Colombia - Bogota Power Project

R E S T R I C T E D R2TUR * 11 T-0 REPORTS DESK FI canY Report No. TO-219a WITHIN FILE uY ONE WEEK This report was prepared for use within the Bank. In making it available to others, the Bank assumes no responsibility to them for the accuracy or completeness of the information contained herein. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT APPRAISAL OF THE EXPANSION PROGRAM OF EMPRESA DE ENERGIA ELECTRICA DE BOGOTA COLOMBIA lanuary 11, 1960 Department of Technical Operations  CURRENCY EQUIVALENTS U.S. $1 - Colombian (Pesos) Ps 8 Ps 1 - U.S. $0.125 Ps 1,000,000 - U.S. $125,000 Ps 8,000,000 - U.S. $1,000,000 The exchange rate of the Colombian peso was Ps 8 to U.S. $1 in June 1959 when the field appraisal was made. Although the exchange rate is now about Ps 7 to U.S. $1, the more conservative rate of Ps 8 to U.S. $1 has been used throughout this report.  APPRAISAL OF THE EXPANSION PROGWi., OF NP RE5A S AT. RG7I3 ETCrTR D-F _ETC COLOMBIA TABLE OF CONTENTS Page SUMMARY i I INTRODUCTION 1 II ThE BORROWER 1 Management 2 Present installations 2 III THE POWER MARKET 3 Past Sales and Load 3 Forecast of Future Sales and Load 3 IV THE PROJECT 4 The Laguneta Addition 5 The Tomine Dam and Reservoir 5 The New Salto Hydro Plant 6 The 33 MW Thermal Addition 6 Improvement in the Distribution and Transmission System 7 Engineering for Future Development of the System 7 Estimated Cost of the Project 7 Engineering and Supervision of Construction 8 Schedule of Construction 9 Rate of Expenditures and Method of Financing 9 V FUTURE CAPACITY REQUIREMENTS 9 The Paipa Thermal Plant 9 The Future Expansion Program 10 VI COMPARISON 1ITH A THERIAL ALTERNATIVE 11 VII FINANCIAL ASPECTS 11 Rates 11 Internal Audits 11 Present Financial Position 11 Past Earnings Record 13 Financial Plan 13 Estimated Future Earnings 14 Debt Service Coverage 15 Debt/Equity Ratio 15 VIII JUSTIFICATION OF THE PROJECT 15 IX CONCLUSION 15  TABLE OF CCH17TENTS (Cont'd) LIST OF ANbMXES Annex 1 - Summary of Past Energy Consumption 2 - Forecast of Sales and Generation i 3 - Load and Capacity Development Curvre it 4 - Technical Features of the Project " 5 - Estimated Cost of the Project " 6 - Bar Chart Construction Schedule If 7 - Actual and Forecast Balance Sheets 1953-1968 8 - Actual and Forecast Income Statements 1954-1968 " 9 - Forecast Sources and Applications of Funds 1959-1968 Map  APPRPISAL OF TIE EXPANSION PROGRAI; OF EMPRESA DE, E,:ERGIA =ECTRICA DE 5OGCTA COLOMBIA SUMMARY i. The Bank has been asked to make a loan of $17.6 million to cover the foreign exchange cost of a project consisting of new hydro and thermal- electric generating facilities, additions and improvements to the trans- mission and distribution system and part of the engineering cost of a future expansion program for the power system of Bogota, Colombia. The project is estimated to cost the equivalent of $30.4 million, including interest during construction, of which $17.6 million would be in foreign currencies. ii. The Empresa de Energia Electrica de Bogota (EEEB), which would be the borrower, is an autonomous organization owned by the Municipality of Bogota. iii. The management and the technical staff of EDEB are adequate to carry on both the day-to-day activities of the company and the expansion work under the project. iv. The project has been planned and designed by competent engineering consultants who would, in conjunction with EEEB personnel, continue the supervision of construction. v. The project is estimated to be completed by mid-1962. This schedule of construction is realistic. vi. The project is needed to meet the growing demand for power in the Bogota area. Power has been in short supply in this area for many years. The forecast of demand justifies the installation of the proposed facilities. The project would add 84 megawatts of hydro capacity and 33 megawatts of thermal capacity to the generation plant of EEEB. The cost of the hydro addition would be approximately $154 per installed KW and of the thermal addition, approximately $207 per installed RI. These are very economical costs for new generation. Extensive additions and improvements to the transmission and distribution system would also be included. vii. EEEB's capitalization at December 31, 1958 amounted to Ps 130.3 million, of which debt totaled Ps 40.7 million and equity amounted to Ps 89.6 million. The debt/equity ratio was 31:69. viii, The present rates will be raised about 16% as a condition of the proposed loan. This increase should provide revenues adequate to enable EEEB to maintain a satisfactory financial position through 1961. The fore- cast of EEEB Is future earnings indicate that a further rate increase will be necessary in 1962 to insure a satisfactory return on investment and to carry out additional planned expansions after completion of the present project.  - ii - ix. Both a satisfactory debt service covenant and a rate covenant were agreed upon during negotiations. x. The estimates of the cost of the project are reasonable. The pro- ject would be suitable as a basis for a Bank loan in an amount equivalent to $17.6 million for a period of 25 years, including a grace period of 3 ycars on amortization payments.  APPRAISAL OF TIE EXPANSION PROGRAM OF B 2LS' DE E NERGIA At' ' 1TRCA DE 32'3Tk COLOMBIk Io INTRODUCTION 1. This report covers the appraisal of the expansion program of the Empresa de Energia Electrica de Bogota (EEEB). The project consists of the addition of 84 MP of hydro and 33 Mi of thermal generating capacity plus associated transmission, distribution and other facilities. The esti- mated cost is equivalent to $30.4 million. The Bank has been requested to make a loan to cover the foreign exchange cost of this project, estimated to be equivalent to $17.6 million, including interest during construction. 2. The original design and planning for the hydro portion of the pro- ject were started in 1955 by the combined engineering consultants Olarte, Ospina, Arias y Payan Ltda. of Bogota (OLAP) and Tippett-Abbett-McCarthy- Stratton of New York. OLAP has continued the detailed engineering work since 1958e Engineering responsibility for the thermal addition, which is part of the project, has been assigned to the J.GQ Wnite Corporation of New York. This report is based on data furnished by EEEB and by the Government to a Bank mission which visited Bogota in June 1959. 3. The Borrower would be the Empresa de Energia Electrica de Bogota (BEEB), an autonomous municipal owned public utility which serves the capital city of Bogota and vicinity. 4. The project would be executed by EEEB with the engineering assist- ance of OLAP, II. TTHE BORROWER 5. The Borrower, EBEB, is the only utility supplying power in Bogota, a city of about 1 million. 6. Prior to 1946, the Municipality of Bogota owned 51% of the shares of a private corporation known as Empresas Unidas de Energia Electrica, S.A. which was the successor to two electric utility companies operating in Bogota. In 1946, the Municipality obtained an option to acquire the balance of the shares of the corporation and in 1951 exercised its option, liqui- dated the corporation and thereby acquired and became the owner of all electric utility properties in Bogota. To finance this purchase, the Municipality obtained a loan of Ps 12.5 million from four local banks. In connection with this loan, the Municipality entered into a trust agreement ("fideicomiso"), which will expire wnen the bank loan matures in 1968, pur- suant to which agreement the banks have the right to and in fact had elected a majority of three out of five members of the Board of Directors of the successor enterprise known as the Empresas Unidas de Energia Electrica de Bogota. The result of this arrangement was that the administration of the enterprise was autonomous and that its management was in private hands.  - 2 - 7. In June 1959, the 1.unicipal Council of Bogota adopted a resolution creatirng, pursuant to law, an autonomous entity called Empresa de Energia Electrica de Bogota with a duration of 99 years, which will continue to be administered until 1968 according to the terms of the trust agreement mentioned above. By another resolution, the Municipal Council authorized an increase in the membership of the Board of Directors of Empresa from five to seven members and by agreement between the Yunicipal Council and the banks the Board of Directors has been increased to seven meinbers, of whom four are chosen by the banks and three by the Municipal Council. 8. The present Empresa, also referred to as EEEB, is a juridical entity with legal capacity, among others, to conclude agreements with the Bank. In addition, it has, or can obtain by existing legal procedures, various rights, including the right to acquire land, necessary for the execution of the pro- ject. It is an autonomous enterprise under the direction of a Board of Directors who choose a manager responsible for the operations. Its manager can represent it in dealings with third persons. The actual organization of the enterprise is regulated by the stipulations of the previously mentioned trust agreement, and the enterprise has been administered in a strictly com- mercial way. 9. As a condition of effectiveness of the proposed loan, the Bank will receive appropriate assurance that the Municipality, after expiration of the present trust agreement, will select the Board in a manner calculated to continue the autonomous nature of the enterprise. Management 10. The Board of Directors is responsible for all policy matters. The operational head of the enterprise is its manager. On the basis of its past performance EEEB is judged to be capable of carrying out the con- struction of the proposed project and of operating it after completion. Present Installations 11. The existing generating facilities consist of 113.5 MW of hydro capacity in three plants and 14.5 Mi of thermal capacity in one plant. Two of the three hydro plants are relatively new and account for 108 Md. The small thermal station is not continuously used but is well maintained and reliable. All of these plants are located along the Bogota River about 25 to 35 kilometers downstream from Bogota. The hydro facilities have the benefit of some regulation of the flow of the Bogota River achieved by two storage reservoirs (Neusa and Sisga) on tributaries and a regulating reser- voir (Muna). Only the regulating reservoir is owned by EEEB, but co- operative arrangements have been established with the public agencies concerned for the operation of the storage reservoirs so that optimum regulation of the streams might be obtained. 12. The transmission system consists of three double circuit steel tower transmission lines which connect the plants with seven substations  - 3 - in Bogota which have, in total, a combined capacity of 185.5 YTVA. All are operated at 57.5 kv0 One line is insulated for 115 kv operation which will be the future operating voltage. BEEB also owns a modern steel tower trans- mission line that extends north about 45 km toward Zipaquira. This line is insulated for 115 kv and will be used to tie in the 33 Y9 thermal plant which will be located in the Zipaquira area. 13. The Emoresa oino distAibution facilities in Bogota and the surrounding area as well as facilities for supplying wholesale power to several small neighboriig towns. See Map. 14. The system is isolated and operated as an entity. Due to distance and topography involved, it will probably be many years before interconnection with other networks in Colombia would be feasible. III. THF. P,E]R MAeRKET Past Sales anid Load 15. EEEB's sales increased from 158 million kwh in 1949 to 456 million kwh in 1958, an average annual rate of growth of 12.5%. Division between the three major sales categories remained approximately constant during this period at around 26% residential, 28% commercial and 324 industrial; the re- maining 14% is accounted for by street lighting, traction and other govern- ment uses. 16. The system's peak load increased at practically the same average rate as sales during the ten year period, The peak load increased from 38.7 IrW to 113.5 IW between 1949 and 1958. The system load factor remained stable at 54%. 17. The yearly growth in system load has varied substantially resulting from the fact that expansion in generating facilities did not keep pace with growth in demand. Restrictions had to be imposed on certain types and sizes of load that could be connected. Some restrictions are still in effect, for instance, at present the use of power for domestic water heating, cooking and space heating is restricted, although there are indications that a large deferred demand exists in this field in Bogota. 18. A breakdown of past consumption by category of consumer is given in Annex 1. Forecast of Future Sales and Load 19. E.EEB and its consultants have prepared a forecast of the expected growth in power consumption in Bogota through the year 1968. This forecast was primarily based on the assumption that per capita consumption in Bogota, by the year 1968, would equal that presently experienced in Medellin. Such an assumption may be reasonable but would result in a somewhat higher rate of growth, after allowing for the transitional effects of deferred demand, than can be prudently adopted in this report. The forecast of future sales and load, which is used in this report, takes into account the fact that the  - 4 - system will necessarily continue to operate with restrictions to normal demand until the end of 1961. From 1963 on, it is forecast that kwh sales will increase at an average annual rate of 13% and that load or demand will correspondingly increase at a rate of 10%, It is further forecast that restrictions which will be severe in 1961, w-ill cause the load factor to increase by then to 53Y%. The availability of adequate generating Ca- pacity at the beginning of 1962 will, conversely, result in a decreased load factor to 50% for 1962 and 1963, after which an annual improvement of 1% per year is expected as consumption levels grow. 20. The main features of the expected future load on the EEEB system are as follows: Estimated Future Annual Sales and Load Characteristics Year Gross Sales in Rate of Peak Load Load Generation in million kwh increase in KW Factor million kwh in Sales in I 1959 604 513 12.6 127 54 1960 677 577 12.7 141 55 1961 762 649 12,5 150 58 1962 900 765 17.9 205 50 1963 1044 887 15.9 236 50 1964 1174 1010 13.0 263 51 1965 1330 1140 13,O 291 52 1966 1480 1275 13,0 318 53 1967 1650 1425 13.0 348 54 1968 1834 1580 13.0 380 55 21. The use of energy by EEEB and the system's losses are expected to decline from 1501% in 1959 to 13,8% in 1968. These rather large per- centages are due to the fact that substantial use of energy by the company for pumped water storage is anticipated. One pump installation is in pre- sent use and another is included in the proposed project. 22. The existence of excellent hydro resources, close to Bogota and feasible for development in small increments as needed and with relatively short construction periods, lessens the need for detailed long range load surveys for the Bogota area. The forecast used is realistic and permits a reasonably conservative approach to the analysis of the present project. 