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-PROCT PAPER
Proposal ia Aseccemc~io For the Review ,ott i6. Development Loan Coitte
JORDAN -RURAL AND URBAN ELECTRIFICATION
AID-DLC /P' 2238 j
CTA , 'V* DEPARTMENT OF STATE AGENCY FOR INTERNATIONAL DEVELOPMENT WASHINGTON. D.C. 20523
UNCLASSIFIED
AID-DLC/P-2238
August 25, 1977
MEMORANDUM FOR THE DEVELOPMENT LOAN COMMITTEE
SUBJECT: Jordan - Rural and Urban Electrification
Attached for your review is the recommendation for authorization of a loan to Jordan (the "Cooperating Country") of not to exceed Nine Million United States Dollars ($9,000,000) to help in financing certain foreign exchange and local currency costs of goods and services required for the project.
No meeting is scheduled for this loan proposal. However, please advise us of your concurrence or objections as early as possible, but in no event later than close of business on Wednesday, August 31, 1977. If you are a voting member, a poll sheet has been enclosed for your response.
Development Loan Committee Office of Development Program Review
Attachments: Summary and Recommendations Project Analyses Annexes A - M
UNCLASSIFIED 1. TRANSACTION CODE AGENCY eON INTENNATIONAL OEVELOPMENT Fi A ADD pp IA C CHANGE PROJECT PAPER FACESHEET D DLETE .DOCUMENT CODE 3 3COUNTRy/ENTITY ~JORDAN 4. DOCUMENT REVISION NUMBER
PROJECT NUMBER (7 didl.I1) 6. BUREAU/OFFICE 7. PROJECT TITLE (Maxamni 40 chaacetes)
a. CODE [12780209E28009A. -] .1NE.5YMBOL oRAL] AND URBAN ELECTRIFICATION . ESTIMAlED FY OF PROJECT COMPLETION 9. ESTIMATED DATE OF OBLIGATION A. INITIAL FY 1717J .QUARTER W Y 8 C. FINAL FY 171 (Enfer 1. 2, 3, or 4)
10.ESTIMATED COSTS 15000 OR EQUIVALENT $1 - FIRST FY A. FUJNCIIN(, OURCL 77 , LIFE OF PROJECT B. FX C. L/C o TOTAL E. FX F. L.'C G. TOTAL AIt A'PIIOPRIATED TOTAL 9,000 9,000 9.00 9,000 i4t. N r. . ) I I ( I ( I I I 'L.ANI 7 I7,28 I 19,000 I 1 7,720 I I 1.280 I 9000 OITIIR .,______-_
V. 2. _14)%YCO IN1IY_ ,826 3,674 5,500 1,826 3,674 5,500
TOTALS 9,546 . 4,954 14,500 9,546 4,954 14,500 II.S PROPOSED BUDGET APPROPRIATED FUNDS I000l
A AI'IO 6B.PRIMARY PRIMARY 2 TECH. CODE E. IST FY.-.7 H. .ND FY 28 K. 3RD FY .. "RIA I ION PURPOSE CODE C. GRANT I) LOAN F. GRANT G LOAN I GRANT J. LOAN L. GRANT M. LO. If SA 200 252 9,000 ------_
141
- TOTALS --- _--_ N. 4TH FY - Q. 5TH FY - LIFE OF PROJECT I2. INDEPTH EVAL ______UATION SCIIEDULECJ A. APPROPRIATION ----
0. GC1ANT P. LOAN N GRANT S. LOAN T. GRANT U LOAN
I,, _9,000
Is, I
141 TOTALS9,w 9A,000 -____ 1].DATA CHAN(,l INDICATOR. WEHE CHANGES MADE IN THE PID FACESHEET DATA. BLOCKS 12. 13. 14,OR' 15 OR IN PRP rAI.ESHEET DATA. BLOCK 12' IF YES. ATTACH CHANGED PIO FACESHEET.
2OYES
14. ORI I ATING OFFICE CLEAR" 2E IS. DATE DOCUMENT RECEIVED .!ZINAT UR E ...... IN AID!W, OR FOR AID!V1 DOC|i. SIGNTUREMtNTS. DATE OF DISTRIBIJTiO,. Theodore H. Lustigt... Director,I ITLF Office of Capital Development DA SIGNED-- Bureau for Near East DO 7MM D 1 1,111).4 A 10 8 11771MD 1 Alt) I).?lqI ./ TABLE OF CONTENTS
HASHEMITE KINGDOM OF JORDAN
RURAL AND URBAN ELECTRIFICATION PROJECT
PAGE
SUMMARY AND RECOMMENDATIONS ...... 1
I. PROJECT BACKGROUND ...... 5
A. The Power System...... 5 B. Organization ...... w 5 1. JEA ...... 5 2. JEPCO...... 6
C. Power Planning ...... e. 6 1. National Rural Electrification Plan ...... 6 2. JEPCO Five-year Plan...... 7 3. Financing of Power Projects by Other Donors...... 7
II. DETAILED PROJECT DESCRIPTION...... 9
A. Electrification of Rural Villages ...... 9 B. Upgrading of Amman Electrical System ...... 9 C. Project Planning ...... 0 0 D. Logical Framework ...... * 11 1. Project Goal...... _ ...... 11 2. Project Purpose ...... 11 3. Project Outputs...... 4. Project Inputs ...... 11
III. PROJECT ANALYSES...... 12
A. Technical Analysis ...... 12 1. Project Management ...... 12 2. Generating Capacity.,...... 13 3. Transmission Capacity ...... 13 4. Facilities to be Financed...... 13 5. Compatibility with Existing Equipment...... 13 6. Project Cost Estimate...... 14 7. Tariffs ...... 0.0...... 0...... 15 8. Project Scheduling ...... 16 9. Environmental Considerations...... *...... * 6 PAGE
B. Economic Analysis...... 0 ,...... 18 1. 35 Rural Villages in Amman Area ...... 18 a. General Information., ...... 18 b. Base Period Power Use Projections and Ability to Pay ...... 6 19 c. Economic Rate of Return Calculation ...... 20
2. Baqa and Schneller Area ...... 22 a. General Information...... 22 b. Economic Rate of Return Calculations ...... 22
3. Upgrading of the Amman System ...... ,...... 23
C. Financial Analysis ...... s 24
Do Social Analysis...... 26
E. Household Beneficiaries ...... 28
F. Role of Women ...... 29
G, Repayment Prospects ...... 30
IV. IMPLEMENTATION ARRANGEMENTS ...... 31
A. Implementing Agency - JEPCO ...... 31
B. AID Role in Implementation ...... 32
C. Implementation Plan...... 32
D, Implementation Schedule ...... 33
E. Evaluation Plan ...... 0...... 33
F. Recommended Conditions Precedent and Covenants ...... 34 ANNEXES
to
Project Paper
RURAL AND URBAN ELECTRIFICATION PROJECT
No. of Pages A. Project Map ...... 1
B. Repayment Prospects ...... 2
C-i. Threshold Decision Based on Initial Environmental Examination ..... 4
C-2. Technical Analysis...... 16 TABLES
C-i JEA Estimated Generating Capacity, Capability and Loads (MW). 1 C-2 JEA 132 KV System-Estimated Transformer Capacities for JEPCO Loads ...... o...... 1 C-3 Items and Estimated Costs to be Financed by AID ...... 1 C-4 Items and Estimated Costs to be Financed by JEPCO ...... C-5 Estimated Costs of Elements in Equipment Installation and Erection Contracts...... o...... o ...... •.. 1 C-6 Summary of Quantities of Materials to Serve 35 Villages...... 1
D. Economic Analysis' Tables ...... 16
TABLES
1 Jordan Rural and Urban Electrification - List of Villages by Stage, Population, Distance from Amman No. of Students and Availability of Health Clinic...... 1 2 Power - Calculation of Average Annual KWH Consumption - Per Connection in Villages ...... 1 3 Economic Rate of Return Calculation - Stage I Village Electrification - 1978-2000 ...... 3 4 Economic Rate of Return Calculation - Stage II Village Electrification - 1978-2000...... 3 5 Information on-Population, Students, Schools, & Health Clinics 2 6 Economic Rate of Return Calculation - Baqa Area Electrification - 1978-1990 ...... 3 7 Economic Rate of Return Calculation - Schneller Area Electrification - 1978-1990...o...... 3 (Annexes - continued)
No. of Pages E. Financial AnalysiG' Tables ...... 14
TABLES
1 JEPCO Income Statements - Actual 1971-1975 ...... 2 2 JEPCO Balance Sheet - Actuai 1971-1975 ...... 2...... 2 3 JEPCO Income Statement - Actual 1976: Projections 1977-1985 .... 4 4 JEPCO Balance Sheet - Actual 1976: Projections 1977-1985 ...... 4 5 JEPCO Sources & Uses of Funds - Projections for 1977-1985 ...... 2
F. Social Analysis ...... 5
G-1. Five-year Plan Power Projects - 1976 - 1980 ...... 0 ...... 5 G-2. JEA National Rural Electrification Plan ...... 7
H. Tariffs ......
I. Logical Framework ...... I
J. Borrower's Application for Assistance ...... 2....
K. Statutory Criteria - Project Checklist & Standard Item Checklist.. 9
L. AID Director's 611(e) Certification...... 1
M. Project Loan Authorization Document ...... 3 Page *Lof 34
PROJECT PAPER
HASHE4ITE KINGDOM OF JORDAN
RURAL AND URBAN ELECTRIFICATION .PROJECT
SUMMARY AND RECOMMENDATIONS
1. Borrower: The Hashemite Kingdom of Jordan (GOJ), which will utilize the proceeds of the loan to assist the Jordan Electric Power Company (JEPCO) in financing the dis tribution of electricity to 37 villages in the vicinity of Amman and in upgrading existing electrical distri bution in Amman.
2. The Loan: Not to exceed nine million dollars ($9 million) to help finance procurement of materials and equipment, erection services and technical assistance to manage procurement and project implementation. Procurement will be a foreign exchange cost and erection/installation will probably be a local currency cost.
FX LC TOTAL
AID Loan 7.720 1.280 $ 9.0 Million 62% GOJ Contribution 1.826 3.674 $ 5.5 Million 38% 9.546 4.954 $ 14.5 Million 100%
3. Loan Terms: Repayable in U.S. Dollars over a period of forty (40) years including a 10-year grace period for principal pay ments and interest at an annual rate of two percent (2%) during the grace period and of three percent (3%) there after.
4. Project Cost and Financing: The total cost of the project is estimated to be $14,500,000. A detailed description and cost break down is contained in Part III. Proceeds of the loan will go to the Jordan Electricity Authority (JEA) who will re lend the proceeds to the JEPCO, a privately-owned company granted a concession by the GOJ to distribute, transmit, sell and purchase energy in a concession area comprising greater Amman and villages in its vicinity. Page 2 of 34
5. Description of Project: The objective of the project is to provide reliable electricity service to 35 villages in the rural vicinity of Amman and two areas in surburban Amman to tally representing a population of about 153,000 or about 24,000 potential consumers, and also to reinforce the existing urban Amman system to meet the need for additional electrical service. Inputs to be financed mainly consisting of imported equipment and materials used for substations and distribution systems in urban Amman. Financed inputs to project also include installation and erection services and technical assistance for studies and construction supervision as might be required by the JEPCO and its consultants in implementation of the project. 6. Summary Findings:
A. Technical Analysis -
The JEPCO will implement the project and operate and maintain the electrical facilities upon completion. JEPCO has technical and administrative staff ex perienced in international procurement and electrical system design. JEPCO's technical capability is sup plemented by a British engineering consultant staff in residence. Preliminary plans and estimates of costs were prepared by JEPCO with the approval of JEA and reviewed by an AID consultant. Detailed specifications and electrical distribution plans are currently being prepared by JEPCO. Procurement costs are based on recent similar foreign exchange imports by JEPCO and considered reasonably accurate. B. Economic Analysis -
The 10-11 percent economic rates of return calculated for the electrification of the Baqa and Schneller areas approximated the 10-15 percent opportunity cost of capital assumed for the Jordan economy. As anticipated, the economic rates of return for the 35 villages to be electrified were substantially below that return on capital. In spite of that low return,an average of 3.7 percent, which did not include a variety of economic and social benefits because of measurement and quanti fication problems, electrification of these villages is principally justified as a necessary ingredient to improving the quality of life and possiblyslowing the rural to urban-migration fiow. Page 3 of 34
C. Financial Analysis -
The financial analysis of JEPCO provides convincing evidence of that enterprise's financial capacity to successfully carry out the proposed project. The rates of return on net fixed assets in operation and the return to stockholders are adequate incentives to bring forth the necessary financial resources to meet the firm's resource commitments. The debt-equity ratio and the ratio of cash flow to debt service re quirements also reflect conservative financial manage ment practices.
D. Social Analysis -
The GOJ looks upon electrification as one of the basic social services. The 1976-1980 Five-year Plan seeks to expand all basic social services in the hope that it will help stem or reverse the population movement from the rural areas to the urban centers. The proposed electrification of 37 villages and neighborhoods will not bring about drastic cultural changes in the way of life of the benefited households. All villages are within 20 miles of Amman and have good access by road to urban employment or services. Population to be served have an estimated per capita annual income of $100-$150 derived principally from dry-land farming. A family unit electrical consumer, averaging 6.2 persons, would have an adequate annual income with which to pur chase electrical appliances to improve both the working and living environment for commercial or domestic activities.
7. Statutory Checklist: All statutory criteria have been met (See Annex K).
8. AID's Funding Source: Supporting assistance.
9. Mission Views: The Embassy and USAID Mission strongly support this project. The Mission Director's 611(e) Certification is enclosed as Annex L.
10. Issues: None.
11. Recommendation: That a loan be authorized in an amount not to exceed U.S. $9.0 million. Page 4 of 34
12. Project Committee:
Chairperson - Robert F. Fedel, NE/CD Engineer - IQC Consultant D. Cronin & W. Hodgin, SER/ENGR Economist - Leonard G. Rosenberg, NE/CD Counsel - Jan Miller, GC/NE Desk - Ronald Witherell, NE/JLS Page 5.of 34
I. PROJECT BACKGROUND
A. The Power System
1.01 The Government of Jordan (GOJ) is interested in development of the electricity sector since it has a direct bearing on the individual economic sectors which contribute to the overall growth of the Jordanian economy. Electric power generation from 3972 to 1975 rose from 278 million KWH to 410 million KWH with subscribers increasing over the same period from 98,000 to 140,000. During the 1973-75 Development Plan period, JD 13.4 million * ($40.2 million) was spent (JD 10.2 million from public sector) on electricity projects, JD 7.8 million for generation, JD 5.25 million on transmission and distribution networks and JD 0.4 million on studies and preparation of specifications for future projects. The Five-Year Plan, 1976-1980, includes about $130 million for GOJ investments in electricity projects. Annex G-1 includes a summary of these projects and their status as--f 1975.
1.02 As for rural electrification, the Five-Year Plan, 1976 1980, has a goal of connecting the electric power supply to all towns, villages and other population centers having a population of 500 or more in various parts of the Kingdom. A National Rural Electrification Plan (Annex G-2) was prepared to meet this goal.
1.03 As for the Amman area, projects are proposed to strengthen and upgrade the high and low-tension networks of the Jordan Electric Power Company (JEPCO) and to expand electricity con sumers in the villages and population centers within the Governorates of Amman and Balqa.
1.04 The proposed loan will assist in meeting the Plan goal by electrifying 35 villages of the 251 requiring electrification and by providing materials and equipment to help strengthen and upgrade the Amman high and low-tension networks.
B. Organization
1. JEA
1.05 The Jordan Electricity Authority (JEA) was established by law (in 1967) and by virtue of that law became a legal personality, financially and administratively independent. JEA is governed by a Board of Directors appointed by the cabinet. The most recent General Electricity Law (February 1, 1976) gave the Jordan Electricity Authority responsibility for: (1) all power generation;
* One Jordanian Dinar (JD) = $3.00 U.S. Page 6 of 34
(2) construction of a national transmission network; (3) construc tion of subsidiary networks for distribution of energy to consumers and coordination of these networks with distribution networks of Concessionaires authorized to supply energy to consumers (the two major Concessionaires are Jordan Electric Power Company (JEPCO) serving Amman and Irbid DistrictElectric Company (IDECO)); (4) fix tariffs for energy to consumers; (5) manage the generation, transmission and distribution of energy; and (6) regulate the consumption of energy in the Kingdom by controls over loading.
2. JEPCO
1.06 JEPCO was established in 1947 to supply electricity in a concession area which now covers about 2000 sq. km. in greater Amman. The concession area was established by agreement between the GOJ and JEPCO in November 1962. Tne terms of this concession gave JEPCO such authorities and exemption as necessary to generate,! / transmit, distribute, regulate, buy and sell energy to consumers in the concession area. Under the General Electricity Law, JEA approves all plans for energy development by JEPCO and fixes rates for energy delivered to the consumers.
1.07 The concession granted to JEPCO generally consists of an area included in a 15 km. radius circle whose center is the Amman Mosque plus an area 20 km. wide along the Amman/Zerka road. This area is subject to enlargement by mutual agreement between JEA and JEPCO. For the proposed project both JEPCO and JEA have agreed to extension of the JEPCO concession area to service all villages included in the project.
1.08 The staffing and organization of JEPCO is discussed in detail in Annex C-2.
C. Power Planning
1. NatiQna] Rural Electrification Plan 2/ 1.09 As part of a survey- conducted by the Ministry of Interior in 1975, it was found that 713 villages had no electricity at all, 81 were either served by isolated systems using diesel generators (19) or were connected to the grid (62). Sixty-five (65) of the electrified villages in the Amman and Irbid areas are served by private electricity companies,JEPCO and iDECO. The remaining 16 villages generally lie in southern Jordan and are served by Municipal councils generating their own supply.
1/ JEA in 1976 assumed responsibility for generation previously controlled by JEPCO.
2/ See Annex F for other findings.l Page 7 of 34
1.10 The Rural Electrification Plan, prepared by JEA (Annex G-2), provides for the electrification of all villages having more than 500 inhabitants, a total of 226 villages. In addition, 25 other villages having less than 500 population are very close to the grid and can be electrified at minimum cost and are therefore scheduled for electrification. Of the 251 villages to be electri fied, 239 are reasonably near existing transmission lines, with only 12 villages lying in remote areas. Sixty-five villages are in the Amman and Balqa Governorates. Stages I and II of JEA's plan provides for electrifying 35 villages in the vicinity of Amman which are near existing lines. In addition, two areas of suburban Amman (Baqa and Sclniell-h)are also included.
2. JEPCO Five-Year Plan
1.11 To meet the energy needs in Amman set forth in the National Five-Year Plan, 1976-1980, the JEPCO is finalizing its second five-year plan for upgrading the distribution network in greater Amman. This plan has been coordinated with the Planning Department of JEA and generally will permit an expansion of the distribution network adequate to meet the expected demand in 1983. Priorities have been identified and the proposed AID loan will assist in financing project elements which contribute to the first three years of the plan. Elements provided under the loan will be used in new and expanded substation facilities in Amman .....
3. Financing of Power Projects by Other Dorors
1.12 Several foreign lending institutions are participating or expected to participate in the financing of electricity projects in Jordan. Donors and elements of the plan to be financed are noted below:
(a) For power generation:
1st Stage Hussein - Two 33 MW steam generating units IBRD credits for $10.2 and $5 million Kuwait Fund - $10.2 million
2nd Stage Hussein - One 33 MW steam generating unit and 132 KV line Arab Fund - $20 million
3rd Stage Hussein - Two 66 MW steam generating units Saudi Fund - $35 million Kuwait Fund - $20 million Arab Fund - $20 million Page 8 of 34
Aqaba - Two 3 MW diesel generators KFW (Republic of Germany) - $5 million
(b) For expansion in JEPCO concession area: UK - about $9.5 million (L 5.5 million)
(c) Elements of village electrification, other than those included in the proposed AID project, are expected to be financed as follows:
(1) The USSR will finance electrification of 170 villages near Irbid and 30 in the vicinity of Amman.
(2) The Danish Government has been requested to finance 21 diesel generatingunits for 14 remote villages.
(3) Three regional rural projects in South Jordan are under consideration for financing by the Common Market and the East Germans. These projects include: generators and lines at Karak to electrify 20 villages; generator and lines at Taffila to electrify 8 villages; generator and lines at Shubak to electrify 8 villages.
1.13 The proposed AID project, together with the above financed activities, will contribute to the near complete attainment of the rural electrification goals for village electrification outlined in the National Plan. Page 9 o 34
II. DETAILED PROJECT DESCRIPTION
2.01 The project has two major components: one to provide electricity to 37 villages in the vicinity of Amman, the other to upgrade the existing electrical system in Amman itself. The latter component is aimed at contributing to needed electrical service to meet Amman's expanding domestic, commercial and indus trial growth. JEPCO,over the ten year period 1967-1976, increased electricity sales from 78 million KWH to 269 million KWH. All of Amman's electrical facilities are being expanded to meet this growing demand.
A. Electrification of Rural Villages
2.02 The map of Annex A shows the location of the 37 villages to be electrified under the project. Tabular data shown in Annex D lists villages and vital statistics and the mate rials required for the erection of the distribution systems. Table C-6 of Annex -. lists all items to be procured under the loan.
B. Upgrading of Amman Electrical System
2.03 The second major component of the project is the procurement of equipment and materials to be used by JEPCO in the upgrading of the Amman distribution system to be carried out during the five year period beginning in 1978. The estimated cost of the upgrading is $28 million, exclusive of inflation. The upgrading, in general, consists of equipment, lines, cables, substations, and control facilities required to handle an increase in 33 KV power to be delivered to the JEPCO distribution system. This upgraded capacity will meet power demand by Amman utilizing the expanded generation facilities at the Hussein Power Station. For the portion of the upgrading covered by this project, JEPCO will finance $1.026 million in off-shore equipment and materials and the loan will finance $1.55 million foreign exchange for transformers in the distribution system and power regulating units for the central power control facility which is now being developed by JEPCO. JEPCO will be financing all remaining costs for the planned upgrading program. Page 10 of 34
2.04 The project also will provide machinery and equipment for erection andppacement of poles, laWing of cable and-f-ranS F-g c f1mdree-Ig Such items include trucks with mounted hoists and drilling units and back hoe trenchers. JEPCO construction staff will principally be the users of this equipment for project construc tion and maintenance activities. The details of materials to be purchased and the cost estimates are found in Annex C-2, Table's 3 and 4.
C. Project Planning
2.05 Project planning has been carried out by JEA and JEPCO with the assistance of their U.S. and European consultants. Preliminary plans, specifications and estimates have been prepared. Actual implementation will take place as follows with JFOCO carrying out the major burden of work subject to JEA (and AID) approval:
a. JEPCO Consultant prepares tender documents and specifications for the U.S. procurement of project materials.
1). TnvitaLion for Bids (IFB) will be issued following adver tising.
c:. Bids will be analyzed and awards made. b d. Concurrent with a-c above, JEPCO and JEA will prepare plans and tender documents for the tendering of construction and erection services (loan funds will participate in financing part of the local costs for Jordanian or Code 941 contractors).
,:. I' , l Ju.l I hl , 11 ,11S M id1, tillliplalt-l1 Wl I I fie. I'tW(':i V1;41 01111 ware housed by JEPCO until installation by contractors or JEPCO staff.
2.06 Any specialized expertise required in connection with the installation or use of specific equipment and materials financed by the loan will be provided through manufacturer's assistance requested in the IFB. Funding up to $500,000 has also been provided in the loan for such additional U.S. expertise as might be required to assist JEPCO and its c6nsultants in carrying out needed services for procurement and installatibimanagement and supervision of the proposed JEPCO expansion program.... Further details of project implementation as it relates to AID and JEPCO actions is found in paragraph A , Part IV. Page 11 zf 34
D. Logical Framework
1. Project Goal
2.07 The ultimate project goal is to improve the quality of life for about 153,000 village inhabitants by provision of electricity to an estimated 24,000 homes. Supplying electrical service will also facilitate lighting of mosques, churches, schools, clinics and the installation of street lighting. Availability of electri city in the villages will make it possible to establish and expand small commercial or productive entities.
2. Project Purpose
2.08 The purpose of the project is to permit the utilization of electric power by 24,000 potential consumer units located in 37 villages and to contribute to improvements in the reliability and increased quantity of electricity available to industrial, commercial a.nd residential customers in Amman.
3. Project Outputs
2.09 Project outputs will be installed and erected materials comprising the distribution systems in 37 villages and in the upgraded electricity system in Amman.
4. Project Inputs
2.10 Project inputs will be electrical equipment, materials and devices and such services as necessary to assure adequate tech nical management, planning, procurement, erection and installation.
2.11 A chart of the project's Logical Framework Matrix is shown in Annex I. Page 12 of 34
III. PROJECT ANALYSES
A. Technical Analysis
3.01. An IQC consultant for AID accompanied an AID project design team to evaluate the technical aspects of the proposed project including: a review of the preliminary plans prepared by JEA and JEPCO; a review of equipment and materials to be procured; an assessment of the estimated costs for these comodities; the techni cal implementation capabilities of JEA and JEPCO to design and carry out the proposed project; analyze the current design standards used in electrification projects in Jordan; a review of the electricity gener. ;ing capacity in Jordan and its ability to serve the proposed networks to be constructed with materials and equipment to be procured under the-loan; and prepare tabulations of items to be procured and the estimated costs for full financing of the project in which the proposed loan funds will participate. The details of this Technical Analysis are included as ANNEX C-2. A general summary of its conclusJons is given below.
1. Project Management
3.02. JEA is the GOJ agency responsible for administering all power activities in Jordan. Except for planning and construction carried out by area concessions, such as that held by JEPCO, JEA has the responsibility and capability to plan, design and construct electrical facilities. For work planned and carried out by the concessions, the JEA has approval authority.
The major role of JEA in the project is providing JEPCO with the necessary poles for erection of the distribution systems. Details of JEA pole plant are discussed in ANNEX C-2. The supply and production of poles is a critical constraint to implementation of the construction/ erection phase of the project. The JEA has responded to this require ment and is proceeding with design services for constructing an additional plant. JEA is aware of the critical timing of this effort.
3.03. JEPCO has the technical and administrative staff experienced in managing and implementating projects of similar magnitude. A British firm of electrical engineers, Kennedy & Donkin under a continuing contract are providing design planning, procurement and general advice to JEPCO. A resident staff of three engineers work in the JEPCO office. JEPCO and its consultant are preparing the specifications and bidding documents for procurement of project items. Some assistance may be required for loan funds to finance additional help for JEPCO in administering and supervising the procurement and installation of project items. Page 13 of 34
2. Generating Capacity
3.04. Planned increases in generating capacity are under construction. Together with the existing generation the facilities can handle system loads til 1982. In the event that one generator is out of service, some cutback might be necessary during peak load. This condition is not considered critical to the successful implementation of the project. 3. Transmission Capacity 3.05. The 132 kV transmission lines and transformers stepping down to 33 kV are more than adequate for the estimated loads. The 33 kV system, with the proposed upgrading of the system as planned by JEPCO, is adequate for the predicted loads.
