Haiti - Third Power Project

Document of The Woi ld Bank FOR OFFICIAL USE ONLY Report No. 9165 PROJECT COMPLETION REPORT HAITI THIRD POWER PROJECT (CREDIT 1281-HA) NOVEMBER 30, 1990 Infrastructure and Energy Division Country Department III Latin America and the Caribbean Regional. Office 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 Currency Unit = Gourde (G) USS 1.00 = G$ 5.00 G$ 1.00 = US$ 0.20 WEIGHT AND MEASURE t (metric ton) = 1,000 kgs (2.205 pounds) k cal (kilo calorie) = 3,968 Btu (British thermal units) 1 barrel = 42 US gallor.s = 159 liters 1 kilovolt (kV) 1,000 volts (V) 1 kilowatt (kW) = 1,000 wattts (W) 1 megawatt (MW) = 1,000 kilowatts (kW) 1 kilowatt-hour (kWh) - 1,000 watt-hours (Wh) 1 gigawatt-hour (GWh) = 1,000,000 kilowatt-hours (kWh) 1 megavolt-ampere (MVA) = 1,000,000 volt-ampere (VA) 1 kilometer (km) = 0,6214 mile (mi) 1 hertz (Hz) 1 cycle per second ABBREVIATIONS AND ACRONYMS BMRE =Bureau of Mines and Energy Resources CCCE =Caisse Centrale de Cooperation Economique (France) CIDA =Canadian International Development Agency (Canada) DECON =Deutsche Energie-Contult (Germany) EdH =Electricite d'Haiti IDB =Inter-American Development Bank KfW =Kreditanstalt fur Wiederaufbau (Federal Republic of Germany) MARNDR IM;2<try of Agriculture, Natural Resources and Rural Development PTC =Petroleum Technical Committee UNDP =United Nations Development Programme FISCAL YEAR October 1 - September 30  TFt WORLD llNK FOR OFFICIAL USE ONLY WASf"810to.fVC 20433 U S A Office of Director-General Operatiosa 2vaMlatiou November 30, 1990 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Completion Report on Haiti Third Power Project (Credit 1281-HA) Attached, for information, is a copy of a report entitled "Project Completion Report on Haiti - Third Power Project (Credit 1281-HA)" prepared by the Latin America and the Caribbean Regional Office. No audit of this project has been made by the Operations Evaluation Department at this time. Attachment This aocument hs a mtsrctd dgtnbuuon and may be sued by ml:wnts only in te f=M'ace I of their ofmcti duueL Its conw nu may not otvwae be dcmea withOut World ana auu_on.aon  FOR OFFICIAL USE ONLY HAITI PROJECT COMPLETION REPORT THIRD POWER PROJECr (CREDIT 1281-HA) TABLE OF CONTENTS Page No PREFACE ........................................... (i) EVALUATION SUMMARY ......................................... (ii) PART I PROJECT REVIEW FROM BANK'S PERSPECTIVE Project Identification ................................ 1 Background .......... 1 IDA Lending to the Sector .............................1 Electric Power Sector Organization ..... .............. I Project Objectives and Descriptions ......................... 2 Project Objective .................................. . 2 Project Description ................................. 2 Proiect Design and Organization ............................. 3 Origin ................................. 3 Preparation ................................. 3 Appraisal and Negotiations ............................ 3 Estimated Pruject Cost and Financing .................. 3 Project Implementation ...................................... 3 Generation and Distribution Components ................ 3 Execution Timetables .................................. 3 Execution Problems .................................... 4 Procurement ................. ......................... 4 Project Cost and Financing ......................... 4 Distributinns ......................... 4 Performance of Consultants, Contractors, and Suppliers 4 Covenants ......................... 4 Project Results ......................... 5 Market Growth ......................... 5 Rate of Return ......................... 5 Comparison of Forecast and Actual Performance. 6 Sustainability. 6 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.  TABLE OF CONTENTS (Cont.) Page No. IDA Performance ............................................. 6 Lessons to be Learned Regarding thie Performance ....... 6 of IDA PART II PROJECT REVIEW FROM BORROWER'S PERSPECTIVE ......... 9 PART III STATISTICAL INFORMATION ......................... 10 Table 1. Related IDA Credits ........................ 10 Table 2. Project Timetable .......................... 11 Table 3. Credit Disbursements ....................... 12 Table 4. Project Implementation ..................... 13 Table 5. Project Cost and Financing ................. 15 Table 6. Project Results ............................ 16 Table 7. Status of Key Covenants .................... 17 Table 8. Mission Data ............................... 18 ANNEXES: Annex 1. Forecast and Actual lncome Statements ...... 19 Annex 2. Forecast and Actual Balance Sheets ......... 20 Annex 3. Forecast and Actual Sources and Application of Funds Statements ............. 21  -i- HAITI PROJECT COMPLETION REPORT THIRD POWER PROJECT (CREDIT 1281-HA) PREFACE This is the Project Completion Report (PCR) for the Third Power Project, which was partially financed by Credit 1281-HA (SDR 23.1) of June 1982. The Borrower is the Republic of Haiti and the Executing Agency was Electricite d'Haiti (EdH). Project works started on time but were concluded 18 months behind schedule. The Infrastructure and Energy Division, Department III of the Latin American and Caribbean Regional Office (LA3IE) prepared Parts I and III of the PCR based on the Staff Appraisal Report; the Credit and Project Agreements; supervision reports; correspondence between IDA and the Borrower; internal IDA memoranda; and on final project data prepared by the Executing Agency. Part II was not prepared because it would have been difficult for the Borrower and Executing Agency to complete since many of their representatives have moved on to new assignments.  - ii- HARII PROJECT COMPLETION REPORT ELECTRICITE D'HAITI (EdH) THIRD POWER PROJECT (CREDIT 1281-HA) EVALUATION S'JMMARY Objectives 1. The project's main objective was to provide additional generating capacity by June 1984, promote the use of indigenous resources, reduce energy losses, and improve EdH'. institutional performance. In addition, an important prc:-ct objecti7e was construction of a new headquarters office buildi) ) for EdH, rehabilitation of part of the Port-au-Prince distribution network, and repairs of Peligre hydro facilities. (para. 3.01). Implementation Experience 2. Overall completion of the project suffered 18 months delay, mainly because of the unsatisfactory performance of the principal consultant which was unable to expeditiously prepare designs for the new diesel generating plant, and the distribution renovation program. Further, their design for the headquarters building was unsuitable and had to be redone by others, thereby delaying its completion (para. 5.01). Result 3. The project achieved its main objective with a delay of only 5 months. But it was unsuccessful in reducing energy losses during the project period, promote the use of indigenous resources, or improve EdH's performance. On the other hand, it succeeded in improving electricity service reliability and with the new headquarters building, provided a sound foundation for improvements in EdH's institutional performance (paras. 6.01 and 8.01). Sustainability 4. Through two subsequent credits, IDA has assisted the sector by financing required additional generating capacity, reducing technical losses through distribution network rehabilitation, and strengthening of EdH to improve its performance. Nevertheless, EdH continues to depend too much on foreign consultants. This practice should cease because it is expensive and constrains autonomy. If  - iii - EdH is unable to operate effectively without such help, Government should consider transferring some, or all, of the utility's operation to the private sector. (para. 7.01). Findings and Lessons Learned 5. The institutional framework was not diagnosed in dept'