23. Arinex 2 shoTws in more detail than the above table the estimate of future load arowth charact'eristics. IV. THE PROJECT 24. The project provides for an expansion of the hydro developments carried out 'oy EEEB in the reach of the Bogota River just after it traverses the plateau of 3ogota, a wide flat pre-historic lake bed situated at an elevation of 2,250 meters above sea level and having a drainage area of 4,270 square kilometers. The river meanders across this plateau and begins  - 5 - its precipitous drop toward the Magdalena River valley near the village of Alicachin about 20 kilometers west of the city of Bogota. In its first 24 kilometers after leaving the plateau, the river drops 1,800 meters, and in the next 90 kilometers it drops an additional 420 meters, thus provIding an extremely favorable situation for hydro power development. The project takes advantage of this situation, In addit'ion, the project provides for instal- lation of a relatively small amount of thermal capacity which is necessary to provide a reasonable hydro-thermal balance to the system, The technical features of the project are more fully described in Annex 4 and on the ac- companying map, 25. The project consists of: (a) The addition of a fourth 18 Mr unit to the existing Laguneta hydro plant on the Bogota River. (b) The construction of an earthfill (Tomine) dam and regulating reservoir on the Siecha River, a tributary of the Bogota River. {c) The construction of a new 66 IYU hydro station (Salto II) on the Bogota River. (d) The installation of a 33 I4W thermal plant near Zipaquira. (e) The improvements and expansion of EZEB's transmission and distribution system. (f) Engineering and investigation for further hydroelectric expansion. (a) The Laguneta Addition 26. The Laguneta plant which was completed in 1957 includes three generating units, each of 18 W.M Provisions were made during the con- struction of this plant for the addition of a fourth unit. The installation of the fourth unit, which is provided for in the project, will require a modest arqount of civil work at the plant and will include extension of the powerhouse. Orders for the equipment for this additional unlt have been placed. Awards were made after international bidding and were in accord with recommendations of EEEB's consulting enginieers. EEEB has already paid out about $100,000 on the equipment. (b) The Tomine Dam and Reservoir 27. The project includes the first stage construction of the Tomine earthfill dam and reservoir on the Siecha River, some 190 river kilometers upstream from Alicachin, the point below which -EB's hydro developments begin, Successful operation of the series of hydro developments planned will depend to a great extent on this upstream storage on the Bogota River. The three existing reservoirs on tributaries of the Bogota have storage capacity to regulate the flow at Alicachin to about 12,1 cubic meters per second based on the driest 5-year period in the last 90 years and to 14,0 cUbDic meters per second on the basis of the second driest 5-year perlod,  -6. The Tomlne reservoir Will, in its initial stage, increase the regulated flow at Alicachin by approximately 4.3 cubic meters per second. 28. The initial stage included in the project provides for construction of the dam to a height of 38 meters, It would be so constructed as to allow for future heightening by 11 meters. The dam would impoumd a reservoir of 299 million cubic meters in the initial stage and 639 million cubic meters after the 11 meter heigl-htening. The initial stage also includes a control structure on the Bogota River and a pumping plan:t with one 3,000 horsepower electric powered pump which will be used to transfer the surplus, non- regulated flow of the Bogota River to the reservoir. The pumping facility would be designed for an ultimate installation of four pumps. 29. Designs are sufficiently advanced to allow reasonably firm cost estimates to be compiled. (c) The New Salto Hydro Plant 30. The Salto site has been used for electric power production for many years. The first 4 lid station was developed in 1923. Between the years 1939 and 1941 the generating facilities were expanded by 50 M$4. The Salto plant utilizing a gross head of 419 meters along only 2.4 kilometers of the Bogota River is an excellent hydroelectric development. 31. The various regulation works that have been completed on the tributaries of the Bogota since 1941 plus the Tomine reservoir, which is included in the current project, will increase the minimum flow of the river sufficiently to permit the development of an additional 66 1Wil at the Salto site. A completely new plant, however, will be required. Details of this plant are given in Annex 4. 32. Plans have been prepared by the consultants and are well advanced. Internationally competitive bids have been received for the equipment and award recommendations made by the consultants. The cost estimates are there- fore realistic. It is expected that EEEP will soon award contracts for major equipment. (d) The 33 NJ Thermal Addition 33. The Government, in 1956, had contracted with a group of French suppliers for the supply and erection of a two unit (2 x 33 MhN) thermal plant which was to be located near Belencito. For various reasons this plant has not been put into commission by the Government. The EBEB has theref.ore con- cluded a contract with the Government for the sale of one of the 33 FM units and will install it near Zipaquira. The foreign exchange cost of modifying the equipment and of additional equipment necessary to adapt the plant to single unit operation is included in the proposed loan and this installation, in total, is therefore a feature of the project.  - 7 - (e) Imrrovement in the DMstribution and Transm-ission System 34. The proposed project will add 117 ENT to 'EEB's system, or an increase of about 90N to its generating capac-ty. This will necessitate extensive improvement and rehabilitation in the transmission and distri- bution facilities for the full utilization of new nower. There will be an increase in voltage of the main transmission lines from 57.5 kv to 115 kv which will necessitate improvement in existing facilities as well as some new lines, There will also be an expansion in the existing substations as well as the construction of new substations to serve the expanded generating facilities. The expansion and rehabilitation of the distribution system includes increasing the number of transformation points in the secondary as well as in the primary networks which is expected to reduce the length of distribution and lessen the voltage drops. The secondary system will be rehabilitated and additional capacitors and regulators will be introduced to improve the voltage conditions. 