4. Facilities to be Financed
3.06. For the project elements intended to upgrade the Amman system, the ans s to be procured are designed to conform with JEPCO system planning for use in new and expanded capacity substations. The ,Conro-enter.is_, tb needed and theamount shown in project is for partial equipping. JEPCO is proceeding to construct substations and procure and install other elements. 3.07. The project for service to the 35 villages and two urban areas is based on use of overhead lines. Loan Funds will not be used to replace existing overhead lines with underground cable. 3.08. Loan funds will also help meet JEPCCreuiremen or;ipmprovi g their con-struhctonand maintenance capability. This equipment,includes hos1-tsand trucks to handle and trAnqqp islxibution. transformers anid small, cable, reels, back hoes for tench;LInga2ost hole diygr attachments to assist JEPCO in its field erection and construction in the concession area.
5. Compatibility With Existing Equipment 3.09. There are no major conflicts regarding compatability of the equipment proposed for the Project with the equipment now used by JEPCO. JEPCO funds are procuring those items comparable to those already in use or those only adaptable for use with British in place equipment. Any minor variations can be resolved by JEPCO engineers. Page 14 of 34
6. Project Cost Estimate
3.10 Unit costs of items to be procured were derived from an analysis of current costs of materials in the U.S. and the-costs, freight and insurance of similar items recently purchased by JEPCO. JEPCO's engineering consultant provided additional cost and specification data used to develop construction/erection/installation costs and the overall project costs. An increase due to inflation of 10% has been applied to the total cost for all procurement items. The total estimated procurement cost of $7.22 million may be adjusted following the receipt of bids. Any bid pricing over or under this estimate will only effect the amount of loan funds available from the total $9 million remaining to finance contractor costs for installation and erection.
3.11. Kennedy & Donkin in April 1977 submitted to JEPCO a "Planning Report for 33 kV Distribution Network Reinforcements for 1978 to 1983." Details of the distributed and total load forecasts for the JEPCO concession area were calculated and alternative system reinforcements were presented and staged over the 5-year period. Costs for the entire program without inflation for each alternative was about $28 million. Inflation at 10% per year, compounded, would increase cost by about $11 million to a total cost of $3) million. JEPCO is presently refining the load estimates which, undoubtedly will reduce the reinforcement requirements over the next five year period. The amount of reduction in the $39 million five year program is not known at this writing, however JEPCO is proceeding with the necessary design of those elements of the central 33 kV distribution system which will berequired regardless of any adjustments in the estimated loads of the new areas to be served in the five year plan. Necessary elements of the expansion include facilities for central monitoring and control of the 33kV system supplied to Amman by JEA. Present control stations are dispersed throughout Amman and require the physical presence of technicians to carry out the needed control of electricity to the system. The loan will provide $350,000 toward needed consoles and control units needed in the facility.
3.12. A $1.2 million item for AID financing under the loan is based upon a requirement for transformer capacity necessary for the Amman system upgrading. A capacity of 100,000 KVA is needed in various capacity transformers. The estimated average cost/KVA is $12. Detailed capacities required are being determined by JEPCO for procurement. Page 15 of 34
3.13. A sunary of overall project costs is shown below. Detailed descriptions of item is found in Annex C.
COST SUMMARY (in thousands US $)
JEPCO AID TOTAL ITEM FX LC FX LC Distribution System - 37 Villages Materials and Equipment - - 4,665.2 - 4,665.2 Poles - 2,384.0 - - 2,384.0
Ugrading Amman System 1,026.0 - 1,550.0 - 2,576.0
Installation and Erection - 1,090.0 - 1,280.0 2,370.0
Construction and Maintenance - - 350.0 - 350.0 Equipment
Engineering Services 300.0 200.01 500.0 - 1,000.0
Inflation Factor 133.0 367.0 654.8 - 1,154.8
Subtotal 1,459.0 4,041.0 7,720.0 1,280.014,500.0
Totals 5,500.0 9,000.0
7. Tariffs
3.14. JEA, being responsible for all electricity generation in Jordan, sells power to JEPCO at rates approved by the JEA Board of Directors. This bulk tariff is based on the prices of fuel oil and other costs directly associated with the power generation. Annex H includes tariff data. With the approval of JEA the JEPCO sets tariffs for the sale of electricity to consumers. Individual households are responsible for their own interior electrical wiring connecting up tb the meter. Consumers also pay a fixed charge for the necessary wiring and meter rental required to connect to the low voltage system brought into the village. These charges are fixed according to approved rates (see Annex E). A two-month deposit is also required to insure coverage for two months consumption is financially covered. Rates for industrial users of three phase power are also fixed with the user generally shouldering the cost of the third wire required for three phase operation. Page 16 of 34
3.15. Consumer tariffs were recently studied and revised by the JEA in satisfaction of conditions set forth in IBRD Development Credit Agreement 570-JO(2nd Hussein Thermal Power Project) for generation facilities. The proposed rates were presented and accepted by the IBRD in March 1977. The tariffs became law on March 1, 1977.
8. Project Scheduling 3.16. JEPCO with the assistance of Kennedy & Donkin is presently preparing the specifications, general conditions and invitation bid for documents on all items to be financed by loan funds. Items expected are to go out for bid in December 1977. Awards can be expected by the end of February 1978. 3.17. JEPCO on a continuous basis will be preparing the detailed erection plans and specifications for issuance to contractors. Construction/erection contracts (by local contractors) will be awarded upon receipt of AID contract approvals and materials delivery. JEA on a continuous basis will be supplying JEPCO with poles needed to erect project networks and make such arrangements as required to assure sufficient quantities. The JEA plan producing for and supplying poles will be submitted by JEA as a condi tion precedent to loan disbursement. The project is expected to be completed by December 1979.
9. Environmental Considerations 3.18. The project, as a rural electrification project limited the to construction of electrical distribution networks and house connections, has limited potential for significant adverse environ mental effects. The potential for these effects is discussed below. 3.19. Short-term effects are those effects imposed during the construction stages of the project. Construction activities will be limited to the installation of poles and wire in rural villages. will result This in temporary disruption of traffic both vehicular and pedestrian along paths in which pole erections will occur. A positive effect of this construction will be the scrapping of existing, hazardous poles and lines erected by operators of independent diesel generators which have served selected village consumers. Existing infrastructure and private properties will be restored following any disruption. Page 17 of 34
3.20. Access rights of way for extending wire and poles from the main grid to the villages will be short. Trees and heavy vegetation is minimal in the Jordan countryside and therefore existing physical land characteristics and foliage will not be effected. 3.21. To the rural village homeowners, the project will bring electric power for better lighting and permit use of appliances, such as refrigerators, irons, washing machines, etc., will all of which contribute to a better quality of life for the rural people. Refrigerators, in particular, providing cold storage to prevent spoilage of food as well as providing fly-free storage of food, will assist greatly in protecting the health of rural peoples. Cottage industries will probably be expanded or established thus improving the economic status of the family unit, since the project will not radically effect the existing cultural structure of the rural village its or. occupants. The degree of positive impact on cultural aspects will not be great. 3.22. National resources irreversibly committed during the implementation of the project are limited to land that will serve as a right-of-way for distribution lines. The land area committed thus will consist of long, narrow strips of land which will be returned to original state in the villages themselves and, in the case of open field lines, the agricultural potential of the land-use under the lines will remain the same. 3.23. A negative environmental determination has been made and doucmented in Annex C-1. Page 18 of 34
B. Economic Analysis
1. 35 Rural Villages in Amman Area
a. General Information
3.24. A list of the thirty-five (35) rural villages that are to be connected by.this proposed project to the Jordanian central power system via the JEPCO transmission and distribution system is presented in Table I (Annex D ). That table also contains information on population, distance from Amman, number of students and availabilities of health clinics. A two-staged implementation approach was adopted, with a one year lag in commencing eltctrification between the Stage I and Stage I! groups (1980 and 1981 respectively). Stage I includes those eighteen (18) villages that do not require the construction of any high voltage (H.V.) 33 kv main lines but only of spur H.V. lines from existing H.V. main lines. Stage II (seventeen (17) villages) does require the ex tension of the H.V. main lines. Stage II capital costs are approximately 40 percent greater than Stage I with quite similar base populations (Stage II about 10 percent greater) and power load growth projections. The remaining thirty-one (31) villages in the Amman area will probably be electrified by 1981, if the current Jordan Electricity Authority's master plan Is implemented, and financial assistance is forthcoming as noted in paragraph 1.12, page 8.
3.25. Access of the villages to the main road to Amman are good and the in ternal village road system adequate to provide satisfactory access to the construction, operation and maintenance of the power distribution system. Most of the villages are within 20 miles of Amman. Most of the villages do possess potable water systems and contain some educa tional facility (no data as to level of school was available). Except for two villages (Um Abhara and Ira) a health clinic is available in each village.
3.26. The major occupation of the_villages is dry-land farming with winte. wheat as the primary crop. A limited amount of vegetables a.ne grown in the late spring and early summer based on residual moisture from winter rains. Firm income data for villages in Jordan are not available but an average $100-$150 per capita income estimate appears reasonable. f- Since most of the villages in Stage I and II are relatively close to Amman (20 miles or less), the opportunity does exist to supplement farm income with work in the capital city. Based on discussions with knowled~eable individuals in Amman, we have assumedthat an income estimate of about $200 per capita ($1,240 per family unit with an average size of 6.2 per sons) is a reasonable approximation for the base period calculation of ability to pay for pper used. In 1976, the per capita GNP in Jordan was calculated at $514..-
1/ See P.1 of May 24, 1977 PRP on Jordan Village Association. 2/ See CERP 0004, Jordan Embassy's Annual Economic Trends Report, May 18, 1977. Page S9 of 34
b. Base Period Power Use Projections and Ability to Pay
3.27. Table 2 (Annex D ) presents the calculation of the annual average-M-use per connection in the 35 villages for the year of initial operation. 3.28. In that initial year of operation, it was assumed 1h~a 40 percent of the potential consumers are connected. Table 2, therefore, assumes, for example, that for refrigerators, about eight (8) percent of the total village population will acquire that appliance in the initial year of operation. For television, the corresponding proportion is 20 percent of total village population. These relationships as well as the average cost of appliances are presented in a footnote to Table 2 . The annual cost of electric power per connection in the initial year of operation is Calculated as follows:
800 KWH per annum x 30 fils per KWH JD 24.000
Meter Rental - 75 fils per month x 12 .900
(Annual costs (for KWH use and JD 24.900 meter rental) is about 6 percent of family income.) $74.70
3.29. In addition, connection costs for single-phase consumers, seven ninety percent (97%) of the total, is JD 15 ($45) per connection paid directly to JEPCO. House wiring costs are about JD 3 per connection. With 6.2 persons (one family unit) attributed to each connection, the per connection annual income (as noted previously) is approximately 1,240. The $45 (JD 15) for connection costs paid directly to JEPCO (traditionally in one lump sum) adds another 3.6 percent of family income and hVse wiring another 0.7 percent for the initial year of operations.
l/ There are several other villages in the Amman area currently sup plied by JEPCO. Only one, Mahis (15 kms from Amman) appears to have similar characteristics to those of most of the 35 villages in cluded in this project. From initial connection in 1974, Mahis' average annual consumption per connection in 1976 was 821 KWH, in creasing from 300 1WH in 1974 and 500 KWH in 1975. The number of connections have increased by about 10 percent per annum.
2/ These percentages are consistent with the analysis as to the relation between household income and expenditure on electricity presented in a Table 3.1, Issues in Rural Electrification, Report No. 517, July 24, 1974, Public Utilities Department, IBRD. Page 20 of 34
c. Economic Rate of Return Calculation
3.30. As noted previously, dry-land farming in the villages is the dominant form of agriculture in the area with little or no chance to introduce irrigated agriculture. Unless special measures are taken as to geL,,raphical diversification of industry in the Amman area, most of the villages are unlikely to have any significant growth in small industry in the foreseeable future. If industrial growth does spill over from Amman, the villages within a 5-10 kilometer radius of Amman will, most likely, be the most immediately affected.
3.31. In summary, the impact of the availability of a dependable electric power supply will be mainly on the consumption rather than the produc tion side. The economic rate of return tables in Annex D reflect this judgment in that the primary benefit is measured by the revenues collected from power sales almost entirely from domestic consumers. Value added from incremental productive activities, whether agricul tural of industrial, attributable to the project are excluded not ohly because of difficulties of quantification, but also because they are unlikely to be significant. Other theoretically quantifiable benefits, such as reduced current resource costs through the elimina tion of kerosene consumption for lighting is excluded because of lack of basic data. Other possible benefits, such as the presumed in creased efficacy of the informal and formal education system measures for consumers' surplus add-on and reduced flow of the rural-urban migration pattern are excluded because the current state of the art is unable to pro vide any objective numerical basis for inclusion. Certainly one of the major social reasons for the village electrification segment of this project is to provide incentives for families to remain in the villages and to ease the population pressure on Amman. It is presumed that improving the quality of life in the villages by providing a dependable electric power supply will contribute meaningfully to this objective.
3.32. In spite of these severe qualifications, the calculations in Ta iles 3 thru.j._ in Annex D do provide a limited proxy economic analysis. The opportunity cost of capital in Jordan is generally assumed to be in the 10-15 percent range. It is unlikely that the results of the economic rate of return calculation that one can normally construct for this group of villages will come close to that opportunity cost of capital. The relatively wide dispersal pattern of the consumers and the high cost of providing power services, the lack of any substantial agricultural or industrial demand and the low income levels of the residential customers and relatively low per connection power usage, precludes that result. Page 21 of.34
3.33. Before proceeding to present the results of the economic rate of return calculations, the major parameters included in that analysis will be outlined. This material is presented in the explanatory note to those tables:
3.34. 1. In 1976, approximately 70,000 persons resided in the 35 villages. A 3 percent annual population growth rate is utilized for the 1976 through 1990 time period; 2.5 percent for 1991-1995, and 2 percent for 1996-2000. In the initial year of operations, 40 percent of potential consumers are connected, 80 percent by 1990 and 90 per cent by the year 2000.
3.35. 2. In year one of actual operations, average annual KWH consumption is 800 KWH. Stage I provides for a 4.5 percent compounded increase in per consumer consumption to 1990 (about 1,250 KWH per annum) and 3.5 percent (1990-2000) to 1,761 KWH per annum. Stage II adopted the same rate for 1978-1990 and a somewhat lower annual growth rate for 1990-2000 (2.5 percent), to about 1,580 KWH per annum.
3.36. 3. It is assumed that 97 percent of the connections are single-phased consumers, representing the domestic or household con sumer. This minimal small industry/commercial impact adds some conservative bias to the projections. Sales revenue is based on a 28 fils/KWH price, slightly below the current first block rate of 30 fils per 1-100 KWH monthly consumption. The 28 fils/KWH rate reflects a 6 percent reduction because of consumption by non-paying charities.
3.37. The internal rate of return for Stage I is 4.6 percent (Table 3, AnnexD ), and for Stage II, 1.8 percent (Table 4 , Annex D ). To gether, the two average out to about 3.2 per-cent. lTihis is, of course, substantially below the assumed 10-15 percent opportunity cost of capital in Jordan. As stated above, the results of the economic rate of return calculations were anticipated. In spite of these relatively low economic rates of return, the probable significantly favorable sov'.al benefits implicit in the provision of electric power to the thirty-five villages warrant going forward with this segment of the project.
1/ The results of the economic analysis of a recent IBRD rural electri fication project in Egypt are worth noting. In that report, "Appraisal of a Regional Electrification Project in Egypt," Report No. 1517a-EGT, klay 24, 1977, the average economic rate of return for the rural zones was 4.2 percent. The IBRD included a shadow wage for unskilled labor and the reduced net resource costs attributable to the substitution of electric power for kerosene (up to 15 KWH per month) in addition to the revenue from power sales. The main increases in consumption over the next 5-10 years was assumed to come from commercial and residential consumers. Page 22 of 34
2. Baga and Schneller Area
a. General Information 3.38. Table 5, (Lnnex D ) outlines the available information the on Baqa and Schneller areas that are to be tied into the JEPCO distribution system in 1980. The population of both areas in 1977 totals about 83,000 persons (55,535 in Baqa and 27,413 in Schneller). 3.39. About 5-10 percent of the population currently receive power small diesel from generators operated under special license -rom the Jordan Electricity Authority. No information as to per capita consumption current of power consumers is available. These small diesel generators will cease operations when JEPCO power is available and presumably will be sold or transferred to other sites by the owners.
3.40. No published income data is available for these urban areas. Given the employment of the residents of the areas, income is probably well above the $200 per capita estimate adopted for the occupants the of 35 villages. A $350 per capita base period estimate is adopted as a reasonable approximation. With this presumed annual family in come level (6.2 x $350 =.$2,170) and the utilization of the base period annual 800 KWH power consumption per connection used in the village analysis, there is no need to calculate the ability to pay for this level of power use. The previous calculations for the 35 villages are adequate to cover the ability to pay aspect of the analysis. (See Tables 3 and 4 , Annex D )
b. Economic Rate of Return Calculations
3.41. Tables 6 and 7 , Annex D , provide calculations the economic rate of return fo-the Baqa and Schneller areas for 1978-1990. Given the higher per capita income assumed for the residents of the Baqa and Schneller area, the major parameters differ substantially from analysis the presented for the 35 villages. Some of these major param eters are as follows: 3.42. 1. In year one of operations (1980) 80 percent of the popula tion will request and receive power supplies. By 1990, the last year of the analysis, the proportion receiving power will have increased to 97 percent. A 3 percent annual population growth rate for 1977-1990 was adopted.
3.43. 2. The base period annual KWH consumption per connection taken as 800 was KWH. By 1990, average KWH consumption per connection is projected as 1987 KWH, or at a 9.6 percent compounded annual growth rate. Page 23 of 34
3.44. The results of adapting this more rapid rate of consumer con nections and annual increase in power consumption (and, of course, the lov'oer capital costs per connection) is reflected in the internal rates of return for both areas. Baqa area internal rate of return of 11.0 percenc and the Schneller area of 10.7 percent are reasonably close to the previously noted 10-15 percent range as to the opportunity cost of capital in Jordan.
3. Upgrading of the Amman System 3.45. The total financial involvement of both AID and JEPCO in the Amman upgrading element of the project covered by the proposed loan is $2.576 million. These funds are to procure off-shore materials and equipment needed for a small segment of the proposed Amman five-year power expansion program. The entire program was set forth in a Planning Report by JEPCO consultant Kennedy & Donkin, dated April 1977. The total estimated cost of that program, including inflation, is about $38 million. The consultant did not analyze the economic benefits of the overall project including the $2.576 million noted above. Page 24 of 34
C. Financial Analysis 3.46. The financial and operating practices reflected in JEPCO's cial statements finan for 1971-1976 and projected for 1977-1985 are in detail discussed below. They provide convincing evidence of the operating utility's capacity to mobilize the necessary resources both to construct the facilities included in this project, to operate and maintain such facilities and to provide a reasonable rate of return on both total net fixed assets in service and to the company's stockholders. 3.47. Tables 1 and 2, Annex) present the income statementandbalnce sheet for JEPCO during 1971-1975. The actual 1976 financial information, as well as the projections for 1977-1985, are presented in Tables 3; 4 and 5, (Annex E). From 1971-1976, the average unweighted rate of return annual on net fixed assets in operation was 7.9 percent. From 1974 through 1976, this ratio had steadily declined, until in 1976 was only it 2.8 percent. Those operating results reflected, in good the rapid part, increase in the net asset base without a concomitant increase in net income. Net profit after income tax did decline drastically in 1974 and 1975 from the higher levels of the earlier period while the asset rate base had gone from about JD 4.1 million in 1971 to about JD 10.5 million in 1976. This decline in net profit after income taxes also affected the ratios of average net profit on par value of common stock. From 1971-1975, that average unweighted ratio was 9.3 percent, but by 1975 it had fallen to 6.8 percent and by 1976 to 4.0 percent. 3.48. The total long-term debt of JEPCO was practically non-existent in 1971 - only JD 220,000. By 1975, it hid incre-sed 2 JD 3,630,000 to JD ,174,000'and to by 1976. In spite of this significant increase in long term debt, the debt-equity ratio was still low - 1:3 in 1975 and 1:2 in 1976. These are conservative debt-equity ratios for a power distri bution company.
3.49. The 1977-1985 projections as to the income statement and balance sheet, sources and uses of funds, Annex are presented in Tables 3, 4 and- 5f E respectively. The explanatory notes provide information to as assumptions included in those projections. Before outlining the major conclusions derived from those projections, it should be noted that these projections are being revised by JEPCO. In the month, power past projections for 1977-1983 have been scaled down because of several factors. For example, many of the temporary Lebanese dents in Amman resi (said to number as many as 60,000) have left the country and the plan for a new airport has been temporarily shelved. Delays in other power using projects in and around Amman are also being contem plated. It will be several months before JEPCO is able to revise its forward planning. Based on discussions with JEPCO anticipated officials, it is not that the financial soundness and profitability of the prise enter will be substantially changed as a result of that revision. Page 25 of 34
3.50. The 1977-1985 income statement (Table 3, Annex E) would indicate that JEPCO's prospects for earning a reasonaIe return on average net fixed assets in operation (line 25) are bright. The interest on loans (line 20) includes the proposed AID loan, relent by JEA to JEPCO at seven percent (77.) interest rate, fifteen (15) year maturity and three (3) year grace period. That annual rate of return on average net fixed assets in operation (based on net profit after in come tax) varies from 7.0 percent to 11.4 percent, with an unweighted average of about 10.0 percent per annum for 1977-1985. For 1971-76, it was 7.9 percent. The average net profit on common stock par value varies from a low of 6.3 percent (1977), to a high of 14.5 percent (1985). The unweighted average for the 1977-1985 time period is about 11.0 percent per annum. For 1971-1976, it was 8.4 percent.
3.51. In 1976, the long-term debt/equity ratio was 1:2. By 1981, it will decrease to 1:1.6 but by 1985 return to the 1976 level of 1:2. Between 1981-1985, JEPCO had planned to sell JD 8 million of common stock. The debt-coverage ratio varies from 4.6 times (1980) to 3.4 times (1985) for the 1977-1985 time period. These ratios do reflect conservative financial policies and planning by JEPCO management. Page 26 of 3L
D. Social Analysis
3.52. Decisions to connect 251 villages to the national grid thus bringing electricity into homes and facilities serving these homes are based on the National Five-year Plan for Development, 1976-80. Under this plan the GOJ intends to direct public and private invest ments into facilities providing basic social services to rural or remote populations. The GOJ's Ministry of the Interior conducted a survey of rural Jordan in order to determine what services are available and what sectors require urgent attention. The basic services investigated are health, drinking water, electricity, hous ing, education and youth welfare. A discussion of this survey and its findings is in Annex _ . In terms of electricity, a National Rural Electrification Plan was prepared as part of the Five-year Plan to achieve electrification of all villages (226) having a population over 500, and 25 villages near lines but under 500 population. Vil lages revealed as wanting in the social service survey were identified in the electrification plan. This project is directed to 35 of those villages and two communities in surburban Amman.
3.53. These particular 35 villages were those remaining to be in cluded in GOJ's program for foreign assistance in the electrification sector. Of the 251 villages designated for electrification, 170 in the Irbid area and 30 of the 65 in the Amman area, are to be financed by the USSR. Most of the remaining villages are included in assistance from other donors. The communities of Baqa and Schneller were se lected because they are large population centers near Amman, but economic development has been slow due to lack of infrastructure. It is expected that the introduction of electricity will stimulate small-scale commercial enterprises nurtured by Amman's expansion with improved employment opportunities and the proximity of land for truck gardending.
3.54. Several of these villages are presently served by electricity provided by privately-owned diesel generators. In generai these generators are of old vintage and ill maintained and thus unreliable in terms of sustaining commercial activity and household appliances such as refrigerators, and pressing irons or sewing machines. House hold lighting is usually limited to low-power bulbs. Street lighting is poor or non-existent. Overhead wiring for electrical distribution is somewhat erratic and hazardous. In terms of the average household a public electrification system will improve family health by Page 27 of 34
refrigeration of foods, better lighting for reading will motivate education, electrically operated grills and stoves will reduce hazards of open fires, applicances such as sewing machines and electric motor-driven craftsmen tools, etc., will enable establish ment of neighborhood service shops. To some extent all the fore going benefits are available through privately-owned generators, however, the quantity and quality of the electricity provided is uncertain. Public service will make it available to all and un doubtedly raise the standard of living by encouraging the seeking of employment and increased income with which to purchase household app"It ances and luxury items such as television sets. In most cases the cost of electrical energy provided by public service will be equal or less than the cost of that provided by the private suppliers.
3.55. Income is a determinant of the demand and consumption of electricity since it establishes the ability of a household to pur chase appliances and pay for their operation. (No data are avail able on income in the villages to be electrified. A $200 per capita income is used in the economic calculations, Page 18.) In addition growth in income creates markets for goods and services whose creation also requires electricity. The average annual consumption per domestic consumer has increased from 498 kilowatt hours (KWH) in 1965 to 762 KWH in 1974. These data were based on single-phase electricity usage which is limited to lighting and small appliances. Thus, actual usage with heavier three-phase motors, etc., used in house holds would be higher. Domestic consumption on the JEPCO system has grown at 15.3% per year since 1965 to 1974. The commercial sector of the economy represents a population serving activity and hence is related to domestic electricity usage. In the JEPCO system commercial consumption has grown at 16.1% per year since 1965.
3.56. The foregoing references to the economy have a direct impact in the population and the individual household and family structure. Most of Jordan's rural population, whether it be the subsistence dry-land farmer or the nomad who moves from place to place seeking employment as a migrant agricultural worker, are generally familiar with the benefits which can be derived from electricity. All have access to radios whether they be line or battery powered. Many have seen television and the basic household applicances such as electric irons, sewing machines, and hot plates. From these observations it is concluded that the proposed electrification project will not radically alter the basic cultural pattern of village life. Page 28 of 34
3.57. All the villages to be provided electricity under the loan are reasonably permanent with stable buildings of concrete block or stucco. Most villages have an acceptable infrastructure; access roads exist, drainage ditches have been constructed and potable water is accessible. Clinics and schools are staffed and functioning a mosque and church are also available. Privys are evident. All have some semblance of municipal government with police stations, post offices. Local industries and commercial activities would most likely include a gas station, machine repair shop, general store, baker, coffee bar, flour mill, clothier, olive presses, and central produce market area. All these commercial activities can be expected to expand with electri fication. Employment generation directly attributed to electricity will be minimal since few people are required to manage the utility for the main Amman office and to read meters and carry out minor installa tions and repairs.
