Public Disclosure Copy The World Bank Implementation Status & Results Report Second Rwanda Energy Sector Development Policy Operation (P166458) Second Rwanda Energy Sector Development Policy Operation (P166458) AFRICA | Rwanda | Energy & Extractives Global Practice | IBRD/IDA | Development Policy Lending | FY 2019 | Seq No: 1 | ARCHIVED on 25-Feb-2019 | ISR36034 | Implementing Agencies: MINECOFIN, MINECOFIN, MININFRA Key Dates Key Project Dates Bank Approval Date:15-Nov-2018 Effectiveness Date:07-Dec-2018 Planned Mid Term Review Date:-- Actual Mid-Term Review Date:-- Original Closing Date:30-Jun-2020 Revised Closing Date:30-Jun-2020 Program Development Objectives Program Development Objective (from Program Document) The Program Development Objective (PDO) of the proposed operation is to enable fiscally sustainable expansion of electricity services in Rwanda. The proposed operation is built around two pillars: (i) containing the fiscal impact of the electricity sector; and (ii) improving the operational efficiency, affordability, and accountability of electricity service. PHRPDODEL Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO  --  Satisfactory Overall Implementation Progress (IP)  --  Satisfactory Overall Risk Rating  --  Substantial Implementation Status and Key Decisions The DPO series and the first operation were approved by the Board on December 1, 2017. The first operation was declared effective on December 20, 2017. The second operation in the DPO series was approved on November 15, 2018, and a third operation is under preparation with projected Board date in Q2 FY2020. Implementation of the policy and institutional measures (prior actions) taken under DPO 1 and DPO 2 are already showing tangible results in the form of reduced fiscal risks and improved service at lower cost for electricity consumers in Rwanda. As a result of the Least-Cost Development Plan prepared under DPO 1, a consensus emerged among Government authorities that better system planning is needed to ensure that new generation capacity additions are in line with demand growth. This is reflected in the NIST1, approved in late 2017, which, rather than setting an absolute target for generation capacity in MW, sets the objective of always balancing demand and supply. At the same time, implementation of the new electricity tariff and the new connection policy has drastically improved the affordability of electricity for low-income consumers, while largely maintaining REG’s revenue base. Quality of service is also improving, with the average duration of interruptions (as measured by System Average Interruption Duration Index [SAIDI] is now being measured and monitored. To fulfil the overarching objective of the DPO series, MINECOFIN and MININFRA have jointly 2/25/2019 Page 1 of 5 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Second Rwanda Energy Sector Development Policy Operation (P166458) submitted to the Economic Cluster policy options to contain fiscal transfers to the electricity sector, building upon the assessments concluded under DPO1. Approval of the National Electrification Plan (NEP) and related policies and procedures has put in place an advanced framework for expanding electricity access. Utility reforms pertaining to management, operations, and financial reporting initiated under DPO1 have been strengthened under DPO2. Taken together, the prior actions under DPO 2 complete the sector’s investment planning framework and make critical progress towards containing the projected fiscal transfers. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance  High  --  High Macroeconomic  Moderate  --  Moderate Sector Strategies and Policies  Substantial  --  Substantial Technical Design of Project or Program  Substantial  --  Substantial Institutional Capacity for Implementation and Sustainability  Substantial  --  Substantial Fiduciary  Moderate  --  Moderate Environment and Social  Moderate  --  Moderate Stakeholders  Substantial  --  Substantial Other  Moderate  --  Moderate Overall  Substantial  --  Substantial Results Results Indicators PHINDIRITBL  Contain electricity subsidies as percentage of GDP (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 1.40 -- 1.35 1.40 Date 30-Jun-2017 -- 31-Jan-2019 30-Jun-2021 2/25/2019 Page 2 of 5 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Second Rwanda Energy Sector Development Policy Operation (P166458) PHINDIRITBL  Implement the quarterly automatic tariff adjustment (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N -- N Y Date 30-Jun-2017 -- 31-Jan-2019 30-Jun-2021 PHINDIRITBL  Ensure all generation and transmission projects initiated or accepted by the Government over the past 24 months are consistent with the LCPDP and comply with the PPP Law and competitive procurement (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N -- N Y Date 30-Sep-2017 -- 31-Jan-2019 31-Dec-2020 PHINDIRITBL  Initiate competitive procurement processes to implement investments identified in the LCPDP (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 -- 0.00 1.00 Date 30-Sep-2017 -- 31-Jan-2019 31-Dec-2020 PHINDIRITBL  Expand electrification rate countrywide (percentage of households) (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target 61% (38% on- 40.7% (29.7% on-grid and grid and 23% 11% off-grid) 47.6% (36% on-grid and off-grid) Value -- 21% among female- 11.6% off-grid) 50% among headed households female-headed households Date 30-Sep-2017 -- 31-Jan-2019 30-Jun-2021 2/25/2019 Page 3 of 5 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Second Rwanda Energy Sector Development Policy Operation (P166458) PHINDIRITBL  Expand electrification rate among rural households (percentage of households) (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 16% -- n.a. 25% Date 30-Jun-2017 -- 31-Jan-2019 30-Jun-2021 PHINDIRITBL  Ensure EUCL’s financial statements are in full compliance with IFRS, the independent audit of REG's and EUCL’s financial statements is without qualifications, and REG's and EUCL’s financial statements (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N -- N Y Date 30-Sep-2017 -- 31-Jan-2019 30-Jun-2021 PHINDIRITBL  Reduce total electricity sector losses as a percentage of electricity supply (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 22.00 -- 20.00 19.00 Date 31-Dec-2016 -- 31-Jan-2019 30-Jun-2021 PHINDIRITBL  Reduce average duration of interruptions (SAIDI) and average frequency of interruptions (SAIFI) (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target SAIDI: 28 SAIDI: 44 hours; SAIFI: SAIDI: 44 hours; SAIFI: Value -- hours; SAIFI: 265 265 183.4 hours Date 31-Dec-2018 -- 31-Jan-2019 31-Dec-2020 2/25/2019 Page 4 of 5 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Second Rwanda Energy Sector Development Policy Operation (P166458) PHINDIRITBL  Implement and publish annual customer satisfaction survey (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N -- N Y Date 30-Sep-2017 -- 31-Jan-2019 30-Jun-2021 Overall Comments Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P166458 IDA-63440 Effective USD 125.00 125.00 0.00 124.02 0.00 100% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P166458 IDA-63440 Effective 15-Nov-2018 16-Nov-2018 07-Dec-2018 30-Jun-2020 30-Jun-2020 Tranches Restructuring History There has been no restructuring to date. Related Operations P162671-Rwanda Energy Sector Development Policy Loan ,P169040-Third Rwanda Energy Sector Development Policy Operation 2/25/2019 Page 5 of 5 Public Disclosure Copy