35. Detailed studies of the transmission and distribution work that would be carried out as part of the project are being made. (f) Engineering for Future Development of the System 36. EEB intends to develop future hydro installations downstream from existing plants as new capacity is required. Detailed engineering investigations are to be started in 1960 to assure optimum development of the remaining nearby hydro sites. For that purpose, the proposed loan in- cludes an amount to purchase geological investigation equipment and to fin- ance in part engineering studies which will ultimately form the basis of EEEB's further expansion program. Estimated Cost of the Project 37. The project is estimated to cost the equivalent of $30.4 million, including interest during construction, of which $17.6 million would be in foreign currency. Deducting interest during construction,the cost of improvements to the distribution system in Bogota, and the allowance for engineering work for futiure developments, results in an overall cost of $196 per KJ installed, which is very lowT. Work in progress of the equiva- lent of $100,000 would not be included in a loan. The foreign exchange and the local currency cost of the items included in the project are shown in the following table (a detailed breakdown is shown in Annex 5):  - 8 - Estimated Cost of the Project Foreign Local Item Exchang Costs Total tin thousands of dollars) Laguneta addition 623 249 872 Salto II 3,156 1,661 4,817 Thermal muat 2-835 4,001 6,836 Tomine dam 1,725 5,438 7,163 Transmission 3,185 207 3,392 Distribution 3,858 882 4,740 Engineering for future 210 250 460 development Total 15,592 12,688 28,280 Less work in progress 100 - 100 15, 492 12,688 28,180 Interest during construction 2,108 - 2,108 Proposed loan amount 17,600 12,688 30,288 38. The equipment estimates for Laguneta, Salto and the thermal addition are based on firm bids. The estimated cost of the project in- cludes contingencies amounting to more than 16% on the remaining parts of the project which are realistic and sufficient to cover price increases. These contingencies should be adequate for the construction of the project. Engineering and Supervision of Construction 39, The firm of OLAP, a well-known Colombian engineering firm, in association with other consultants have been advising 'EEB on this project. The engineering is substantially complete for the addition to the Laguneta plant and for construction of the new Salto II plant. Equipment bids have been evaluated for both and awarded. OLAP is presently preparing detailed studies on the Tomine dam and reservoir. A well-known U.S. consultant (Preston T. Bennett) has been retained by OLAP to assist with the foundation and stability studies. Documents and drawings necessary for bid invitations are expected to be completed in early 19600 The engineering of the trans- mission and distribution network is now being carried out by EZEB's own staff with the assistance of OLAP, and J,G. TThite is preparing the engineer- ing studies for the thermal plant, These arrangements are satisfactory. 40. Construction of the various components which comprise the project will present no new problems or procedures to EEE3. The work will be let for contract in the same manner as had EEEB's other plant expansions in the past. There are well-qualified contractors in Colombia able to carry out the work. All contracts will be submitted for competitive bidding. The engineering supervision of construction will be the responsibility of EEEB forces in association with OLAP.  - 9 Schedule of Construction 41. The execution of the project is scheduled over a period of two and a half years through the middle of 1962, as indicated in bar chart form in Annex 6. The Laguneta addition is to be completed in July 1960, Salto II at the end of 1961 and the thermal plant by the middle of 1962. This sched- ule is reasonable. Rate of Expenditures and Method of Financing 42. It is proposed that the foreign exchange cost of the project which aggregates about $17.6 million equivalent, including interest during con- struction, be financed by a loan from the Bank. Local currency costs which total about 40% of project cost will be met from the internal resources of the Borrower plus a Ps 13.6 million 5-year Government credit for a thermal plant equipment, as mentioned in paragraphs 46 and 65. 43. The rate of expenditures on the project are estimated as follows: Foreign-V Local2J Year Exchange Currency Total (in thousands of dollars) 1959 _ 660 66o 1960 8,000 3,470 11,470 1961 7,310 4,280 11,590 1962 2,290 2,710 5,000 1963 _ 1,570 1,570 Total 17,600 12,690 30,290 V. FUTURE CAPACITY REQUIREBENTS The Paipa Thermal Plant 44. EEEB's programing of its future capacity requirements has been complicated by the commitment made by the Government to purchase a two-unit 66 MJ thermal plant to be located at Paipa and from which a large portion of the energy was expected to be delivered to EEEB's system at Zipaquira over a transmission line of 140 km in length. This was notwithstanding that engineering studies had concluded that the Paipa plant would be a very un- economic source of energy for the Bogota area since it would inevitably cost much more than the EEEB system's hydro. At the time the Bank's mission visited Bogota, the arrangements for ETEB to utilize the Paipa plant's output had progressed to the point that EEEB had agreed to contribute some Ps 20 million toward the cost of erecting the plant and thereafter to purchase J Includes interest during construction. / Includes in 1959 costs incurred in 1958 and in 1963 costs of 1964.  - 10 - power from it at a rate to be negotiated which presumably would cover the portion of the capital charges and operating costs of the Paipa plant re- presented by the energy taken by EZEB's system. 45. For the future hydro-thermal balance of EEEB's system and for peaking purposes it is desirable that by some time in the mid-1960's EEEB's system should have some additional thermal capacity, probably in the order of 30-40 NW. Because of this situation, J. G. Thite made an engineering study for Electraguas which concluded that it is feasible to split the Paipa plant into two 33 MNW stations. Because of this feasibility the Bank recom- mended in a letter dated July 24, 1959 to the Minister of Fomento that this course of action be adopted and one of the 33 I-W units be sold to EEEB and located at a point within EEEB's system. A feasible location for a thermal plant to serve EEEB's system had already been determined to be Zipaquira where a local coal supply and adequate cooling water are available. The Zipaquira location would eliminate substantial transmission costs which, under the original scheme, would have been encountered. 46. Arrangemerts have now been concluded between E =B and the Govern- ment to cover purchase of basic equipment for one 33 IW unit. The price is firm at Ps 16 million plus Ps 2.622 million in-terest and will be paid in 5 annual installments. Other costs of completing the installation are esti- mated to be Ps 12.0 million plus $2.835 million. The total cost of the plant is therefore estimated to be equivalent to $6.835 million, or about $207 per installed Kw. The F-uture Expansion Program 47. By the end of 1961 the proposed project, which is described above, would add 117 MS to the capacity of the system. Based on the load forecast outlined, it appears that this capacity would be fully utilized by the end of 1963. Additional capacity would have to be made available shortly thereafter. 48. Following the execution of the proposed project, it is estimated that future generation capacity would be added to the system by a series of hydro developments as follows: Plant Completion Date Canoas (40 N) End 1963 Neusa (25 W) Mid 1964 Tena I-1 (62 N) End 1965 Tena I-2 (62 M) End 1967 El Colegio (105 MW) End 1969 Construction costs of this program have been included in the financial fore- casts outlined in Section VIIe The schedule of construction would, of course, be adjusted in light of actual load growth. The program, related to the ex- pected growth in demand, is shown graphically in Annex 3. The map at the end of this report shows the physical location of the above plants as well as those existing and those included in the project,  - 11 - VLI. COFARISOH I'TH A THi'iRAL ALTE[RNATIVE 49. The cost of the hydro portion of the project less the cost of the proposed additions to the transmission and distribution facilities, which would be common to either thermal or hydro generation sources, and less the cost of engineering for future development is estimated to be equivalent to about $12,9 million. This includes the total cost of the Tomine reservoir9 all of which is not strictly chargeable to the present project because the regulation provided will make possible future hydro additions as well as some additional generation from existing plants. Even on this conservative basis, the cost per hydro kilowatt added is only about $154. The project is a more economic source of power than any alternative thermal plant of equivalent capacity. VII. FINA!CIAL ASPECTS Rates 50. The charge for electricity in Bogota has been and still is extremely low. Prior to the rate increase described below, the average revenue per kwh sold in 1959 (converted to U.S. dollars at 8:1) was only 5.35 centavos (6.7 U.S. mills), one of the lowest in the world. 