Sri Lanka - Fifth Power Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 3711 PROJECT PERFORMANCE AUDIT REPORT SRI LANKA - FIFTH POWER PROJECT (CREDIT 372-CE) December 7, 1981 Operations Evaluation Department 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.  FOR OFFICIAL USE ONLY PROJECT PERFORMANCE AUDIT REPORT SRI LANKA - FIFTH POWER PROJECT (CREDIT 372-CE) TABLE OF CONTENTS Page No. Preface ....................................... i Project Performance Audit Basic Data Sheet.......................... ii Highlights ..... . . . . . . . . o. . . . . . ............. ...... o... iv Attachment: Project Completion Report 1. Introduction, Summary and Conclusions ................. 1 2. Preparation and Appraisal ........ ............... 3 3. Implementation and Cost ....................................... 5 4. Justification ................ . ........ ....10 5. Financial Performance ........................... 12 Annexes: 1. List of 33kV Subtransmission Lines Built .................. 17 2. Schedule of Main Contracts ......... ...................... 18 3. Schedule of Cumulative Disbursements ....... o .............. 19 4. Bulk Consumers Supplied Under Project ........................ 20 5. CEB Forecast (1972-77) and Actual (1972-78) Income Statements.. 23 6. CEB Forecast (1972-77) and Actual (1972-78) and Applications of Funds Statement ................ ... . 24 7. CEB Forecast (1972-77) and Actual (1972-78) Balance Sheets 25 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.  PROJECT PERFORMANCE AUDIT REPORT SRI LANKA - FIFTH POWER PROJECT (CREDIT 372-CE) PREFACE This report presents the results of a performance audit of the Sri Lanka Fifth Power Project for which Credit 372-CE of US$6.0 million was made to the Government of Sri Lanka in April 1973. The credit was fully disbursed and closed by May 1979. The report consists of Highlights prepared by the Operations Evalua- tion Department (OED) and a Project Completion Report (PCR) prepared by the South Asia Regional Office. In preparing the PCR, the Region took into account the findings of a project completion mission carried out in May 1980 and also the information provided in a technical report prepared by the Ceylon Electricity Board (CEB), the state-owned utility responsible for implementing the project. The implementation period of the Fifth Power Project followed immediately that of the Fourth Power Project, which was the subject of a recent Project Performance Audit Report. Both projects shared common institu- tional and financial objections and, in the event, faced similar experiences and difficulties. Following its abbreviated procedure, OED has reviewed the Appraisal and President's Reports, the loan documents, the Minutes of the Board dis- cussions, CEB's technical report, and the PCR. OED has also discussed the project with Bank staff. On the basis of this limited review, OED finds no reason to disagree with the general conclusions of the PCR. Following normal OED procedures, a draft copy of this report was sent to the Government and CEB for comments. However, none were received.  - ii - PROJECT PERFORMANCE AUDIT BASIC DATA SHEET SRI LANKA - FIFTH POWER PROJECT (CREDIT 372-CE) KEY PROJECT DATA Actual or Item Appraisal Current Estimate Total Project Cost (US$ million) 9.78 10.70 Cost overrun 9% Credit Amount (US$ million) 6.0 6.0 Disbursed 6.0-/ Date for Completion of Physical Components 06/76 End 1979 Proportion Completed by Appraisal Target Date (%) 50 Proportion of Time Overrun (%) 110 Economic Rate of Return (%) n.a. n.a./b Financial Performance SatisfactoryLC Institutional Performance Worse Cumulative Estimated and Actual Disbursements (US$ million) June 30: 1974 1975 1976 1977 1978 1979 (i) Appraisal Estimate 0.2 4.9 6.0 6.0 6.0 6.0 (ii) Actual 0.2 1.7 4.5 5.3 5.6 6.0 (ii) as % of (i) 100 35 75 88 93 100 OTHER PROJECT DATA Original Actual First Mention in Files 1971 Negotiations 0 Board Approval 04/05/73 Credit Agreement Date 04/18/73 Effectiveness.Date 07/25/73 Closing Date 12/31/76 05/04/79 Borrower Ceylon Electricity Board Executing Agency Ceylon Electricity Board Fiscal Year of Borrower January 1 - December 31 Follow-on Project Sixth Power (Transmission) Project Credit Number 1048 CE Amount (US$ million) 19.5 Credit Agreement 09/24/80 Executing Agency Ceylon Electricity Board /a In addition, an amount of US$2.4 million from the Fourth Power Project (Loan 636-CE) was used to meet the foreign exchange cost overrun on this project. /b No economic rate of return was calculated-at appraisal or after comple- tion of the project (PCR para. 4.5). 1c Based on 1980 unaudited accounts. MISSION DATA Month/ No. of No. of Date of Year Weeks Persons Total Report Preappraisal 11/71 1 2 2 01/14/72 Appraisal 07/72 3 2 6 03/14/73 8 Supervision I 10/73 2 2 4 12/17/73 Supervision II 11/74 2 2 4 03/10/75 Supervision III 03/77 2 2 4 05/06/77 Supervision IV 09/78 2 2 4 11/09/78 1S I81 COUNTRY EXCHANGE RATE Name of Currency: Sri Lanka Rupee (Rs) Exchange Rate: Appraisal US$1 = Rs 11.19 (inclu ing 65% FEECSLb 1974 US$1 = Rs 11.04 " 1975 US$1 = Rs 12.72 " 1976 US$1 = Rs 14.57 " 1977 until November 15 /c US$1 = Rs 13.02 after November 15 US$1 = Rs 15.56 1978 US$1 = Rs 15.51 /a Supervision missions for the Fourth (Loan 636-CE) and Fifth power projects were combined: effectively eight man-weeks supervision of the fifth project was undertaken. /b Foreigh Exchange Entitlement Certificates; a levy imposed by GOSL in 1968 of 55% of the official exchange rate. In 1972, it was raised to 65%. /c FEECs were abolished on November 15, 1977. - iv - PROJECT PERFORMANCE AUDIT REPORT SRI LANKA - FIFTH POWER PROJECT (CREDIT 372-CE) HIGHLIGHTS The project comprised the rehabilitation and expansion of trans- mission and distribution facilities of the Ceylon Electricity Board (CEB) and was designed, built and supervised entirely by CEB's staff (PCR paras. 3.11 and 3.12). It was modified for justifiable reasons but implemented about 3-1/2 years behind schedule (PCR paras. 3.02-3.09). The final cost of the project, as recorded in CEB's books, was marginally higher than the appraisal estimate (PCR paras. 3.14-3.16). Delays in the implementation of the project did not adversely affect the utilization of new generating capacity provided under the Fourth Power Project, since construction of the latter was also delayed; furthermore, growth in the demand for energy was much lower than forecast throughout the project period (1973-79), mainly because of a slowdown in the growth of the economy. The rural electrification program, to which the project was expected to provide support, progressed slowly in the earlier years but improved considerably thereafter (PCR para. 4.4). , Largely due to the shortfall in energy sales and to inadequate tariffs, CEB's rate of return on assets during the project period remained generally well below the 8% stipulated in the credit agreement, while the improvements in accounts receivable took much longer than expected (PCR paras. 