E. Household Beneficiaries
3.58. The value that domestic consumers place on electricity is usually measured by what they pay for the electricity. However, the consumer may also anticipate other benefits including monetary savings resulting from the reduced cost over the alternative power sources (e.g., kerosene lamps or battery-powered radios or TVs). The consumer may also experience an appreciation for the unrestricted use of elec tricity when compared with a local generation system that functions only three (3) hours a night. A better quality of light from an electric bulb compared to that of a kerosene lamp. The convenience of an electric iron as compared with a charcoal iron or use of an electric grill when compared to an open fire or liquid fueled burners.
3.59. The cost of using an electrical appliance includes the cost of the appliance itself as well as the electricity consumed. Consumers may not be sophisticated enough to think in terms of annualized costs of appliances but they surely take the appliance costs into consider ation. The decision to connect may be anticipation of reduced costs of using some appliances, but generally such a decision is based on the qualitative benefits hopefully to be derived from hookup to public electric service. Page 29 of 34
3.60. The basis for the foregoing assertion that household demand for electricity is based primarily on quality and convenience con siderations, was revealed in a survey conducted in El Salvador, in which respondents who said they wanted electricity were asked why. In no case was lower cost given as the reason. Rather the respon dents stated they were looking forward to the convenience, re liability and continual availability of electric power.
F. Role of Women
3.61. While all village inhabitants will enjoy an improved quality of life when electric power becomes generally available after con nection to the grid, women will enjoy particular benefits because of the greatly enhanced possibility of using labor-saving household equipment. Most household work is done by traditional manual methods wfthout benefit of washing ac inese1ectric irons, refrigerators, etc. When electricity is available, use of such appliances becomes significant.
3.62. With the increased availability-of electricity in rural house holds, women will be able to perform their housework more easily and quickly, as well as benefit from the general improvement in living conditions through better lighting. Page 30 of 34
G. Repayment Prospects
3.63. An analysis of Jordan's balance of payments was recently completed by USAID/Jordan. The pertinent sections and tables of that analysis are reproduced in Annex B. This analysis notes the ratio of debt service to export of goods and services was 6% in 1976 which indicates a considerable capacity for increased borrow ings. This ratio has not changed substantially over the past four years during which time the ratio fluctuated from 7.3% in 1972 to 5.0% in 1975. It is not expected that the debt service ratio will fluctuate substantially over the next few years. This relative stabilization in the debt service ratio is predicated on the antici pated increased export of phosphates, other minerals and agricultural produce combined with the continued availability of concessional loans. The proposed loan, considering the concessionary terms recom mended and the amount of the loan, will have minimal impact on the debt service ratio.
3.64. The GOJ over the next two or three years is expected to in crease its indebtedness considerably through the development of a Potash production facility on the Dead Sea, construction of the Maqarin Dam for Jordan Valley irrigation construction of a fertilizer plant near Aqaba, and construction of water supply and sewage facili ties for Amman. Each of these projects will incur expenditures of $300 to $500 million and will require considerable foreign exchange financing. The effects of such borrowing will, however, not be felt until principal repayments comence, i.e., up to 10 years after dis bursements under the loans commence. Page.31 of 34
IV. IMPLEMENTATION ARRANGEMENTS
A. Implementing Agency - JEPCO
4.01 As noted elsewhere in this paper, the Jordan Electricity Authority (JEA) was established by law to generate, regulate and distribute, directly or through concession arrangements, electric power throughout Jordan. Their technical capabilities and organizational details are discussed in Annex C. The proceeds of the loan will be relent by the GOJ to JEA and, in turn, by JEA to the Jordan Electric Power Company (JEPCO), which has a concession area serving greater Amman.. (JEPCO has expanded its concession area to include all the villages to be electrified under the loan.) JEPCO's capabilities and organizational structure are discussed in Annex C. JEPCO has been the recipient, through JEA, of loans from the UK and other donors. The rate of interest on these loans varies. The reloans by JEA to JEPCO have been made with terms of 6% annual interest, a maturity of 15 years including a grace period of 3 years. The loan here proposed would be made available to JEPCO on the same terms, except at at interest rate of 7% which is the rate at which JEA now proposes lending to JEPCO.
4.02 JEPCO will have the full responsibility for constructing and operating the electrical distribution facilities for the 37 villages comprising the project,. for sales-io ultimate consumers, and for the reinforcement of the existing Ammansystem. JEPCO maintains an "in house" staff from a UK consultant, Kennedy & Donkin, which provides assistance in the design, construction, bid analysis and procurement. These services complement existing JEPCO staff to assure full technical coverage of JEPCO's responsi bilities. In view of JEPCO's expanded responsibilities for this project, the proposed loan includes a cost item of $500,000 to finance services including technical studies, procuremer- and supervision directly related to the AID project should there be insufficient staff or expertise in JEPCO to carry out the loan funded program in a timely manner.
4.03 Under the proposed implementation plan, Kennedy & Donkin and JEPCO, with such guidance and approval required from JEA, will prepare the detailed designs and equipment lists and specifications. These data, together with Invitations for Bids (IFB's)for the supply of equipment and materials, will be reviewed and approved by AID for procurement from suppliers in Code 941 countries, including the United States. JEPCO has procured supplies in the past from Pakistan, India and Korea.
4.04 JEPCO will warehouse all materials procured and issue them as needed to construction/erection contractors. JEPCO's capability Page 32 of 34
for storage and issue of equipment was reviewed during project design and found to be adequate. However, in view of the magni tude of procurement under this project, the JEPCO materials control procedures will be reviewed in more detail in the early stages of the project. Should inadequacies be found, recoin mendations for improvement, possibly including technical assistance, will be made.
4.05 The proposed project includes an estimated $1,280,000 intended to assist in financing the construction/erection of project elements. Prior to release of any loan funds for construction/erection, JEPCO will provide AID with a plan for carrying out all construction/erection services associated with installation of project materials and equipment. AID's contribution to this project element will in no event exceed 55% of the construc tion costs.
4.06 Loan funds for construction/erection will be disbursed pari passu wilh JEPCO, according to a participation formula agreed upon that contract. for JEPCO plans for contracting are still in formulative :,-aqes and its capacity for force account vis-a-vis private contrac tor is beinq reviewed. 4.07 Detailed plans for construction will be aqreed upon after JEFICO's plan for contracting has been submitted to AID.
W. AID Role In Implementation
4.08 USAID/Amman will provide the day-to-day implementation runctions of project development. Specifications, lists and conditions of the Invitations for Bids and contracts will be re viewed and approved by AID/W, except as otherwise agreed upon. All procurement will follow usual AID procedures. Monitoring of the implementation process, for both procurement and construction/ erection phases, will be accomplished by USAID on a continuing basis. The borrower, JEPCO, will submit periodic reports of progress which shall be the primary means of verifying project progress.
C. Implementation Plan
4.09 JEPCO and its consultants will prepare IFB's for procurement and plans for carrying out the construction/erection. Technical assistance is available through the loan to assist in any areas found deficient following development of these detailed plans. Typical areas where additional assistance, both long and short terms, might be required are: inspection and shipping services associated with the procurement; specialized review of design plans; electrical system studies; construction/erection/installation technical supervision;.and spare parts control. Services required ?age 33 of 34
wi II be und:r host. country contracting procedures. All procure ment is to be completed and equipment and materials on site prior to awards of contracts for erection.
4.10 Critical to the erection of project materials is the availability of concrete poles. Present pole production capacity is inadequate, but we have been advised by JEA that a second pole plant is being purchased. JEA will be required to submit evidence that local production of concrete poles will be adequate for the needs of the project before any funds will be disbursed.
D. Implementation Schedule
4.11 Loan Agreement Signed September 15, 1977 Initial CP's Met November 1, 1977 Bids Requested for Equipment & Materials Decwmber 1, 1977 Orders Placed for Equipment & Materials February 1, 1978 CP's Met for Erection Phase March 15, 1978 Equipment and Materials On Site May 15, 1978 AID Approval of Erection Contracts June 1, 1978 Construction/Erection Completed December 31, 1979 4.12 The disbursements for the procurement phase, estimated to be $7,220,000, will take place upon award of procurement contracts expected in February 1978. The estimated $1,280,000 to be used in financing construction/erection contracts will be disbursed over the estimated 1-1/2 year period required for erection and installa tion of the electrical distribution systems. The disbursement of funds for TA will take place over the life of the project. Any rusidual of funds not used for TA will be considered as eligible for financing construction/erection services.
E. Evaluation Plan
4.13 Evaluation of project purposes, which is cornectina most of the estimated 24,000 metered consumers to the public electrical system, can be verified by a review of the JEPCO records. Elec trical load estimates were based on anticipated time-phased requests for connections to the system prepared by JEA and JEPCO as reviewed by AID. Target numbers of connections can be conpared during the years following installation of the electrical distri bution systems. 4.14 By loan Implementation Letter, JEPCO shall be required to submit an annual report for five years following project completion, enumerating the status of connections to the distribution systems. The first report will be required to be submitted July 1, 1980, and shall list, by vil lage the number of connections made and power consumed. This report shall also identify, for each area, the number of consumers supplied low voltage service (400/230 volt for small industries) and high-voltage consumers (larger industrial users). Page 34 of 34
4.15 Targets for cumulative numbers of residential connections for years indicated are as follows: YEAR BAQA SCHNELLER 35 VILLAGES
1980 7900 3900 2500 1981 9300 4100 5700 1982 8800 4300 6000 1983 9200 4500 6600 1984 9700 4700 7200 4.16 Evaluation of project purpose regarding the upgrading of the Amman system can be made by determining operational status of control center in which loan-financed equipment will be installed and by com pletion of the entire system upgrading in which loan-financed trans formers are used throughout. The evaluation of control center status should take place in 1980 and the remainder of the system in 1981. F. Recommended Conditions Precedent and Covenants
4.17 In addition to the standard conditions precedent, i.e., legal opinion attesting to valadity of Loan Agreement, naming of borrower's representatives, and designation of JEPCO as being responsible for execution of the project, additional conditions precedent to disburse ment are expected to be: 1. Prior to disbursements of funds for procurement of materials and equipment: (a) An agreement between the GOJ and JEA passing the loan to JEA and evidencing authority of the JEA to release the $9 million to JEPCO; (b) A reloan agreement between JEA and JEPCO; (c) Submission to and approval of AID of detailed plans for layout of the distribution system, complete bidding documents, including technical specifications, and pro posed warehousing and inventory control procedures; (d) Evidence satisfactory to AID that an additional pole plant has been purchased and that acceptable plans for its operation have been made. 2. Prior to disbursement of funds for construction and erection: (a) Submission to and approval by AID of a detailed plan for construction or erection of the project facilities, including a schedule for contracting of such work as will not be performed by JEPCO; (b) A plan for establishing construction supervision; (c) Submission to and approval by AID of all bid documents and contracts for which AID funds are expected to be expended; (d) Evidence satisfactory to AID that an additional pole plant has been constructed and is capable of supplying poles of adequate quality needed for construction of the project in accordance with the construction schedule. ANNEXES
to
Project Paper
RURAL AND URBAN ELECTRIFICATION PROJECT
No. of Pages
A. Project Map...... 1
B. Repayment Prospects...... 2
C-I. Threshold Decision Based on Initial Environmental Examination ..... 4
C-2. Technical Analysis ...... 16
TABLES
C-1 JEA Estimated Generating Capacity, Capability and Loads (W). I C-2 JEA 132 KV System-Estimated Transformer Capacities for JEPCO Loads ...... I C-3 Items and Estimated Costs to be Financed by AID ...... 1 C-4 Items and Estimated Costs to be Financed by JEPCO ...... C-5 Estimated Costs of Elements in Equipment Installation and Erection Contracts ...... I C-6 Summary of Quantities of Materials to Serve 35 Villages...... 1
D. Economic Analysis' Tables ...... 16
TABLES
1 Jordan Rural and Urban Electrification - List of Villages by Stage, Population, Distance from Amman No. of Students and Availability of Health Clinic ...... 1 2 Power - Calculation of Average Annual KWH Consumption Per Connection in Villages ...... 1 3 Economic Rate of Return Calculation - Stage I Village Electrification - 1978-2000 ...... 3 4 Economic Rate of Return Calculation - Stage II Village Electrification - 1978-2000 ...... 3 5 Information on-Population, Students, Schools, & Health Clinics 2 6 Economic Rate of Return Calculation - Baqa Area Electrification - 1978-1990...... 3 7 Economic Rate of Return Calculation - Schneller Area Electrification - 1978-1.990 ...... 3 (Annexes - continued)
No. of -Pages E. Financial Analysis' Tables ...... 14
TABLES
1 JEPCO Income Statements - Actual 1971-1975 ...... 2 2 JEPCO Balance Sheet - Actual 1971-1975 ...... 2 3 JEPCO Income Statement - Actual 1976: Projections 1977-1985 .... 4 4 JEPCO Balance Sheet - Actual 1976: Projections 1977-1985 ...... 4 5 JEPCO Sources & Uses of Funds - Projections for 1977-1985 ...... 2
F. Social Analysis ...... 0 5
G-1. Five-year Plan Power Projects - 1976 - 1980 ...... 5
G-2. JEA National Rural Electrification Plan ...... 7
H. Tariffs ...... 5
I. Logical Framework ...... 1
J. Borrower's Application for Assistance ...... 2
K. Statutory Criteria - Project Checklist & Standard Item Checklist.. 9
6 L. AID Director's 11(e) Certification ...... I
M. Project Loan Authorization Document ...... 3 Page 1 of 1
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------ie / . .
.'r U' - •VILLAGE 133 XV ELCTIFC/O MAD-- -3FAIA I v '":~j,7#IIKV 3- - INS l6oiittmm Loca o..rIAL,, ,3K, .. :" -ssi, *"Wq 4 AM -~ g1- SI t i . a ....b ~i - ANNEX B
Page 1 of 2 REPAYMENT PROSPECTS
Jordan suffers from a chronic Balance of Trade deficit, with exports of goods offsetting only about 25% of commodity imports. Despite this structural problem its overall Balance of Payments has been in slight surplus as grant aid from abroad, and rapidly increasing re mittances from Jordanians working abroad, together compensate for much of the trade gap.
US DOLLARS 1973 1974 1975 1976 Goods & Services -182.4 -251.4 -355.2 - 324 Import of Goods -323.4 -467.1 -698.7 -1005 Export of Goods + 69.0 +149.4 +146.7 + 207 Net Services + 68.7 + 66.3 +197.1 + 474 Transfers +193.8 +260.1 +419.4 + 381 Private + 10.5 + 6.9 + 5.4 2 Government +183.3 +253.2 +414.0 379 Current Acct. + 10.5 + 8.7 + 64.2 + 57 Capital Acct. + 22.2 + 31.5 +133.8 - 52.5 Private - 0.6 + 2.1 + 20.4 + 10.5 Government + 22.8 + 29.4 +113.4 - 63.0 Basic Balance + 33 + 40.2 +197.4 + 4.5
As shown in the Table above, Jordan's commodity exports tripled from $69 million in 1973 to $207 million in 1976. Expanded phosphate exports ($12 million in '73 and $58 million in '76) account for much of the increase but fruit and vegetable exports, mainly to neighboring Arab state%, also have risen markedly - $13 million in 1973 to $59 million in 1976. These two categories represent more than 50% of all commodity exports with no other single item of much importance. Despite this impressive performance the Trade Balance has worsened since imports too have tripled, starting from a much higher base - $324 million in '73 to $1,005.million in 1976. Consumer goods account about $300 million, or 40% of the total, falling from 45% in 1973. Capital goods imports rose very rapidly from $60 million to approxi mately $345 million in 1976, a more than five-fold increase and reflection a of Jordan's growing developmental effort. Raw material imports too nominally quadrupled to about $270 million in 1976, but perhaps $100 million of this increase is the result of a new negoti ated price of oil which took effect in 1976. The growth in consumer Annex B
Page 2 of 2 Repayment Prospects - continued
good imports is essentially a function of rising income and infla tionary pressure in Jordan. The Jordanians have not modified import regulations or custom duties, both of which compare favorably with other developing countries. The striking increase in overseas remittance, and growing public sector expenditure greatly stimulated the economy, in turn giving rise to the sizeable increase in con suxner imports.
In 1973 remittances officially recorded approximated $195 million. As the oil rich Arab states expanded their development expenditures, salaries rose and remittance more than doubled to $372 million last year. The total net service income in 1976 was $580 million as opposed to only $66 million in 1973. This nine-fold increase, to gether with official transfer payments of about $380 million in 1976 more than offset the trade deficit. Central government trans fers were about $185 million in 1973.
With the capital account showing a surplus of $22 million in 1973 and rising to $135 million in 1976, as GOJ loan disbursement expanded, Jordan's basic Balance improved from $33 million to $198 million during the period.
Foreign exchange reserves stood at $618 million at the end of last year representing about eight (8)months commodity goods imports. The 1973 ratio was about the same. During t a same period the debt service ratio (interest and principal payments on external debt divided by total foreign exchange earnings) declined from 16% to 6%. This ratio indicates considerable capacity for increased borrowing.
It will take at least 10 years for Jordan to significantly improve its Balance of Trade situation. The 1976-1980 Development Plan proj etss unrealistic increases in exports, but we are reasonably optimistic about the export picture over the longer run. Fertilizer and phos phate exports of up to $200 million could be reached by the early 1980s, given the status of current investment plans. Potash and other Dead Sea minerals also look promising. A current study indicates such exports of perhaps $100 million are possible by mid-1978 to late 1980s, as the capital projects in the Jordan Valley are completed. Agricul tural exports from this region too should expand rar idly to fill what is an almost unlimited demand in the Arab States. Tourism also, given peace in the region, could loom large as an export earner in the ser vice category. Jordan's Balance of Payment situation will justify economic assistanc and concessional lending for many years to come. However, over the longer run the prospects are reasonably good. Jordan's long border with Israel gives it a major political importance which, in the short run, should continue to make Jordan a prime source for donor assistance. Barring war we do not envisage a weakening of the Jordanian dinar nor in Jordan's ability to repay its foreign debt. draft/fedet ANNEX C-1 Page 1 of 4
Threshold Decision Based
on
Initial Environmental Examination
PROJECT LOCATION: JORDAN
PROJECT TITLE: Rural and Urban Electrification
FUNDING: FY 1977 - $9.0 million
LIFE OF PROJECT: Three (3) years
lEE PREPARED BY: Robert F. Fedel Date:8/9!77
ENVIRONMENTAL ACTION RECOMMENDED: Negative Determination
BUREAU FOR NEAR EAST DECISION:
APPROV ED ______
DISAPPROVED:
DATE: L,4 / /f77
Clearan : rj/ GC/NE: -Date SER/ENd: Date &"t
A discussion of the cultural and socioeconomic impacts is found in Environmental Considerations Section, page 16; Social Analyrsis, page 26; and Social Analysis, Annex F. ANNEX C-1 Page 2 of 4
[I4PAcrT' I D,:12lIFICA'11OI1 AIMD KVkALUATOIZ Fcjr'.Mj
Impact Identification ]invae:t Arenas and'ub-areas l/ and Evaluation 2
A. IAN) I); :
I. Changing the character of the Land through:
11. Tncreasing the population ------N b. Extracting natural resources ------N
C. Land clearing . .L
d. Changing soil character - NN----- 2. Altering natural defenses ------N
3. Foreclosing important uses ...... L I. Jeopardizing man or his works ...... N
5. Othvr factors
B. WATER QUALITY
1. Physical. state of water ------N 2. Chemical and biological states ------NN---
-. Ecological balance ------N It. Other factors
_/ :;, }i:xplanatorv Iotes for this form. / 1J:;e the following symbols: I -No environmental impact L - Little enviroruental impact M -Moderate environmental impact S- High environmental impact ) -Unknown environmental impact Augu,:*jt 1976 ANNEX C-1 Page 3 of 4
IMPACT IDENTIFICATTOIH AND E-VALUATION1 FORM C. ATMOSPHERIC 1. Air additives N 2 Air pollution ------N
tiI.-l. pl0 tion ------N I.Other fnctors
1). NATURAL RESOURCES
1. Diversion, altered use of water N
2. Irreversible, inefficient commitments N
3. Other factors
I. Altering physical symbols ------N l)ilution of cultural traditions ------L 3. Othr iactors
V. I3OCIOECO1JOioT C
1. Changes in ecorlomic/employment patterns ------M
Changes in population ------N
.. ChWIE~os ini cultural patterns ...... 1. Other factors ANNEX C-I Page 4 of 4.
IMPACT ]IDENIFICATIO11 AND EVAIUATIOil FOWI-. r, I 'll
I. Chtuiging a n.atural envirornent __N Eimi": Intinrig tr ecosystem cOlement ...... N . Other f'Wt0lis
I. Ili'r1ILLi clzi] impacts ------N ' •,OIIL2'DVUI' t impacts ------N 3. Larger progi-wn impacts --- N 4.Other fa. ,s
[ OPIIEl~ I.... .,Jl, 1!.IPACTS (not listed1 above)
A discussion of the cultural and socioeconomic impacts in Environmental Considerations is found Section, page 16; Social and Analysis, page 26; Social Analysis, Annex F. ANNEX C-2 Page 1 of 16
TECHNICAL ANALYSIS
Considered in this section are the aspects of the Project relating to the existing power supply system for the city of Amman and the surrounding area, the expansion of this system to serve two areas within Amman and 35 villages in the vicinity of the city, and the reinforcement of the system within Amman by the installation of transformers and cables.
1. Introduction
The city of Amman and the surrounding area has been served for many years by the Jordanian Electric Power Co., Ltd. (JEPCO). Diesel units located within or near the city have been utilized to supply the power needed. About 11 years ago the Jordan Electricity Authority (JEA) was created with the responsibility for bulk power supply to Amman and to other areas.
The present and projected future arrangement is for JEA to own and operate the generating station and 132 KV transmission lines and 132-33 KV substations, and for JEPCO to own and operate the 33 KV subtransmission lines, the substations stepping down to primary dis tribution voltage, the primary distribution lines, the transformations to secondary voltage, the secondary lines, and the customer services and meters.
The electrical system components to be financed under the loan relate to: (a) the 33 KV system; (b) the substations for stepping down to primary voltage; (c) the primary distribution system; (d) the transformations from primary to secondary voltage; and (e) the secondary distribution system. The services connecting customers to the secondary system are not included, since it is JEPCO policy to charge the customer for the installation of this service. As regards meters, a monthly charge is made for the meter to cover the cost of its installation and maintenance. Service conductors and meters will be obtained as part of the regular purchase items by JEPCO.
Power supply systems in Jordan are designed to conform with applicable codes covering such items as strength of structures and conductors, and clearance from energized conductors to ground. Materials procured under the loan will comply with accepted U.S. standards of safety and operation. Page 2 of 16
2. Generating Capacity
The capacity and capability of the generation system was reviewed to assure that power is available to serve the distribu- Lion equipment to be financed by the AID loan. Table C-1 shows the projected capaci+y and capability of generation and the estimated loads by generating stations for the next 10 years. This information, supplied by JEA, is based on the latest available estimates of future loads.
The table shows that with the indicated reliability criterion, loss of largest generating unit at the time of annual peak load, the estimated peak loads in 1979, 1980 and 1982 are approximately equal to the firm capability. In these years, loss of the largest unit at the peak time may require load reduction. In other years Lhc planned firm capability is adequate for the estimated peak load.
3. Transmission and Distribution Systems
Following is discussion of the transmission and distribution systems in Amman and the surrounding area. Comments are made as to adequacy nf the transmission system. Conclusions are drawn fcr the sub-transmission and distribution systems. These conclusions affect Lhe selection of equipment to be financed by the AID loan. This equipment is discussed in the following section.
The transmission voltage of 132 KV is now established and with Ihe planned expansion is adequate for the projected loads. Proposed capacities of substation transformers serving JEPCO loads are shown in Table C-2. These transformer capacities were selected for a load level which is approximately 59 percent higher in 1983 than the revised estimate which is shown in the table and are greatly in excess of revised load requirements in all locations. Transformer capacities are from Kennedy and Donkin "Planning Report for 33 KV Dist.ribution - Network Reinforcements for 1978 to 1983".
The 33 KV system is used both as a subtransmission system stupping down to 11 KV and 6.6 KV primary distributi,,n voltages, and as a distribution voltage stepping down to 220/380 Volt secondary. It Is concluded that for service to the villages in outlying areas, the single transformation from 33 KV to 220/380 Volt secondary should be utilized where feasible rather than the double transformation from 33 KV to 11 KV or 6.6 KV primary and then to secondary voltage. It.is recognized, however, that it is more economical to make short extensions to existing ii1KV or 6.6 KV systems to serve small loads. Page 3 of 16
It is understood that the present 6.6 KV primary system is to be converted to 11 KV utilizing transformers with 6.6/11 KV primary windings that have been obtained for this purpose. For this technical analysis, the primary distribution system is considered to be 11 KV with the 6.6 KV lines converted to the higher voltage. The actual rate of conversion will not affect items procured under the Project. The secondary voltage is 220 Volts line to single phase neutral. For installations discussed in this the following section of report, this voltage will be 220/440 Volts single phase in addition to the 220/380 Volt three phase system now used. Locations of the 132 KV transmission the lines and substations, overhead 33 KV lines and substations, lines and certain 11 KV overhead which are of interest are shown on Map (AnnexA). Also shown are the extensions to existing lines included in the Jordan Electrification Program as discussed in the following section. The underground portions of the 33 KV and 11 KV lines in congested central area in Amman are omitted from the map to improve clarity of illustration.
4. Items in the Overall Project to be Financed by the Loan The items financed by the loan are discussed and in this section the items to be financed by JEPCO are discussed in the following section.
AID financed items consist of: (a) extensions lines to 35 of electric rural villages and to the Baq'a suburban and Shneller areas of Amman; (b) materials for reinforcing transmission the existing JEPCO and distribution systems; (c) installation of a control center; (d) purchase of equipment used in installation and construc tion; (e) a portion of the local costs for erection and installation costs; and (f) engineering services as might be required for supervision. The estimated costs of the entire project The are shown below. total project cost is $14.5 million with $9 million financed by AID and $5.5 million to be funded by JEPCO. Foreign exchange and local cost items of project financing are shown in tables C-3, 4 and 5. Page 4 of 16
JEPCO AID ITEM FINANCING FINANCING TOTAL
Materials Procurement: For 37 Villages $2,384,000 $4,665,200 $ 7,049,200 For Amman System 1,026,000 1,550,000 2,576,000 Erection Equipment 350,000 350,000 Inflation 300,000 654,800 1,154,800
SUBTOTAL FOR PROCUREMENT $3,910,000 $7,220,000 $11,130,000
Erection $1,090,000 $1,280,000 $ 2,370,000 Engineering Services 500,000 500,000 1,000,000
TOTAL PROJECT COSTS $5,500,000 $9,000,000 $14,500,000
a. Service to 37 Villages
The selected villages were inspected and divided into two categories. In the first category are those in which most of the land is occupied by houses that are generally continuous along the main streets. For these villages, it is proposed to supply three phase service from 220/380 Volt, 3 phase secondaries as is done within the city of Amman.