51. A rate increase which became effective December 1, 1959, will increase this average to about 6.8 centavos (8.5 U.S mills). This in- crease was based on a forecast of capital requirements made in early 1958 for a considerably smaller program than the present one. As a consequence a further rate increase to 8 centavos (10 U.S. mills) is necessary and will be a condition of effectiveness of the proposed loan. 52. It appears that another rate increase will be necessary in 1962 to provide revenues adequate to enable 3EEB to proceed with the next stage of its expansion program. Internal Audits 53. EEEBts financial statements are prepared by an auditor appointed by the Board of Directors. Although the auditor technically reports only to the Board, his assignment is full time and he is on EEEB's payroll. To conform with sound financial practice EEEB has agreed to have its annual financial statements certified by an independent accounting firm satis- factory to the Bank. Present Financial Position 54. Condersed balance sheets for the years 1953 through 1958 are shown in Annex 7. Fixed assets are carried at original cost. As of December 31, 1958, net fixed assets in operation amounted to Ps 108.0 million ($13.2 million). Reserve for depreciation totaled Ps 23.8 million ($3.0 million) and work in progress Ps 16,0 million ($2.0 million). A substantial part of book value represents recent plant additions. Gross fixed assets plus work in progress almost doubled between 1955 and 1958, increasing from Ps 79.1 million ($9.9 million) to Ps 147.9 million ($18.5 million).  - 12 - 55. The capitalization at the end of 1958 consisted of Ps 40.7 million ($5.1 million) of debt and Ps 89.6 million ($11.2 rrillion) of equity. The debt/equity ratio was 31/69. About 90% of the debt at that time, however, was either short term or scheduled to mature by the end of 1961. 56. The debt consisted of the following: Peso Obli7ations In Millions Municipalization Debt Ps 8.25 $1.0 Short Term Bank Loans 15.08 1.9 Long Term Mortgage Loan 5.08 6 Other Debt 2.22 .3 Total 30.63 3.8 Foreign Suppliers' Credits 10.08 1.3 Total Debt Ps 40,71 $5l 57. The Ps 8.25 million municipalization debt was the balance due on a Ps 12.5 million long term bank loan incurred in 1951 by the Municipality of Bogota to exercise an option to purchase the then outstanding 49% minority interest in EEEB. Annual maturities of Ps 0,375 million are scheduled for 1959 through 1962; annual maturities of Ps 1.5 million and Ps 3.75 million are scheduled for 1963 and 1964 respectively, and there- after annual maturities of Ps 0.375 million are scheduled through 1968. Under an agreement reached last June with the Municipality, EEEB has formally assumed this debt and adjusted its financial statements accordingly. 58. It was agreed during negotiations that short term bank loans, which at the end of 1959 totaled approximately Ps 17.75 million, will be extended so that Ps 5 million matures in 1962, Ps 6,375 million in 1963 and Ps 6.375 million in 1964. Evidence has been received from the local banks which satisfactorily substantiate this. The Ps 5.08 million long term mortgage loan maturing through 1962 is secured by the Salto I hydro plant. The relatively small size of this loan and its early maturity do not appear to require that the proposed Bank loan be secured. Foreign suppliers' credits are mostly U.S. dollar obligations. 59. Additional debt incurred in 1959 includes a Ps 13.6 million obligation to the Government, repayable over the next five years, in- curred to finance in part the purchase of the basic equipment of the 33 MW thermal unit. EEEB also purchased through suppliers' credits Ps 7el million of equipment, principally for the fourth unit at Laguneta. 60. In addition to its debt obligations, EEEB is required to credit annually as a dividend to the Municipality 10% of net profit to be used exclusively to cover future billings for street lighting and improvement of the municipal street lighting system. Although it can be argued in  - 13 - this connection that the principle of the Municipality's paying its bills for services received would indeed be sound, it is felt that in view of' this established practice it would be unrealistic for the Bank to insist on this point. 61. Total equity has increased from Ps 29.2 million ($3.7 million) in 1953 to Ps 89.6 million ($11.2 million) in 1958. Capitalized interest accounted for Ps 4.7 million ($0.6 million) or 8y6 of this increase, whereas the balance of Ps 55.7 million ($6.9 million) is attributable to retained earnings. As previously mentioned, the Municipality is the sole owner of EEEB. Past Earnings Record 62. Earnings in recent years are shown in Annex 8. Gross income in- creased from Ps 8.8 million ($1.1 million) in 1954 to Ps 18.4 million ($2.3 million) in 1958, producing a return on net fixed assets, including work in progress, varying between 19.7% in 1954 and 13.8% in 1957. The return in 1958 was 14.8%. Financial Plan 63. A ten year forecast (1959-1968) of Sources and Applications of Funds is given as Annex 9. As previ-ously discussed, the forecast demand for power in the Bogota area involves a long range program of sizable plant additions and considerable capital expenditures. During the four-year period ending 1962, plant additions and working capital requirements are estimated to aggregate Ps 334 million ($41.8 million) as follows: a) Ps 226 million ($28&3 million) - The proposed Bank project and minor current additions. b) Ps 7 million ($0.9 million) - Provision for additional working capital requirements. c) Ps 101 million ($12.6 million) - Provision for initial ex- penditures in 1961 and 1962 for future expansion. 64. At the time the Bank appraised the project, EEEB was faced with major problems in financing these requirements. Its rates were inadequate to generate sufficient funds both to service its rapidly maturing debt and to provide a reasonable portion of the cost of the proposed initial project and the overall expansion program. However, during and prior to negotiations, a satisfactory financial plan was evolved to improve EEEB's financial position and to provide the forecast Ps 334 million capital requirements for the period ending 1962. In summary EEEB has: a) agreed to increase internal cash generating by obtaining further rate increases to be effective not later than April 1, 1960, which will produce average revenues per kwh sold of 8 centavos;  - 14 - b) arranged to extend the short term bank loans so that they become due in 1962 through 1964; C) arranged to reschedule the maturities of the Ps 8.25 million municipalization debt so that Ps 4.5 million due in 1959 and 1960 is now due in 1963 and 1964. 65. A summary of the forecast of funds available under this financial plan for the four years ending 1962 follows: In M4illions _____ Interrnal cash generation Ps 176.3 $22.0 Less: Debt service and dividends to Municipality 82.6 2tl 93.7 11.7 27.5 Increase in reserve for employee benefits 11.2 1.4 3.3 Borrowings: Proposed IBRD loan 140.6 17.6 41.3 Thermal unit loan 13.6 1.7 4.0 Future foreign loans 70.8 8.8 20.8 Other 10.4 103 -l2a Ps 235.4 $z9,4 69.2 Total Funds Ps 340.3 $42.5 100.0 The above summary is based on the rate increase resulting in average revenues per kwh sold of 8 centavos to be effective as of April 1, 1960 and a further rate increase resulting in average revenues per kwh sold of 10 centavos to be effective January 1, 1962. 