The World Bank Report No: ISR2268 Implementation Status & Results Bosnia and Herz Public Disclosure Copy Energy Community of South East Europe (ECSEE) APL3-Bosnia and Herzegovina Project (P090666) Operation Name: Energy Community of South East Europe (ECSEE) APL3- Project Stage: Implementation Seq.No: 6 Status: ARCHIVED Last Modified Date: 29-Nov-2010 Bosnia and Herzegovina Project (P090666) Country: Bosnia and Herz Approval FY: 2006 Product Line: IBRD/IDA Region: EUROPE AND CENTRAL ASIA Lending Instrument: Adaptable Program Loan Implementing Agency(ies): EPBiH, EPHZHB, EPRS Key Dates Board Approval Date 16-Jun-2006 Original Closing Date 31-Dec-2010 Planned Mid Term Review Date Last Archived ISR Date 19-Apr-2010 Effectiveness Date 13-Apr-2007 Revised Closing Date 30-Jun-2012 Actual Mid Term Review Date Project Development Objectives Project Development Objective (from Project Appraisal Document) The countries of South East Europe, including Bosnia and Herzegovina, and the European Commission are cooperating to develop a regional energy market, the Energy Community of South East Europe (ECSEE) and integrate it into the internal energy market of the European Union. The objective of the project is to facilitate BiH's participation in ECSEE through investments to: (i) improve dam safety; (ii) reduce adverse environmental impacts at thermal power stations; (iii) replace ageing existing facilities and equipment at hydropower and thermal power stations; (iv) rehabilitate distribution systems and introduce distribution Supervisory Control and Data Acquisition (SCADA) systems, (v) establish a market operation system, (vi) provide hardware and software to improve the financial management information systems of the Elektroprivredas; and through technical assistance to facilitate project implementation, and determine the best way to reduce sulfur dioxide and nitrogen oxide emissions at a power plant. Has the Project Development Objective been changed since Board Approval of the Project? Yes No Component(s) Component Name Component Cost Public Disclosure Copy EPBiH Component 15.20 EPHZHB component 2.00 EPRS component 19.50 Overall Ratings Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Satisfactory Overall Implementation Progress (IP) Moderately Satisfactory Satisfactory Overall Risk Rating Page 1 of 7 The World Bank Report No: ISR2268 Implementation Status Overview Project implementation has gained momentum during the last one year and is satisfactory. All the three implementing agencies have made good progress and implementation is Public Disclosure Copy expected to further accelerate. Beginning October 2008 when the project became effective, the implementing agencies have awarded contracts for SDR 23.1 million (93% of the Credit amount of SDR 25.1 million). Bids are currently under evaluation for an amount of SDR 2.2 million (IDA finance of SDR 1.87 million). Together with the contracts already awarded would add up to more than 99% of the Credit amount under implementation. Disbursement have also picked up and by the middle of November, an amount of US$15.3 million (more than 40% of the Credit amount) had been disbursed. For the last two quarters the disbursements have remained ahead of the revised disbursement schedule and are expected to pick up further momentum since many contracts have been signed within the last six months. One component, i.e. the installation of air-filtering system in Kakanj thermal power plant (Unit 5) has been commissioned. This is the first such installation in the Western Balkans and has attracted media attention for adoption of modern technology by the EPBiH. It has also been well received by the population around the power plant since it has resulted in a significant improvement in air quality in and around Kakanj town. A preceding project (Third Electric Power Reconstruction Project P058521) with the same implementing agencies had piloted a Financial Management Information System to improve management control, transparency, and efficiency of finance function within the power utilities. Follow on financing was included in the current project. EPHZHB not only piloted it successfully but expanded it through the enterprise. Seeing the benefits of improved efficiency and management controls, the other two implementing agencies (EPBiH and EPRS) are also implementing the pilots in their finance functions but would like to scale it up through their enterprises. In the absence of additional financing from the donors, the power companies have decided to scale it up with their own funds. The project has been restructured on November 22, 2010 and the Closing Date has been extended to June 30, 2012. Results Project Development Objective Indicators Indicator Baseline Current End Target Indicator Name Value Value Value Market liberalization in the regional market 0% in most countires A small proportion (HV customers Date in EPHZHB) of the market opened; Date rest of the market not yet 01-Jan-2007 liberalized in BiH due to Public Disclosure Copy Type Unit of Measure Comment insufficiently developed framework Comment Custom Indicator Text for operation of Transco and ISO, disagreement between two Entities. Date 14-Apr-2010 Comment Because of the financial crisis, most of the countries in the sub- region have slowed down market liberalization. Page 2 of 7 The World Bank Report No: ISR2268 Indicator Baseline Current End Target Public Disclosure Copy Indicator Name Value Value Value Electricity