In the second category are the villages in which the houses are scattered with much vacant land between houses. For these villages it is proposed to supply single phase service from 220/440 Volt single phase secondaries. Although the estimates of transformer sizes are based on the total number of people in the village, not all of the houses will be served initially. When the detailed layout is made, a transformer will be located near a center of houses and the secondaries extended to serve several houses. At any time in the future, the secondary lines may be extended, or three phase service may be provided by the addition of transformers and an additional conductor to the distribution primary and to the secondary lines. All equipment to be procured is suitable for eventual use at three phase.
Tables C-3, 4 and 5 indicate the items to be included in the Project and the estimated costs. Table C-6 lists the items as calculated for each of the 37 villages. Tables C-3 and 4 have the item breakdown for P;iq'a and Schneller. Steel lattice poles have been included for use in mountainous areas where it is impractical to transport the heavier concrete poles used in level areas. Page 5 of 16
b. Items for Reinforcing the JEPCO Urban System
Tables C-3,and & list the items to be procured for the JEPCO urban system. Included are 100 MVA of 33-11 KV transformers (Item 3, Table C-3). "JEPCO Proposed Development Program, 1977 1979" indicates that these transformers will be needed for all high voltage expansion proposed within that period. Also included is a Control Center for indication of status and control of operation of major equipment in the JEPCO power system. It is reported that pilot wires and auxiliary relay contacts have been provided in anticipation of installation of the Control Center. The original installation considers future expansion as needed for the growing JEPCO power distribution system.
c. Erection and Installation Machinery and Equipment
Installation equipment, including trucks with hoists of sufficient capacity to handle distribution transformers and the smaller cable reels, is to be procured under the loan. JEPCO now uses contractor's equipment for transport of materials. It is concluded that trucks of moderate size (3 ton capacity) will improve effiriency in the movement of materials for maintenance and small line extensions. The use ot back hoes should facilitate trenching in soil containing rocks. Specifications for this equipment will be prepared along with those of electrical items for a U.S. pro curement IFB.
d. Price Escalation
A value approximating 10 percent of material costs is included for price escalation.
e. Services for Erection and Installation
Estimates for eq.ipment installation are shown in table C-5 and are based on historical JEPCO costs. The total estimated installation costs ($2.37 million) includes funds remaining in the AID loan following procurement and the remainder for financing by JEPCO. The JEPCO portion will include all of the civil works for substations and part of the material installation. Details and comments on availability of local and offshore contractor services is noted in Section 6 below.
f. Systems Studies and Expediting and Constructin Supervision
Before specifications are written for materials, it will be necessary to make system studies to determine voltage drops and fault currents for the coordination of protective devices. After orders are placed, factory inspection should be considered to ensure Page 6 of 16
materials compliance with specifications. Expediting might be necessary to make certain that materials are delivered in time to meet desired construction schedules. Construction supervision is necessary to ensure that field construction is carried out as scheduled.
g. Items in the Overali Project for Financing by JEPCO
As shown in table C-4, the materials to be supplied by JEPCO consist of poles, circuit breakers and underground cables. As regards poles, JEA has assumed responsibility for supplying and selling concrete poles to JEPCO. Capability of JEA to produce the required number of concrete poles is discussed below in paragraph 8. The costs shown are at the present level at which poles are supplied by JEA to JEPCO.
The 11 KV circuit breakers required for system expansion will be financed by JEPCO since substations now in operation and under construction are designed for installation of a non-U.S. type of circuit breaker which nas been in regular use by JEPCO. Expansion of existing substations using another type of circuit breaker obtained in the U.S. could require considerable rearrangement in these substations to accommodate the new type of circuit breaker The problem of keeping a sufficient inventory of spare parts would also be made mor., difficult. For these reasons the 11 KV circuit breakers shown in table C-4 are to be procured by JEPCO at the current prices.
Although the primary and secondary systems for the 37 villages and for Baq'a and Shneller areas are shown as consisting entirely of overhead lines, it is realized that detailed layouts may indicate that short sections of underground cable may be needed to obtain desired clearances from existing structures. The item in table C-4 for underground cable to be supplied by JEPCO is intended to provide needed sections of underground cable. The types of cable now used by JEPCO are not generally manufactured in the U.S. Introduction of U.S. cable practices would require a training program for the JEPCO cable splicers and is not believed to be justified by the relatively small amount of cable involved.
A portion of the installation and construction services is assigned to JEPCO as indicated in table C-5. Civil works for sub stations are to be provided entirely by JEPCO. This item consists mostly of labor, cement, sand and aggregate and reinforcing steel obtainable in Jordan. It is concluded that the buildings now used are more elaborate than necessary and that walls to enclose the equipment would be adequate for future installations.
Detailed circuit layouts are required to select circuit the primary routes, transformer locations and the routes of the secondary Page 7 of 16
lines. The secondary line layouts will require careful consideration, and it may be necessary to consider alternatives to obtain the more efficient arrangements.
An estimate of 10 percent for inflation is shown for the JEPCO portion of the project including materials installation and detailed layouts.
5. Equipment Compatibility
For the items to be procured with loan funds, such as con dictors for overhead lines, circuit reclosers and isolators, and transformers, there is no problem of compatibility with the equip ment now used. If the conductors supplied are of U.S. wire sizes in circular mils, connectors must be selected that will accommodate both the circular mil wire sizes and the square millimeter wire sizes now in use. This can be accomplished by JEPCO engineers without difficulty.
Since procurement item aluminum conductor and steel core conductor are new additions to the JEPCO plant, a training program in splicing and handling these items will be included as part of the materials procurement IFB.
6. Availability and Capability of Contractors
Interviews were conducted with four contractors selected by JEPCO as the more capable organizations in Jordan. ThI-se contractors are as follows:
Electro-Mechanical Contracting Electrical Contracting Office Co. WR Abdul Hadi and -. Hamdi and Ibrahim Man,jo Co. Ltd.
Each of the contractors employs ma',agement and engineering personnel who seem capable of project Edministration.
It I I .- ,A, -u I -. & -1-i, I .l a 1". 4 t .!J . -r b,..1l 1-, , _ 1 ..- S a a Because of the much higher wages offered in Saudi Arabia, Jordanian workers are moving to Saudi Arabia in large numbers.
Each contractor indicated that it would be necessary to bring workers from other countries for temporary residence for the duration of the job. Countries mentioned for obtaining trained workers were England and West Germany. Countries identified as sources of untrained workers were India, Pakistan and Egypt. JEPCO concurs in the necessity for importation of workers from other countries.
It is reported that JEPCO has been having approximately 50 percent of its work done by contractors, including the larger jobs. It is expected that this policy will continue in the future and that a considerable portion of the work in the Project will be performed by contractors. Page 8 of 16
7. Engineering Services
As shown in table C-3, AID funding is provided for system studies, expediting and supervision in the event such services are not otherwise provided by JEPCO or its consultants, Kennedy & Donkin. Services include studies of voltage drops to the consumers near the end of secondary lines to make certain that the voltage provided at the time of peak load is adequate for the operation of appliances. Also included is investigation of short circuit currents at critical locations to check adequacy of reclosers and fuses for maximum and minimum short circuit current values.
During the time of manufacture of the equipment, contact should be maintained with the manufacturers to ensure conformance with purchase specifications. Expediting should also be performed so that the equipment will be shipped at the time needed for con struction schedules.
Observation of conditions in Jordan indicates a shortage of personnel with the training necessary for supervision of the con struction program. Such supervision is necessary to ensure the success of the program.
It is concluded that for the system studies, material inspection and supervision of construction, the services consultants of U.S. might be required. The availability of such consulting services will be determined and reviewed during loan implementation. Tn the JEPCO financing shown in table C-4 is an item for engineering design and layout. Plans have been made by JEPCO to utilize their consultant, Kennedy & Donkin, for the preparation of detailed layouts of primary and secondary distribution lines, and the preparation of equipment specifications and tenders. This arrangement can be implemented promptly and seems adequate to produce the desired result.
8. Technical Capability of JEA and JEPCO The JEA and JEPCO organizations were visited several times and discussions held with key personnel. The following observations are based on the visits and discussions.
a. JEA Capability
The JEA was created about 11 years ago with the responsi bility for generation and high voltage transmission. At the present time the organization is growing rapidly with a reported increase in personnel of about 20 percent in the first three months of 1977. As Page 9 of 16
of March 31, the organization was as follows:
Employees Administration, Finance, Auditing, etc. 85 High Tension Power Supply 202 Generating Stations 257 Transmission and Distribution 44 Concr-.e Pole Plant 45
Total 633 The management personnel interviewed seem to be capable. If the organization can continue to expand to conform to the growing work load, it seems to be adequate from the administrative stand point.
Shown in the above table are the personnel for the concrete pole plant which is owned and operated by JEA to supply poles for both JEA and JEPCO. It is reported that the present capacity of the plant is 10 poles per day and that it will be increased to 17 poles per day in the near future, or about 102 poles per six day week. For the estimated 14,000 poles needed for the proposed project, about 137 weeks or 2.64 years would be required to produce the poles. This is with no allowance for holidays and other lost time and assumes all the poles produced are made available Project. for the In addition to the normal growth extensions, other projects are contemplated that will require large quantities of poles. Thus it is evident that the pole production capacity must be increased in the immediate future. Guarantee of supply of poles for the Project, either by large expansion of concrete pole produc tion, or by alternative procurement, will be noted in the loan agreement since a supply of poles is the most critical item in the Project.
The maximum pole length of 11 meters is somewhat short for distribution primary lines in many instances. JEPCO has developed steel extensions for these poles to increase their height above ground and these extensions are judged to be satisfactory. The quality of the poles produced by the JEA plant varies. The poles are made of prestressed concrete and the steel wires are tensioned individually. Poles in storage piles with obvious bends indicate that the tensions in the steel wires are not uniform and that the full strength of the prestressed pole is not being developed. Tensioning of all wires simultaneously would ensure uniformity of tension and would at the same time speed up the process. Page 10 of 16
Inspection of the aggregate in the storage pile indicated that the material was of poor quality with an excessive amount of very fine material. There was no evident control of amount of cement in the mix or of water-cement ratio. Crumbling of concrete in poles in storage piles indicates that the spinning process used is not producing dense uniform concrete. Review of quality control procedures is needed.
Observed handling of poles with hand operated hoists is obviously a slow process. Use of electrically driven hoists could reduce materially the handling time per pole.
These items have been brought to the attention of JEA and JEPCO.
b. JEPCO Capability
JEPCO and predecessor company have been in operation since 1938. The Company is controlled by a Board of Directors, which includes shareholder representatives, the Director General of JEA and a representative of the City of Amman.
The chief' executive is the Chairman of the Board. He is assisted by three managers, the Technical Manager, the Administrative Manager, and the Financial Manager. In the Technical Section there are 35 Engineers and 7 Assistant Engineers, with 206 trained technicians and 300 laborers. Total personnel for the Company is about 1,050.
The personnel interviewed appear to be capable. To assist in engineering planning, a firm of British consulting engineers, Kennedy and Donkin, has been employed continuously for several years.
The proposed project specifies single phase extensions to remote villages. The extension of lines to these villages and the use of single phase are both new concepts for JEPCO. After con siderable discussion, the single phase concept has been accepted without reservation.
inspection of JEPCO facility for storage of materials and supplies indicated that adequate space is available with the present level of activity. Additional space for outdoor storage can be made available by a small amount of grading and the erection of a fence around a plot of ground now owned by the Company which is adjacent to the present storage area. It is concluded that the materials and equipment to be procured under the loan should be stored in the new area and kept entirely separate from the general company stores in the present storage area. Such recommendations will be noted in loan implementation letters. Page 11 of 16
9. Overhead vs. Underground Cables
After inspection of the villages for which power is to be provided, it is concluded that overhead construction for both primary and secondary lines should be used in all locations where adequate clearances may be maintained at the time the lines are constructed. It is reported that JEPCO has been replacing over head lines that have been in existence for many years by under ground cable because structures were constructed under these overhead lines at a later time. Materials and services for this replacement program will not be funded under the loan. TA3E C-1
JORDAN ELECTRICITY AUTHORITY
ESTIMATED GENERATING CAPACITY, CAPABILITY AND LOADS (MW)
1977 1978 1979 1980 1981 1982 1983 19841985 1986 1987 Station Capacity
Marka & Irbid 45 45 56 56 45 45 39 34 32 29 29 Hussein (Gas Turbines) 34 34 34 34 34 34 34 34 34 34 34 Hussein (Steam Turbines) 66 99 99 165 231 231 297 297 297 Subtotal 397 397 145 178 189 255 310 310-- 370-0 365 363 460 460 South Jordan NC NC NC NC NC 94 127 Total 127 193 259 325 145 178 189 255 310 404 497 492 556 719 785 Station Capability. Marka & Irbid 43 43 53 53 43 43 37 32 30 27 27 I ~0 Hussein (Gas Turbines) 32 32 32 32 32 32 32 32 32 32 32 Hussein (Steam Turbines) a 60( ) 9 0 (b) 90 150(c)21 0 () 2 10 270 270 270 370 370 Subtotal (13-5 175 235 285 285 339 34 332 2 U South Jordan NC NC NC NC NC 88 118 118 178 238 298 Total 135 165 175 235 285 373 457 452 510 7 727 Firm Capability (Send-Out) 105 135 145 175 225 313 397 392 450 597 657 Loads JEPCO & Irbid 90 110 147 174 194 216 234 259 288 319 354 South Jordan NC NC NC NC NC , 98 104 112 133 142 159 90 110 147 17- 194 314 338 371 42-1 461- 513
NC - Not connected to transmission system. (a) These units are now constructed and are in the trial operation stage. (b) An additional unit is under construction. (c) Tender documents have been issued for these units. 2-2
JORDAN ELECTRICITY AUTHORITY
132 KV SYSTEM - ESTIMATED TRANSFO.ER CAPACITIES FOR
JEPCO LOADS
1977 1978 1979 1980 1981 198.2 .1983
Marqa - Transf.Capacity 45.0 45.0 45.0 90.0 90.0 90.0 90.0 Diesel Genr - Mg 45.0 45.0 45.0 45.0 2 34.0 34.0 28.0 Total Cap. (approx.) 90.0 90.0 90.0 135.0 124.0 124.0 118.0 Load 39.7 42.1 -41.0(2)45.5 51.3 47.2 53.8 Bayader Transf Capacity 45.0 45.0 90.0 90..0 90.0 90.0 90.0 0 Load 38.3 47.7 -40.1" 46.9 45.6 54.2 - 63.0 Amman-South- Transf. Cap. (1) - - 90.0 90.0 90.0 90.0 90.0 Load - - -25.0 29.6 17.5(3) 16.6 18.8 Amman East- Transf. Cap. - - - - 90.0 90.0 90.0 Load - - - - (2)26.5 54.0- 61.0 Hussein- Transf Cap. 30.0 30.0 30.0 60.0 "60.0 60.0 60.0 Load 22.0 26.2 -25.9 30.0 33.1 29.0 _ 34.4
Total Capacity 165 165 300 375 454 454 448 Total Load - MVA 100- 116 132 152 174 201 231 - 1W 90 104 119" 1_7 157 181 208 ia W
(1) New airport and rural loads not included Loads and transformer capacities are in MVA (at 0.90 power factor) unless indicated otherwise, Transformer, capacities are from Kennedy & Donkin "Planning Report for 33 KV Distribution - Network Reinforcement for 1978 to 1983': Load estimates have been reduced -since this report was issued and the reduced values are shown. (2) Tender documents have been issued (3) Site has been selected. TABLE 0-3 Page 14 of 16 TT.:.'3 AYD 'TTW*t'.D COSTS TO 3?:.9FINAliC7 EY A-D
1 ' %i 35 . " ' ,.' ( -.S Dol l ar. .; ",-I;t ,ost/Unit vantity Cost vrhcal Primary ijns 3' KV I Ph-r,! Km 10,000 15 150,0OO 33 KV 1 Phase Km 9 11 80Y 756,000 KV 3 Phase Km 9,000 16 ;IKV I1'1,0OO 1 Phnsi Km 8,4ie 1 t latticeL' t., 400 Potes (for mountains) rZach 2,000 420 91, O000 3 Phase Fuse Tnstall.tion Each 1,500 5o 75,000 0 pnOO, Polci 3 Ph. Is Isolators wilh r oeratin d , oes r g dsEach 400 go 80,000
33 KV Reclosers with Isolators Each 10,000 Transf, Oroxindinrormers - Equiomnnt 'rDr 5tations o 5 50,000 Lt 1057 5,7 00 A 33-0.4K' 3 Phase 3ach 2,00 8 100 VA 33-0.4KV 1 7ha:3e Each 1,200 27 32,10,19,200 300 KVA 11-O. 4 KV 3 ?h,;se Ea-h 3,000 9 27,000 100) K',. 'l-o.,lyqv 1 Ph''se Each 1,000 3 3,000 virh-ad Secondary Lines h W. 220/-3b0 Km 5,500 15L 3 Wir 220M.tIO 90,000 Km 4,000 226 904,000 2_. ",Ri RAQ':\ and SC ..
rv,,nrh'ad TLnn 3, - 3 "hase Km 10,000 3 30,000 203l11 t1V V- ? hqsehKm .000. 9,000 9 31,000 220/3.q0 Fm ,500 91 500,50 'Trans,formors 500 KVA 11-0.h Each 4,000 10 5 K..A 33-]I 40,OO KV Each 60,00c 1 33KV Isolators 60,000 Each ,O00 3 12,000
3. y, i ' ~t !.T O' A-7 'A SYSTEM
Remotn control, push button type, Electrical Control Unit 350,000 Transformners for Eypanolon "Program 100 f1VA 33-11 IrV ransfgrmer Each VA 12 100,000 1,200,O,30
,,4.1:?'I ,, T .. "
3 Ton Trucks with mnn'r-2.'d ist Post Hole Digger Attachments Prck 71oo type 3hove ls 350,000" 5, CONTRACT COYSTS POR CO ISTWK'.'rPO.N AND iSTALLATiON Resilu'l Loan funds available to participate in loca! cost or foeign '7xchno Cinancing of contracts for erection and installation. 1?80,00 ** 6. -- p rrT,7,,S3...,FOR C07'T: !JCTTONAm,1) INSTALATION 500,000 7. IW"'LATTON FACTOP!0R POCUREIT!.NT iTET.K, 10% 65,s900
!*LQ.'A, COS.T ITEM, ALT ' .TOTAL COST ITEMS FOR LOAN FINANCING 9,000,000 TABLE C-4 Page 15 of 16
T1rr3N)TYTAP CS2PC3 rCED B3Y JE-PC0 ' SDollars
Mat:i, 1:
P .r.,"- ' ...... : I.9 1,000 $ 200,000 * PoC)Ih:';,,ir I[ V T.P E Tinrs L3,000 2,181,000 * 'Irrc roun 1'n1"rs12- 350s 000 llnrhrground Cnbl° 676,000 (rirnt C'-v ts for Con:struction Inst af.t.n 1,090,000*
l" 'rine'Pr n . :in ,n, Layout 500,000 *
Tnrl: tinri qrxsti 50,000 TOTAL COST O Ir .S -'T'ijC7-D.•.,Y JE1C0 $ 5,5oo,o * Itrr,: for T.ocal Cost Finncing l'[.) 001,00 T-ora]. Cost Fi..cing
TABLE C-5
"[TTAT'nrc'm;-'C!' ,LM,.NTS IN EQPIIP .ENT 7,49TA .rATIO;. ;U',' E.W,.CTTON C01NTT,. CT , -T 'S Dollnrs
Delivering of poles to locations $ 22r,000 Hloles for pOle; u1nd guys ]i",€,'' Installation of poles and guys 192,000 Installlation of conductors and connections to transformers 180,000 Installation of 57 rural type ground mounted transformer stations including fences and civil works 79,000 Installation of transformers, reclosers and isolators 100,000 Equipment transport, storage and insurance 160,000 Cable installation 580,000 Civil works - 5 ground mounted 33-11 KV substations 710,000
' 'A '.TT,,.T'.. t A';11 -ECTION CUSTS $ 2,370,000
A,;'TNT TO 7 ' BY AID LON $ 1,280,000
AMOUi,T[T) ME "MITANCEZ 7%j3PCO $ 1,090,000 Note: 4I Equipment Installation nn:i Fr,'ction contracts will be Local Co7t unless carried out by offshore oligibl.e country contractors. ST A1VAIABLE COPY Line Lengths j Transformers-K1VA Line Le.%ths 33-0.LKV 11-0.4 KV .. illages (35) 33 11 KV 33 XVN 200-VAJ10KVA1 130O:-VA 100,1A 220/3S0 -V220/44 _Phase !Phase 3Phase iPhase Recloser 3Phase !Phase 13m.hase lPhase 3Phase iPhase
1 Juweida,Tabia& - huribat 3 4 20 Ja.-a 2 1 5 ".'a 'in 7 2 21 2'anj a 1 1 4 Qusair &. .:ugablain 4 2 10 Rumeinmin 1 7 Um Jauza 1 1 7 Zai, Sabeihi, Allan & Jm Elamad 11 1 4 28 lhildp,Tela'al Ali & Im El Sumna 7 3 46 Tabarbour & Nwigis 1 2 7 :-ujm :Esh Shami, -*1 Faisalyla, - Buwaiyda .1 Mttalla & !.u:aggar 6 16 1 2 9 25 81 -.ashiriya 3 2 1 20 9 arishiyat & Hisban 10 1 3 25 11as11 1a 5 Y1"Pzza, Um Abhra & Iraq El Ar 13 1 3 1 18 Marj' :.T-,m! _ 3 11 :39 Ira Yarga 2l Abu ']useir 2 1 7 LNuzha 1 i 12 15: 16 1 27 9 3. 15)1 22!. -1- ANNEX D Table 1 JORDAN RURAL AND URBAN ELECTRIFICATION
List of Villages by Stage, Population, Distance from Amman No. of Students and Availability of Health Clinic
Approx. Distance Available Population From No. of Name of Village Health 1976 Ammanl/ Students Clinic (1) (2) (3) (4) (5) Stage I El Juweida 900 10 325 Yes Jawa & Khureibat es Suq 6,000 10 Manja 478 Yes 500 29 210 Ma'in Yes 3,600 42 750 Yes Um-Qusaire & Muqablein 8,000 23 961 Zai Yes 584 40 113 Um Elamad & Allam Yes 2,800 37 281 Yes Tila'al Ali, Khilda & Um Elsmaq 4,300 40 500 Tabarbour & Nwigis Yes 1,200 3 316 Rumeimin Yes 1,200 22 271 Taiba Yes 3,000 7 316 Um Jawza Yes 989 45 360 Yes
Total 33,073
Stage II El Mowaggar 5,000 14 450 Yes El Matala & El Buwaida 2,000 18 120 Hashimiya Yes 5,000 30 Hisban 650 Yes 3,258 22 543 Manshiya flisban Yes 800 24 R.A.9/ Adasiya Yes 900 18 N.A.!/ N.A.9/ Um Abhara 800 18 Rujm Eshami 183 No. 5,500 9 275 El Faisalyia Yes 4,000 10 400 Marj El-Hamam Yes 900 6 113 Iraq Ei-Amir Yes 800 17 203 El Bassa Yes 1,500 32 400 Ira Yes 1,190 27 Yarqa 355 No 1,348 37 574 Sabeihi Yes 1,092 do 359 Abu Museir Yes 573 22 365 Ruzha Yes 3,000 6 220 Yes 37,661 GRAND TOTAL 70,734
1/ Customarily estimated as distance from Hussein Mosque. 2/ N.A. - Information not available. SOURCE: Jordan Electricity Authority, June 1977. - 2 - ANNEX D Table 2 POWER
CALCULATION OF AVERAGE ANNUAL KWH CONSUMPTION PER CONNECTION IN VILLAGES
FOR YEAR OF INITIAL SYSTEM OPERATION
UTILIZATION Electric Device Load Hours/Day Days/Year KWH/Year or Appliance (W)
Lightinq & Radio 200 3 365 219,000
Iron 750 0.5 365 27,375 (150)1/
Refrigerator 350 6 153,300 (70)I_ Television 300 4 365 219,000 (150)1/
Street Lighting 502/ 10 365 182,500
Total 801,1751/
1/ In the calculation of KWH/year average consumption for the initial year of operation, the following percentages of village connections were utilized for the specified household appliances: Iron - 20 percent; Refrigerator - 20 percent; and Television - 50 percent. In year one oi peration, if 40 percent of the village households are connected, then 8 percent of the total village population will purchase irons, 8 percent refrigerators and 20 percent television sets (black and white). The cost of these applicances in Jordan currently are as follows: Iron - JD 3 ($9); Refrigerator - JD 100-150 ($300-450); and Television - JD 80 ($240).
2/ A lump amount of 50W/household for street lighting is assumed.
3/ At 30 fils/KWH, the direct cost per annum for 800 KWH would be 24,000 fils (JD 24.000) or$72.00 per annum.
SOURCE: Jordan Electricity Authority, June 1977. ECONOMIC RATE OF RETURN CALCULATION STAGE I VILLAGE ELECTRIFICATION - 1978-2000 (000 J.D.)
C 0 S T S REVENUES Cost of Oper., Maint. Connections, Meter Rentals Revenues Costs No. of Consumption Capital Energy & Meters and & Connection Less (Col. less Col. 8) Year Connections (000 KWH) Cost Purchased Admin. House iring Total Sales Charges Total 11 (11) (12) (1) (2) (3) (4) (5) (6) (7) (8) (9) (10)
442.8 - - -(442.8) 1978 - - 442.6 ------295.2 - 1979 - - 295.2 - 1980 2,483 1,986.6 - 38.7 15.7 66.2 120.6 55.6 40.7 96.3 24* 3 3.1 1981 2,731 2,284.4 - 43.6 17.1 6.6 67.3 64.0 6.4 70.4 7.5 1982 3,004 2,627.0 - 49.1 18.6 5.5 73.2 73.6 7.1 80.7 8.6 1983 3,305 3,021.1 - 55.4 20.3 8.0 83.7 84.6 7.7 92.3 14.3 1984 3,636 3,474.2 - 62.6 20.2 8.8 91.6 97.3 8.6 105.9 16.7 1985 4,000 3,995.4 - 70.7 24.2 9.7 104.6 111.9 9.4 121.3 21.9 1986 4,400 4,594.7 - 80.0 26.4 10.7 117.1 128.7 10.3 139.0 159.8 28.7 1987 4,840 5,283.9 - 90.6 28.8 11.7 131.1 148.0 11.8 1988 5,324 6,076.4 - 102.7 31.5 12.9 147.1 170.1 12.5 182.6 35.5 44.4 1989 5,856 6,987.9 - 116.5 34.4 14.2 165.1 195.7 13.8 209.5 1990 6,442 8,036.1 - 128.2 37.5 15.6 181.3 225.0 15.1 240.1 58.8 67.6 1991 6,736 8,839.7 - 143.5 39.3 7.8 190.8 247.5 10.9 258.4 78.8 1992 7,030 9,723.7 - 155.9 41.0 7.8 204.7 272.3 11.2 283.5 92.8 1993 7,324 10,696.0 - 167.6 42.8 7.8 218.2 299.5 11.5 311.0 1994 7,618 11,765.6 - 182.3 44.6 7.8 234.7 329.4 11.7 341.1 106.4 1995 7,912 12,942.2 - 198.5 46.5 7.8 252.8 362.4 12.0 374.4 121.6 1996 8,206 13,589.3 - 206.3 48.2 7.8 262.3 380.5 12.3 392.8 130.5 1997 8,500 14,269.0 - 214.5 50.0 7.8 272.3 399.5 12.6 412.1 139.P 1998 8,794 14,982.2 - 223.1 51.9 7.8 282.8 419.5 12.9 432.4 149.6 1999 9,088 15,731.3 - 232.2 53.7 7.8 293.6 440.5 13.1 453.6 160.0 2000 9,381 16,517.9 (147.6) 241.7 55.6 7.8 157.5 462.5 13.4 475.9 318.4 INTERNAL RATE OF RETURN 4.6'2
SOURCE: Jordanian Electric Power Company, Ltd. and Jordan Electricity Authority, June 1977. - 4 - ANNEX D Table 3 ECONOMIC RATE OF RETURN CALCULATION
STAGE I VILLAGE ELECTRIFICATION
EXPLANATORY NOTE TABLE 3
COLUMN 1 - Project time horizon begins in 1978 with operations commencing in 1980 through the year 2000.