66. Based on the forecasts used herein, there would be a cumulative cash surplus of about Ps 6.5 million at the end of 1962 to be applied against forecast deficits for 1963 and 1964. Without the assumed average rate increase to 10 centavos per kwh sold on January 1, 1962, there would be a cumulative cash deficit at the end of 1962 of about Ps 13 million. EEEB's power requirements and financial resources must, of course, be appraised continuously. Around mid-1961 a revised financial plan must be developed on the basis of the data then available to carry out the next stage of expansion. The amount and timing of rate increases (beyond the 8 centavos average revenues per kwh sold to be obtained immediately) would be determined definitively at that time. Estimated Future Earnings 67. Forecast income statements for the ten years ending 1968 are shown in Annex 8. Gross income is estimated to increase from Ps 1808 million ($2.4 million) in 1959 to Ps 33.6 million ($4.2 million) in 1960,  - 15 - Ps 38.7 million ($4.8 million) in 1961 and Ps 57.2 million ($7.2 million) in 1962, mairly reflecting the previously mentioned rate increases. 68. Over the ten year period (1959-1968) the return on net fixed assets in operation would average about 14o and the return on total net fixed assets, including work in progress, would average about 11%. Debt Service Coverage 69. Based on the rate increases cited in this report it is forecast that debt service, which would be covered about 1.5 times in 1959, would be covered 2.4 times in 1960 and 2.9 times in 1961. Thereafter through 1968 debt service would be covered 2.4 or more times.. These coverages are year end ratios. Inasmuch as some additional interim financing is forecast as being necessary in 1963 and 1964, the debt service coverages from 1963 on might be modestly lower. The proposed Loan Agreement contains a debt service covenant which would operate to limit excessive borrowings in the absence of adequate earnings or adequate rate increases. Debt/Equity Ratio 70. The sizable expansion program proposed will materially change EEB's capital structure, The debt/equity ratio is forecast to increase from 31/69 in 1958 to about 50/50 in 1962 and to remain at about that level thereafter as shown in Annex 7. VIII. JUSTIFICATION OF THE PROJECT 71. The project is needed to meet the growing power demand in the Bogota area. The market for power in this area justifies the installation of the proposed facilities which are expected to be fully utilized shortly after the completion of the project. The project should play an important part in eliminating the power shortages which have plagued the Bogota area for many years. IX. CONCLUSION 72. The proposed project to be executed by the Empresa de Energia Electrica de Bogota is technically sound and the estimated cost is reasonable. 73. The project is necessary to meet the expected load growth re- quirements of the system. There is no alternative method of meeting these requirements that would compare favorably on an economic basis, 74, The management of EEEB is qualified to execute the project and to operate the expanded power system. 75. EEEB's present and projected financial condition is satisfactory. lUhen the loan becomes effective rates will be adequate to generate funds sufficient to service debt and to contribute in a satisfactory ratio to the cost of expansion. EEEB and the Government have agreed to maintain a  - 16 - rate level that will cover full costs of operation, debt service or de- preciation, whichever is greater, dividends, if any, and a reasonable surplus to fir;ance new investrient. The definition of "a reasonable surpluss" has been satisfactorily agreed upon. 76. The project would be suitable for a Bank loan of $L7.6 million equivalent for a term of 25 years, including a 3 year grace period on amortization.  EIIRESA DE ENERGIA ELECTRICA DE BOGOTA Summary of Past Energy Consumption by Category and Peak Load (in kwh millicns and megawatts) Category cf 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 Consumer _ Residential'i/ 40.4 46.5 51.3 55v0 62.1 70.8 80o9 91.8 106.1 131,7 Ccmmercial 34.5 41.9 49.8 56,5 71.4 85,3 96,3 106.9 114.9 123.9 Industrial 52.1 61,3 68.4 66.7 81,3 9310 10321 110.1 119.2 138.8 All Other 30.8 32.3 30o6 32.2 3435 38.0 41,4 44.5 53.9 61.7 Total 157.8 182.0 200.1 210.4 249,3 287.1 321,7 353.3 394.1 456.1 Anrual Sales Increase % - 15.5 10.0 5.0 18.5 15,0 12.0 10.D 11.5 15.5 (average 12.5%) Peak Load 38.? 44.1 45,8 54.7 61.4 68.6 70.4 76o0 1ioo6 113,5 Annual Load Increase % - 14.0 4.0 19.5 12.0 12.0 3.0 8.D 32.5 13,0 (average 12,75%) / Includes the category of wholesale sales as EEEB considers that practically all are for residential consumption  EMPRESA DE ENERGIA ELECTRICA DE BOGOTA Method of Developing Residential Sales Forecast Population irr/ Residential Population Sales per Residential Service Area Accounts per Account Account Sales (thousands) (thousands) (kwh) (millions kwh) (a c t u a 1) 1950 703.1 47,9 14,7 973 46c5 1951 739.1 50e3 14,7 1,020 51.3 1952 761.5 53.0 14.4 1,039 55.0 1953 815.6 55-0 14,8 1,130 62.1 1954 870.9 58.8 14.8 1,200 70,8 1955 939.5 64.0 14e7 1,262 80o9 1956 1,013.8 67.9 14,9 1,350 91.8 1957 1,083.5 73.6 14,7 1,442 106,1 1958 1,187.7 81.5 14.6 1,615 131,7 (f o r e c a s t) 1959 1,278.0 86.9 14.7 1,780 154.3 1960 1,373.0 93.0 14@8 1,925 178.9 1961 1,473.5 97.3 15S0 2,120 206.0 1962 1,569.0 105,0 14.8 2,360 248,0 1963 1,660.0 114.0 14.6 2,590 295.0 1/ Estimated, based on actual population of Bogota  EMPRESA DE ENERGIA ELECTRICA DE BOGOTA Method of Developing Commercial Sales Forecast Residential Commercial Ratio of Sales per Commercial Accounts Accounts Residential Commercial Sales to Commercial Account (thousands) (thousands) (thousands kwh) _(millions kwh) (a c t u a 1) 1950 47.9 19.5 2.46 2,15 41,9 1951 50.3 21.9 2.30 2,28 49.8 1952 53,0 23.7 2.24 2.38 56,5 1953 55.0 25.7 2.14 2,78 71.4 1954 58.8 26.9 2,18 3.17 85.3 1955 64.0 28,5 2.24 3.38 96e3 1956 67,9 29.9 2.27 3,58 106,9 1957 73.6 30.0 2,56 3.83 114.9 1958 81.5 30.4 2.68 4.07 123M9 o r e c a s t) 1959 86.9 31.0 2.80 4.33 134,0 1960 93.0 32.0 2.90 4.61 147.5 1961 97,3 33.8 2.88 4.93 166.5 z 1962 105,0 36.8 2,86 5.33 196.o 1963 114,0 40,2 2,84 5,76 232.0 H3  EMPRESA DE ENERGIA ELECTRICA DE BOGOTA Method of Developing Industrial Sales Forecast Industrial Sales per Industrial Accounts Account Sales (thousands) (thousands kwh) (millions kwh) (a c t u a 1) 1950 2,57 23.9 61.3 1951 2.29 29.9 68.4 1952 2.39 27.9 66.7 1953 2.44 33.3 81,3 1954 2.50 37.2 93.0 1955 2.61 39.5 103.1 1956 2.54 43.4 110.0 1957 2.61 45.7 119.2 1958 2.91 47.7 138.8 o r e c a s t) 1959 3.23 50.0 161.1 1960 3.50 52.6 184.0 1961 3.70 55.2 204.0 1962 3.93 62.0 244.0 1963 4.13 67.o 277.0  EMPRESA DE ENERGIA ELECTRICA DE BOGOTA Recapitulation of Sales and Generation Forecast Sales millions kwh) Generation jirllions kwh) Residential/ Commercial Industrial Other Total CCmpany Use Losses Gross 1959 154.3 134.0 161.1 63.6 513.0 7.0 84.0 604.0 1960 178G9 147.5 184.0 66.6 577.0 7.0 93.0 677 ,0 1961 2060o 166.5 204.0 72.5 6490o 7.0 106,0 762.0 1962 248,0 196cO 244,0 77.0 765.0 20.0 115cO 900.0 1963 295.0 232.0 277.0 83,0 887.0 23.5 13395 1i044.0 1964 1,010.0 24.0 140,0 1174.0 1965 Total sales beyond 1963 are forecast to 1,140.0 29,5 160.5 1,330M0 1966 increase at an average rate of 1,275.0 30,0 175.0 1,480,0 1967 approximately 12% per annum 1,425.0 