5.3, 5.4 and 5.7). The net internal cash generation, however, was sufficient to make a satisfactory contribution to the investment program largely because delays in project implementation reduced the amount of annual investment necessary. The overall financial performance in 1980 was satisfactory accord- ing to unaudited accounts (PCR para. 5.3). An economic or financial rate of return for the project was not calculated at the time of project appraisal or on project completion (PCR para. 4.5). The expected institutional improvements under the project did not materialize; the management information system and the accounting and finan- cial procedures and systems, devised by the management consultants, could not be operated effectively, in part because the utility had staffing difficulties but also because of a lack of interest and awareness by CEB's senior manage- ment. These issues are being addressed under the Bank Group's Sixth Power Project, financed by Credit 1048-CE of September 1980 (PCR para. 5.1). While the project enabled the Bank Group to maintain a dialogue with the country, more frequent project supervision missions might have helped CEB to improve its managerial and financial performance (PCR para. 6.1). The following additional point may be of special interest: - factors which contributed to delays in project implementation were: indifferent performance by CEB's project staff and management, and renegotiation of prices by suppliers, as a result of sharp increase in prices of metals, etc. following the fuel crisis (PCR paras. 3.7, 3.10 and 3.13). SRI LANKA: FIFTH POWER PROJECT Attachment (CREDIT 372-CE) PROJECT COMPLETION REPORT 1. INTRODUCTION, SUMMARY AND CONCLUSIONS Introduction 1.1 Ceylon Electricity Board (CEB) is a public corporation that was established in 1969 as the successor to the Department of Government Electrical Undertakings. It is responsible for the development and coordi- nation of the generation, supply and distribution of electrical energy in Sri Lanka. It generates all the power in the country except for that from private plants, nearly all of which are small. CEB's present installed capacity is 398 MW, of which 328 MW is hydro. Its transmission and distri- bution systems are extensive, including 549 miles of 132 kV, 214 miles of 66 kV, over 3,000 miles of 33 kV and about 1,000 miles of 11 kV lines. 1.2 At the time of appraisal in 1973, previous loans and credits had been made as follows: - (a) Loan 101-CE (US$15.9m) to Government of Sri Lanka (GSL) in 1954 for the 25 MW extension to Laksapana hydro electric scheme. (b) Loan 209-CE (US$7.4m) to GSL in 1958 for a 25 MW steam station at Kelanitissa. (c) Loan 283-CE (US$14.1m) to GSL in 1961 for a 25 MW extension to Kelanitissa. (d) Loan 636-CE (US$21.0m, reduced to $16.5m) to Ceylon Electricity Board (CEB)l/ in 1969 for the Maskeliya Oya Stage II (New Laksapana) 90 MW hydro electric scheme. (e) Loan 653-CE/Credit 174-CE (US$29.0m) to GSL in 1969 for a multi- purpose development on the Mahaweli Ganga, part of which was the 37 MW Ukuwela hydro electric station. 1.3 The project was needed mainly to reinforce CEB's system at various points so as to permit full benefit to be gained from the New Laksapana and Ukuwela power stations, which were planned to be commissioned in 1974. 1.4 One of the Bank's main purposes in agreeing to finance this project was to maintain contact with Sri Lanka during a period of difficult relations with GOSL (para 2.1). Summary 1.5 The project was a small one consisting mainly of 86 miles of 132 kV lines with substations, 400 miles of 33 kV lines with substations, and improve- 1/ CEB was established in June 1969. -2 - ments and additions to the Colombo distribution system. Because of changes in system requirements during implementation, the plant actually built varied considerably from that proposed at appraisal (paras 3.1 to 3.6). 1.6 Credit 372-CE for US$6.0 million was provided to finance the foreign components of the project, the total cost of which was estimated as US$9.78 million (para 3.14). Because of inflation, the cost of the original foreign components rose from $6.0 m to 7.09 m, and other equipment costing $1.29 m was added bringing the final foreign cost to $8.38 m. The overrun of 2.38 m was financed from the undisbursed portion of Loan 636-CE for the Maskeliya Oya Stage II (New Laksapana) project. Local costs as recorded were only 61% of the appraisal estimate, but a satisfactory explanation for this is not available (para 3.16). 1.7 Construction was not completed until 3 years later than originally scheduled. The planned period was from the start of 1974 to mid 1976, but few of the foreign materials arrived before 1975 and some minor work was not completed until the end of 1979. Because load growth was slower than forecast and the power stations were late, the actual pace of construction did not result in any loss of lead (para 4.1). Conclusions 1.8 Despite being completed late, the project met its major objectives of enabling full use to be made of the New Laksapana and Ukuwela power stations, permitting new cortsumers to be served, and providing better service to existing consumers. 1.9 The slow rate of construction, although it matched the load growth, must be regarded as unsatisfactory, reflecting deficiencies in CEB's general management and project management and in the Bank's supervision (para 3.13). -3- 2. PREPARATION AND APPRAISAL Background 2.1 Following a change of Government in 1970 the opportunities for Bank assistance were limited for several years. Nevertheless, the Bank wished to maintain dialogue with Sri Lanka, and this transmission and distribution project, modest in size but essentail if the full benefits of previous projects were to be realized, provided a suitable vehicle. 2.2 CEB needed increased transmission and distribution facilities to allow utilization of the output from new hydro electric stations at New Lakeapana (Maskeliya Oya Stage II, 100 MW) and Ukuwela (37 14W, on the Mahaweli Ganga). Both were built with the help of Bank financing and were planned to be commissioned in 1974. CEB therefore had formulated in 1969 this transmission and distribution project. In early planning it had been included as part of the Maskeliya Oya Stage II hydro generation project but, because it was expected to have a much shorter construction period than the hydro development, it was omitted from that project to save commitment'fees, and was to be treated as a separate project starting later. 