COLUMN 2 - In 1976, the estimated population of the eighteen (1.8) Stage I villages was 33,100. From 1976 through 1990, a population growth rate of 3.0 percent per annum was assumed. For 1991-1995, the annual growth rate used was 2.5 percent and for 1996-2000, 2.0 percent. The average number of individuals per connection was taken as 6.2 for the entire time period. In the inital year of electric power distribution, 40 percent of the potential consumers are connected, increasing linearly to 80 percent by 1990 and to 90 percent by the year 2000.
COLUMN 3 - In year one of actual operations (1980), average annual KWH consumption per connection is estimated at 800 KWH. From 1980 through 1990, the compounded annual increase in consumption was projected at 4.5 percent (to 1248 KWH per annum) and 3.5 percent for the 1990-2000 time period (to 1761 KWH in year 2000).
COLUMN 4 - Assumed that 60 percent of the capital expenditures occur in 1978 and 40 percent in 1979. Salvage value (year 2000) is 20 per cent of original capital expenditures. A 25-year straight line depreciation rate was used.
COLUMN 5 - Based on an average commodity rate of 7.8 fils per KWH plus a demand charge. In 1980, the cost of purchased energy is 17.18 fils per KWH. JEPCO purchased energy exceeds retail consumer sales by a 12 percent physical loss factor.
COLUMN 6 - Operation and maintenance cost is calculated at 0.4 percent of total capital investment with an annual increase of 5 percent. Administration cost is assumed as JD 5 per connection.
COLUMN 7 - The cost of consumer connections and meters is JD 45 for three phase consumers and JD 23 for single-phase consumers. For three phase consumers, connection costs are JD 30 and JD 15 for meters; for single-phase, JD 15 for connection costs and JD 8 for meters. Its assumed that 97 percent of consumers are single-phase and 3 percent three-phase consumers for the entire time period. House wiring costs were taken at JD 3 per connection. -5- ANNEX D
Table 3
Stage I Village Electrification - continued
COLUMN 8 - Sum of columns 4, 5, 6 and 7.
COLUMN 9 - Sales revenue from electricity is based on the March 1977 tariff (residential - first Block at 30 fils/KWH for 1-100 KWH per month) and averaged at 28 fils per KWH. It's assumed that about 6 percent of power consumed will be by non-paying cus tomers (mosques, charities, etc.).
COLUMN 10 - Connection costs are paid directly by the consumer to JEPCO. See Column 7 information. Meters are rented by JEPCO to cus tomers at the following rates: 200 fils per month for three phase consumers and 75 fils per month "or single-phase con sumers. JEPCO is the owner of the meters and responsible for maintenance and repair.
COLUMN 11 - Sum of Columns 9 and 10.
COLUMN 12 - Column 11 less Column 8.
SOURCE: Jordanian Electric Power-Company, Ltd. and Jordan Electricity Authority, Tune 1977. ECONOMIC RATE OF RETURN CALCULATION STAGE II VILLAGE ELECTRIFICATION - 1978-2000 (000 J.D.)
C 0 S T S REVENUES Cost of Oper., Maint. Connections, Meter Rentals Revenues No. of Consumption Capital Energy a Meters and & Connection Less Costs Year Connections (000 KWH) Cost Purchased Admin. House Wiring Total Sales Charges Total (Col. 11 less Col. 8) (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) 1978 - - 219.8 - - - 219.8 - - - (219.8) 1979 - - 423.6 - - 432.6 - - (423.6 1980 - - 423.6 - - - 423.6 - - - (423.6) 1981 2,719 2,175.2 - 42.4 18.3 72.5 133.2 60.9 44.6 105.5 ( 27.7) 1982 2,991 2,501.5 - 47.7 19.9 7.3 74.9 70.0 7.0 77.0 2.1 1983 3,290 2,877.8 - 53.8 21.6 8.0 83.4 80.5 7.7 82.2 4.8 1984 3,619 3,308.2 - 60.7 23.5 8.9 93.1 92.6 9.5 102.1 9.0 1985 3,981 3,804.4 - 68.5 25.6 9.7 103.8 106.5 9.3 7'5.8 12.0 1986 4,379 4,375.1 - 77.5 27.9 10.6 116.0 122.5 10.3 132.8 16.3 1 1987 4,817 5,301.4 - 87.7 30.4 12.3 130.4 140.9 11.3 152.2 21.8 1988 5,299 5,876.1 0' - 99.3 33.1 12.8 145.2 162.0 12.4 174.4 29.2 1 1989 5,829 6,654.0 - 112.5 35.1 14.1 161.7 186.3 13.7 200.0 38.3 1990 6,411 7,952.1 - 127.5 39.4 15.5 182.4 214.3 15.0 229.3 46.9 1991 6,766 8,417.3 - 138.4 41.5 9.5 189.4 235.' 11.9 247.6 58.2 1992 7,121 9,259.0 - 150.3 43.6 9.5 203.4 259.3 12.2 271.5 68.1 1993 7,476 10,184.9 - 163.3 45.8 9.5 218.6 2P" ' 12.6 297.8 79.2 1994 7,831 11,203.4 - 177.5 48.0 9.5 235.0 3i./ 12.9 326.6 91.6 1995 8,186 12,323.8 - 193.1 50.2 9.5 252.8 345.1 13.2 358.3 105.5 1996 8,541 12,939.9 - 200.5 52.5 9.5 262.5 362.3 13.6 375.9 113.4 1997 8,896 13,586.9 - 208.4 54.7 9.5 272.6 380.4 13.9 394.3 121.7 1998 9,251 14,266.3 - 216.6 57.0 9.5 283.1 399.5 14.2 413.8 130.7 1999 9,606 14,979.6 - 225.2 59.4 9.5 294.1 419.4 14.6 434.0 139.9 2000 9,970 15,728.6 (213.4) 234.3 61.9 9.7 92.5 440.4 15.0 455.4 362.9 I o0x
INTERNAL RATE OF RETURN 1.8%
SOURCE: Jordanian Electric Power Company, Ltd. and Jordan Electricity Authority, June 1977. -7- ANNEX D Table4 ECONOMIC RATE OF RETURN CALCULATION
STAGE II VILLAGE ELECTRIFICATION
EXPIANATORY NOTE TABLE 4 COLUMN 1 - Project time horizon begins in 1978 with operations commencing in 1981 through the year 2000. COLUMN 2 - In 1976, the estimated population of the seventeen lages was 37,661. (17) vil From 1976 through 1990, a population rate of 3.0 percent growth per annum was adopted, 2.5 percent 1995 and 2.0 for 1991 percent for the 1996-2000 time number of period. The average individuals per consumer connection for the was taken as 6.2 entire time period. In the distribution, initial year of electric power 40 percent of the potential increasing customers were connected, linearly to 80 percent by 1990 and to 90 percent by the year 2000. COLUMN 3 - In year one of actual operations (1981), average KWH consumption is estimated at 800 KWH per annum. From 1980 through 1990, compounded annual increase adopted the was 4.5 percent (to 1240 per annum) and 2.5 percent KWH for the 1990-2000 time period 1580 (to about KWH per annum in the year 2000). COLUMN 4 - Capital expenditures are distributed by year as follows: 1978 - 20 percent; 1979 40 percent; and 1980 - 40 The salvage value in year percent. 2000 is 20 percent of the original expenditure based on a 25-year capital straight line depreciation rate. COLUMN 5 - Based on an average commodity rate of 7.8 fils per demand charge (current KWH plus a 1977 JEA bulk distribution schedule). 1981, the cost of purchased In energy is 17.13 per KWH. JEPCO chased energy exceeds retail pur consumer sales by the 12 percent physical loss factor. COLUMN 6 - Operation and maintenance cost are calculated at 0.4 percent total capital investment with of an annual increase of 5 percent. Administration cost was assumed as JD 5 per connection. COLUMN 7 - The cost of connections and meters consumers are JD 45 for three-phase and JD 23 for single-phase consumers. consumers, For three-phase connection charges are JD 30 for single-phase and JD 15 for meters; consumers JD 15 for for connection costs and JD 8 meters. Its assumed that 97 percent of consumers are single phase and 3 percent three-phase consumers. House wiring costs were taken at JD 3 per connection. - 8 - (Annex D) Table 4
Stage II Village Electrification - continued
COLUMN 8 - Sum of columns 4, 5, 6 and 7. COLUMN 9 - Sales revenue from electricity is based on the March 1977 tariff (residential first block 1-100 KWH per month 30 at fil/KWH) and averaged at 28 fils per KWH. It's assumed that about 6 percent of annual energy consumed will be used by non-paying consumers (i.e., mosques, charities, etc.). COLUMN 10 - Connection costs are paid directly by the consumer to JEPCO. See Column 7 information. Customer meters are rented by JEPCO at the following rates: 200 fils/month for three-phase con sumers and 75 fils/month for single-phase consumers. JEPCO is the owner of the meters and responsible for maintenance and repair.
COLUMN 11 - Sum of Columns 9 and 10.
COLUMN 12 - Column 11 less Column 8.
SOURCE: Jordanian Electric Power Company, Ltd. and Jordan Electricity Authority, June 1977. 9 ANNEX D Table 5
INFORMATION ON
POPULATION. STUDENTS, SCHOOLS. AND HEALTH CLINICS
IN
SCHNELLER AND BAQA
ELECTRIFICATION AREAS
A. BAQA AREA:
1. Population: 55,535 as of 3/31/77
No. of Houses - 7,400
Area - 1,300,000 m 2
2. No. of Male Schools:
12 Schools - Elementary, Secondary and High
No. of Students - 7,134
No. of Teachers - 184
No. of Classrooms - 98
3. No. of Female Schools:
10 Schools - Elementary, Secondary and High
No. of Students - 5,921
No. of Teachers - 152
No. of Classrooms - 58
4. Health Clinics: One
No. of Doctors - 6
No. of Nurses - 20
Clerks - 3
Pharmacists - 4
Workers - 11 - 10 - ANNEX D Table 5 Continued B. SCHNELLER AREA:
1. Population: 27,413 as of 5/31/77
No. of Houses - 3,990
Area - 917,000 m2
2. No. of Male Schools:
3 Schools - Elementary, Secondary and High
No. of Students - 4,130
No. of Teachers - 100
No. of Classrooms - 56
3. No. of Female Schools:
3 Schools - Elementary, Secondary and High
No. of Students - 2,800
No. of Teachers - 62
No. of Classrooms - 46
4. Health Clinics: One
No. of Doctors - 3
No. of Nurses - 13
Clerks - 3
Workers - 4
SOURCE: Ministry of Reconstruction and Development, Hashehite Kingdom of Jordan, June 1977. ECONOMIC RATE OF RETURN CALCULATION BAQA AREA ELECTRIFICATION 1978 - 1990 (000 J.D.)
C 0 S T S REVENUES Cost of Oper., Maint. Connections, Meter Rentals Revenues No. of Consumption Capital Energy & Meters and & Connection Less Costs Year Connections (000 KWH) Cost Purchased Admin. House Wiring Total Sales Charges Total Col. 11 less Col. 8) (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12)
1978 - - 232.4 - - - 232.4 - (232.4) 1979 - - 232.4 - - - 232.4 - (232.4J 1980 7,941 6,352.8 - 123.7 41.8 211.7 377.2 177.9 130.2 308.1 C 69.1) 1981 8,338 7,305.7 - 139.3 43.9 10.6 193.8 204.6 14.0 218.6 24.8 1982 8,755 8,401.6 - 157.0 46.1 11.1 214.2 235.2 14.7 249.9 35.7 1983 9,193 9,661.8 - 177.2 48.4 11.7 237.3 270.5 15.5 286.0 48.7 1984 9,653 11,110.1 - 200.1 51.9 12.3 264.3 311.1 16.2 327.3 63.0 1 1985 10,136 12,777.8 - 226.3 53.4 12.9 292.6 357.8 17.0 374.8 82.2 1986 10,643 14,694.4 - 256.0 56.1 13.5 325.6 411.4 17.9 429.3 103.7 1987 11,17i 16,898.6 - 289.9 58.9 14.2 363.0 473.2 18.8 492.0 129.0 1988 11,734 19,433.4 - 328.5 61.8 14.9 405.2 544.1 19.7 563.8 158.6 1989 12,321 22,348.4 - 372.5 64.9 15.7 453.1 625.8 20.7 646.5 193.4 1990 12,937 25,700.6 (260.3) 422.6 68.2 16.4 246.9 719.6 21.7 741.3 494.4
INTERNAL RATE OF RETURN 11.0%
SCURCE: Jordanian Electric Power Company, Ltd. and Jordan Electricity Authority, June 1977.
ox -12 - ANNEX D Table 6
ECONOMIC RATE OF RETURN CALCULATION
BAQA AREA ELECTRIFICATION
1978 - 1990
EXPLANATORY NOTE TABLE 6
COLUMN 1 - Project time horizon begins in 1978 with operations commencing in 1980. For convenience, the terminal date of the cash flow analysis is taken as 1990.
COLUMN 2 - The estimated population of the Baqa area in 1976 was 54,680. For 1977 through 1990, the population growth rate adopted was 3 percent per annum. In 1990, the population is projected at 82,710. It was assumed that in year one of operations (1980), 80 percent of the population will request and receive electric power service. The number of consumers was derived by utilizing 6.2 family members per connection for the entire time period.
COLUMN 3 - In 1980, KWH consumption per connection is assumed to average 800 KWH per annum. In 1985, this was increased to 1,260 KWH per annum and in 1990 to 1,967 per annum. This is a 9.4 percent per annum compounded growth rate in consumer electric power consump tion.
COLUMN 4 - Capital expenditure was divided equally between 1978 and 1979. At the end of year 1990, the terminal year for the project analy sis, the salvage value is calculated as 56 percent of the original capital investment, given a twenty-five (25) year straight line depreciation rate.
COLUMN 5 - Based on an average commodity rate of 7.8 fils/KWH plus a demand charge (current JEA bulk distribution schedule). In 1980, the cost of purchased energy is 17.14 per KWH. JEPCO purchased energy exceeds retail consumer sales by the 12 percent physical loss factor.
COLUMN 6 - Operation and maintenance costs are calculated at 0.4 percent of total capital investment with an annual increase of 5 percent. Administration cost is assumed as JD 5 per connection.
COLUMN 7 - The cost of connection charges and meter installations are JD 45 for three-phase consumers and JD 23 for single-phase con sumers. For the three-phase consumers, connection costs are JD 30 and JD 15 for meters; for single-phase consumers JD 15 for connection costs and JD 8 for meters. It's assumed that 97 per cent of consumers are single-phase and 3 percent three-phase consumers. House wiring costs were taken at JD 3 per connection. - 13 - ANNEX D Table 6
Baqa Area Electrification - continued
COLUMN 8 - Sum of columns 4, 5, 6 and 7. COLUMN 9 - Sales revenue from electricity is based on the new March 1977 tariff (first Block 1-100 KWH per month at 30 fils/KWH) and averaged at 28 fils per KWH. It's assumed that 6 percent of annual energy consumed will be used by non-paying customers (i.e., mosques, etc.).
COLUMN 10 - Connection charges are paid directly by the consumer to JEPCO. See column 7 explanation. Customer meters are rented by JEPCO at the following rates: 200 fils/month for three-phase con sumers and 75 fils/month for single-phase consumers. JEPCO is the owner of the meters and responsible for maintenance and repair.
COLUMN 11 - Sum of column 9 and 10.
COLUMN 12 - Column 11 less column 8.
SOURCE: Jordanian Electric Power Company, Ltd. and Jordan Electricity Authority, June 1977. ECONOMIC RATE OF RETURN CALCULATION SCHNELLER AREA ELECTRIFICATION 1978 - 1990 (000 J.D.)
C 0 S T S REVENUES Cost of Oper., Maint. Connections, No. of Consumption Meter Rentals Revenues Capital Energy & Meters and Year Connections (000 KWH) Cost & Connection Less Costs Purchased Admin. House Wiring Total Sales (1) (2) Charges Total Col. 11 less Col. 8) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) 1978 - - 120.7 - 1979 - 120.7 - - - - 120.7 - - (120.7 - - 120.7 - 1980 3,901 3,120.8 - - - (120.7) 60.8 20.6 104.0 185.4 87.4 1981 4,096 3,588.9 - 68.4 63.9 151.3 (34.1) 21.6 5.0 97.1 100.5 6.9 1982 4,301 4,127.3 - 77.1 107.4 10.3 22.7 5.5 105.3 115.6 7.2 1983 4,516 4,746.3 - 122.8 17.5 1 87.0 23.8 5.7 116.5 1984 4,742 5,458.3 133.0 7.6 140.6 24.1 - 98.3 25.0 6.0 1985 4,979 6,277.0 129.3 152.8 8.0 160.8 31.5 - 111.2 26.3 6.3 143.8 1986 5,228 7,218.6 175.8 8.3 184.1 40.3 - 125.8 27.6 6.6 160.0 1987 5,489 8,301.4 202.1 8.8 210.9 50.9 - 142.4 28.9 7.0 178.3 1988 5,764 9,546.6 232.4 9.3 241.7 63.4 - 161.4 30.4 7.3 199.1 1989 6,052 10,978.6 267.3 9.7 277.0 77.9 - 183.0 31.9 7.7 222.6 1990 6,355 12,625.4 307.4 10.1 317.5 94.9 (135.2) 207.6 33.5 8.1 114.0 353.5 10.7 364.2 250.2
INTERNAL RATE OF RETURN 10.7%
SOURCE: JOrdanian Electric Power Company, Ltd. and Jordan Electricity Authority, June 1977 ° x 15 ANNEX D Table 7
ECONOMIC RATE OF RETURN CALCULATION
SCHNELLER AREA ELECTRIFICATION
1978 - 1990
EXPLANATORY NOTE TABLE 7
COLUMN 1 - Project time horizon begins in 1978 with operations commencing in 1980. For convenience, the terminal date of the cash flow analysis is taken as 1990.
COLUMN 2 - The estimated population of the Schneller area in 1976 was 26,860. From 1977 through 1990, the population growth rate adopted was 3 percent per annum. In 1990, the population is projected at 40,629. It was assumed that in year one of opera tions (1980), 80 percent of the population will request and re ceive electric power service. The number of consumers was derived by utilizing 6.2 family members per connection for the entire time period.
COLUMN 3 - In 1980, KWH consumption per connection is assumed to average 800 KWH per annum. In 1985, this was increased to 1,261 KWY per annum and in 1990 to 1,987 KWH per annum. This is a 9.6 per ent per annum compounded growth rate in consumer electric power consumption.
COLUMN 4 - Capital expenditure was divided equally between 1978 and 1979. At the end of year 1990, the terminal year for the project an alysis, the salvage value is calculated as 56 percent of the original capital investment given a twenty-five (25) year straight line depreciation rate.
COLUMN 5 - Based on average commodity rate of 7.8 files per KWH plus a demand charge (current JEA bulk distribution schedule). In 1980, the cost of purchased energy is 17.13 per KWH. JEPCO purchased energy exceeds retail consumer sales by the 12 percent physical loss factor.
COLUMN 6 - Operation and maintenance costs are calculated at 0.4 percent of total capital investment with an annual increase of 5 percent. Administration cost is assumed as JD 5 per connection.
COLUMN 7 - The cost of connection charges and meter installations are JD 45 for three-phase consumers and JD 23 for single-phase con sumers. For three-phase consumers, connection costs are JD 30 and JD 15 for meters; for single-phase, JD 15 for connection costs and JD 8 for meters. It's assumed that 97 percent of con sumers are single-phase and 3 percent three-phase consumers. House wiring costs are taken at JD 3 per connection. -16 - ANNEX D Table 7
Schneller Area Electrification - continued
COLUMN 8 - Sum of columns 4, 5, 6 and 7.
COLUMN 9 - Sales revenue from electricity is based on the new March 1977 tariff (first Block 1-100 KWH per month at 30 fils/KWH) and averaged at 28 fils per KWH. It's assumed that 6 percent of annual energy consumed will be used by non-paying customers (i.e., mosques, charities, etc.).
COLUMN 10 - Connection charges are paid directly by the consumers to JEPCO. See column 7 explanation. Customer meters are rented by JEPCO at the following rates: 200 fils/month for three-phase consumers and 75 fils/month for single-phase consumers. JEPCO is the owner of the meters and responsible for maintenance and repair.
COLUMN 11 - Sum of columns 9 and 10.
COLUMN 12 - Column 11 less column 8.
SOURCE: Jordanian Electric Power Company, Ltd. and Jordan Electricity Authority, June 1977. JORDANIAN ELECTRIC POWER COMPANY, LTD.
INCOME STATEMENTS - ACTUAL 1971-1975 (000 J.D.)
ITEM 1971 1972 1973 1974 1975 (1) (2) (3) (4) (5) 16)
INCOME
Sales, Electricity & Meter Rentals 2,015 2,185 2,4'4 2,867 3,369 Miscellaneous 12 12 11 23 32 Investments 9 9 15 16 20 TOTAL INCOME 2,036 2,206 2,506 2,906 3,421
OPERATING EXPENSES fu
Generation 490 573 757 892 1,066 1 Transmission 10 15 18 26 391) 0 Distribution 165 179 206 267 ) Administration 250 303 523 348 438 Purchased Energy 0 0 0 0 297 TOTAL OPERATING EXPENSES 915 1,070 1,504 1,533 2,192
Net Operating Cash Flow 1,121 1,136 1,002 1,373 1,229 Less: De'-reciation 322 351 397 540 608 Equals: Net Operating Profit 799 785 605 833 621 Less: Interest on Loans 5 46 21 37 88 Equals: Net Profit 794 739 584 796 533 Less: Income Taxes 302 281 223 376 254 Equals: Net Profit After Income Tax 492 458 361 420 279 Average Net Fixed Assets in Operation 4,097 4,322 5,602 6,925 8,268 0) Annual Rate of Return on Average Net Fl Fixed Assets in Operation (%) 12.1 11.9 7.8 6.6 4.4 Reserves 212 158 58 112 67 1I - 2 -
ITEbI 1971 1972 1973 1974 1975 (1) (2) (3) (4) (5) (6) Board Remuneration 9 Cash Dividends 9 9 9 8 Payable 271 Capital Stock 291 293 483 341 Par Value 2,718 2,986 3,000 4,644 5,026 Average Net Profit on Common Par Value Stock (%) 10.0 9.7 9.8 10.4 6.8
NOTE: Year ending December 31.
SOURCE: Based on material provided by Jordanian Electric Power Company, Ltd. M 0
0.
0.C-) ri X, JORDANIAN ELECTRIC POWER COMPANY, LTD.
BALANCE SHEET - ACTUAL 1971 - 1975 '000 J.D.)
ITEM 1971 1972 1973 1974 1.975 (1) (2) (3) (4) (5) (6) ASSETS FIXED ASSETS
Fixed Assets in Service 6,238 7,023 9,549 10,606 2.3 3 Less: Accum. Depreciation 2,133 2,484 2,882 3,432 4,031 Equals: Net Fixed Assets in Service at Year End 4,105 4,539 6,667 7,183 8,352 Plus: Work in Progress 4 564 88 112 663 TOTAL FIXED ASSETS 4,139 5,103 6,755 7,295 9,015
CURRENT ASSETS o
Cash & Payments in Advance 244 221 63 392 262 Accounts Receivable 782 786 568 EL7 757 Materials and Supplies 432 746 874 1,340 2,048 TOTAL CURRENT ASSETS 1,458 1,753 1,505 2,858 3,067
Less: Current Liabilities 1,063 1,008 873 1,591 2,198 Equals: Working Capital 395 745 632 1,267 869 541 LONG-TERM INESTMENT 290 308 338 366
GRAND TOTAL ASSETS 4794 6 7,725 8,928 10,425 LIABILITIES EQUITY
Capital Stock 2,718 2,986 3,000 4,644 5,026 0 Capital Stock Revaluation - - 1,211 - - hM Capital Stock Premium 20 5 5 5 5 Legal & Optional Reserves 638 731 804 1,292 1,388 TOTAL EQUITY 3,376 3,722 5,020-- 11 6,619 - 2-
ITEM 1971 1972 1973 1974 1975 (1) (2) (3) (4) (5) (6)
LONG-TERM DEBT
Aman Municipality 32 28 24 20 16 U.K. Development 188 1,049 1,248 1,370 2,158 TOTAL LONG-TERM DEBT 220 1,077 1,272 1,390 2,174
OTHER LIABILITIES
Accrued Taxes 337 379 328 387 350 Deferred Liabilities 581 658 777 894 1,070 Dividends Payable 271 291 293 483 341 Other 9 29 35 (67) (129)
GRAND TOTAL.LIABILITIES 4,794 6,156 7,725 8,928 10,425
0
NOTE: Year ending December 31.
SOURCE: Based on material provided by Jordanian Electric Power Company, Ltd.