generation is maintained at or above base levels in 12,800 GWh Generation and export of power in Equal or greater corresponding hydrological conditions 2009 has reached record levels Date Date and the EPRS and EPBiH have 31-Dec-2005 earned record profits inspite of 31-Dec-2010 Type Unit of Measure Comment lower prices in the regional Comment Custom Indicator Text electricity market. Date 14-Apr-2010 Comment Indicator Baseline Current End Target Indicator Name Value Value Value Environmental Compliance is improved at: No Installation of Electrostatic Yes 1. Kakanj TPP Precipitator to control emissions Date Date 2. Tuzla TPP from Kakanj Thermal Power Plant 3. Ugljevik TPP 31-Dec-2005 (about 20 kilometers from 31-Dec-2010 4. Gacko TPP Comment Sarajevo) is nearing completion Comment Type Unit of Measure and is scheduled for testing and Custom Indicator operational acceptance in June Text 2010 Date 14-Apr-2010 Comment ESP expert consultant (Kjell Porle) would visit the plant at the time of testing and operational acceptance Public Disclosure Copy to supervise and also hold a two day workshop for all thermal plant operators in Bosnia-Herzegovina to present new technologies in air pollution control from thermal power plants. Implementation at other power plants has recently commenced and is being monitored. Page 3 of 7 The World Bank Report No: ISR2268 Indicator Baseline Current End Target Public Disclosure Copy Indicator Name Value Value Value Dam Safety is improved at: No Consultants have been engaged Yes 1. Grabovica and have started work to design Date Date 2. Salakovac dam safety measures. 3. Jablanica 31-Dec-2005 31-Dec-2010 Date 4. Rama Comment Comment 5. Trebinje II 14-Oct-2010 6. Visegrad Comment 7. Bocac Consultants have submitted Type Unit of Measure inception, and intermediate reports Custom Indicator Text to the clients; reviewed and found satisfactory by the Bank Indicator Baseline Current End Target Indicator Name Value Value Value ISO has Functional Market Operation System. No USAID funded consultants are Yes Date working with ISO to develop Date market rules.The activity is delayed 31-Dec-2005 but the ISO has become functional 31-Dec-2010 Type Unit of Measure Comment and is operating the power system. Comment Custom Indicator Text Date 14-Oct-2010 Comment The dispute between the two Entities on the issue of one Transco (and related institutional arrangement for ISO) has deepened. The dispute is not resolved, and this target is unlikely Public Disclosure Copy to be achieved. Intermediate Results Indicators Page 4 of 7 The World Bank Report No: ISR2268 Indicator Baseline Current End Target Public Disclosure Copy Indicator Name Value Value Value Progress in implementation of EPBiH components. 0% 15% 100% Date Date Date 31-Dec-2005 14-Apr-2010 31-Dec-2010 Type Unit of Measure Comment Comment Comment Custom Indicator Text Out of US16.4 million allocation for EPBH, contracts have been awarded and are currently under implementation for an amount of US$6.54 million; bids are under evaluation/issued for an amount of US$7.7 million; and bids are under preparation for an amount of US $2.2 million. Physical progress will be assessed during the next mission. Indicator Baseline Current End Target Indicator Name Value Value Value Progress in implementation of EPHZHB components. 0% 80% 100% Date Date Date 31-Dec-2005 14-Oct-2010 31-Dec-2010 Type Unit of Measure Comment Comment Comment Custom Indicator Text EPHZHB has completed the Bank funded FMIS implementation. Dam Safety study is ongoing. Public Disclosure Copy Page 5 of 7 The World Bank Report No: ISR2268 Indicator Baseline Current End Target Public Disclosure Copy Indicator Name Value Value Value Progress in implementation of EPRS components 0% 15% 100% Date Date Date 31-Dec-2005 14-Oct-2010 31-Dec-2010 Type Unit of Measure Comment Comment Comment Custom Indicator Text OUt of an allocation of US$20.27 millin, EPRS has awarded contracts worth US$13.12 million which are under implementation; contracts worth US$9.7 million are under evaluation and expected to be received for Bank's no objection within the next three weeks. Indicator Baseline Current End Target Indicator Name Value Value Value Progress in implementation of distribution components financed by co- 0% Good progress by EPs; several 100% financers. contracts awarded. Date Date 31-Dec-2005 Date 31-Dec-2010 Type Unit of Measure Comment 14-Oct-2010 Comment Custom Indicator Text Comment An EIB funded component has not yet started implementaion due to ongoing dispute between the two Entities on Transco. Data on Financial Performance (as of 24-Nov-2010) Public Disclosure Copy Financial Agreement(s) Key Dates Project Loan No. Status Approval Date Signing Date Effectiveness Date Closing Date P090666 IDA-41970 Effective 16-Jun-2006 21-Aug-2006 13-Apr-2007 30-Jun-2012 Disbursements (in Millions) Project Loan No. Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P090666 IDA-41970 Effective XDR 25.10 25.10 0.00 10.16 14.94 40.00 Disbursement Graph Page 6 of 7 The World Bank Report No: ISR2268 Public Disclosure Copy Key Decisions Regarding Implementation Project restructuring and the extension of Closing Date to June 30, 2012. Necessary documents i.e. Restructuring Paper and the Data-sheet have been sent to the Institutional Document Unit and will be disclosed. Restructuring History Level two Approved on 22-Nov-2010 Related Projects There are no related projects. Public Disclosure Copy Page 7 of 7