2.3 The feasibility study for this project was carried out by CEB's predecessor, the Department of Government Electricity Undertakings (DGEU) in 1969, and the subject was explored by a Bank mission visiting Colombo in December 1970. The project was appraised in July 1972, negotiations took place in February 1973, the Board approved the Credit in April 1973 and the documents were signed in the same month. The Credit became effective in July 1973. Special Conditions 2.4 Special conditions of the Project were as follows: Development Credit Agreement Comments 3.02 CEB to participate in the formula- No financial adjustment has tion of joint schemes and to super- yet been made in CEB's vise the design and construction of accounts for the Ukuwela "pover" assets created under such power station commissioned schemes: such assets are to be in 1976.1/ transferred to CEB on commissioning. 3.03 GSL to ensure the availability of Satisfactory. foreign exchange for asset repair or replacement. 1/ Under the sixth power project this has been done by the end of 1980 (para 5.9). -4- Project Agreement Comments 3.01 CEB to establish adequate in- Satisfactory - Insurance surance arrangements in accord- Fund established (para 5.8). ance with sound public utility practices. 4.02 CEB's audited accounts to be sub- CEB has been unable to achieve mitted within 6 months of fiscal this deadline in any year.1/ year-end. 4.03 CEB to maintain debt service coverage Satisfactory.2/ of at least 1.5 times net revenues. 4.04 (a) CEB to ensure sufficient revenues - Satisfactory. (i) in fiscal 1973 to cover operating costs, (excluding depreciation) debt service, adequate working capital and not less than 30% of capital expenditures.3/ (ii) thereafter, to produce at least CEB has failed to achieve an 8% rate of return on the current this target in any year from value of its net fixed assets. FY1974.4/ 4.04 (b) from fiscal 1973, CEB to pay dividends Rs 3.9 million was paid in on GSL equity only after net income error in 1975 and CEB has exceeds 30% capital expenditures.3/ been unable to recover it. 4.05 CEB's consumer receivables at the CEB did not meet this target month end (excluding disputed amounts until 1977, but progressive under CEB Act 1969 9.55) not to exceed improvements to collection the aggregate billings in the previous procedures have been made three months. since (para 5.7). 1/ Improved arrangements have been made under the sixth power project (para 5.6). 2/ A supervision mission in September 1978 suggested that this covenant had been violated but following the increase in tariffs in December 1978 and the transfer of responsibility for the Samanalawewa hydro project to MDA the position is again satisfactory. 3/ Defined to include capital expenditures under any joint scheme. 4/ CEB's rate of return continued unsatisfactory, falling to 2.3% in 1978. On IDA's insistence GOSL permitted a tariff increase of 80% in December 1978, which arrested the decline. A further increase of 65% is a condition of effectiveness of the sixth power project. Projections indicate that this increase will permit CEB to achieve the target of 8% return on revalued average net fixed assets in service (para 5.3). -5- 3. IMPLEMENTATION AND COST The Project As Planned 3.1 At appraisal, the project consisted of the following components: 132 kV Lines: Double circuit line 6 miles long to connect Ukuwela power station to the existing grid.l/ Single circuit line 18 miles long from Anuradhapura to Rajangana. Single circuit line 56 miles long from Anuradhapura to Trincomalee. 132 kV Grid Substations: Trincomalee - 10 MVA substation. Rajangana - 10 MVA substation. Anuradhapura - addition of 2 bays of switchgear. 33 kV Lines and Substations: 200 miles of main line (18 separate places). 200 miles of spur lines. 300 consumer substations. Colombo Distribution System: Changing 11 kV and L.T. Switchgear at 11 substations. 25 11 kV ring main units and 25 LT breakers. 20 Packaged distribution substations. 75 L.T. feeder pillars. Service vehicles and equipment. Common Facilities: Buildings and quarters. Vehicles, tools and equipment. The Project As Built 3.2 The 132 kV lines from Ukuwela power station and to Trincomalee were built much as planned. The Ukuwela line as built measured 5 miles instead of 6, and the Trincomalee line 64.2 miles rather than 56, due to normal variations between routes first selected and final routes actually followed. The 18 mile line to Rajangana was not built, because the paper mill proposed at that place did not materialise. The conductor for the Rajangana line was strung as part of the second circuit of the Anuradhapura - Trincomalee line; the tower materials were kept in stores, to be incorporated later into the Kantalai to Valaichchenai line of the Sixth Power Project. 1/ This line was described at appraisal as 12 miles long, apparently in error. - 6 - 3.3 The grid substation at Trincomalee was built as planned, as were the extensions at Anuradhapura. The Rajangana substation was not built, the materials intended for it being incorporated instead in substations that were built at Ukuwela, and at Katunayake for the Free Trade Zone. 3.4 The appraised 33 kV transmission work comprised 18 sections of line, totaling with contingency allowances 200 miles. Some changes arose after further investigations and the sections actually built numbered 21, 16 of them from the original list, and totalled 210 miles (Annex 1). In addition, about 110 miles of spur lines and 300 consumer substations were built. 3.5 Most of the work on the Colombo distribution system was done as planned. The need for the substitution of higher rated switchgear in the substations was not as pressing as predicted, because load growth lagged behind expectation, so some of the project switchgear was diverted to other uses such as the provision of bulk supplies at 11 kV. 3.6 Service equipment and vehicles were purchased under this project, but paid for with funds from loan 636-CE. Implementation Schedule 3.7 It was expected that tenders would be invited by mid 1973, field construction would begin in January 1974 and be completed by June 1976. In fact the construction of the project was very slow and parts of it were not finished until late 1979. Tenders were received in December 1973 and January 1974 and awards were made by the end of April 1974. However, by then the effects of the fuel criais were making themselves felt in the form of sharp increases in metal prices and freight and labour increases. Some suppliers would not accept the tender awards but requested price increases which had to be negotiated, causing further delays in the deliveries of equipment and materials. The completion of parts of the project at later dates than planned fitted in quite well with the reduced rate of increase in demand actually experienced, and did not result in appreciable losses in sales of electricity. 