Indonesia - Extended Deployment of the Enterprise Resource Planning for PLN (Persero) Project

Page 1 INTEGRATED SAFEGUARDS DATA SHEET CONCEPT STAGE Report No.: AC4397 Date ISDS Prepared/Updated: 06/10/2009 I. BASIC INFORMATION A. Basic Project Data Country: Indonesia Project ID: P116855 Project Name: Extended Deployment of the Enterprise Resource Planning for PLN Task Team Leader: Migara Jayawardena Estimated Appraisal Date: Estimated Board Date: September 17, 2009 Managing Unit: EASIS Lending Instrument: Specific Investment Loan Sector: Power (80%);Central government administration (20%) Theme: Infrastructure services for private sector development (67%);Other public sector governance (33%) IBRD Amount (US$m.): 38.50 IDA Amount (US$m.): 0.00 GEF Amount (US$m.): 0.00 PCF Amount (US$m.): 0.00 Other financing amounts by source: Borrower 0.00 0.00 B. Project Objectives [from section 2 of PCN] The Extended Deployment of the Enterprise Resource Planning for PLN, is proposed for additional financing under the existing Java-Bali Power Sector Restructuring and Strengthening Project. The Java-Bali Power Sector Restructuring and Strengthening Project's objective is to improve the reliability and efficiency of the power system in Java-Bali and strengthen PLN and PGN's management capabilities. This is to be achieved by undertaking the following tasks: - Investments related to improving the electricity system and strengthening the transmission network; - Implementation of a pilot and then a deployment of the Enterprise Resource Planning (ERP) system in the Java-Bali business units; and - Technical assistance to complete feasibility work for a key power plant in; and strengthen capacity and assist with the restructuring of PGN, a state-owned gas company. Page 2 The proposed project development objective, structure, and results indicators are reflective of a first order restructuring of the project that was approved by the Board on June 19, 2008. The total loan amount of the existing project, including the front end fee, is $141 million. The Java- Bali Power Sector Restructuring and Strengthening Project is performing satisfactorily with 65% of the loan disbursed and the remaining funds fully committed. PLN is now proposing the extended deployment of the ERP system so that they can integrate the Business Units outside of Java-Bali into one common business systems platform at an estimated cost of $38.5 million. The World Bank is well placed to assist PLN with this effort, having been involved with the ERP deployment from its initial pilot stage. The expansion to business units beyond the Java-Bali network would be a replication of already-developed and tested modules and practices, using broadly the same implementation team. The proposed additional financing is a natural extension of the modular deployment of the ERP systems, and is fully consistent with the development objective of the existing Java-Bali Power Sector Restructuring and Strengthening Project. C. Project Description [from section 3 of PCN] PLN is now proposing an expanded deployment of the ERP system to the rest of its business units so that they can integrate the Business Units outside of Java-Bali into one common business systems platform. This would complete the deployment of the ERP across the company, further optimize the existing system to maximize its benefits, strengthen their capacity to support the system on a continuing basis, and explore options for the next stage of technology related enhancements to better manage their customer interface. The deployment of the ERP to the remainder of PLN#s operations is expected to strengthen their management capabilities in the "outer islands". This includes a number of business units that cover a vast geographic area operating in many rural and underserved regions of the country. Since the ERP system would then cover most of the company, PLN plans to further optimize the system so that the full potential of the integrated system can be realized. As the ERP system expands coverage, there will also be significant additional demands placed on the company's IT Shared Services group. PLN plans to significantly strengthen the IT Shared Services group's capacity to support users on an ongoing basis. Given the ERP system's significance to its daily operations, PLN also proposes to implement a disaster recovery center to ensure business continuity in the event of a disaster. PLN would also like to continue with their Strategic Information Systems plan and identify opportunities in Customer Care and Billing. A small component of financing will go towards undertaking a detailed diagnostic and developing a roadmap for this critical area. The total loan amount for the proposed project is US$38.5 million. D. Project location (if known) The proposed Project for additional financing will support the deployment of the ERP system to PLN's business units beyond the Java-Bali network. E. Borrower