Hydroelectric Project
Total Page:16
File Type:pdf, Size:1020Kb
Document of The World Bank FOR OFFICIAL USE ONLY A,4/1. 2 > )J-- Public Disclosure Authorized Report No. 6189-CHA STAFF APPRAISALREPORT Public Disclosure Authorized CHINA SHUIKOUHYDROELECTRIC PROJECT November 24, 1986 Public Disclosure Authorized Public Disclosure Authorized Projects Department East Asia and Pacific Regional Office This documenthas a restricted distribution and may be used by recipients only in the performanceof their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS Currency - RMB Yuan (Y) US$1.00 = Y 3.70 Y 1.00 = US$0.27 Y 1.00 = 100 fen (As of September1986) Fiscal Year January 1 to December 31 Weights and Measures km - Kilometer (= 0.62 miles) kWh - Kilowatt hour (= 860.42 kcals) GWh - Gigawatt hour (1,000,000kilowatt hours) TWh - Terawatt hour (1,000,000,000kilowatt hours' kW - Kilowatt (1,000 watts) MW - Megawatt (1,000 kilowatts) kV - Kilovolt (1,000 volts) kVA - Kilovolt-ampere(1,000 volt-amperes MVA - Megavolt-ampere(1,000 kilovolt-amperes) TPD - Ton per day PRINCIPALABBREVIATIONS AND ACRONYMS USED ECEPA - East China Electric Power Administration ECHIDI - East China HydroelectricPower Investigationand Design Institute ECG - East China Grid FPEPB - Fujian ProvincialElectric Power Bureau FPFB - Fujian ProvincialFinance Bureau PPG - Fujian Provincial Grid FTPS - Fuzhou Thermal Power Station GOC - Government of China GPF - Governmentof the Province of Fujian GVIAO - Gross Value of Industrialand AgriculturalOutput HIPDC - Huaneng InternationalPower DevelopmentCorporation IAEA - InternationalAtomic Energy Agency MKE - Morrison Knudsen EngineeringCompany MOP - Ministry of Finance MOR - Minsitry of Railways MWREP - Ministry of Water Resourcesand Electric Power PCBC - People's ConstructionBank of China SAA - State Audit Administration SBC - Special Board of Consultants SEC - State Economic Commission SHPC - Shuikou HydroelectricProject Corporation SPC - State Planning Commission TCC - Technical Cooperation Credit WREPERI - Water Resources and Electric Power Economic Research Institute FOR OMCIAL USEONLY CHINA SHUIKOU HYDROELECTRICPROJECT STAFF APPRAISAL REPORT Table of Contents Page No. I.THE ENERGY SECTOR,. I. T..EEGY..TR..........O....O.....O....................... 1 A. ............ .......... ................ ............ 1 B* Resource Endowment.... 00 * ........... ........... ...; 2 C. Efficiency of Energy Use ............... ........... 2 II. THE POWER SUBSECTOR....................................... 3 A. ...................Background 0..*. .000.0000.0.o.......e000 3 B. The Market for Electricity...............................4 C. Institutions .................................... 4 D. Tariffs0.0...............................,0000000 000**00.0......... 5 E. Manpower and Training........ ............. 5 F. Planning.00 ... 0..0.000000...00000...0000000....00..0000..00000...000000000.... G. Technology Transfer............................... 7 H. Subsector Problems.............................. 0....... 7 I. SubsectorObjectives and Policies.*.*#................... 8 J. Role of the Bank......................................... 9 III. THE BENEFICIARY . ... O............... 10 A. Legal Status and Organization............................ 10 S.Baaetet................................... 10 C. Staffing and ............................................ 11 E. Accounting .o.* ,.****...........e...........s..............e.......12 F. Audit*.................................................13 G. Tariffs ........ 13 H. Billing and .........................00000000009000000000 14 I. Computer Applicationsand InformationManagement 00.....0. 15 J. Insurance*.... .... ............ 15 This report was prepared on the basis of an appraisalcarried out during February 14 to March 8, 1986, by C.K. Chandran,W. Cao, R. Morton, A. Liebenthal,I.H. Cheng and M. Cernea and a follow up mission in September 1986 by C.K. Chandran,W. Cao, R. Morton and I.H. Cheng. The followingconsultants participated: A. Raizen and D. Graybill. This documenthas a restricteddistribution and may be used by recipientsonly in the performnce of their officialduties. Its contents may not otherwisebe disclosedwithout World Bankauthorization. -ii - Page No. IV. THE POWER MARKET AND THE PROGRAM-.*..* ..................... 16 A. The East China Grid......................................16 B. The Fujian Power Grid....................................16 Co Load Forecast............... o.............................18 D. The 1986-1995Power DevelopmentProgram.................. 19 V. THE PROJECTo...............................................,o21 A. Project Objectiveso...... o. o........o.. o.....*.....o.... oo... 21 B. Project Description............................................... 