3.8 The 132 kV- line connecting Ukuwela to the grid was completed in June 1975 in time for the commissioning of that power station which was a year late. The Trincomalee line, which according to the revised program was to be started in October 1975 and completed in April 1977, was actually energized in January 1979. 3.9 The 33 kV lines, which were programmed to be finished in 1977, took much longer and some were not completed until the end of 1979 (Annex 1). Parts of the Colombo distribution work similarly lingered until the end of 1979. Procurement 3.10 All materials supplied under the credit were purchased after inter- national competitive bidding in accordance with IDA guidelines. A list of the main contracts is given in Annex 2. CEB initially prepared 7 sets of tender documents to cover all foreign materials and equipment in the project, but at IDA's request these were reworked into 11 sets subdivided into numerous lots and small suppliers were permitted to bid for a single lot if they wished. For the substations, the numerous small contracts offered no price advantage and awards were made for the alternative offers of complete packages. However, buying the transmission line materials piecemeal did give price advantages, although some were at the cost of delayed deliveries. -7- Implementation 3.11 No consultants were employed for the project since CEB had gained extensive experience with similar work done between 1968 and 1972 on Maskeliya Oya Stage I when 292 miles of 132 kV and 525 miles of 33 kV lines as well as 10 grid substations were built. CEB's engineers performed all the engineering including supervision of construction for the project. 3.12 The construction of the project was done by CEB's own labour on force account, using a field organisation consisting of three groups, each with its own resident engineer, staff and construction gangs. Head office staff was res- ponsible for coordinating the work of the field units. Skilled personnel were to be provided by CEB and unskilled labour was hired locally. It was predicted that CEB would need to train about 200 skilled workers to make this arrangement succeed, but it was not found possible to train and retain so many in the time available. 3.13 Although the late completion had no serious repercussions, the progress of the project cannot be considered satisfactory. It reflects a lack of control by CEB's management at the time, a problem which will be investigated by management consultants as part of the sixth power project (para 5.1). Matters would probably have been improved by closer supervision by the Bank (Section 6). Project Cost 3.14 The following table summarizes the project appraisal estimate and compares it with the actual costs recorded by CEB. Project Cost US$1/ Appraisal Final Cost (Estimated) Foreign Local Total ForeignL Local Total 132 kV Bxtensions 2.01 0.43 2.44 3.89 0.15 4.04 33 kV V.xtensions 2.70 1.27 3.97 2.47 0.67 3.14 11 kV and LT switchgear 0.73 0.07 0.80 0.73 0.02 0.75 Building & quarters - 0.71 0.71 - 0.01 0.01 Engineering & admin. - 0.54 0.54 - 0.29 0.29 Customs duties - 0.54 0.54 - 0.98 0.98 Vehicles, tools & equipment 0.06 0.03 0.09 1.29 0.20 1.49 Contingency Physical 0.09 0.02 0.11 - - - Price 0.41 0.17 0.58 - - - 6.00 3.78 9.78 8.38 2.32 10.70 1/ Effective average exchange rate for project including FEECs was US$1.00 = Rs 11.09. Rate used at appraisal was 11.19. -8- 3.15 CEB's books show that the foreign costs of the project totalled US$8.38m, compared with $6.Om at appraisal. Due to inflation, costs of 132 kV equipment overran the estimate by 94%. Vehicles, tools and equipment, most of which were not provided in the estimate, were purchased at a foreign cost of $1.29m. 3.16 The local costs excluding FEECs recorded in CEB's books total US$2.32m equivalent, only 61% of the appraisal estimate. An increase of US$0.44m equiva- lent (81%) in customs duties was caused by changes in the rates after appraisal, and $0.17m equivalent more than estimated was spent on vehicles and tools. No quarters were actually built under the project, so almost none of the sum estimated for them was spent. The reductions in local costs of the 132 kV, 33 kV, and 11 kV works, and engineering and administration, have not been satisfactorily explained as records are not available in CEB because of inadequate project cost recording and accounting. Bank project officers should ensure that adequate cost accounts and explanations are prepared and retained at least until completion reports have been made. 3.17 Before the project could get under way material costs had started to escalate at an unprecedented rate. Typical prices paid for similar materials for the two stages of Maskeliya Oya (DP I and MOP II) compared as follows: )MOP I MOP II Increase Transformer, 10 MVA FF 225,000 FF 357,350 59% Transmission tower $350/ton $490/ton 40% Conductor $511/km $1,240/km 143% The project cost estimate was based on prices 20% higher than those paid for MOP I, and price contingencies of 7 % on foreign costs and 10% on local costs were included. These contingencies, usual at the time, proved inadequate. 3.18 Funds were made available from the Maskeliya Oya Stage II Loan 636-CE to finance the $2.38m foreign cost overrun. The actual disbursements under development Credit Agreement 372-CE of April 18, 1973 were as follows:- Credit Actual Category Agreement at Closing I. Equipment, materials and installations for the 132 kV and 33 kV systems 4.70 5.38 II. Equipment, materials and installations for the 11 kV distributions system 0.70 0.49 III. Vehicles and service equipment 0.10 0.13 IV. Unallocated 0.50 - US$ 6.00 6.00 -9- Disbursements 3.19 Disbursements were made for the CIF cost of imported materials and equipment. It was estimated at appraisal that the total of US$6.0 million would be disbursed by mid 1976, but at that date only $3.4 million (57%) had actually been disbursed, and disbursements continued into 1979 (Annex 3). - 10 - 4. JUSTIFICATION 4.1 The project was part of a program of investments in power generation and transmission under Sri Lanka's second Five Year Plan (1972-76). It was intended to permit effective use of increased generating capacity and provide better service to consumers. Major benefits to the economy were to include providing power service to the important plantation sector, connecting factories to the system, and bringing electricity to villages. It was expected that there would be a large increase in industrial output, substituting local products for imports and helping with the country's balance of payments. As an indication that these expectations were met, Annex 4 gives lists of 68 large consumers connected in 1975, and 61 more in 1976. Load Growth 4.2 Actual sales are compared with the 1972 appraisal forecast below. The forecast increase in energy sales for the period 1971 to 1977 averaged 