Benin - Power Rehabilitation and Extension Project

Docement of The WVorld Bank FOR OFFICIAL USE ONLY Report1No. 9559-BEN STAFF APPRAISAL REPORT REPUBLIC OF BENIN POWER REHABILITATION AND EXTENSION PROJECT MAY 31, 1991 Industry and Energy Division Occidental and Central Africa 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.  CURRENCY EQUIVALENTS Currency Unit - Franc CFA (CFAF) ' US$ 1 - CFAF 250 CFAF 1 - US$ 0.004 CFAF 1,000 - US$ 4.00 ABBREVIATIONS AND ACRONYMS CAA - Caisse Autonome d'Amortissement CCCE - Caisse Centrale de Cooperation Economique CEB - Communaute Electrique du Benin CEET - Compagnie Energie Electrique du Togo CIMAO - Societe des Ciments de l'Afrique de l'Ouest CTL - Centrale Thermique de Lome EdF - Electricite de France ESIE - Ecole Superieure Interafricaine d'Electricitd GOB - Government of B6nin KfW - Kreditanstalt fuer Wiederaufbau MIEEP - Ministere de l'Industrie, de l'Energie et des Entreprises Publiques OTP - Office Togolais des Phosphates SBEE - Socidt6 Beninoise d'Electricite et d'Eau SCO - Societe des Ciments d'Onigbolo UNDP - United Nations Development Program UPDEA - Union des Producteurs, Transporteurs et Distributeurs d'Energie Electrique d'Afrique VRA - Volta River Authority WAPSI - West Africa Power System Interconnection MEASURES AND EQUIVALENTS One kilovolt (kV) - 1,000 Volts One Megawatt (MW) - 1,000 kilowatts (kW) One Gigawatt hour (GWh) - 1 million kilowatt hours (kWh) One barrel (bbl) - 0.16 cubic meter One ton of oil equivalent (toe) - about 7 bbl of crude oil FISCAL YEARS SBEE - January 1 to December 31 CEET - January 1 to December 31 CEB - January 1 to December 31 The Franc CFA is tied to the French Franc (FF) in the ratio of FF 1 to CFAF 50. The French Franc is currently floating.  ri ., %aA rr L LLt1. Llk BENIN POWER REHABILITATION AND EXTENSION PROJECT STAFF APPRAISAL REPORT TABLE OF CONTENTS Page Nos. CREDIT AND PROJECT SUMMARY . .......................... ....... iv I. THE ENERGY AND POWER SECTORS. .. 1 Energy Sector ............. , .. ..... . ............. 1 A. Energy Resources 1.. ........ 1 B. Energy Supply and Consumption . . . 1 C. Energy Sector Organiza.ion . . .............. . 2 D. Energy Policy and Pricing . . 3 Power Sector ....... 4 E. Existing Power Supply Facilities . .4 F. Existing Demand ...... . 5 G. Demand Forecast ........ .. 6 H. Power Strategy and Investment Planning 7 I. Bank Group Strategy and Rationale for Involvement. 9 II. THE BORROWER AND THE EXECUTING AGENCY ................... 10 SociEt4 B6ninoise d'Electricit6 et d'Eau (SBEE) .. 10 Status and Organization .................... 10 Staf fing ......................... *........ 11 Accounting and Audit Arrangements .......... 12 Insurance ..00........... ................... 12 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. I contents may not otherwise be disclosed without World Dank authorization.  - ii - III *THE PROJECT ... .. .. ... . .... 12 11 . T E P O CT ............................. . . . . . . .. 1 A. Background .......... .12 B. Project Objectives ............................... 13 C. Project Description .. .13 D. Project Cost .............. *..... ........ 13 E. Project Financing ....................... .14 F. Coordination with Co-Financiers . .15 0. Project Implementation 15 H. Procurement ..16 I. Disbursements ......................... .17 J. Environmental Aspects ..18 IV. FINANCIAL ANALYSIS .............*.... ..... * ........... 18 A. Past Finances and Present Financial Position of SBEE 18 B. Billing and Collection . .20 C. Tariffs ..21 D. Financing Plan ..22 E0 Future Finances . .23 V. ECONOMIC JUSTIFICATION .24 A. Justification. ........ 24 B. Economic Rate of Return . .25 C. Risk .26 VI. AGREEMENTS REACHED AND RECOMMENDATION ...........26 ANNEXES 1-1 Energy Balance 1-2 Existing Power Facilities 1-3 Historical Supply, Sales and Losses 1-4 Load Forecast and Energy Balance 1-5 SBEE Investments FYs 91-95 2-1 SBEE - Present Organization Chart 2-2 SBEE - Target Organization Chart 3-1 Project Description 3-2 Project Cost 3-3 Financing Plan 3-4 Organization Chart for Project Management 3-5 Project Implementation Schedule 3-6 Details of Procurement Packages 3-7 Estimated Credit Disbursements 4-1 Income Statement FYs 78-90 4-2 Funds Flow Statements FYs 78-90  - iii 4-3 Balance Sheet FYs 78-90 4-4 Tariffs 4-5 Funds Flow Statements FYs 90-98 4-6 Income Statement FYs 90-98 4-7 Balance Sheet FYs 90-98 4-8 Assumptions 5-1 Economic Analysis 6-1 Documents Contained in the Project File MAPS IBRD No. 22831 and 22832