21 C. Cost Estimate............................................o25 D. FinancingPlan.. ...........................................* 26 E. Procurementaton........o....o.o..o...................oooo27 . Projet Implementation............................................ 29 Co DisbursementalApets...oo..o.................o.............o 31 H. Resettlementgo........................... .. o....o.........32 I Environmental...............................................Aspects 36 Jo Monitoringand Reporting ......o..o......o.ooooo...o.o..o..e.....37 K. Riskso o.ooooo..oooooo...oooooo..oooo......ooo....ooo.. 38 B. Past and Present FinancialPerformance................... 39 CA FutureFinances ............................. 0............. 40 VIIo ....................U..... oo.ooooo o.ooo...ooooo.oo6..oo..... 45 A. Need for the Project.....................................45 B. Least Cost Studieso.......................................o45 C. Economic Rate of Return..........................o.......... 47 VIII. AGREEMENTSREACHED AND RECOMHENDATIONSo.o..o..oo.oooo ..... 48 - iii ANNEXES 1. InstalledCapacity, Electricity Generation and Sales in the Power Subsector 2. ElectricityGeneration by Region and by Type of Plant 3. PerformanceIndicators for FPEPB 4. Staffing of FPEPB 5. FPEPB's Existing Training Facilitiesand ExpansionProgram 6. ElectricityTariff of FPEPB (1985) 7. InstalledCapacity, Generation and Energy Sales of FPEPB 8. Energy Consumptionby Category of Customers 9. DevelopmentPrograms of East China Grid and Fujian Province 10. DevelopmentPlanning of Min River Basin 11. Salient Physical Features of the Project 12. Terms of Reference and Program for Studies of Regional Integrated Operation 13. Cost Estimate by Category and Purpose 14. Annual Distributionof Expenditures 15. ProcurementSchedules 16. Schedule of Disbursement 17. ResettlementPlan and EnvironmentalActions for Monitoringand Reporting 18. FPEPB's FinancialStatements (1981-85) 19. FPEPB's FinancialForecasts (1986-95) 20. Assumptionsto FinancialProjections 21. ECEPA's Key FinancialIndicators (1981-85) 22. Economic Evaluationof Railway Relocation Component 23. Economic Rate of Return 24. Least Cost Studies for ECG 25. SelectedDocuments and Data Available in the Project File CHARTS 1. Organizationof the Electric Power IndustryWithin MWREP 2. Organizationof FPEPB 3. Project ImplementationSchedule MAPS 1. Link with East China Grid (IBRD 19561) 2. Scheme of Min Jiang Valley Development(IBRD 19562) 3. Fujian Power Grid (IBRD 19563) CHINA SHUIKOUHYDROELECTRIC PROJECT Loan and Project Summary Borrower: The People's Republic of China Beneficiary: Fujian ProvincialElectric Power Bureau (FPEPB) Amount: $140.0 million equivalent Terms: 20 years, includingfive years grace, at standard variable interest rate OnlendingTerms: The proceeds of the loan would be onlent from the Government to FPEPB under a subsidiaryloan agree- ment with a 20 year term, includingfive years of grace and at an interest rate of 8.5% p.a. The foreign exchange risk (between the dollar and RMB) and commitmentfees would be borne by FPEPB. Project Objectives The project seeks to supporteconomic growth in East and Descriptions: China and Fujian province through developmentof a major hydroelectricsite on the Min river. The project would be the Bank's first involvementin the power subsectorin Fujian province,and the fifth Bank loan to the power subsectorin China. It would help to:. (a) develop a major hydro site to serve primarilyas a peaking station in the East China Grid; (b) effectivelyintroduce the most modern technologyavailable for speedy constructionof a large dam and power station; (c) link the East China and Fujian systems and promotemore effective integratedoperation of a major regional grid; and (d) provide training in management of international contractsfor large civil works and in financial management. The project comprisesthe construction of a 101 m high concrete gravity dam, a spil way, a powerhouseand a navigationlock; provisionand installationof seven generatingunits of 200 KW each; constructionof a single-circuit500 kV trans- mission line and installationof equipmentat an associatedsubstation; provision of consulting services for design and constructionmanagement; the resettlementof the reservoirarea population and a program for its economic and social reestablishment; and carrying out of studies and a training program. - ii - Benefits: The projectwill providea dependablecapacity of 1,000MS to meet the peak demandfor the combined East Chinaand Fujianprovincial grids and generate 4,950 CWh annuallyon the average. Indirect benefitsinclude the improvementof navigational conditionson the Min river,and the expansionof the capacityof the Waiyang-Fuzhourailway. Risks: The geologicalconditions are very good, investi-