9.7% per year. Actual growth declined badly after 1972 and did not recover again until 1978. The average growth in energy sold over the period 1971 to 1977 was only 6.3%. The actual speed of implementation of the project was appar- ently to the actual rate of load growth. GWh Sold Annual load Forecast Actual growth % 1966 424 - 1967 489 15.3 19b8 556 13.7 1969 604 8.6 1970 662 9.6 1971 722 9.1 1972 787 823 14.0 1973 865 855 3.9 1974 949 892 4.3 1975 1,040 965 8.2 1976 1,143 996 3.2 1977 1,257 1,042 4.6 1978 1,161 11.4 Average Increase 1971/77 9.7% 6.3% - 11 - 4.3 In 1972 Sri Lanka's consumption of electricity was less than 60 kWh per head. By 1978 it had grown to about 81 kWh per head. The following table shows how the numbers of CEB's consumers increased over the period of the Five Year Plan (1972-76), and almost doubled by the end of 1978: - Number of Consumers Average Average End End End Increase % Increase % 1971 1976 1978 1971/76 1971/ 78 Domestic 52,081 86,604 113,950 10.7 11.8 Small Industry 2,182 3,064 3,542 7.0 7.2 Large Industry 53 56 62 3.2 2.3 Commercial 16,344 24,200 26,509 8.2 7.2 Local Authorities 444 548 568 4.2 3.6 Street Lights 135 246 277 12.8 10.8 77,179 114,718 144,908 8.3 9.4 Rural Electrification 4.4 Rural electrification schemes were completed at an accelerating rate d!iring the period of the project: - 1971 1972 1973 1974 1975 1976 1977 1978 1979 Schemes completed in the year 52 59 66 101 116 168 166 272 481 Rate of Return 4.5 No estimate of economic rate of return on the project was made at appraisal because there was no way of identifying the increase in revenues properly attributable to it. This remains true. Records of this nature are not customarily.kept by many electric utilities. - 12 - 5. FINANCIAL PERFORMANCE 5.1 The establishment of CEB as a public corporation was a condition of effectiveness for Loan 636-CE. Consultants were appointed to prepare appro- priate commercial-style accounting systems and to undertake a current valuation of CEB's assets. These tasks were completed satisfactorily by 1973, but staffing difficulties in recent years have led to problems in maintaining the prescribed accounting and financial reporting systems. A further study of CEB's management and accounting problems is being undertaken in connection with the Sixth Power project. 5.2 CEB's audited income statements, sources and applications of funds statements and balance sheets for the period FY1972 through 1978 are shown in Annexes 5, 6 and 7 and are compared with those forecast for FY1972 at the time of appraisal. Key financial indicators are summarized below and the major features of CEB's financial performance are discussed in succeeding paragraphs (5.3 through 5.9). Earnings 5.3 CEB's earnings in the period FY1972 through 1978 were adversely affected by the much slower growth in energy sales than forecast and the failure to increase tariffs in this period. The forecast level of energy sales in 1976 was not achieved until 1978 because of the slow growth in the level of economic activity in Sri Lanka. Although CEB's tariffs were increased in April 1972 by about 16%, CEB failed to meet the covenanted 8% rate of return on net fixed assets in operation in every year from 1974 onwards. Further tariff increases were not approved and by 1978 the rate of return fell to 2.3% on average net fixed assets. Between 1972 and 1978, while CEB's average revenue remained at Rs 0.16/kWh, the average energy cost rose from Rs 0.10 to Rs 0.17/kWh sold. CEB was permitted to increase tariffs by about 80% in December 1978 in order to improve its financial position 1/. Fixed Asset Revaluation 5.4 A current valuation of fixed assets, undertaken by CEB's consultants, was incorporated in CEB's balance sheet at December 31, 1971. It was agreed with IDA that local indices would be used for subsequent revaluations. Fixed assets were revalued in 1977 and again 1978 using the agreed indices. Between 1972 and 1976 no adjustment was made to fixed asset values and the rate of return on net fixed assets in those years is, in consequence, overstated 2/. Contribution to Investment 5.5 CEB's financing plan forecast at the time of appraisal and actual for the period 1972 through 1977 are set out below. Despite CEB's inability to increase revenues to meet the covenanted 8% rate of return on net fixed 1/ A further tariff increase was introduced in October 1980. The rate of return was about 9% in 1980 (according to unaudited accounts) and is expected to be about 11% in 1981. 2/ Fixed assets were revalued in 1979 and 1980. KEY FINANCIAL INDICATORS (Estimate/Actual) 1972 1973 1974 1975 1976 1977 1978 1979 EST ACT EST ACT EST ACT EST ACT EST ACT EST ACT ACT 1. Energy Sales (GWh) 787 823 865 855 949 892 1040 965 1143 996 1257 1042 1161 1298 2. Sales Revenue/KWh Sold(Rupees) 0.17 0.15 0.17 0.16 0.17 0.16 0.19 0.16 0.19 0.16 0.19 0.16 0.18 0.30 3. Cost/KWh-sold (Rupees) 0.12 0.10 0.13 0.13 0.10 0.10 0.10 0.11 0.10 0.12 0.11 0.14 0.17 0.20 4. Operating Ratio 73% 69% 74% 80% 56% 63% 55% 65% 55% 74% 57% 87% 95% 59% 5. Rate of return on average net fixed 4-1% 5.3% 4.8% 4.2% 8.0% 7.0% 8.3% 6.5% 8.0% 5.6% 8.3% 2.6% 2.3% 6.8% assets 6. Debt Service Coverage 1.6 2.0 1.4 1.9 2.3 2.5 2.8 2.2 2.5 1.9 2.7 2.1 1.8 7. Current Ratio 3.9 1.7 3.1 1.6 3.9 2.4 4.1 3.2 5.2 2.6 6.2 1.8 2.0 8. Debt/Equity Ratio 24/76 21/79 23/77 20/80 25/75 18182 31/69 19/81 29/71 21/79 27/73 15/85 24/76 9 Contribution to 4 Total Estimated 49% 13% 67% -Investment Total Actual 41% 10. Consumer Receivables 25% 44%_ 25% 36% 25% 40% 25% 33% 25% 33% 25% 24% 28% 25% as % Billings - 14 - assets, CEB's contribution to investment was a reasonable 41% as against 49% forecast at appraisal. This is attributable to the slower rate of capital expenditure than forecast, less debt service and also to the waiving of dividends on GSL equity.L/ However, in 1978 the contribution to investment declined to 13% following a large increase in capital expenditure. CEB Financing Plan 1972-77 (Rs. million) FORECAST ACTUAL Requirements % % Capital Expenditure 619 91 542 78 Working Capital 64 9 151 22 683 100 693 100 Sources of Funds: Internal Cash Generation 729 569 Less Debt Service (303) (273) GSL Dividend (92) (9) Contribution to Investment 334 49 287 41 Consumer Contributions 30 4 17 3 Loans 319 47 301 43 GSL Grants - - 52 8 Prior Year Adjustments - - 36 5 683 100 693 100 5.6 In other respects CEB's financial position from FY1972 onwards was satisfactory - debt service coverage of about 2 times was maintained while the debt/equity ratio was very conservative, following the revaluation of fixed assets in 1971 and the creation of a "revaluation reserve". CEB's current ratio fell well short of the very high levels (ranging from 3 to 6) forecast between 1972-77. and ranged between 1.6 and 3.2: a current ratio of