30,0 195.0 1,650,0 1968 1,580.0 34.0 220,0 1,834.0 1/ Includes wholesale sales CD  El Colegio NvF I05 MW 500 (. -(End 1969) N -Q IS434 /IR' PROJECT H 400 __ 0 o o300 k *.X <~~~~~~~~ ~ ~ ~~ 2 0 CS 12f 1 - L /NT4LE zr (277 1200 w ___ w z~~~~~~~~~~~ PA~ ~ 4PAT LES COLOMBIA - 0~~~~~~~~10 4 00 LAR6ESrUN/TfMWJ LOAD ak CAPACITY DEVEL.OPMEN1 I Empresca de Energia Electrica de Bogota 0 -j~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~r 1958 1959 192_0 1961 1962 1963 1964 1965 1966 1967 1968 1969 m DECEMBER 1959 YEARS IDRD-603R (  ANNTEX 4 TECHNICAL FEATPUTES OF THE PROJECT The Bog-ta Piv,er 1. The Bogota River, a tributary of the Mlagdalena River, flows south- westerly approximately 370 kilometers from its origin, at an altitude of 2590 meters, ten kilometers northwest of the town of VTillapinzon, to its confluence with the Magdalena River, near the city of Girardot. It has a drainage area of about 5730 square kilometers. The first 256 km (7M of its total length) traverse the Sabana cie Bogota, a plateau situated at an elevation of 2,550 meters above sea level with a drainage area of 4,270 square kilometers. The average slope of the river from the con- fluence of the Siecha River to the Muna River at Alicachin, a distance of 200 kilometers is only .012%. At Alicachin where the river leaves the Sabana, it falls rapidly aescending in the next 114 kilometers about 2,220 meters until it reaches the Miagdalena River. The fall in the first 24 kilometers as it leaves the plateau is about 1,800 meters, Existing Reservoirs 2. Three reservoirs which affect the flow available for hydro plants in EEEB's system have been constructed in the Bogota River basin during the past 13 years. Only one, the Muna Reservoir, was constructed exclusively for power regulation. The Muna Reservoir, completed in 1950, dams the Muna Rive just upstream from where it enters the Bogota at Alicachin. It is an earth- dam of about 20 meters maximum height and has a capacity of 42 million cubic meters. An adjacent pumping plant with a capacity of about 4 cubic meters per second allows storage of Bogota River surplus for short term regulation. 3. The first dam for the regulation of the Bogota River, for irrigation and flood control, was the Sisga dam, on the Sisga River. This dam com- pleted in 1951, is an earthdam of about 54 meters maximum height with a capacity of 94 million cubic meters. It is regulated for hydroelectric benefit. This dam was built and is owned by the "Caja de Credito Agrario Industrial y Minero". 4. A year later a second dam, the Neusa dam, was completed on the Neusa River, a tributary of the Bogota. It is an earthdam with a maximum height of about 45 meters, forming a reservoir with a capacity of about 110 million cubic meters. The normal reservoir level, at an elevation of 2,975 meters, will be utilized in the future by a 345 meter head, 25 DU peaking Dlant. The dam ivas built by the "Banco de la Republica" for the benefit of the "Acueducto de Bogota"., and for irrigation and flood control. The reservoir is also operated for river regulation for hydroelectric benefit, 5. The Acueducto ?ivunicipal de Bogota built the La Regadera dam in 1942 to supply water to the city of Bogota. The reservoir located at the headwaters of the Tunjuelo River, tributary of the Bogota, has a capacity of h.5 million cubic meters. In 1950, the sane company finished the Chicaca dam on the Chisaca River, tributary of the Tunjuelo River. Its  ANNEX 4 - Page 2 capacity is 5 million cubic meters. These two reservoirs are operated exclusively for Bogota's water supply. Their operation does not materially affect the regime of the Logota River. Tomine Reservoir 6. The Tomine dam which would be includied in the proposed project, would be located on the Siecha River 2,500 meters upstream from the con- fluence of the Siecha and Bogota, about 5O km from the city of Bogota. The control weir on the Bogota would be located just downstream from the mouth of the Siecha River. The reservoir would control the Siecha River basin, an area of about 350 square kilometers, and by means of the Bogota River control weir and initial pump station of 3,000 hp capacity, would permit storage of the Bogota River's surplus flow. The area, which would be controlled from the pump station, includes the Siecha River basin, and would cover 920 square kilometers or 21.61a of the total Bogota River basin. 3am 7. This would be an earthfill dam with inclined impervious clay core and a concrete cut-off membrane in the upstream toe of the dam, extending to rock. The upstream face is protected by riprap and the downstream protected by sod. The designi of the initial construction would permit a future 11 meter heightening of the dam. Principal characteristics of the dam are as follows: Dimensions Stage 1 Stage 2 Dam Height above ground 30.2 m 41.0 m Height above excavation 38.0 m 49,0 m Crest length 325 m 350 m Crest elevation 2,594.2 m 2,605.0 m Volume of fill 1,020,000 m3 820,000 m3 Slopes (upstream & down) 2.5:1 Mlaximum depth to cut-off 60 m SpilIway Crest length 25.0 m 25.0 m Crest elevation 2590.6 m 2602.0 m Capacity At R.L. 2592.7 185 m3/s At R.L. 2594.2 470 m3/s At R.L. 2603.5 100 m3/s At R.L. 2605.0 325 m3/s The spillway would consist of an unlined open channel cut into the right abutment with an initial concrete crest which would be raised by an arch dam for Stage 2.  A1,71EX 4 - Pag-e I Foundations 8. Foundation studies have, and are, being made by OIAP with the help of a well qualified consultant. Extensive drillings have been completed and the decision has been made to excavate the top 6-8 meters which con- sist of organic clays. Then, without dewatering, the excavation would be filled with clean, pervious material. The foundation will be built up over sand and gravel strata, 10 to 50 m thick, that overlie sandstone and shale. The depth of the excavation, the high permeability of the sand gravel strata, the size of the area and artesian head combine to prevent economical dewatering. Foundation conditions are difficult, but in the opinion of the consultants, the soft clays and silts can be replaced by wet excavation and fill to provide a foundation at least equal to the natural conditions which have been found acceptable under many of the existing earth dams. Saddle Dam 9. A lateral saddle beyond the main dam! right abutment will be closed by a simple earthfill impervious core damr. It will contain about 500,000 cubic meters of fill in the first stage and require another 190,000 cubic meters for the stage 2 extension. It will have the same slopes and face protection as the main dam. The foundation should pre- sent no problem. Outlet 10. The hill, or "island", that will remain between the main and saddle dams will contain the outlet tunnel. This tunnel will also serve as an inlet conduit for pumping from the Bogota. The tunnel will be 2.5 m in diameter, concrete and steel lined, 140 m in length controlled by a butterfly valve. Intake capacity will be 24 cubic meters per second. Reservoir 11. The reservoir characteristics are as follows: Stage 1 Stage 2 Normal level 2590.6 m 2602.0 m Maximuim level 2592.7 m 2603.5 m Normal area 2352 ha 3340 ha 1-1aximurm area 2531 ha 3443 ha Normal capacity 299 Om3 639 hm3 Useable storage 279 ym3 619 yn3 Dead storage (at 20 Nm3 elevation 2573.0 m) Investigations indicate that the reservoir area is well blanketed with impervious deposits. Potential seepage paths are extremely long as com- pared to the head difference and, therefore, the dam will be structurally sound.  