0- W JORDANIN ELECTRIC POWER COmPANxy, LTD. INCOME STATEMENT ACTUAL 1976: PROJECTIONS - 1977-1985 (000 J.D.) Line ACTUAL P R No. T 1976 0 J E C T I 0 N S 1977 1978 1979 1980 1981 1982 1983 1984 1985 (1)12) (3) 1 Sales (GWES) 5 6 (7) (8) -97.0) 269 331 407 497 (11 2 Average Revenue Per KWH Sold 601 721 851 987 (Fils) 15.3 22.01 23.22 23.22 1,125 1260 3 Income fro Power Sales 23.22 23.22 23.22 23.22 23.22 4,122 7,286 9,450 11,540 23.22 4 Other Income 13,955 16,742 19,760 22,918 26,122 133 156 172 189 29,257 5 -TO AL INCOME 209 230 253 278 306 4,255 7,442 9622 11,729 14164 337 16,972 20,013 23,196 26,428 29,594 rURCHASES FROM JEA 6 Purchase Demand (MW) 71 82 100 118 134 148 7 Purchase Energy (GWH) 156 160 175 195 227 8 366 462 564 683 Self-Generation (GWE) 161 819 967 1,121 1,278 1,432 10 - - - __- - - - 1C CostCost of Purchased Demand - 1,508 2,208 Energy 1,085 2,809 3,571 2,605 2,958 3,267 3,532 3,854 4,305 4,359 5,279 6,331 7,474 8,665 5,012 11 Self Generation Cost 835 9,879 11,069 a 130 - _ _ - 12 TOTAL ENERGY .-. COST 2_____47 1,920 4,447 5,779 6,964 8,237 9,598 - 11,006 12,529 14,184 16,081 o OPERATING COST 13 Transmission & Distribution Cost 507 659 857 1,114 14 Administration Cost 1,448 1,882 2,446 3,180 4,134 557 679 829 1,010 1,232 5,374 1,503 1,833 2,236 2,728 3,328 15 TOTALOPERATING COST 1,064 1,338 1,685 2,124 2,680 3,385 4,279 5,416 6,862 8,702 16 GRAND TOTAL OPERATING COSTENERGY AND 2,984 5,785 7,464 9,088 10,917 12,983 15,285 17,945 21,046 24,783 17 NET OPERATING (Line CASH FLOW 5 less Line 16) 1,271 1,657 18 Less: Depreciation 2,158 2,641 3.247 3,989 4,728 675 486 5,2-1 5,382 4,811 19 Equals: 611 760 888 1,008 1,128 Net Operating Profit 596 1,171 1,248 1,368 1,448 20 Less: 1,547 1,881 2,359 2,981 Interest on Loans - 3,600 4,003 4,014 3,363 21 Equals: 164 243 296 311 365 Net Profit 596 1,007 415 424 474 523 1,304 1,585 2,048 2,616 3,185 3,579 3,540 2,840 6'X (AI -2 -
Line ACTUAL NO. P R 0 J E C T I 0 N S 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 22 LESS- (1 () 3) (41 5s)- Income Tax 306 453 587 713 (6) (7) ()9 (10) (ii1) 23 922 1,177 1,433 1,611 1,593 1278 EQtJAIS: Net Profit After Income Tax 290 554 717 872 1,126 1,439 1,752 1,968 1,947 1,562 24 Average Net Fixed Assets in Operation 10,460 1P,230 9,616 12,350 14,985 17,13? 19,069 20,881 22,573 23,665 25 Annual Rate of Return on Average Net Fixed Assets in Operation 2.8% 7.0% 10.0k 9.5% 9.6% 10.5% 26 Reserves 11.4% 11.5% 10.7% 8.8% 56 101 130 158 20T5 27 Board Remuneration 217 318 358 354 284 8 8 8 8 28 8 8 8 9 8 8 Cash Dividends Payable 226 445 579 706 913 1,214 1,426 1,602 1,585 1,270 29 Capital Stock Par Value 5,138 7,000 8,000 8,000 8,000 9,000 10,000 11,000 12,000 13,000 30 Average Net Profit on Common Stock Par Value A.0% 6.3% 7.2% 8.8% 11.4% 13.5% 31 Amortization & Intezest 14.3% 14.5% 13.2% 9.8% On Loans 258 467 546 684 639 32 1,003 1,053 1,145 1,278 1,410 DEBT COVERAGE RATIO 4.9 3.5 3.9 3.9 4.6 3.9 3.5 4.6 4.2 3.4
0 SOURCE: Jordanian Electric Power Company, Ltd., June 1977.
015
0. Page 7 of 14
JORDANIAN ELECTRIC POWER COMPANY, INC. ACTUAL INCOME STATEMENT 1976: PROJECTIONS 1977 - 1985
EXPLANATORY NOTE TABLE 3
LINE NO. 1 SALES - From 1973 through 1976, sales (GWH) increased by an average annual compound rate of 20 percent. The 1975 to 1976, the increase was 26 percent. For 1976 through 1981, sales are projected to in crease by about 22 percent per annum compounded: for 1981 - 1985, by 15 percent per annum. 3 INCOME FROM POWER SALES - Weighted tariff value of 23.22 fils per KWH sold in 1978 is based on recently instituted March 1977 tariff schedules. 4 OTHER INCOME - Primarily connection charges and meter rentals.
5 TOTAL INCOME - Sum of lines 3 and 4.
6 - 12 COST OF ENERGY - (Purchased from JEA and Self-generated) - Average energy charge for JEA purchases at weighted tariff value of per 7.8 fils KWH plus demand charge based on maximum demand. Self-generated energy cost based on historic actual cost of JEPCO small diesel power stations which is about 13.00 fils per KWH generated. 13 TRANSMISSION & DSTRIBUTION COST - Based on historic figures with an annual increase o'f 30 percent. 14 AIIINISTRATION COST - Based on historic figures with an annual in crease of 22 percent.
15 TOTAL OPERATING COST - Sum of lines 13 and 14. 16 GRAND TOTAL ENERGY & OPERATING COSTS - Sum of lines 12 and 15. 17 NET OPERATING CASH FLOW - Difference between total income (line 5) and total energy and operating costs (line 16). 18 DEPRECIATION - Annual depreciation charges are calculated at about 4 percent of fixed assets in service. 19 NET OPERATING PROFIT - Net operating cash flow (line 17) less depreciation (line 18). Page 8 of 14 (Table 3)
LINE NO. 20 INTEREST ON LOANS - Includes interest payments on direct JEA loan and British capital grant passed onto JEPCO through JEA 6 at percent per annum interest, three (3)year grace period and fifteen (15) year maturity; proposed USAID loan to GOJ passed onto JEPCO at anticipated seven percent (7%) interest rate, three (3) year grace period and fifteen (15) year maturity; and borrowing additional of JD 4 million scheduled for 1980-1983 on terms similar to anticipated JEA terms to JEPCO for proposed AID project loan of JD 3 million.
21 NET PROFIT - Net operating profit (line 19) less interest on loans (line 20). 22 INCOME TAX - According to the tax law in Jordan calculated at 45 percent of net profit. 23 NET PROFIT AFTER INCOME TAX - Net profit (line 21) less income tax (line 22).
24 AVERAGE NET FIXED ASSETS IN OPERATION - Average of beginning and end of year net fixed assets placed in operation.
25 ANNUAL RATE OF RETURN ON AVERAGE NET FIXED ASSETS IN OPERATION - Net operating profit (line 19) less income tax (line 22) divided by average net fixed assets in operation (line 24). Interest payments are considered as a portion of the return on average net fixed assets in operation. 24 RESERVES - According to the company law in Jordan, 10 percent of net profit (line 21) must be placed in a reserve account. 27 BOARD REMUNERATION - It is a fixed amount of about JD 8,000 per annum. 28 CASH DIVIDENDS PAYABLE - Net profit (line 21) less income tax (line 22), reserves (line 26) and Board remuneration (line 27) equals cash dividends payable.
29 CAPITAL STOCK PAR VALUE - From JEPCO Balance Sheet.
30 AVERAGE NET PROFIT ON COMMON STOCK PAR VALUE - Cash dividends pay able divided (line 28) by capital stock par value (line 29). 31 AMORTIZATION AND INTEREST ON LOANS - Annual debt repayment plus interest on loans. 32 DEBT COVERAGE RATIO - Ratio of net operating cash flow (line 17) to debt service - amortization and interest on loans (line 31).
SOURCE: Jordanian Electric Power Company, Ltd., June 1977. JORDANIAN ELECTRIC POWER COMPANY, LTD. BALANCE SHEET ACTUAL 1976: PROJECTIONS 1977-1985 (000 J.D.)
ACTUAL P R 0 J E C T IO N S LINE ITEM 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 NO, (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) ASSETS FIXED ASSETS
1 Fixed Assets In Service 16,808 12,157 15,28r 18,997 22,197 :,5,197 28,197 31,197 34,197 36,197 2 Less: Accum. Depreciation 4,707 3,797 4,108 5,168 6,056 7.064 8,]J92 9,440 10,808 12,256 3 Equals: Net Fixed Assets 12,101 8,360 1C$872 13,829 16,141 18,133 20,005 21,757 23,389 23,941 In Service
4 Plus: Work in Progress 411 3,123 3,-i7 3,200 3,000 3,000 3,000 3,000 2,000 2,000
23,005 24,757 25,389 25,941 0 5 TOTAL FIXED ASSETS 12,512 11,483 14,589 17,029 19,141 21,133
CURRENT ASSETS
6 Cash & Payments in Advance 331 350 368 386 406 420 441 463 486 510 7 Accounts Receivable 803 1,157 1,501 1,838 2,217 2,660 3,139 3,641 4,150 4,649 8 Materials and Supplies 1,499 1,649 1,814 1,995 2,195 2,414 2,656 2,921 3,213 3,535 9 Investments in Limited Companies 359 359 359 359 359 359 359 359 359 359 10 JEA Accounts (Marqa Power - - Station) - 2,000 2,000 1,250 - - - -
11 TOTAL CURRENT ASSETS 2,992 5,515 6,042 5,828 5,177 5,853 6,595 7,384 8,208 9,053
804 1 12 Provident Fund Investments 343 377 414 459 500 550 605 665 731
13 TOTAL ASSETS 15,847 17,375 21,045 23312 24,818 27,536 30,205 32,806 34,328 35,798 JORDANIAN ELECTRIC POWER COMPANY, LTD. BALANCE SHEET ACTUAL 197p: PROJECTIONS 1977-1985 (000 J.D.)
ACTUAL P R O J E C T 1 0 N S Line ITEM 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 No. (1) (2) (3) (4) (5) (6) (7) (8) (9, (10) (11)
LIAEILITIES EMuity 14 Capital Stock 5,138 7,000 8,000 8,000 8,000 9,000 10,000 11,000 12,000 13,000 15 Premium On Capital Stock - - 600 600 600 1,200 1,800 2,400 3,000 3,600 16 Legal & Optional Reserves 2,17P 2,279 2,409 2,567 2,772 2,989 3,307 3,665 4,019 4,303
17 TOTAL EQUITY 7,316 9,279 11,009 11,167 11,372 13,189 15,107 17,065 19,019 20,903
18 LONG-TERM DEBT 3,630 4,630 5,844 6,456 7,768 8,130 8,492 8,771 7,967 7,080
CURRENT LIABILITIES o 19 Sundry Creditors 3,145 1,158 1,412 2,421 1,723 1,393 954 547 473 1,021 0 20 Consumers Deposits 531 615 713 827 959 1,112 1,289 1,495 1,734 2,011 21 Reserve for Employees Indemnity 80 80 80 80 80 80 80 80 80 80 22 Health Care Fund 10 12 14 16 18 20 22 24 26 28 - - - - 23 Accrued Income Tax 28 - - - - -
24 TOTAL CURRENT LIABILITIES 3,794 1,865 2,219 3,344 2,780 2,6n5 2,34- 2,146 2,313 3,140
APPROPRIATIONS 25 Cash Dividends Payable 226 445 579 706 913 1,214 1,426 1,602 1,585 1,270 26 Income Tax 268 453 587 713 922 1,177 1,433 1,611 1,593 1,278 2 27 Board Remuneration 8 8 8 8 8 8 8 8 8 8 28 TOTAL APPROPRIATIONS 502 906 1,174 1,427 1,843 2,399 2,867 3,221 3,186 2,556 29 Employees Saving ill Provident Fund 605 695 799 918 1,055 1,213 1,394 1,603 1,843 2,119 30 TOTAL LIABILITIES 15,847 17,375 21,045 23,312 24,818 27,536 30,205 32,806 34,328 35,798 SOURCEma t -od_u _an Ee tri c____ k SOURCE: Jordanian Electric Power Company, Ltd. June 1977. Page 11 of 14 ANNEX E
Table 4
JORDANIAN ELECTRIC POWER COMPANY, LTD.
BALANCE SHEET
ACTUAL 1976: PROJECTIONS 1977 - 1985
EXPLANATORY NOTE
TABLE 4 LINE NO.
1 - FIXED ASSETS IN SERVICE - The decrease in fixed assets between 1976 and 1977 was caused by the sale of the Marqa diesel power station by JEPCO to JEA. In 1974, a revaluation of fixed assets was completed. Year-end (December 31) fixed assets are initially recorded and valucd at cost.
2 - ACCUMULATED DEPRECIATION - Calculated at 4 percent per annum of fixed assets in service.
5 - TOTAL FIXED ASSETS - Line I less 2 plus line 3.
6 - CASH AND PAYMENTS IN ADVANCE - Based on historic figures plus an annual increase of 5 percent.
7 - ACCOUNTS RECEIVABLES - Based on a 58-day billing collection period.
8 - MATERIALS AND SUPPLIES - Based on 1976 inventories and assuming an annual increase of 10 percent.
10 - JEA ACCOUNTS (MARQA POWER STATION) - Marqa diesel power station sold to JEA was valued at a price of JD 5.250 million and payments are expected over the next three years (1977-1979).
11 - TOTAL CURRENT ASSETS - Sum of lines 6 through 10. 12 - PROVIDENT FUND INVESTMENTS - Pension fund increased annually by 10 percent, the historic growth figure.
13 - TOTAL ASSETS - Sum of lines 5, 11 and 12.
14 - CAPITAL STOCK - Par value of capital -tock issued to meet financial requirements of expansion program.
It's estimated at 600 fils per one JD par value share of common stock issued. Page 12 of 14 ANNX E Table 4
LINE NO.
16 - LEGAL AND OPTIONAL RESERVES - Companies law in Jordan required JEPCO to set aside 10 percent of n .t profit into reserve ac count.
17 - TOTAL EQUITY - Sum of items 14, 15 and 16.
18 - LONG-TERM DEBT - Based on additional long-term borrowing less amortization (or repayment) of existing long-term debt. 19 - SUNDRY CREDITORS - Residual between total assets and liabili ties.
20 - CONSUMER DEPOSITS - Based on historic figures with an annual increase of 16 percent.
22 - HEALTH CARE FUND - Based on an annual increase of JD 2000 per annum.
28 - TOTAL APPROPRIATIONS - Lines 25, 26 and 27 based on income statement projections for 1977-1985.
29 - EMPLOYEES SAVING PROVIDENT FUND - Represents amounts deducted from employees for saving in pension fund. Increased annually at 15 percent per annum.
SOURCE: Jordanian Electric Power Company, Ltd., June 1977 JORDANIAN ELECTRIC POWER COMPANY, LTD. SO(JPES & USES OF FUNDS PROJECTIONS FOR 1977-1985 (000 J.D.)
Line ITEM 1977 1978 1979 1980 1981 1982 1983 1984 1985 No. (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) SOURCES
1 Net Operating Revenue 1,171 1,547 1,881 2,359 2,981 3,600 4,003 4,014 3,363 2 Depreciation 486 61] 760 888 1,008 1.128 1,248 1,368 1,448 3 TOTAL ABOVE 1,657 2,158 2641 3,247 3,989 4,728 5,251 5,382 4,811 BORROWINGS 4 British Loans 1,103 217 ...... 5 JEA . Loan 200 - - - 6 American Loan - - 1,300 1,000 700 7 New Loans - .- 0 - - - 1,000 1,000 1,000 1,000 - - TOTAL BORROWINGS 1,30 1 1,000 1,700 1,000 1,000 1,000 OTHER SOURCES
8 Marqa Power Station 2,000 2,000 1,250 - - - - 9 Capital Stock Issues 1,000/ 1,000 - - 1,000 1,000 1,000 1,000 1,000 10 Premium on Capt. Stock Issues - 600 - - 600 600 600 600 600 11 Reserves 1 130 15R 205 217 318 358 354 284 TOTAL 2,101 3,730 1,408 250 1,817 1,918 1,958 1,954 1,884 TOTAL SOURCES 5,061 7,405 5,049 5,152 6,806 7646 8,209 7,336 6,695 D
D Ci
./Capital stock dividend revaluation. - 2 -
Line ITEMS 1977 1978 1979 1980 1981 1982 1983 1984 1985 No. (1) (2) (3) (4) (5) (6) (7) (8) (9) (10)
USES
12 ANNUAL INVESTMENT 3,123 3,717 3,200 3,000 3,000 3,000 3,000 2,000 2,000
DEBT SERVICES 13 Interest on Loan 164 243 296 311 365 415 424 474 523 14 Amortization 303 303 388 388 638 638 721 804 887
15 TOTAL DEBT SERVICES 467 546 684 699 1,003 1,053 1,145 1,278 1,410
APPROPRIATIONS 0 16 Cash Dividends Payable 445 579 706 913 1,214 1,426 1,602 1,585 1,270 17 Income Tax 453 587 713 922 1,177 1,433 1,611 1,593 1,278 o 18 Board Remuneration 8 8 8 8 8 8 8 8 8 19 TOTAL APPROPRIATION 906 1,174 1,427 1,843 2,399 2,867 3,221 3.186 2.556
20 TOTAL USES 4,496 5,437 5,311 5,542 6,402 6,920 7,366 6464
21 ANNUAL SURPLUS OR DEFICIT + 565 +1,968 - 262 - 390 + 404 + 726 843 + 872 + 729
SOURCE: Jordanian Electric Power Company, Ltd., June 1977
0. CL ANNEX F Page 1 5
SOCIAL ANALYSIS
The internal inigration pattern in Jordan is unique in that it is due mainly to the Arab-Israeli wars and the occupation of Jordan lands. However, a substantial part of the total migration should be attributed to income differentials and the inequitable distri bution of social services betwee.L rural and urban areas. The Amman urban area generally provides, in varying quality and quantity, most of the basic social services which with public itilities, industrial establishments, Government departments, and (commercial centers have become migration targets.
GOJ planners are aware of this situation and the consequences of a population surplus in the Amman area. This migration has brought about an increased demand for social services and a declining standard of living in the rural areas, with a resulting slow down or decrease in agricultural production. To help reverse this migration pattern, the GOJ is proceeding, with the assistance of AID and other donors, to develop the Jordan Valley both through the provision of basic social services and an infrastructure to inc-ease agricultural production. The basic social services are health, education, housing, electricity and water. In the Jordan Valley, AID is providing facilities for schools, clinics and the housing needed to staff these facilities. The Republic of Germany, together with the GOJ, is providing electricity and water. Both GOJ and AID are assisting the farmer by providing loans and equip ment.
Though there are no detailed economic and statistical studies regarding the causes of internal migration in Jordan, the search for a better standard of living and higher incomes are among the strongest incentives. The introduction of basic social services in rural villages is an objectivc of GOJ plans which, hopefully, will serve the following purposes: (a) alleviate the rural to urban migration and create a reverse migration. Achievement of this objective will minimize the budget burden and the social cost of having overcrowded urban centers; and (b) dampen adverse effects of inflationary pressures which caused a biased growth of Amman at the expense of the other cities and rural areas in Jordan.
To achieve these goals, the planner must optimize financial resources by finding the best formula for allocating funds between the economically productive projects and social projects. Cost benefit analysis is one method to compare the feasibility of any given economic type project; however, in the case of basic social services, projects do not entirely yield themselves to economic return type feasibility logic. ,iuaiiex F) Page 2 of 5
F-2
Social services provided by any government may be viewed in two different perspectives. The first, basic social services, inclLides only those services that are essential and directly affect the welfare of individuals, such as health, education, hx(ising, electricity and water. The second, more broadly defined, includes, in addition to basic services, those related to the productive sectors; and are primarily provided to increase produc tion in these sectors. However, the effect of these services permeates indirectly to recipient individuals and regions. Industrial, ag.-ic:ultural, commercial, transport and defense services are examples.
The GOJ Three-Year Development Plan (1973-1975) put special emphasis on the support and development of basic social services. The plan aimed at increasing income from government investments in projects related to electricity and water supply, construc tion and other servku-j. Among the principal goals of the Plan was the development of various aspects of economic and social activities throughout the Kingdom, especially in the rural areas. This was to be achieved by: organizing. and strengthening local governments and expanding their authority; increasing citizens' participation in the development of domestic resources; creating incentives to attract investments into various activities within rural areas; and curbing current migration flow into the Amman/ Zerka area.
Although growth in income was realized over the Three-Year Plan period, the actual impact on individual villages was not assessed. Progress in expanding the availability of social services in Jordan was made under the 1973-1975 Plan and was further refined and defined in the Five-Year Plan (1976-1980). To assist in this latter effort, the Ministry of Interior carried out a survey to determine the availability of basic social services in the rural areas of Jordan.!/ The survey included 794 towns and villages and 158 population gatherings in the East Bank with a population of nearly 1.3 million divided into seven population categories.
The most notable revelation from the survey was the large number of towns and villages of 1,000 inhabitants or less. These numbered 588 compared to 206 of more than 1,000 inhabitants. The survey further revealed that villages tended to concentrate in the two Governorates of Irbid and Amman which accounted for 546 villages followed by the Governorates of Karak, Ma'an and Balka which had 110, 73 and 65 villages, respectively.
I/ Source of Survey reference: Hashemite Kingdom of Jordan, National Planning Council, General Report of the Jordan Development Conference, Amman, May 31-June 2, 1976, Volume III. (Annex F)
Page 3 of 5
F - 3
Using the comprehensive survey method, field work carried out by the Ministry of Interior through local governments concentrated on the following basic social services: I. Educational Services were surveyed according to level, vising authority, super number of students at each level and of teachers. number The survey has put the number of schools all levels of (irrespective of the supervising authority) 1857 (excluding at 95 kindergartens) of which 911 were elemen'-ary schools, 804 preparatory schools and 142 secondary schools. The number of schools of all levels stood at 746 in the villages of Irbid Governorate followed by 612 in the villages of Amman Governorate. 2. Health Services: The survey has shown that there public are 277 clinics, 48 private clinics and 17 Trbid Governorate dentistry clinics. tops the list with 100 clinics followed Karak Governorate by with 77 clinics. The number of hospitals in all Governorates of the East Bank except Amman proper amounted to 19, of which 11 were public (having 693 beds) and eight private (having 213 beds) in addition to 27 health centers.
3. Agricultural Services: A survey of social services in rural Jordan must include agricultural services because of the prominent position they occupy in the development of rural areas. However, these services are not considered basic services since they indirectly contrit,ite to the incomes the rural population. of Therefore, the survoy includes important agricultural some services such as co-oporatives, exten sion services and veterinary centers. The survey,has r the number of ac.ricultural co-operatives on the East Bank ct 149, agricultural extension services centers at 94 and veterinary centers at 35. 4. Social Services: The survey included vocational, health social rehaoilitation and centers, charitable societies, and youth clubs welfare centers. Multi-purpose rehabilitation centers amounts to 20, charitable societies to 148, cultural and sports clubs to 25 and youth welfare centers to 20. 5. General Services: This category includes three services--water,electricity important and roads. The survey has indi cated that there are 333 villages whose water supply comes from various sources such as artesian and natural wells, springs and small reservoirs. The number of villages which have pipe or pipe networks was 403. Moreover, 58 viliages have no water sources whatsoever. For the purposes of this study, only villages with distribution networks are Ton sidered as having water services. The number of such villages is 372. (Annex F)
Page 4 of 5
F-4
As for electricity services, the survey has revealed that over 700 villages have no electricity. Of the 81 villages that have electricity, 62 are linked to the general network whereas 19 have local networks. Asphalt roads in rural areas cover a distance of 3403.kms. whereas the length of stone-paved and dirt roads are 18 kms. and 913 kms., respectively.
Furthermore, the Ministry of Interior survey includes other services beside those mentioned in paragraphs 1-5 above. These' are religions and postal services, economic activity of rural population and municipal and local government services. No doubt the survey is a pioneering effort which has resulted in a wealth of statistics and information which may prove of great utility to interested researchers. In order to give a clear picture of the prevailing conditions in the field of services, the Ministry of Interior has made a classification of social services in the East Bank Governorates according to population groups. The %ollowing table shows these tabulations. 138 (Annex F) Page 5 of 5
DISTRIBUTION OF AVAILABLE BASIC SOCIAL SERVICES IN TOWNS AND VILLAGES ACCORDING TO GOVERNORATE
Amman Irbid Balqa. Karak Ma'an East Bank
Total Villages 228 31- 65 110 73 794 population 388441 579639 139211 114281 54561 1276133 1. V I I L)es with Educat'i _on;TF Services k.iT, er9c'rtens 9 12 9 4 2 36 Elementary Schools 194 281 56 100 50 681 preparatory School 83 179 28 64 25 379 Secondary -,:hools 12 42 9 13 5 81 Commercial " 2 I I I - 5 Industrial " I I - - - 2 AgricuItural " - - - I I 2 2, Villages with [T'ailth Services public CITincs 45 85 28 58 32 248 pL'ivate CI inics 10 I I 9 I 22 Dent 1stry " 4 7 I 2 2 16 maternal & Chi Id care centres 8 12 5 4 3 32 public Hospitals I 4 I 2 2 10 private Hospitals I 10 - I - 12 Medical Centres 6 6 3 5 5 25 Blood Bank 2 5 I I 2 II pharmacies 7' 8 3 I 2 21 .Midwives 8 9 5 4 3 29 3. ViIla.es with Ele ctricity Services public nelwork- il 44 5 2 - 62 Local network 2 6 I 5 5 19 4. Vi I lIages with Water pipes Distributed to Hou ses 87 178 9 78 20 372 Undistributed 10 6 7 - 8 31 5. Villages with Po stal Services post F-f Te 23 59 17 28 9 136 postal Divison 80 122 31 47 29 309
: Excludi n9 Amman Proper Source: Ministry of Intt, ior. A'lI1!Z G-1 Page 1 of 5
'LE",CTiTr:'"" .*.,A) . ?i7--'":, PidI7',-192O 'jp lie¢¢,, 1 J, =' 3o
-i - - in 1 71 -
1976 1977 1978 1979 1980 Total
I Hussein itirnal 5790 4550 .1850 .-1100 2300 21890
POWC "totion Z/crq.i 2) 112 KV tra.nsmiss- 780 1340 1700 1200 250 5270 ion stLle :i) Interconnection 250 400 350 -- j 1000 with Syria 2 I Jordan Valley 700 1400 300 2400 clc rifi ation I IrOjt'c I
5) Kar;ak di.trict 700 1000 800 -- ec't ific t ion 2500 project ;) Exlansion project 1715 1560 900 900 900 5975 in Allllan area 1 K)xli),Ision projest 465 280 220 200 165 1330 Ill north irva ) Aqalba *lectrifi- 450 1700 250 -,--2400 cat ion pIroject 9) Power SUpply deve- 70 --... l 7 70 l oplm tent in the S0,11h of .ordan
Iota! 10920 12230 9370 6700 3615 428.%5
BEST AVAILABLE COPY JORDAN ELECTRICITY AUTHORITY PROJECTS MIlv P)75 and is runnimn.-ice then satiot et.r,[ The first inspection c:,carrieda out .:id ,:stlts were Projects Under Implementation encouraging without any considerable defects During the year 1975 I-A Hussein Thermal Power Station/Stage this unit has supplied IFPCO and I the Refinery with 45 G.W.1t which is about 211!%l of the This stage comprises the supply and erection of 2x33MW. total consumed energv in Amman area Steam generating units together with their associated electr ical, mechanical and civil works, and the supply and erection b) 2x33 MW Steam Units of a 15 MW. packaged gas turbine unit with all its related 1. Electro Mechanical Works works. The equipment is supplied by Messrs Breda of Italy for The power station is located at the East - South side of the boilers part, Messrs TIBB of Italy for the electrical the Jordanian Refinery approximately 6 Km from Zerqa town equipment, Saunir Duval for the transformers and GEA and erected at an average sea level of 547 meter . for the condenser
The fuel oil needed for the boilers is transfered by 8" pipe 2. Civil Works line, 1.2 Km long from the Refinery and the water ral services All the excavation works and 80 % of concrete works is from 6 deep wells already drilled in that area . have been completed .