about 2 is generally regarded as a satisfactory indicator of liquidity. Continuing difficulty was experienced, however, in achieving the timely submission of CEB's audited accounts. Insufficient allowance was made for the status of CEB's accounting development and the local statutory timetable which allows four months from the year end for the preparation of accounts for audit by the Auditor General and a further six months for completion of the audit and submission of his report to the House of Representatives. The recently approved Sixth Power project requires the submission of unaudited accounts within four months and an audit report within ten months of CEB's year-end. 1/ CEB paid Rs 3.9 million in 1975 in error and to date has not recovered this amount. - 15 - Consumer Receivables 5.7 CEB covenanted to ensure that consumer receivables at each month end were not greater than the billings for the three months ending on that date. CEB was unable to achieve this target, particularly as receivables transferred on November 1, 1969 (Rs 45.5 million) included considerable amounts disputed by local authority licensees and government departments, and represented about eight months' billings at that time. Following the introduction of improved billing and collection methods CEB had some success in reducing its receivables to about four months' billings by the end of 1973. Eventually it was necessary for CEB to write-off some Rs 12 million of the original Rs 45.5 million consumer receivables as bad debts. The total amount written off by CEB between 1969-1979 (including the Rs 12 million) represents less than 1 % of the revenues during the same period. This is a very satis- factory record. While CEB continued to experience some difficulty in recovering amounts due from local authority licensees, consumer receivables had been reduced to a little over three months' billings by end 1978. The local authority receivables will be settled following the transfer of the local authority distribution systems to CEB in 1980. Insurance Arrangements 5.8 CEB established an internal Insurance Fund to which is transferred an annual amount equivalent to 1/10% of fixed assets in operation. This arrangement is adequate to cover most risks except castastrophe, for assistance with which public corporations rely upon the government. Joint Schemes - transfer of assets 5.9 GSL agreed, (Development Credit S 3.02) to ensure CEB's satisfactory participation in the formulation of a series of planned multi-purpose schemes to be constructed by other agencies and to transfer all power assets so constructed to CEB for subsequent operation on terms acceptable to the Association. To date, one such scheme, Ukuwela, is complete; the hydro station was transferred to CEB in 1976 for operation but no financial adjustment has been made in CEB's accounts. The current value of this plant is not reflected in CEB's asset base for rate of return purposes. As was agreed under the sixth power project, a part of the costs (together with a corresponding loan liability) of the multi-purpose Ukuwela project was apportioned to CEB by December 31, 1980. - 16 - 6. BANK PERFORMANCE Working relationships between CEB and the Bank were satisfactory, but the project was started in a period of strained relations between GOSL and the Bank, during which the Bank limited the frequency of its missions to the country. Later on, an unusually heavy work load on the projects division concerned (due to an upsurge of activity in Indonesia), combined with staff constraints, resulted in a period of further reduced supervision of this project. Bank staff made only five visits in seven years. and no visit was made between November 1974 and March 1977. Closer supervision at half yearly intervals would have facilitated regular discussions with CEB, especially at times when managers were being succeeded by new ones, and might have led to closer compliance with the terms of the loan and better control of CEB's operations and finances. South Asia Regional Office October 1980 SRI LANKA FIFTH POWER PROJECT COMPLETION REPORT List of 33 kV Subtransmission Lines Built Line Miles Date of Completion Programmed Actual Miles 1. Eriyagama/Kundasale 15.0 January 1977 December 1979 15 2. Rattota/Gammuduwa 5.5 May 1977 May 1978 05 3. Kundasale/Wavi 5.5 September 1977 December 1979 05 4. Marassana/Galaha 8.0 February 1978 December 1979 08 5. Weligamuwa/Mavathagama 7.0 August 1976 June 1978 10 6. Wehare/Narammala 10.0 March 1977 June 1978 08 7. Wellawa-Hiripitiya 8.0 October 1977 June 1978 09 8. Spring field Estate- Bingiriya-Bowatte 8.0 June 1978 October 1976 08 9. Vaddukoddai/Jaffna 6.0 August 1976 December 1979 06 10. Kodikamam/Point Pedro 9.0 February 1977 December 1979 09 11. Ranna Hungama/Nonagama Jn. 8.0 July 1977 September 1977 09 12. Kalumalley/Kiriwanaketiya 3.0 October 1977 December 1979 03 13. Chelsea/Stratheden 2.5 June 1976 September 1978 03 14. Kahawatta/Peronuwa 3.0 August 1976 December 1979 03 15. Talgaswela/Kurunduhage-Hatekma 15.0 June 1977 December 1979 15 16. Yahalahella/Gonapola 6.0 November 1977 December 1979 06 17. Alubomulla/Bandaragama 5.0 March 1978 December 1979 05 18. Trincomalee/Pulmuddai 48.0 September 1976 September 1977 44 19. Deniyaya/Embulipitiya 24.0 March 1976 March 1976 26 20. Talgala/Welimilla 6.0 July 1977 September 1977 06 21. Kamburupitiya/Deiyandara 7.0 March 1977 April 1978 07 200255 210 - 18 - ANMEX 2 SRI LANKA FIFTH POWER PROJECT COMPLETION REPORT Schedule of Main Contracts Delivery Date Order Complete 1. Steel towers, 132 kV 03/74 2. Insulators & hardware, 132 kV 03/74 3. Conductor and accessories 03/74 04/76 4. Conductor 04/74 11/74 5. Tapes and clamps 12/75 6. Substation equipment 04/74 04/76 7. Power line carrier equipment 04/74 04/76 8. Towers, poles and fittings, 33 kV 03/74 9. Insulators and hardware, 33 kV 03/74 10. Isolators, 33 kV 03/74 09/74 11. Conductor 08/74 01/76 12. Underground cable 04/74 12/74 13. Distribution Transformers 04/74 14. Insulators and divertors 04/74 15. Galvanised wire 04/74 01/76 16. Copper tape 04/74 02/76 17. Metering equipment 04/74 01/76 18. Copper cable 04/74 02/76 19. Earth pipes 04/74 01/76 20. Insulators and fuses 01/76 21. Galvanised wire 04/74 12/76 22. Unit Substations 04/74 04/75 23. Feeder Pillars 04/74 11/76 24. Vehicles Awafed under 636-CE 25. Tools and equipment 03/74 09/74 26. Tools and equipment 03/74 12/76 -19 - ANNEX 3 SRI LANKA CEYLON ELECTRICITY BOAR) Fifth Power Project (Credit 372-CE) Schbdule of Cumulative Disbursements (US$ million) Actual as a IDA Percentage of Fiscal year Appraisal Appraisal and Semester Estimate Actual Estimate 1974 1st 0.1 - 0 2nd 0.2 0.2 100 1975 1st 3.8 0.4 11 2nd 4.9 1.7 35 1976 1st 6.0 3.4 57 2nd 4.5 75 1977 1st 5.2 87 2nd 5.3 88 1978 1st 5.5 92 2nd 5.6 93 1979 1st 5.8 97 2nd 6.0 100 Closing