AM\IEX 4 - Page 4 Sedimrentation 12. The reservoir will be capable of storing two axnd a half times the normal Siecha River floTw. All incominig sediment will therefore be trapped in the reservoir. The Siecha carries a considerable amount of' suspended solids as evidenced by visual inspection and by the pattern of deposition of alluvial material still in process at the site. The present alluvium is due to a long period of aggradation which still continues. 13. Reliable sedimentation studies are not available for either the Siecha or the Bogota River. However, the voluime of sediment that they might carry is conservatively compared to that of the Colorado River above Lake ibad for the Siecha and to the 1iissouri River at Omaha for tile bogota. On this basis, and assuming that 12 cubic meters per second (50, of ultimate panping capacity) were continuously piiroed from the Bogota and future diversions, the reservoir life in the first stage would be 55 years and in the second, 126 years. Actually, even for the conservative assun-ptions made, the reservoir life in the first stage would be much greater as continuously pumping as much as 12 culbic L-Eti,rs por second will not be nossible until after the second stage of thc reservoir and after the future diversions to the Bogota. Hydrology 14. The basic data available for analysis of the regime of the bogota River are flow-i records from Tocancipa (30 years) and Salto (25 years) and rainfall records from Bogota (94> years). Flow records are available from 19 other stations (tributaries and main streara) for varying lengths of timae and rainfall data from 26 other observation points in the basin. Good correlation between rainfall in Looota and stream flow at Salto have been establishled. Based on the correlation, it appears that the most eritical 5-year dry period occurred between 1945-49 and the second most critical between 1939-43. Plant capacity has been planned on regulation related to the second most critical period. 15. The folloiwing two tables sw-iarize the results of hydrological studies by OLAP on which long range power planning lhas been based. Table 1 indicates that progressively, -wTith the upstream developnient contemplated in the long range developm-ient plan of EERB, the net flow of Alicachin can be increased from the present 14.1 cubic meters per second to 32.0. Table 2 indicates that, with the rerulation indicated in Table 1, the estirimated hydro potential of the Bogota River to be a total of 945 A1,6. The hydro developments plannned for execution through 1968 are shown graphically on Annexes 3 and 6.  ANNEX 4 .. Pa, Table 1 Yinimum Useable Stream Flows Bogota River at Alicachin (m3/s) 1 Present Gross Losse,3 Yet A. First critical period 14 6 0.5 14.1 B. Second critical period 16,5 0X5 16.0 2. liith Stage 1 Tomine (no pumpping) A. First critical period 190 1.0 18.0 B. Second critical period 20.8 1.0 19.3 3. With 6 m3/s PuLE -ap2cLty A. First critical period 20.0 1.5 18.5 B. Second critical period 21.8 1.5 20,3 4, 'ith Stage 2 Tomine & 16 _m3/s Pump Capacity A. First critical period 21.1 2X5 18,6 B. Second critical period 23.5 2,5 21.0 5. With Future Diversion to Bogota Basin A. First critical period 31.8 305 23.3 B. Second critical period 35.5 3.5 32.0  ANMBX 4 P P^g 6 Table 2 3ogota River Power Pro;,ects Plant Capacity (iiw) ' F1oTwS Charquito Bogota Bogota (n3/s) II Canoas Salto Laguna'ta L oa 5 o.6 1A 14.0 21.2 93.8 64el 85.0 149.4 B 15.9 24.1 106.5 72.7 95.7 168.0 2A 17.9 27.1 119.8 81.8 107.0 185.6 B 19.6 29.8 131.8 90,0 117.1 202.3 3A 18.4 27.8 123.1 84.1 109.8 190.2 3 20.1 30.5 135.1 92.2 120.0 206.9 4A 18.5 28.0 123.8 84.5 110.4 191.2 3 20.8 31,6 139.8 95.4 123,9 213.4 5A 28.1 42e6 188.4 128.6 165,0 281,2 3 31.7 48.1 213.0 145.4 185.9 315.5 Head (m) 62 94 416 284 352 580 Present Capacity - - 54 54 - - Added by Project _ _ 66 18 - - Sub-total 3/ - - 120 72 - - Future Additions Initial 16 24 - - 124 211 Final 16 24 99 72 62 105 Total 4/ 32 48 219 144 186 316 Size of Future (2x16) (2x:4) (3x33) (4x18) (3x62) (6x52.7) Units J For 50% capacity factor gI Refer to Table 1 3/ Total system hydro including present project, 192 Ixlvi 4/ Total hydro potential of Bogota river projects, 945 MW  ANNEX 4 - Page 7 Features of the Salto Addition 16. An existing concrete, gated weir will be used to control the new (and existing) Salto intake. The weir backs up a pond of 50,000 cubic meters capacity which allows hourly pondage. Trash racks will feed two 6.4 x 6.4 x 39.0 m sand traps. 17. iWater will be conveyed through a lined pressure tunnel, 2.65 m in diameter and 1,625 m in length to a concrete lined surge tank, 148 m high and 6.2 m in diameter and to a single wolded steel penstock 715 m in length. Powerhouse and switchyard will be adjacent and aownstream from the Salto I plant. Salto II will use part of the eaisting Salto I tail- race. Both plants will discharge direct to the Laguneta intake to prevent sand pickup. Features of the Laguneta Addition 18. The existing plant was planned for the fourth unit addition. The addition will consist mainly of expanding the powerhouse structure, foundations and equipment assembly. The existing switchyard has already been laid out for the addition. Features of Transmission and Distribution Improvements 19. The proposed transmission lines from the TLaguneta substation to the Bogota junction and switching station will be 33 km long. The lines will be carried as twin circuits on steel towers of standard design, with approximately 10 towers per mile. Conductors will be ACSR, 26/7, 605%000 CM; separate static wires of copperweld steel conductor will be provided for each circuit. Installation will be for 115 kv at 9,500 feet elevation and will consist of ten 10" disc standard type (Locke, or equivalent) insulators spaced 5-3/4 inches. 20. The general location of the transmission circuits are indicated on the Appendix Map. Precise locations have not been determined, but as the result of a study of topographic maps and a general inspection of the area the consultants indicate that the lines can be iinstalled without undue construction difficulties. 21. The present distribution system in Bogota operates at nominal primary potential of 6,600 volts, with secondary voltage of 260/150. A change in tne distribution of primary voltage to a voltage of 11,400 has been underway and requires adciitional installations. New lines will have to be added and cables for operation at the higher voltage. The utiliza- tion voltage in the area is 150 volts. betailed studies are being made for conversion of the system to the 208/120 volt standard.  LAUTEX 5 ESTIIMATED COST OF TEE PROJECT (in dollar thousands) Cost Forein Local Tot;a' A. La a Addition Equipment 62 ,.o 620X0 Structure - 62.5 62.5 Laguneta Pond Excavation - 75.0 75,0 Dike 51e2 51.2 Concrete Works _ lOo0 10.0 Sub-total 620.0 198.? 818,7 Contingencies 26.3 26.3 Enginleering 0 2 _ 26 Total 623.0 246&? 87. 7 B. Salto II Land _ 12.5 12.5 Site Work - 25,6 25,6 Intakes 15.0 137.5 152,5 Tunrel & Surge Tank 55.0 49o,4 545.4 Valve Chamber 50.0 30.0 0O Penstock 571.0 1b5.1 736.1 Equipment & Structure 1,810.0 285,0 2,095.0 Tailrace 14.0 124.5 133.5 Switchyard Su-tta40 3o8 a 28* Sub-tot al T12g755o0 1,309.4 4,064.4 Contingencies 276.o 202.0 478,0 Engineering 125.0 149.9 2 Total 31156O 1,661.3 4,817.3 C. Thermal Purchase of Government- 2,500.0 2,500,0 owned equipment Modifications to above 100,G - 10OO Additional equipment 1,200.0 - 1,200.0 Transportation 15500 62,5 212.5 Erection 270.0 506,3 776.3 Structures & Site Work 180.0 576.o 756.o Land - - 30cQ Sub-total 1,900"O 3.674,8 5,574.8 Contingencles 285,0 176r2 461L2 Engineering 62o.o 150.0 800.0 Total 2, 835 0 4)001.0 66836.0  ANEX 5 -PageZ Cost ForeLrgn Local Total D. Tomine Reservoir Lard _ 1,500M0 1,500.0 Road Relocation - 100.0 1O0M0 Dam & Dikes- Foundations 10OO 437.5 537.5 Earthlwork 580,0 1,762,5 2,342.5 Spillway 50.0 75