The main distinguishing feature of this power station is that The power house is expected to be completed in the cooling of turbine steam condenser and cooling towers is first half of 1976 and erection works are planned to be effected by Air and not by water as done in other power stations completed and unit commissioned before the end of year located at sea or river side . 1976 .
Works under this stage were divided into 10 tenders to - B 132 KV Transmission System project/Stage I cover site borings, supply of materials and erection of the various electrical, mechanical, and civil works .This stage of the project comprises erection the supply and of materials , equipment, instruments and tools The total cost of this stage amounted to eight million required for the building of 37 Km of 132 KV double circuit Dinars, foreign element of which is financed by two equal over-head line between the Hussein Thermal power Station loans from the International Bank for Reconstruction and Deve- at Zerqa and three other substations 132/33 KV -at Zerqa, lopment (IBRD) and the Kuwait Fund (KF). The value of these Marka and Bayader in addition to the supply and erection of loans was $ 10.2 Million each and the local cost to be financed materials and equipment relating to the above - mentioned n by the Jordanian Government substations and powor line carrier system . . During the year 1975 the following works havL been completed : Works under this project were divided into five main ten- o . ders for the supply and erection of the equipment and the a) 15 MW Gas Turbine Unit relating civil works. These tenders were awarded during 1974 This unit was manufactured about 65% of the works for the supply and erection of the and erected by Messrs West- overhead transmission line and the main substations have inghous: Canada Ltd. The unit has been commissioned in been completed The total costs of stage I of this project amounted to Iit 2,346,000 the foreign element of which is financed by a Brit:.n Loan amounting to JD 1,738,000 while the local part is finai; Erection and operation of this project is exp:.cted to be ced by the Jordanian government. During 1975 JD 1,450.0ot completed during 1978 were disbursed on this project The total cost of this project is estimated to JI) 2.500.000 Messrs Preece Cardew & Rider of U.K together with tWc to be financed by the government JEA staff are carrying out the site supervision of constr,- Messrs preece Cardew & Ridew of U.K together with the ction. JEA staff are carrying out the consultanty works
I- C 66 KV Line - Interconnection with Syria/Stage I 2-1B Jordan Valley Electrification project
The first stage of this project comprises 66 KV ovei This project comprises the erection of a 33 KV distribution head transmission line between Dera' and Irbid with a lengtih network all along the Jordan Valley and erection of spur lines of 20 Km Jordan together with a main substation 66/33 KV to provide electricity to the various towns, villages, water in Irbid. The capacity of power exchange on this line is pumping stations and other centers in the valley together 10,000 Kw. About 150% of this project have been completed with the erection of the LV networks in these towns and during the year 1975 villages. Power will be provided by the Central power stations in both Amman and Irbid through 33 Kv transmission 'lines Projects to be implemented extended from Bayader substation to Shouna and to A'arda Junction and Samma to North Shonua 2- A Karak Electrification project This project comprises the following :The works have been divided into two tenders the first of which comprises 33 Kv transmission lines and 33/0.4 Kv substations, 1- New Central power station: was floated in October 1975 and it is expected to be awarded The new power station includes three Diesel generating in the second quarter of 1976 . The second terider comprises sets, 1500 Kw each together with their associated elec- the LV distribution network and is planned to be floated in trical, mechanical and civil works . Works under this the first quarter of 1976 and expected to be awarded on the project were divided into two tenders the first of which third quarter of 1976 . covers the generating sets, and it is expected to Ihe, awaerdhe du rating setsndit ofpecd19 isur T he awarded during the first quarter of 1976 . The other lpail The completion of this project is expected to be during 1978. covers the civil works and is expected to be floartd Total cost is estimated to be JD 2,597,000 the foreign element during the first quarter of 1976 . amounting to 1.678 Million JD will be financed by Loan from the The completion and operation of this power station i.; German Construction Bank (KFW) while the local element will expected to be during 1978 be financed by the government . Engineering and Consultancy works for this project is carried out by Messrs. Lahmeyr Inter 2- The Distribution network national of West Gernamy . > 0 O This project comprises 33 KV and LV networks toctn Lo electrification of 23 towns and villages in Karak di.strii' 2 C Aqaba Electrification project t Tender for the supply of the required materials havet *,. q, The cabinet of MVinisters decided that all electrical works at awarded and the delivery of these materials will b i Aqaba should be handed over to JEA as from January 1976 . JEA will implement 1st the following new projects in Aqaba: JD 7 Million. the foreign eler-ent of whiih ,ouid in to .ID 1. Two mobile diesel generating sets 1000 Kw each to increase 6.10,000 to be financed by a loan froii t:h. lnt'r.H onal Bank the capacity of the existing power station and to meet the for Reconstruction and Development for :i valu- of five increased load during the interim period million Dollars and a loan from Arab fund for FConomic and Tender of these units was floated on November 1975 and Social Development for a value of JD 4,326,00o . ie the local the expected date for award is the first quarter of 1976 element will be financed locally. Messrs Kuljian (.nrp. of U.S.A. and the expected completion and operation of the units is are carrying out the Engineering Consultancy works. June 1977
-E 132 KV Transmission System project/Stage II 2. New Diesel Power Station in Wadi Yusuf This stage of the 132 KV transmission system comprises -M This powerah station t gte comprisesih te twoas caediesel generatingii, Eetiasets 3MW each together with the associated civil, Electrical 1. The interconnection of the cement works at Fuheis with and mechanical work and the interconnection via 33 KV the 132 KV system through 132 KV Double circuit trans- lines of this p. station with the old one mission line having a length of 7.5 km from Bayader Sub- The tenders of this project is expected to be floated during stations to the Cement works in Fuheis together with ne- the first quarter of 1976 cessary switchgears and transformers in both Bayader and Cement works substations . The total cost of this project is estimated to be JD 2,700,000 the foreign element of which is to be financed by a loan Tenders for this project were floated and it is expected to from the German Construction Bank (KFW) amounting to JD award all the tenders during the first half of 1976 . 1,932,000 while the local element is to be financed from The completion of the erection and operation of the pro- the government. ject is expected to be by the end of 1977 . 2. The interconnection of Irbid with the 132 KV system thr- Messrs Fichtner of West Germany are carrying out the ough 132 KV double circuit lines between Hussein Thermal Consultancy works for the project power Station and Irbid with a total length of 60 km. Also the interconnection of Irbid with Syria through a 230 2 - D Hussein Thermal Power Station/Stage 11 kv transmission line with a length of 17 kms from the Due to the continuous increase in electrical demand and accord Syrian borders to Irbid substation together with the assoc- ing to the studies conducted, it was found that a second gas iated switchgear and transformers for both Zerqa and Irbid turbine would be needed to be running in the first quarter substations . 1976. Also a third 33 MW steam unit would be needed in miu 1978 Technical specifications and tender docuients for this project have been prepared to be floated in 1976 . The Technical specifications and tender documents for both unit. completion of the erection and operation is expected to be were prepared during 1975 and a contract was signed with end 1978 beginning of 1976 . Messrs AEG-Kanis of Germany to supply and erect a 18.8 MW The total cost of the project is estimated to be JD 6 million packaged Gas Turbine with a cost of 3D 1,250,000 . the foreign element of which amounts to JD 2,340,000 to The implementation commenced and the completion and ope It be financed by a loan from the Arab Fund for Economic tion of the unit is expected to be in May 1976 . P-- and Social Development and the local element to be finan- Bids for the 3rd steam unit have been ced locally . JEA together with the Syrian Electricity received and opened 01, It is expected to be awarded during the first quarter of 19U Corporation is carrying out the Engineering works . and completed during 1978. The total cost of this unit is about Projects Under Study - Projects Financed and supervised by JEA 3-A 132KV Transmission system/stage III 4-A JEPCO continued the implementation of the expansion of its JEA in cooperation with its Consultants Messrs. Preec: Car- distribution system which is financed by a dew & Rider conducted studies related loan from JEA to the extensina of amounting to JD the 132 3.100,000 . During 1975 many tenders for KV transmission system . Results of this study supply and erection of the necessary equipment showed the necessity of a 35 km double for the 33 circuit overhead 132 KV overhad lines kv line and underground cables and 33/6.6 KV sub between Hussein Thermal Power Station and a new stations in the concession area have been 132/33 awarded kv substation at El Qaser South of Amman to lw, ope rativeTie ei in 19800s . Due to world price escalation and technical modifications done on the company's projects JEA approved The estimates for the total cost of this project amounts to extend its to "loan to JEPCO by an additional loan three million Dinars . amounting to JD 450,000 An agreement to this effect has been signed between both parties. 3 -B Electricity Power Supply Development in the South of Jordan Due to the expected expansion in some of the existing iidu- The JEA has also obtained a loan from the British ODA for stries in the Southern areas of the Kingdom such as the ph- the value of £ 1.9 Million to be rdent osphate at EI-Hasa and to JEPCO to cover the Aqaba port projects, and estab- increased cost requirements of its expansion plans . JEPCO lishment of new ones such as fertilizer, Potash, irrigation, JEA and NPC are expected drinking to finalise signature of the loab water , railway projects , tourism projects and agreement during the first half of 1976 rural electrification JEA signed an agreement with Preece Messrs Cardew & Rider of U.K to study and submit a feasi- 4-B IDECO completed during -1975 the implementation bility report on the Electricity of its power supply development in generation and distribution projects that are financed by a loan the south of Jordan. The submission of this report is dute in from JEA amounting June 1976 to JD 1,600,000 These projects comprise the erection of a new power station 3-C Hussein Thermal Power Station/stage IlI including 3x3 MW Diesel generating sets and 33 KV overhead lines in the various parts of the district for rural electrication JEA instructed their consultant, Messrs Kuljian Corp. to purposes carry out a feasibility study on the expansion of the Hussein Thermal power station by adding one or two steam units, 66 MW each, to match with the increased loads. The consultants is due to submit their report during the first quarter of 1976.
3-D The JEA started during 1975 a field survey to all villages in Jordan in preperation for studies on a national rural ele ctrification plan . This plan will cover all towns and villages whether lying in electrified areas or in remote areas . It is expected to finalise the study and submit a report on it duir ing the first h-alf of 1976 0 . Implementation of the same is M envisaged to be started during 1976 . ANNEX G-2 Jordan .ect'c~tvE Authgrity Page 1 of 7) Rational Rural Electriflcal~n Ln,
I. Introductign
RuraliElectrification In Jordan has nat bmen given the properlattention for a long period; and at present the very IbaLted number of rural ara.ai with saui.l sca tter'ed eletric power supply systems muffer from supply conditionsgbelow the required standards, similar to other ba.sic social servicess. A rapid intern.al ismigration from rural areas to urban areas in Jordan is uni-puin that; it is. due ulItin ly to the Ar'b-Israil warm and also due to substantial income differentials and socinl sorvic.es, inenuitable distribution between rural and urban centres. At present most of the basic social smo-vices, public industrial utilities, activities, public departments and coimrcial contros are located at Amman and Zerqt areas and to. less degree at Irbid.
Consequently a lot of problems with unpleasnt con sequences arised from population surplus in the Urban areas on the one hand and the decrease of population in the rur.,l areas on th. other hand. The Jordanian Planners, being awaire of these facts have made one of their the objectives t, il levisite rural urban migration, to redistribute more bly c iitai the basic social services end projects and and to dampen the adverse effects of inflationary press ures which c.used a biased R:rowth of Amman at thf- c,)st of the other cities and rural areas in Jordlan*.
In 1975 the population of Amman amounted 1,004,560 to persons i.e,, 38% of the whole Jordan. Tho annual rate of growth of Axmnn population 11% ,. oiAnted to for the period (1966-1976). During 1975) Amman 93% had of all Jordan's economic establishunent, employi.ng 5 persons and more, 94.% of Jordan's outstading extended crodits to activities or peri.sons, 10(K of Inaurin:es corpanies, 95% of non-agricul tural And non-governm,,ntal labour force, 70'A of government offices, 54-1 of etc. hoapitals For 1970 82% of total electricity units Jordan generated in 8.1% of total units consumed and 70-, of total number of consumers in electricity h.:ve bern However, in Aminie it .hould be box-ne inmi1o, ,when e--king plfns in the rural areas that those servi'ces are an ,,r r .. and must be implemented irrespective of their costu and benefits. The national rural electrification plan r'ep resents one of these major socialiservice projects to be Imploemintede
2/.0 -2- (Annex G-2) Page 2 of 7 2.' : ural Jordan The Ministry 2 of Interior has carried c'r'der to deter-ine the out 1i SLr-,y availability of basic in in the rural goriil eer,,ce..; a:eas of Jordrn. The and villages survey include.,.! 794 aed 158 population gatherings tciris with a population In t,e East 1.ank cf nearli 2.3 million divided Into sever. p;culation cat.-gories. No doult the survey aIttributes has revealed some out stan:irig of rural Jordan. The t:!e hi:th most notable of t:,sge number of towns and irs r les villages of 1,0(0 .Ir.-,,bIt.,!,nt: --'-- w.,ich ,".d to almrunt-.i t, % 206 c. more than 1,000 ' '86 L--rt.her revealtd Inhabitarts. The tblat villges tended C,rw( y has twj Go''rnoratt to conc-:ntr(,t.e in tf!, s of Irbid and Aman as 546 villac,.s which bet oeer, . followed by the Governorate.. 1.a'an etid Balk. wtich of tarak, had 110, 73 and 65 vill-,ges, Lively. respec- The attached table NO. (1) Includes !.-! E;U:vey s.-, .inj a sur mary of t: the availability of c'es iri tne rk.ral basic so,:'ial ;sv.r areas of Jordan. These seivics are co, '.?:trat.ed on t: .- following: .1 Educaiti )na. Servces:.. nesel %-re surveyed accorcing author,!y, to level, s.;,ervisin. number of students at each lev. I numbe f teacher.s. The arid survey has puli tt," sho o of all levels nurt,ft it (irrespective of tfl , sing a;.hority) at supervi '1857 (excluding 95 Kin O whil 911 were elementary jr(3artfri:l ) sChool. schools, 604 preparat -ry and 142 secondary school;. s diool, of all levels Th.- nuna er of stood at 748 in the village; of lirbi Governorate followed by 612 in t.,e vllia,: of Aimm .- Governorate., ,.2 H-eal tn .,-r'.ices*_ ' he suL .ey has Shiown that there ,ind 17 entistry are 2',7 rlbic rliCs clinicc . lrt'id Goverr list wi .h 100 Clinics ,rat,, tc.p. followed by Kar.. ','.verr, ,wit, 77 clinics. The nurrber :, , of :cspl t., .s i A; norater of tne East Bank all r except Amman rog-er to '19 c: whicn 11 were errcr t:l:d piblic ( )-avin 69? ei(jht F ivate ( havin; be(s) i 213 beds) In a,...jitlcn health -ntetrs. to ;./
A surve of social services In rural .,rdan a(ric¢ult ural services m.st ir.r:lu, becaise of the --owine.nt they oc upy in tie development po!iticr these s-rvices of rUrAL iirra. Howevr are not considered bas': they in, irectly rervi es since contribute to the populat ,n. Therefore, Inc(.;nes of ',Th r;..al the survey Inc! .des tant acr Icultural services imptr tension ruch as co-,.pera,..,:. services and veterinary ,A has put centesn. !h the number of agricultural vey the co;-,pera~tiv, East fiank at 140, agricultural s on extenslon service-s centers at 94 and veterinary centers at 35. EiT AVAILABLE COPY (Annex G-2) Page 3 of 7 '2.4. Social S'orvices : The survey included vocational, health and social r4,habilitation centers, charitable societie:n, clubs a'nd youth welfare centers. Multi purpose rehabilitation centers amounts to 20, charitable societies'to 148, cultural and sports clubs to 25 and youth welfare.centers to 20.
2.5. General .ervices :This category Includ,'s three impor tant services : water, electricity and roai1s. The survey his indicated that there are 33:, villages whose water supPly comes from various sources such -N artesian and natural wells, springs and small re servoirt. The number of villaces which has pipe or pipe networks were 403. Moreover, 58 villli-ces have no water sources whatsoever. For the purposes of this stLiy, only villages with distribution networks are considered as having water services. The number of such villages is 372.
As for electricity services, the survey has reveailed that over 700 villAges have no electricity. Of the 81. vill,iges that have ele,7tricity 62 are linked to the yJeneral network whereas 19 have local networks.
Asphalt roads in rural areas cover a distance of 3403 Kms whereas tie length of stone-paved and dirt roads are 18 Kms and 9-3 Kms rerspectively.
Further-. re, the Ministry of Interior .urvey includc' ather .ervicf beside those mentioned in pAragraphs (1-5) above. These ire religions and postal servi-.es, ecoic,ic activity of rural population and municipal and local qover nment services.
3. Exi.tin.g Rural Electrification Projects,
As refe:..d to above, only 81 villagen in Jordan enjo ,:,lectric ser'ices out of a total of 794 villagns i..e. 1 of the total "*un,er of villages. 713 villac," are left with out electric!ty.
62 villl:.-ies out of the 81 are electrified via regionpl 33Kv overheat. line networks. Whereas the re:.t of 19 villaqe!. are electrilf.,?d through local small unreliahle diesel geni.! rating units And L.V. distribution networks.
About ' %of the electrified villages lie In the Airman and Irbid ar, *s wtich are served by the private electricit.y companyE. T ,, rest lies in the southern p irts of ordan and ar. s~rv'd' by mulnicipal council project..;. In most c,=,,z the supply in the rural areas is effected throuci exterding the 'existing 33Kv three Phase sy.stems to the villa, es, and installing 33/0.4/0.2"!Kv distribu tion transformers and serving most consumers in the vill ages directly from 400/230V networks. In a few cases, prin cipally in 1!olated areas served by diesel 11Kv and 6.6Kv is used. 8urg3 Electrlg .catln Plan --4. (Annex G-2) Page 4 of 7 4.1 Selectior, Criteria: This plan calls for the electrification of all villa ,s in Jordan with inhabitants of 500 and m, re. The!e ar,'.unt to (226) .'illages distributed as follow,:
L;overnoratle Inrablt, t) t ! ~~~5015-999 ;U 00-1 ., ,u e C] . . .. - Amman & B1a24 - Irbid 23 23 t C' 32 24 63 - Karak 11 14 - Ma'an 14 5 2 1 ,3 rot& 5 1017-
In additi, r to th'e above villages, there ire (25) otf,..-:- vi lla,-estwit'l population less than (500) 1 ..t are very cl.:Pse tc t!e networks and could be electrified with the mrlr.mun CO ts. Con:equent ly t he total number of villag'., includ-d in the nat lonal i iral electrification plan i1 (.31) vil Lage:, aric of wi. :n (12) lie in the remote area , whereas reotainder amounting tie to (239) villages li,- in trhe vicinity of existin] 33 kv networks.:
4.2 Electrical Demand & Fnerqy Requirementst Based on statistical figures from d:ffer-nt rura. ar-eas, it is assi. ned that the average annual erryv con;sumpt cn of a rural consumer is 335 kwh, and the 'veione riaxa r, loads is 2L0 watts. It is assu-ed that only 40% of the total pop, lat. :,n c-f each villa-e will be connected to the net vork r,. ! n. e first year of operation increasing , t.o ab,Lt 90 ': ier 7 years. It is also assumed that the average pers. ns per c rs.L1.vr is 6.2. Load factors in rural areas are expec:ted to be lcw during the early ':tages of the project (207. apptox.) iJncrear Ing slowly untill electricity is utilised in ru(al farmliJ, industries and other possible projects. Ba;ed on t'.ese assumption, it is expecte,.. that the a.:.I itional corsumption dir to Implementation of the plan will be ab, ut (2) GwlH during the tirst ye-r (t op.erat,,-n of the fir;t stage rising to about (48) C.b after 10 years. The additional maximum demand will be about (j) MW during tne first year rising to about (27) i-W after 10 years. .4.3 Cost Estm te 4.3.1 The following assumption have been made to at tie arrive cost estimate of the plan: (1975 price levels):
- 33 kv overhead lines (000 JD/Km - Pole mounted listbution s/s -50 KV 1300 JD/:s/s - 100 K A 1500 JD/:i/s
BEST AVAILABLE COPY (Annex G-2) Page 5 of 7 L LV 'dist'rlbution networks - Villages of less than '20C10 1600C JD. vili. 'je inhabitants -V.1laLes o more than 2000 20000JD/'viAla.e Innabit ants
- Sall diesel power station - 60 -100 kw units. 150 Je',s. - 500 kw units 200 JOD,
4.3.2 The plan comprises tne following w,,aifn elenenti,: - No. of villages 251 village - Population of villages(1975)3961)00 rerscn - L, nith of 33 kv lines 880 k.n - Diesel units 7x11.) kw+22,60 4.3.3 Tot i1estimated cost JD - C:r.,t at 1975 price level 10,455,000 - E,',-alation 3, 3,?2, 00C: - C ntingencies Iti10,0(;": Total cost 14, .77', 0O 4.4 Implementarton schedule Te plan is to be implemented In 5 annual st.i'ges in Fil areas except Irbid where it will be implenented in 7-: stages. Tho 33 kv overhead line network is to be as an exten:.:on of existin; networks In all areals. It is expected that implementatilon will start early r *xt year.
•. o s: - It is assumed that locally produced prestresse" concrete ;..,.:les will rt-used throu hout the whole plan. The existin' concrete pole plant ownet by the JEA having an annual Frocuction cit a city of 3000-50 0 poles will not be able to cc-.er the req*iremqnts of the pla41 in time, and thus either it shoulc ie extends, or even a new "ole plant neare to the rural areas to be built. It.Is estimated to cost about 250,000 JD. 6'. Sk.ir.1,;-. ry Tabh. No. 2 shcq!- numbers of Yillages and st .es of impl. -. ntation in each .,istrict, the Capital cost at 1973 price i.'els, cuntircencies an:J escalation of the cost. The tazle aLso -. owt a breakdown of t, e cost between local ana forelgn elewent!.
BLE'JT AVAIL-ABLE COPY (Annex G-2T" P1 6,of 7
SURVEY OF, SOCIAL SIAWVIC Table 'I- C(.MPREHENSIVEU., RURAL AREA ACCORDING TO iGVEi,.-UTAI'h
EAiT A .,MAN IkBlID BA.QA KA.- 4K BANK
1N.,. r'f Towne & Villages 794 228 318 .5 1l.C Po:,ul,.t:ion Categories less than- 2451 97 71 17 27 20I 01 22- j -500 220' 66 80 . 3C 5'1 1000 123 32 59 13 10:;1-1500 58 10 26 7 15.:1-2000 35: 4 15 e 2,-)1-5000 79, 9 51 50"'-And over 34' 10 16 3 - c:"".onl Servictr !;nools 1857' 612 748 172 214 Kind' ertenF 95 35 25 21 9 Eleri, :;it ry Scholl a. E.os 316 233 104 24 n b. Girls 326 142 119 7 ;4 c. qo-Educational 269 81 92' 37 4'C Pr;-p,:1!-tory Scholl!: '.. bys 456 93 274 27 3F .. rls 2.276 69 130 P2 1 C. .'o-Ed&.ationfll 72 14 33 5 , Y!: 93 2 1 45 6 4 . Irls 62 19 211 5 7 ti. 1 I~EXvi ev Clinics . 1, 1CrliC 277 45 91 2? 65 I.. -riv. te 48 12 - 21) Dr.ti: try Ci1nics 17 4 9 2 2 Hato .r il & Cnildcare Centers 31 8 i.D 4 Hedi,:zl Centers Ho.--Atals 27 6 6 3 7 mi.. Fublic 11 1 4 2 b. Pri.va te 8 3 4 - . Drfr '..t' 1 ,. V~lI;!',... th water pipes ;--. tribl,-t-ed t-) houises 31 10 6 7 - b. .nd~jstri'utec 272 87 178 9 78 , 1ec', . ,:t,,l ervic( VE.L,,, ::lMctriciry 1it:ot 73 215 269 59 O3 I '".. with I ectricity VI V * a. .: -fral netw.zrk u2 11 44 h,. ' ,1 networt: 19 2 6 . L,> . .. vt. Authorities 7 Nu .: 11 Q4oLncils P6 16 42 16 V1'i,', Council 191 34 877 6 44
E£t..'2!ding Amman Proper source: : Ministry of Interior
BEST AVAILABLE COPY' - t4|--_- k1 .iCWjp~_T 7i~Z~Z~A~~CT-Table 2
CCUST ESTIF-AME Or X~.& !AT0 'LRL.L£','ti77,
vistrict/Hegion Neo. of Vill- LOeCot at 1975 C:ntin;;cnciep:| &.&ola- Total . ages Level ForeiGn Local Total
- Amman & balca 5tases 1,11,111 65 2583 293 728 2162 1442 3604 & Iv (1977-1981)
II - Irbid zmtawes 1....VII 121 5168 5b6 2026 4 3112 7780 (1977-1983)
III- Karak Stage II 33 1094 62 152 785 523 1308 (1979-1980)
IV-- Tafila area Stage 1 7 720 81 88- 393 396 989 (1979-1980)
V - Shoubak Stage I 7 341 17 94 271 181 452 - -m1n71.1980) VI Remote "Area& Staqe 1 12 54 61 134 520 224 744 -i979-1980)
t455 32Z 5676 14677
|x
MX -J010 !;:EX H
E. cI tyicj ty _v j: S:pf(-, T:arl f
From The JSA To Conlr r In
Am,;t n Area APPj07E -iC- 1, 1q77
The Prices of electrical energy supplied in DiJm; Iy the Jordan Electricity Authority in thie Amman area,, sIng Amman and Balqa governorates are determined by vijit,(e of Article (31) of the General Electricity Law No. (it) of 1976 as follows :-
I- The followinq prices of electrical enerijy Fire to be charged 'o consumers supplied in bUlk by JEA :-
Maximum Demand Tariff : A month~ly lumo. swtrn of JDiKW of monthly nw;ix imum demand.