Date 12/31/76 5/4/79 - 20 - ANNEX 4 Page 1 of 3 SRI LANKA FIFTH POWER PROJECT COMPLETION REPORT Bulk Consumers Supplied Under Project Name Date 1. Power Loom, Mirigama January 1975 2. Imbulgahagoda Tea Factory, Waduramba January 1975 3. Karanavai Sub., - Aug. January 1975 4. Dasa Industries, Kelaniya - Aug. February 1975 5. St. Mary's Fibre Mills, Marawila February 1975 6. Panwila Pump House February 1975 7. Kanagaratnam Mills, Anpitiya February 1975 8. New Police Station, Avissawella February 1975 9. Laxmi Tile Factory, Malwana February 1975 10. Regional Research Station, Gannoruwa March 1975 11. Tourist Village, Habarana March 1975 12. State Timber Corp., Rathmalana March 1975 13. D.C. Mill, Werella - Aug. March 1975 14. Spinning Mill, Mattagama March 1975 15. Palm Garden Estate, Rathnapura - Augmentation April 1975 16. S.L.B.C., Jaffna April 1975 17. Thihariya Sub. April 1975 18. Pethiyagoda Estate, Tellambuwa April 1975 19. Homadota Estate, Udugama April 1975 20. Govt. Hospital, Udugama April 1975 21. Ranawana Saw Mill, Katugastota April 1975 22. Power Loom, Wariyapola April 1975 23. Nahawilla Estate, Demodera April 1975 24. Kalkudah Rest House April 1975 25. Shifting of Paranaambalama sub. May 1975 26. A'pura Preservation Board, Kuttampokuna, Periyankulam June 1975 27. Fisheries Harbour, Cod Bay Trincomalee June 1975 28. O.T.S. Work Site, Padukka June 1975 29. Straw Board Factory, Godawaya June 1975 30. Power Loom Tissamaharama June 1975 31. Kataragama Water Supply scheme June 1975 32. St. Anthony's Fibre Mills Angampitiya July 1975 33. Kalutara Beach Hotel July 1975 34. Karawalpitiya Saw Mills, Wattala July 1975 35. Gangodagama Hospital July 1975 36. Peonkanda Estate - Aug. July 1975 37. Kalkudah Tourist Complex Imperial Oceanic Hotel July 1975 38. C.T.B.. Medawachchiya July 1975 - 21- ANNEX 4 Page 2 of 3 Name Date 39. Paddy Mill, Hasalaka July 1975 40. Bottalgala Estate August 1975 41. Kahawatte Rural Hospital August 1975 42. Railway Housing Scheme, Ratmalana August 1975 43. Muthugiriya Mills, Ja-ela August 1975 44. Water Works, Dehiwala August 1975 45. Galaboda Tea Factory, Rathnapura August 1975 46. Dunsworth Factory, Dehiowita August 1975 47. Alerton Tea Factory, Rakwana August 1975 48. St. Andrew's Tile Factory, Waikkal August 1975 49. Nupe Pump House August 1975 50. Power Loom Kegalle September 1975 51. Maternity Home, Galella September 1975 52. Gaurakelle Estate, Agrapatana Aug. September 1975 53. Kotiyagala Estate, Rogawanthalawa - Aug. September 1975 54. Melgort Estate, Pussellawa September 1975 55. Hope Estate, Bandarawela September 1975 56. Tea Research Institute, Kottawa October 1975 57. Palm Garden Hotel, Beruwala October 1975 58. Bault Clay Factory, Mahayala, Horana October 1975 59. Straw Board Factory, Polhenmulla November 1975 60. Peacock Diamond Factory, Liyanagemulla November 1975 61. Ceylon Resino Plastic Ltd. Peliyagoda November 1975 62. Jaffna Punkulam Sub. Aug. December 1975 63. Mullegama Saw-Mill December 1975 64. Hotel Topay, Kandy December 1975 65. State Plantation Factory, Labukele, N'Eliya December 1975 66. Blue Lagoon Hotel, Nilaweli - December 1975 67. S.L.B.C., Amparal December 1975 68. Mayura Garments, Ratmalana December 1975 69. Jaffna Co-operative Textile Union, Kandawil January 1976 70. Sugar Cane Factory Ulapane January 1976 71. Ball Clay Factory, Kalutara North January 1976 72. Cecilton Tea Factory Balangoda January 1976 73. Welihinda Fibre Mill, Divulapitiya February 1976 74. Keggala Beach Hotel February 1976 75. Wall Tile Factory, Balangoda February 1976 76. Veyangoda Water supply scheme February 1976 77. Special Project Dewahuwa February 1976 78. Textile Co-operation February 1976 79. National Training Centre February 1976 80. Fisheries Harbour, Mirissa March 1976 81. Rajagaha Fibre Mill, Divulapitiya March 1976 82. Hydro Industries Rathmalana March 1976 83. Salsusala Factory, Gothatuwa March 1976 84. Ranatunga Rubber Factory, Yakkala March 1976 85. Kalaoya Development Scheme ) Aukana Temples Circuit Bungalow) March 1976 - 22- ANNEX 4 Page 3 of 3 Name Date 86. Rajagedara Farm Malsiripura March 1976 87. Rourist Village, Babarana (Aug.) March 1976 88. Girithala Hotel Project April 1976 89. Crepe Rubber Factory Baduraliya April 1976 90. Wicklow Hills, Wamuruwa April 1976 91. Kalumala Tea Factory April 1976 92. Ritladeniya Mills Kuliyapitiya May 1976 93. Walpita Farm May 1976 9.4. Fisheries Training Centre Kalutara May 1976 95. Crepe Rubber Factory, Waharaka June 1976 96. Ragama Hospital June 1976 97. Walaboda Tea Factory - Balangoda June 1976 98. Appatite Factory, Appawala June 1976 99. 2nd Kosdin Factory, Meetiyagoda June 1976 100. Repeater Station Mannar June 1976 101. Paddy Marketing Board Madawachchlya June 1976 102. Troupe Estate Talawakele June 1976 103. Cattle Farm Udugada June 1976 104. Paddy Complase Kantalai July 1976 105. Engineering Unit Yatalatissayaura July 1976 106. Sericulture Office Anuradhapura July 1976 107. Katunayake Air Port July 1976 108. Gamsiri Uda Samuluwa Gandara July 1976 109. Shamrock Tile Factory Wennappuwa July 1976 110. Ice Plant, Pitipana July 1976 111. Fisheries Harbour, Negombo July 1976 112. Laggala Pepeater Station August 1976 113. Mt. Lavinia Hotel August 1976 114. Mt. Lavinia Beach Hotel August 1976 115. Tilly Beach Hotel Mt. Lavinia August 1976 116. Dambuu Oya Project Down Site (M.D.B.) August 1976 117. Ginenoya Project Halputota Sub. August 1976 118. Paranthan Chemicals August 1976 119. Chemanax Factory Ratmalana September 1976 120. R.V.D.B. Workshop, Dambulla September 1976 121. Straw Board Factory Naula September 1976 122. Kandy Fertilizer Ltd. Kengalla September 1976 123. Hingarana Housing Scheme September 1976 124. Ginganga Project Meegoda Sub. October 1976 125. Boosa Sub. October 1976 126. Wethera Rubber Factory October 1976 127. Sugar Corporation - Kantalai December 1976 128. Dyalagawa Tea Factory - Akuressa December 1976 129. Irrigation Scheme - Makanduwa December 1976 SRI LANKA FIF7H POWER PROJECT (CREDIT 372 CE) S.L. Rupees (million) CEB FORECAST (1972-77) AND ACTUAL (172-78) INCOME STATEMENT 1972 1973 1974 1975 1976 1gr7 1978 Tear Ending Deceber 31 .t_ E.Ate i c Apr. Apr.A Estieate Ac stimte eEite AEime Ac l E. e A Aite Actul Actul Energy Sales (GWh) 787 823 865 855 949 892 1,040 965 1,143 996 1,257 1,042 1,161 Average Revenue (Rupees) per KWh sold 0.169 0.152 0.174 0.158 0.174 0.16 0.19 0.161 0.189 0.162 0.189 0.164 0.177 Operating Revenue.: Uale. 132.8 122.9 150.5 135.4 164.7 142.4 197.7 155.3 216.5 161.3 237.4 170.8 205.3 operating Expensen: Generation - Fuel 14.2 6.6 22.8 27.3 - 3.1 - 0.3 8.6 4.6 5.3 1.1 7.4 . Other 6.3 6.0 ) 8.8 8.0 9.1 9.8 13.3 34.5 5.0 ) 37.9 6.1 ) 40.3 5.4 ) 45.9 6.6 ) 47.5 6.8 ) 55.5 5.5 7.6 Transmission ) )) )) Distribution 9.8 13.4 14.3 20.6 26.0 24.8 35.2 A~ m tratn 11.2 23.7 12.5 23.4 13.7 26,1 15.3 31.2 15.8 37.1 18.5 38.5 46.0 Depreciatlon 37.1 32.3 37.3 32.1 "f.