginal Cost developed. Date 18-Apr-2007 26-May-2011 31-Mar-2015 30-Apr-2016 Comments This activity was financed by an ESMAP activity. PHINDIRITBL  Planning and dispatch model installed and used in CFE to incorporate intermittent sources. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Installed and Value None -- Partially achieved used Date 18-Apr-2007 12-Mar-2014 31-Mar-2015 30-Apr-2016 Comments CFE implemented dispatch tools to incorporate renewables. In July 2013, a World Bank expert delivered a workshop on integrating renewables into the grid to top technical officials from CFE, SENER and CRE. Following up on this workshop, CFE is defining a program of activities, to be financed by TA, to help the utility better address the issue. Financing for this activity was included in the restructuring of May 2014. PHINDIRITBL  Strategic Environmental Assessment is developed and accepted as basis permitting scale-up of wind energy in Oaxaca region. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Strategic Environmental Value None -- Achieved Assessment completed and disseminated Date 18-Apr-2007 16-Jun-2014 31-Mar-2015 30-Apr-2016 Comments SESA has been completed. The final report has been submitted to SENER and translation to the Zapoteco dialect is in progress. SENER 4/9/2015 Public Disclosure Copy Page 11 of 14 Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) submitted the final report to the Bank on March 6, 2015. PHINDIRITBL  Publishing of new intermittent energy connection contract by CRE including RE capacity recognition. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target New intermittent energy connection contract Value None -- Achieved including RE capacity recognition is published by CRE. Date 18-Apr-2007 26-Sep-2013 31-Mar-2015 30-Apr-2016 Comments - In July 2011, CRE released a resolution with a methodology to determine such capacity contribution. The technical work benefited from the support of Die Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) - In May 2012, CRE published the General Rules for permit holders (using renewable energy) to be granted the interconnection to the National Grid (Reglas Generales de Interconexión al SistemaEléctrico Nacional para generadores o permisionarios con fuentes de energías renovables o cogeneración eficiente.) PHINDIRITBL  Strengthening of SENER IPU business development services addressing marketing, permitting issues, financing, facilitation, and business advisory services to sponsors of renewable energy projects (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target UPI's business development Value None -- Partially achieved services judged adequate Date 18-Apr-2007 11-Mar-2014 31-Mar-2015 30-Apr-2016 Comments The one stop shop design (TA activity) has been concluded and all four deliverables have been accepted by SENER (contract with INFOTEC was signed on June 16, 2014). Following up activity is the actual implementation of the one stop shop (also a TA activity, which is in progress). 4/9/2015 Public Disclosure Copy Page 12 of 14 Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) PHINDIRITBL  Institutional capacity sufficient to issue and manage tenders for additional wind farms/other RE resources. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Assessed as Value None -- Achieved adequate Date 18-Apr-2007 19-Dec-2012 31-Mar-2015 30-Apr-2016 Comments Capacity is in place. Development of wind farms has been very strong over the past few years (1750 MW installed capacity in Oaxaca and approximately 1900 MW country-wide under either IPP or self-supply schemes by March 2015). Overall Comments Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P077717 TF-56781 Effective USD 25.00 25.00 0.00 9.94 15.06 40% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P077717 TF-56781 Effective 05-Oct-2006 05-Oct-2006 18-Apr-2007 30-Jun-2014 30-Apr-2016 Cumulative Disbursements 4/9/2015 Public Disclosure Copy Page 13 of 14 Public Disclosure Copy The World Bank Implementation Status & Results Report Large-scale Renewable Energy Development Project (Phase 1 = $25M; Phase 2 = $45M) (P077717) Restructuring History Level Approved on 18-Jun-2013 ,Level 2 Approved on 12-May-2014 ,Level 2 Approved on 21-Mar-2015 Related Project(s) There are no related projects. 4/9/2015 Public Disclosure Copy Page 14 of 14