% 32.2 l7.2 34.8 48.0 36.1 54.6 68.4 83.3 97.0 83.7 ' 110.5 108.3 91.5 89.9 108.4 101.5 119.9 119.7 133.9 148.1 192.8 oer Surplus 35.d 39.2 40.0 "7.1 73.2 55.5 bY.3 Sj.u 96.6 41.6 103.5 22.7 12.5 other Ine 3.9 12.1 4.2 12.4 4.6 15.9 5.0 13.4 5.3 16.9 5.6 25.9 36.5 Net Incame 39.7 51.3 44.2 39.5 77.8 68.4 94.3 67.2 101.9 58.5 109.1 48.6 49.0 Inest (net) (12.6) (11.5) (11.0) (8.5) (9.2) (8.7) (20.3) (15.2) (28.9) (15.9) (28.3) (24.7) (27.8) Dividend n Governent Equity (5.0) (5.0) (0.4) - - - (16.4) ( 3.9) (30.9) - (39.7) - - Net Surplus 22.1 34.8 32.8 31.0 68.6 59.7 57.6 48.1 42.1 42.6 41.1 23.9 21.2 Rate of Return n Average Net Fixed ABeta 4.1% 5.3% 4.8% 4.2% 8.0% 7.0% 8.3% 6.5% 8.0% 5.6 1 8.3 4 2.6% 2.3% ln operation FIF PCWER PROJECT (CREDIT 372 CE) S.L. Rapees (million) CEB FIRECAST (1972 - 77) AND ACTUAL (1972-- 78) SOURCES AND APPLICATIONS OF FUND STATEMENT 1972 I1973 1974 1975 ly1 6 I197T 1958 Year Ending December 31 Apr. Apr. Apr. Apr. Apr. Apr. Etiate Actual Estimate Actual Estimate Actual Estimate Actual Estimate Actual Estimate Actual Actual SOURCES: Internal Cash Generation Net Income 39.7 51.3 44.2 39.5 77.8 68.4 94.3 67.2 101.9 58.5 109.1 48.6 49.0 Depmciation 37.1 32.3 37.3 32.1 37.5 32.2 47.2 34.8 48.0 36.1 55.6 68.4 83.3 Total IcO 76.8 83.6 81.5 71.6 11533 100.6 141.5 102.0 149.9 94.6 163.7 117.0 132.3 Lees Debt Service: Amorti.ation 31.5 30.7 41.3 288 31.6 31,6 26.2 31.2 30.3 34.5 31.4 32.0 46.2 Interest 12.6 11.5 11.0 8.5 9.2 8.7 20.3 15.2 28.9 15.9 28.3 24.7 27.8 44.1 42.2 52.3 37.3 40.8 40.3 46.5 46.4 59.2 50.4 59.7 56.7 74.0 Contribution to Investmaet 32.7 41.4 29.2 34.3 74.5 60.3 95.0 55.6 90.7 44.2 104.0 60.3 58.3 Loans 34.2 20.1 27.4 31.i 93.1 21.0 150.4 66.6 7.1 77.7 7.2 84.6 339.1 GoverWment Grants (Equity) - - - 12.0 - 10.0 - 10.0 - 15.0 - 5.0 17.7 Consumer Contributions 4.5 5.9 5.0 1.6 5.0 1.6 5.0 1.9 5.0 1.5 5.0 4.0 11.6 TOrAI SOURCES 71.4 b7.4 61.6 79.1 172.6 9.9 250.4 134.1 102.8 138.4 116.2 153.9 426.7 APPLICATIONS: capital Expenditure 77.0 57.1 70.9 76.3 146.6 55.3 227.1 88.9 38.4 121.2 58.9 141.1 354.5 Dividend on Governamt Equity 5.0 5.0 0.4 - - - 16.4 3.9 30.9 - 39.7 - - Working Capital Variation 10.6 22.8 9.7 10 3 26.0 48.8 6.9 37.8 33.5 15.8 17.6 15.4 79.0 Prior Year Adjuatment - (17.5) - (9:5) - ( 11.2) - 3.9 - 1.4 - (2.6) 6.8 TOTAL APPLICATIONS 71.4 67.4 61.6 79.1 172.6 9.9 250.4 134.1 102.8 138.4 116.2 153.9 426.7 Debt Service Coverage 1.6 2.0 1.4 1.9 2.3 2.5 2.8 2.2 2.5 1.9 2.7 2.1 1.8 Contribution to Investment (including working ESTIMATED 49 _ 13 % capital) $ ACTUAL 41 % sRI 1ARA FITH1 PWER PROJECT (CREDIT 372 CE) CEB POICAST (1972-77) AnD ACT0AL (1972 - 78) B~LACE SUEEMS S.L. Rupees (million) 1972 1973 197A 1975 1976 1977 197 Yer Ending December 31 Apr. Apr. Apr. Apr. Apre. Apr. Estimate Atu Estim Act Acl Et A Estiate Actual Estimate Actual Ette Actual Estimate A.tual Actual FUXED ASSETS: Grsø fied assets 1240.1 1234.9 1249.1 1242.k 1410.6 1381.8 1676.9 1437.8 18¢2.i 1481.6 1859.9 2604.8 3126.8 lese Depreltation (282.7) (277.9) (320.0) (309.7) (357.5) (341.8 (404.7) (376.6) (455.4) (412.6) (510.0) (732.9) (905.6) Conumr Contributlons ( 1.0) ( 12.4) ( 16.0) ( 14.0) ( 21.0) (15.6) ( 26.0) ( 17.5) ( 31.0) ( 19.0) ( 36.0) (23.0) ( 25.2) Net Fixed Assets 946.4 944.6 913.1 918.7 1032.1 1024.4 1246.2 1043.7 1315.7 120.0 1313.9 1848.9 2195.7 V~rk in Pr~..s 95.2 78.7 157.1 149.5 142.2 65.4 103.0 9B.3 18-9 175.7 20.0 274.1 446.2 CUE= 1041.6 1023.3 1070.2 1068.2 1-74.3 1089.8 1349.2 1142.0 1334.6 1225.7 1339.9 2123.0 2641.9 Inventories 24.1 40.3 25.0 54.9 27.0 57.0 27.5 81.1 28.0 95.7 30.0 134.2 159.5 Receivables Consr 33.2 53.5 37.6 49.2 41.2 57.6 49.4 51.2 54.1 52.5 59.4 41.4 56.5 Other 16.o 34.3 16.o 59.4 16.o 67.8 16.o 85.4 16.o 126.1 16.o 216.o 238.0 Cash 16.7 19.6 5.7 - 13.9 27.1 20.0 26 - 10.0 54.6 6.7 62, 17,1 71-8 90.0 147.7 4.3 177.4 111.3 202.4 119.2 227.7 152.7 281.0 168.3 P9 S2R TOTAL ASSETS 1131.6 V71.0 1154.5 1245.6 1285.6 1292.2 1468.4 1369.7 1487.3 1506.7 1512.2 25319 3167.7 LIABILITIES: Equity ad Reserve: Government Equtty 379.1 379.2 379.1 391.2 379.1 441.9 379.1 463.9 379.1 478.9 379.1 483.9 501.6 Insurance Rsee - 3.6 - 4.9 - 6.2 - 7.7 - 9.2 - u.8 14.9 Rev.luatim Reserve 280.7 121.4 280.7 121.4 280.7 80.3 280.7 68.2 280.7 68.3 280.7 896.9 1146.8 Other Reserves (tin. Accumulated Surplus) 178.3 354.1 21.1 393.6 279.7 463.7 337.3 506.9 379.4 546.6 420.5 570,5 60.8 838.1 858.3 870.9 911.1 939.5 9wi 997.1 1046 7 1039.2 pin] n 1080.3 1963.1 2268.1 Long Term Debt (ine. Supplier Credits) 270.2 224.2 256.3 226.6 317.8 216.0 4k2.0 251.4 418.8 294.6 394.6 347.2 640.1 Current Liabilities 23.3 88.5 27.3 107.9 28.3 84.i 29.3 71.6 29.3 109.1 27.3 221.6 259.5 TOTAL LIABILITTES 1131.6 1171i0 -l54.5 1245.6 1285.6 1292.2 1468.4 1369.7 1487.3 1506.7 1502.2 2531.9 3167.7 Debt/Equity Ratio 24/76 21/79 23/T 20/80 25/75 18/28 31/69 19/81 29/71 21/79 27/73 15/85 24/76 Cur-nt Rati. 3.9 1.7 3.1 1.6 - 3.0 2.4 4.1 3.2 5.2 2.6 6.2 1.8 2.0  IBRD 16024 (PCR) 80* al* SRI LANKA SEPTEMBER 1981 -lo* CEYLON ELECTRICITY BOARD FIFTH POWER PROJECT 1o- POINT PEDRO POWER TRANSMISSION AND DISTRIBUTION PROJECT KARAITIVU 6 132 kV Line - Existing 0 - x- 66 kV Line - Existing ******** 66 kv Line (132 KVConstruction) 33 kV Line - Existing PUNKUDUTIVU Thermal Power Station A Hydro Power Station 0 Grid Substation KILINOCHCHI Hydra Power Station Under Construction 132 kV Line - Proposed Project 33 kV Line - Proposed Project 0 Grid Substation - Proposed Prolect * Distribution Extension MANKULAM SC Single Circuit DC Double Circuit -9. PULMODDAI (DLAKSAPANA 50 MW Q NORTON BRIDGE 50 MW ( GRAND PASS ( Thermal Station) 50 MW VAVUNYA POLPITIYA iMosietliyo Oyo Stage 1) 75 MW TRINCOMALEE O,INGINIYAGALA 10MW @CHUNNAKAM 14 MW RORAWUPOTANA UDA WALAWE 6 MW NEW LAKSAPANA(Maskeliyo Oya 90 MW Stage II) sc POLGOLLA (Under Construction) 40 MW ANURADHAPURA THIS MAP, BASED ON IBRD 10199R,MARCH 1973, HAS BEEN SPECIFICALLY PREPARED FOR THE PROJECT COMPLETION REPORT OF THE CEYLON EPPAWELA ELECTRICITY BOARD FIFTH POWER PROJECT; THE ARTWORK FOR THE MAP WHICH RAJANGANA MINNERIYA ILLUSTRATED THE ORIGINAL REPORT FOR THIS PROJECT IS UNAVAILABLE. -8. PUTTALAM HABARANA HIRIPTIYABATTICALOA RAJAKADOLU CHILA BOLAWAT KNY GALAHA PEAK AK ARAIPATTU NEGOMBOINGINIAGALA COLOMBO SAPUGASKANDA uc 7 CO1OAC80 0/5TR/SUTION EXTENSION \® UWR . * qb KOLONNAWA PDKA\ 1 DABUL POLONNARUW RATMALANA2 EL Tha ,nws h.. h.. prp..d by' h. Wonvrnh. af.HIRI BELLAPITIYA O 't.rd. of 0- o. to wh,,h ita i ,at.,h.d Th,. d.-Mv-i a uNd Do ALAHGDA 65APGAS.A.N Dho SnCth, -op do mtnly. oh nb peart of the Word Bank and it echato. sny DOROMU A ,uomnt on th e ea de s of 1terpor o wy 1sstr KATARAGAMA Thr deCpnoinatsonh usedan th do nEyItpat WoRW Ban InNAdGa san te ro o a ew AraRo ofin c o Colombo AK 80* 1 2 BELLAITIY