Day KWH Tariff : A rate of 8.5 fils/KWH sold
durIng the duy hours lset:weten 0700 and 2300) hours;.
Night KWH Tariff : A rate e± 5 fil ,I, ween 2300 and 0700 u1,, .. 2- The above rates wil be increar(Id by 0.041 I 1 1:; for each 100 fils tiat the cost of fuel brii,,: at the Hussein Therman Power Staton ex.....b. JD R.0/tonne. 3- .Iectricity b. ll. r iould p',I .r ,:,or,ti,]y. d,,,.Ii .iver the consumerr., delay ti py:.t.riL of l., bills beyond a period of one month afrterI i, .hij:. payment; are due, then an intezest of (1%) p,,r month will be applied on amounts due and rot paidd. (Annex H) 4" The consumers should unde-t;)Ke to irriprove thr. .."r factor at their premise!s at -he,-, not. Iost; thtnh (0.85), in cas. of ariy d&'cre .; Ili the power factor blow (0.65), th#. con:511m-' wi 1 pay In addition to his electriqity 1l1 the foLiw- Ing penalties :- Conspunrs Powter Factor The irncrea;e _ 0.85 No increase 0.85-0.70 0.77% of the total bill for every 0.01 of power fict, r less than 0.85. 0.70-0.60 0.95% of the total biJl for every 0.01 of p.f less than 0.35. 0.60-0.50 1.2% of the total bill for every C.01 of p.f le:.s than 0.85. Less than 0.50 1.5% of the total bill for every 0.01. of p.f lu,.;i; than 0.85. One flls'per KWH sold to be allocated for th,', lo:. of financing the Rural Electrification Proje:tr:Iii In, Jordan, and to be deposited in a special fund -0 J1NA for this purpose. (Annex H) Page 3 of' 11ctrig ,t¥RetailTariff From 3 PCO To Consumers In Its Concession Area The price of electrical energy supplied by the Jordan Electric ' Power Company in its concession areacmprising Aman and Balqa governorates are determined by virbue of Article (32) of the General Electricity Law No. (8) of 1976 as follows, : 1- The following prices of electrical energy are bo be charged to consumers supplied on L.V distribu tion networks by JEPCO. StandartTariff :- It is applied on Domestic, and public buildings, Hospitals, Worship pl: aces, Broadcasting & T.V, Street lighting and Pumping water stationssingle and three phase supplies. Fiat block : From 1-100 KWH/month a. 30 fils/KWH Second block: Over 100 KWH/month ---- 23 fils/KWH ,Commercial Consumers Tariff :- For all Commercial consumers single and three phase supplies. Fkst bl&ck : From 1-100 KWH/month ------35 fils/KWH Second block: Over 100 KWH/month ------28 fils/KWH Small Industrial Consumers Tariff : It Is applied on small industrial consumers who are supplied from the L.V network (400/230) Volt for single and three phase. (Annex H) Page 4 of 5 Finat block z Frpip 1-100 KWh/month --- 35 fils/KW5 Second block : From 101-2500 KWh/month-21 fils/KWh Third block :: Over 2500 KWh/month --- 1 5 fils/KWh Large-Industrial Consumers Tariff It is applied on Large Industr ial Consumers who are wupplied from the H.V network and subs tations. Maximum Demand.Tariff,: A monthly Lump sum of JD 2.7/KW of monthly maximum demand. Day KWh Tariff : A rate of 11 fils/KWh sold dur ing the day hours between 0700 and 2300 hours. NightK(Wh Tariff : A rate of 6 fils/KWh sold dur ing the night hours between 2300 and 0700 hours. Off-Peak Consumers Tariff: (6) fils/KWh sold during the night houss between 2300 and 0700 hours. 2- Minimum charge for domestic consumers is fixed at 75b fils/month. 3-. Minimum charge for commercial consumers is fixed at JD I/month. (Annex H) Pa(W 5,of 5 4- The company will continue granting reduction, for certain consumers in accordance with previous arra ngements followed so far. In addition to that JEA employees connected to the company's network will be geanted a reduction of 75% from their total monthly consumption. 5- The consumers should undertake to improve the power factor at their premises at their own cost to be not less than (0.85), in case of any decrease in the power factor below (0.05), the consumer will pay in addition to his electricity bill the follow ing penalties 2- Consumers Power Factor The Increase 0.85 No IDcrease 0.85-0.70 0.77% of the total bill for every 001 of power factor less than 0.85. 0.70-0.60 0.95% of the total bill for every 0.01 of p.f less than 0.85. 0.60-0.50 102% of the total bill for every 0.01 of pef less tian 0.85. Less than 0.50 1.5% of the total bill for every 0.01 of p.f less than 0.85. 6-M The company should provide the necessary metering equipment required for the application of large Industrial Consumers Tariff and off-peak consumers tariff with4.n a period of six months from the date of putting this tariff into effect. During this period small Industrial.Consumers Tariff will be applied on Large Industrial Consumers. AIO 1020-2 (1-72) PROJECT DESIGN SUMMARY Life of Projc: LOGICAL FRAMEWORK From FY 77 to FY 80 Total U.S. Funding $9.O00.O00 Project Title & Number: JORDAN RURAL AD URBAN ELECTRIFICATION 2780209 Date prepared: August 10. 1977 NARRATIVE SUMMARY OBJECTIVELY VERIFIABLE INDICATORS MEANS OF VERIFICATION IMPORTANT ASSUMPTIONS Program orSacor Goal: The broader objective to Measures of Goal Achievement: 1) Census statistics whichthisprojectcontributes: and studies by Asumptio for achievnggoal target Improve the quality 1) Increase in the average family government agencies (GOJ). of life for 153,000 village inhabitants, income of households in the villages Appliances Available on Local to be electrified. 2) Sales records of local stores Market. 2) Increased ownership of electric Public Recognition of the appliances, advantages of the accessibility of electricity. ProjectPurpose: Conditionsthatwill indicatepurposehasbeen JEPCO billing and service 1) To permit the records will Assumptionsforachievingpwpose: utilization of electri- achieved: End of project status. determine number of connections made. 1) Equipment and materials will city by 24,000 potential consumer units 1) By 1980 about 2500 connections wil3JECO will submit annual reports on July located in 37 villages and, be procured and contractors be made in 35 villages and about 1, during 5 years starting in 1980, 2) to contribute to improvements with selected to carry out erection in the 12,000 in Baqa and Schneller areas, such data included realiability services. and increased quantity of 2) By 1980 the central power control 2) Inspection will verify operational 2) JEPCO maintains accepted electricity available to commercial, center in Amman will be operational status of control center. Quantity of accounting industrial, and residential consumers in procedures. and transformers will be in process transformers installed will be resources to fund their Amman. verified 3) JEPCU provides the financial contri of installation in upgraded system by JEPCO warehouse issuance records of bution to upgraded system materials to erection contractors, materials and equipment. 4) JEPCO personnel expansion to meeting andmanpower technical needs for account services in Outputs: Magnitude ot Outputs: new areas. Assumptions for acieving outputs: 7000 poles isual site inspections. Erected poles, strung overhead lines, 1) Availability of adequate Installation records of JEPCO. design staff installed transformers, circuit controls, 600 KM of overhead lines in JEPCO or its and rotctiv-- deices consultants. and protective devices. 2) Availability of sufficient 61 tasomr poles to be provided by JEA to 61 transformers roject. S vailabiliti) of qualified 1 control contractors and JEPCO construc center tion units. 4) Availability of JEPCO funding 5 Availability of erection supervision staff. Inputs: Implementation Target (Type and Quantity) 1) Review and acceptance of lowest re- 1) By AID: Electrical materials Assumptions for providing inputs: and 1) Award of procurement contracts for sponsive tender. equipment and services, 1) Continuance of consultant services equipment and materials. 2) Review of designs and IFB documents as now under contract with JEPCO. Ex 2) Adequate staff and assistance from to technical adequacy. Review of JEPCO pansion 2) By JEPCO: Technical services for of JEPCO staff to handle consultants, operations and staffing to ascertain design plans and specifications. additional consumer services. 5 a 3) Erection of new pole plant and capabilities as to utility management and 2) JEA and JEPCO recognition of critical | Utility management services for expanded capacity of existing plant. operation, role of poles in project. operation. aD 3) Production from new plant. 3. By JEA: Adequate supply of utility poles. ANNEX J Page ~.of 2 -1 At|. •, jr! / J.":., J hNO1 ,1.1- CEAA 4.,.n.Il\N Ii 17+ 0 A AM~ (A 'N k.- ----uN.- A.CTIO."> ':... Ilk ft 1977 ...... ,.'... - ...... Li...... O,, r-ccr .l . . : j c-rieon. i...* -1 -. - - '...,: ...... , T u ' ,.... Chri .tophor H. h l...1.. PR ...... r .. CO..T.. .CD ADM rzfcr to the rir " 'c.zionz held i- Ar a- wth t, e T'7* t.;h,:n,!riod 3 to 16 Ju.e i':,concernin; the financing of eleotricity P-, r .. devolop:acnt in the Greater Am.man area which comprises rcinforce :.,rd exeno.m of t;-ban, suburban and rural distribution networks,. 'Th, ...... of -he '-zdr-itc,no.-'-'tr of Jordanr%( ....haz: thethe intnation elec.riciJ-wy to ;...mc,'th' c o ,,:. t div clc :;.c: cfr i4 - 'co ,ttry by exte=.. g he e let.i it .. in Jord.-.,. Fhi:,,J. -twill e t:he;dt,. hi - h vo&:a;e diztributicn .,;:r,: tl ';Tin 'to ":"d- i Lectrn Vower Cozpany by increasing its d-ri ;.i. :XW] m£ e...;...-"in" itz rano. .1t will also electrity 35 villages ;. :.:Out:rb:.n. :. : i:: JL.. Z'..upply area - kmz.an and surroundig areas. .. : Voj,ctc~nz ttc.2 ai ess ential pa.r of the Five Year (1976-1960) ..;::- lan of the Eikctricity Sector in Jordan. In tie litht of thc; zrbc e-non-ionei discussions, it is contemplated ht SUI; of UC 9 million wi' be the U2AID contribution out of the to-a! ciua,' costs, a.ounting to UZ$ 14.5 million, of the project. The of the "hmite Kingdom of Jordan shall zhannel the loan pro,ued., th-rcu.gn Jord::!, :'-'!ctricity Authority to J-PO, w.,ich shall aszu::.e .riic duitics and rc.p.nibiiities for the implementaticn of the proj3.ct, .r l a;l te oprati;:, an& .:aintcnate of .he project facilities after is i,. ' lan prcceeds:haUl be uzi to fin. cc eligible local and. t.':r,.:.o.. . . c'tz :' uip~rits, services and materials needed for the e0'7ction aii inztallatiin of -he electrical systems. .P.-WAVAILABLE COPY 6../2 (Annex J) " ,LNNING Page 2 of 2 (-.UUACIL -2- I ih.l be roozt obliged, if you would take the necessary steps to c-l.mcditc the processing of the requisite loan agreement to be concluded L:; soon as poorcible. Sincerely yours, President ,-o. Director General Jordan Electricity Authority cco. Jordan Electric Power Company ANNEX K (Page 1 of 9) Nt eSE~y nAE A fi J'AIDI3A.OOK 3,App 6r TRAWS. 14U'o3:11 tlovere, 10, 1976 ,'.,I JORDAN - AMMAN AREA Village Electrification 6C(2) - PROJECT CHECKLIST st, below are, first, statutory criteria applicable generally to projects with FAA funds, and ...n -oject criteria applicable to individual fund sources: Development Assistance (with a sub cate.ry for criteria applicable only to loans); and Security Supporting Assistance funds. CR.S. REFERENiCES: IS COUNTRY CHECK'LIST UP TO DATE? IDENTIFY. HAS STANDARD ITEM CHECKLIST BIE REVEWEDl FOR THIS PROJECT? .,. 'PJL CRITERIA FOR PROJECT. Ano. Unnumbered; FAA Sec. 653(b)_ (a) Describe how Committees cn Appropria- (a) The Committees will be notified tions of Senate and H!ouse have been or in accordance with normal Agency will be notified ccnc2rning the project; (b) is assistance within (Operational procedures. Year udget) country or international orqanization allocation reported to (b) All necessary notifications will Corgress (or not more than $1 million be made. over that figure plus I0%)? FM Sec. 611(a)(11. Prior to obligation in excess of S100,OO, will there be (a) (a) Yes, engineering, financial, and other plans necessary to carry out the assistance and (b)a reasonably firn estirate of the (b) Yes. cost to the U.S. of the assistance? 2. A --ec. Elifa)(2). if further lcis- No further legislative action is ,ative action is reouired within recipient country, what is basis for reasonable required. expectation that such action will be completed in timse to permit orderly accomplishment of purpose of the assis tance? FAA Sec. 611(b); Ap. Sec. lO. If for water or %at-re Itdland resource This is not a water or water-related construction, has proect met the stan- land resource construction project. cards and criteria as per iemorandum of the President dated Sept. 5, 1973 !replaces Memorandum of May 15, 1962; see Fed. Register, Vol 38, No. 174, Part I1, Sept. 10, 1973)? 5. FAA Sec. 611(e). If project is capital assistance e.g., construction), and all Yes. See Annex B of the Project Pal'r. U.S. assistance for it will exceed $1 million, has Mission Director certified the country's capability effectively to maintain and utilize the project? " " ' r7 7 Ft 7 "6 II_M E 11_" NO_ 'e_'_ _t_ _IO o f 9 6-W-2 1 Uovcmber 10, 1976 3:11 AIDHAIJO:OOI( 3 A., 6C A. 6. FAA Sec. 209, 619. Is project susceptible This project is not susceptible of execu of execution as part of regional or multi- tion as a regional project, and the pro'), ot .ateral project? If so wily is project not so executed? Information and conclusion, will not necessarily encourage regional i,'tether assistance will encourage development proqrams. regional development proqrams. If assistance is for newly independent Jordan is not a newly independent country country, is it furnished throuah multi iateralorganizations or plans to the maximum extent appropriate? 7. FAA Sec. 601(,.1); (and Sec. 201(f) for Because of the nature of.the project to ______,__Tiorzation and ':onclusions whether project will encourage be financed (i.e., the electrificatioA efforts of the country to: (a)increase of rural villages), it is unlikely L" ')e f'o-' of international trade; (b) -fos- that the loan will have any of the effe'l r; .r private initiative and competition; indicated in (a), (b), (c), (d) and (f). (c) encourage development and use of cooperatives, credit unions, and savings Electrification of rural Jordan, will, hw. and loan associations; (d) discourage ever, improve technical efficiency of in monopolistic practices; (e improve dustry, agriculture and commerce. technical efficiency of industry, agri culture and corrmerce; and (f) strengthen free labor unions. 8. FAVASec. 601(b). Information and con- The loan will finance the procurement of I'lusion on how project will encourage equipment and materials from U.S. servicos. L.S. private trade and invesbent abroad and encourage private U.S. participation in foreign assistance programs (including use of private trade channels and the services of U.S. private enterprise). 9. FAA Sec. 6 1 2(!,) Sec. 63'_(j_. Describe steps taken to assure thdt, to the raximu:n extent possible, the country is The Project Agreement will so provide, ontrib'uting *ocal currencies to meet the cost of contractual and other services, and foreign currencies owned .-y the U.S. are utilized to meet the cost of contractual and other services. 10. FA Sec. 612(d . Does the U.S. own excess foreign currency and, if se, what arrange ments have been made for its release? B. FU:DIN11 CRITERIA FOR PROJECT "_'evelooment Assistance Pro .:ct Criteria Not applicable since project funded from a. "AA Sec. 102(c); Sec. 111; Sec. 2Li. Security Supporting Assistance funds. .xtent twhic-h activi ty n.i-7" effec .'vely involve the poor ir development, by extending access to econo;y at local level, increasing labor-intensive pro duction, spreading investn. ,t out from cities to small towns and r;jral areas; and (b) help d-veiop cooperatives, especially by technical assistance, to assist rural and urban poor to help themselves toward better lice, and other wise encourage democratic private and W.T 0 PV ,ocal governmental institutions? ...... (Annex K) Pase 3 o' AW .A..OO'K3. 3:6L Na c.ber 10, 1976 6C(2d-. 10; I3as:, , ' Ws? 11,,iabl e: N.A. ir.Clude or.l , i . . Iar.rapil - ' a, I , r c. -- v,lCn c.,r;esponds to t sourcv of fUs:d3s id . if wore than ono fur:d source is ,:ed for project, include relevaint paragraph for each fund source.] (I)[103] for agriculture, rural develop nnt or nutrition; if so, extent to wVIIch activit/ i',soecifically dvi. igned to incrre';C prcurtivity and inco:,e 3f rural peor; F103A] if for aqricultural research, 4s full account taker, of neeas of smaII farmnrs ; (2) [IUj for Iopulation planning or health; if sn, extent to which activity exterds nw-cost, integrated delivery syste.i,; tu provide health and firnily plannnq services, i:specially to rural areas and poor; (3)[105] for educaLon, publ ic admin istration, or human reourcos develup;ient; if so, extent to which activity stren Lh,-ns nonforol1 education, makes formal education wore relevant , es pucially for rural famil i. and urian ;;0or, or Strenfq thins nanaql21,;'elt. capab i i ty of ins titLtions ,.i, lni the poor to participate in development; (4) [1061 for technic. "ss stance, en(rqli, research, reconstruction, and so,1cc ted d.eie moi;:entproblems; if so, extent activity is: (a) technical ciuopf-ration ana develop ment, ,slc ilily ,itn U.S. private and volunlary, or rer;ionai and inter national (levelopocen L, organizations; (b)to help alleviatc energy problem; (c)research int., aind .valuation of, ,conoic developmnenL processes and techni ues; (d) reconstruction after natural or ,l ,na(le disaster; (e) for special 'Ir,, -'ent problem, and tv enable propel- utilization of ,,arlir,- I.S. infrastructure, etc., ass P.t 4nce; f) for proqrars of urban development, especially small labor-intensive enterprises., warletion( systems, and financial or other institutions to help urban poor participate in economic and social develooment. S.MEO , Annx K) PaRe 4 cf 9 .-overbe. 10, 1976 3:11 AIDHAUDcO 3, App. 6C (5) [107] by qrants for coordinated private effort to develop and di,.seminate intern;"diate technologies appropriate " . developing countries. r. PA Sec. l10(a); Sec. 208e) . Is the Ie Cip'ievnEont"- JichiV1II 111"9n-60-c- tri b u t e N.A. funds to the project, and inwhat r.nner has or will it provide assurances that it will provide at least 25% nf the Costs of the program, project, or activity witn respect to which the assistance is to be furnis!';ed (or has the latter cost-sharino requireinent been waived for a "relatively least-developed" country)? d. FAA Sec. ll0(h). Will qrant capital asis i n e rsed for project over N.A. more th.ar. 3 >ears? If so, has justifi cation satisfactory to Conqress been made, and efforts for other financing? e. FAA Scc. 207; Sec. 113. Extent to whtci-rssistance reflects appropriate N.A. eimphasis on; (1) encouraging development of der;o,:ratic, economic, political, and ,,ocial institutions; (2)self-help in riveting the country's food needs; (3) improvi'tg availability of trained worker power izi the country; (4) prop.ranis dies nJ to rie t the country's health need",; (5)utho:r important, areas of economic, political, and social develop taunt, including industry; free labor unions, cooperatives, and Voluntary Aqencies; transportation and corrmunica tjon; planninif and public aid.inistration; urban developtment, and ndernizatio i of oxistmno laws; or (6) intej,'ating women into' tho recipient country's national econoity. FAA Sc. .1(,). Describe extent to .:h i i oor Ti r e-cqn i zes the ,"t ic Iiar N.A. needs. (iesi ms, and capac,-!;s of toe pople (ifthe country; utilizes the cou0lrT's' inLellectual re-soirces to oncourie institutional development; and ,uplports . vic education and training in skiiIs r.quired for effec(ti~e partici pition in gov:crt:.ntal and political orocesses essential to self-qovernment. (Annex K) Page 5 of 9 " VH" O K 3, 6C * b4, f LCI"V1,U" O 3, oAhp 6C 1il ovm-cr10, 1976 6C(-S 0I1 ' AA ?(Ii)(':?)-(. and -', S(c.Sec. 201an (S: 8c).1 Does N.A. the activity give reasonable promise of contributing to the developmient: of economic resources, or to the increase of productive capacities and self-sustaining Pconomic orowtn; or of educational or other institutions directed toward social progress? Is it related to and consis tent eiLh other development activities, and will it h. FAA Sec. 201((; .Sec. 21_1_(A (_6 Information and concusion on possibh N.A. effects of the assistance on U.S. economy, with special reference to areas of sub stantial labor surplus, and extent to which U.S. conviodities and assistance are furnished in a illner consistent with iriprcving or safeguarding the U.S. balance. of-payments position. 2. lDevelopm,,n. As, istance Project CriLeria a. iAA Se:. 2Oi Informationrif. ,nd concn-us- on on a5Vflatil ity of financ- N.A. iog from other freeworld sources, incliding private sources within U.S. h. FAA Sec. '0l(b)(?); 201(d). Infor nation ind conclus ion on ( I)--c'apaci ty of N.A. the cniintry to repay the loan, including rn]scnablecess of repayient orospects, and (2) reasonablenpess a;nd leqality (under law5 of country and U.S.) of lending and relending terms of the loan. c. I AA Sec. 201(e). If :.oan is not mide pursuant to a 'ul tilateral plan, N.A. ond tihu amount of tne lon exceeds $101,000, 'l's country su11mitted to AID an ipplication for such funds toqether with assuronces to indicate that funds will be uscd in an ecnnniu'cally and technically sound manner? d. I'AA Sec. 201(f). Does project paper N.A. desc,'ibe how project will promote the country's economic develol'mot taking into account the country's human and material rsources requirements and relalionship between ultimate objectives of the project and overall economic development? TANS NDDOOK ______6C(2)- NovebeE.~li~111 0 ,'A ' M ~(Annex K) Pane 6 Of 9 3:1) AI..... 0 11 A p.6 t. FAA Soc. ? Totall(). anount cf N.A. 1110 Un-nC -oa-n which is ,:oing directly to private enterprise, is going to intermediate credit institutions or tither borrowers for use by private enterprise, isbeing used to finance imports from private sources, or is otherwise being used to finance procure ments from private sources? f. FAA Sec. 620 If assistance is for an 7 productive enterprise which will N.A. compete in the U.S. with U.S. enterprise, is there an aareerun-j by the recipient country to prevent export to the U.S. of more than 20% of the enterprise's annual production during the life of the loan? 3. Projct.Critria. Solelv for Secur FAA vc. 53i. How will this assistance support promote economic or political stability? The electrification of Jordan for is necessary economic development. The GOJ's con- Mrbtn 4. Additio nal rtisCriteria for Alliance for tinued stability and pursuit policies is contingent upon suchof moderatedevelopment. [Not,: Alliance for Progress projects should add the following two items to a project checklist.] a. FA, Sec. 251(b)(1) .(,i). assist Does nce .-i P ino- account principles N.A. 6f the Act of Boqota and the Charter of Punta del Lste; and to what extent will the activity contribute to the economic or political integration of Latin America? b. FAA();Sc 25F 25L(h For loan", has there been taken into account the effort riade by recipient nation to N.A. repdtriate capital invested in other countries by their own citizens? Is loan consistent with the findings and recomm,,ndations of the Inter-Atnerican ConvuitLee frr the Allianco for Procress (now, "FPCIfrS," tie Permanont Excutive Cnittee o the OAS) in its annual review of national development ictivities? [AID_ (Annex K) Page 7 of 9 OIIAN DIMOK 3, App 6C Tn ... .. IoCT. 3:11 *J ovIemae.:. IG,76 6C(3-, JORDAN- Amman Area Village Electrification )C(3) - STA;;DARD ITE8, CiECKLIS7 Listed below are statutory items assistance wnich nornully will be covered routinely agreement dealing with its implementation, in those provisions of an or covered in the agreement where certain uses of funds by exclusion (as are permitted, but other uses not). These it.o.m* are arranged under the general headirgs of (A) Procurement, (3) Construction, (C)Other Restrictions. and A. Proc ureme,,_t 1. FAA Sec. 602. ,Are there arranqements to pw,'mit U.S. sm::all businets to P.rticipate Small business equ-itab i nC5si;Ih unsi will be permitted to equitably in thecf furnishinan;s ;rti goods and participate in accordance serv ices fi nced ? "procedures. with A.I.D. 2. rAA Sec. 604(a) Will a!] pricureTent, :oirmo ity f-inancea be f,';,i the U.S. Yes. except as otherwise dteriiid by the President or under delegation from him? 3. 5^1A Svc. 60-(d). If the cooperating coury discrimnates ns U.Jordan marine does not discriminate insurance companies, will aaree- marine against U.S. nent insurance companies. require that marine ;,nurance be plac,-t in tho U.S. on co m:;odities financed? 1. FAA SW . mint u aI60e ricultural If' nf fsc.re, procure coi,:-odity nr No procurement p.ruduct is to be of agricultural commodity financed, is there or product provi is to be financed. ion ,;, in. such pricurewent whenodu the doustic price of sucn conr.:odity is less than parity? 5. FAA :ic 60'1_,1). Will I.S. Government Yes. However, few instance, if any, xress e rson i of wherever practicableprope inr ty lieuI e util ized of the utilization of excess property procurement u" are antici new itens? pated. 6. 1',-V,_req,jire..2r, t that at(a) lleaist 5)],i anor, centumitncerwtn tepoetareet This requirement will be of the incorporated into r tros,trna;e of o;r"-odities the project (corputed agreement. scnarutely for cry ulk carriers, dry cargo liners, ana financed tank2rs) shll b,- transpnited on pri ateiy owned U.S.-fia,, co;i,e-rc ia ivsseIs to the exlnt that Su .. eS'l. iri uvaiiable at fair and reasonable raes. . FAA %C. 621. If terhnical assistance Yes. is-fin"an-cc-d," will such assistance be fur nished to tue fuiles exten.t pructcable as qoo'is and professiona) !nd servir.u other fr :n private enterprise on a contract basis? If the facilities other of Federal agencies will be utilized, - . . ,, .(Annex K) Page 8 of 9 6 '(3)-. AIDIHANDBOOX ,;p. 5C A? ire thvy ;cularly suitble, not corlpetLtiw,v th p enterpris.2. ,rivaz' and rid, avilihle 'itdacu undue inter ferenc with doriestic proora,,s? 8. Int.rn,,tLiondl Air Tranpt. Fair Co111LetLiFI . P73 t, 1974 If air transportation of persons or property is financed on qrant basis, will Yes. provision b,,rlde that U.S.-flao carriers will be utilized to the extent such service is available? [I. Construction 1. FA S:'c. 601(d). If a ca.)i al (o.g., con~tructinoi"proiect, are engineering Yes. and professional services of U.S.' firms and their affiliates to he u'ed to the n,,.,imwl extent corsistent with the national interest? 2. FAA 6;1(,,._. ).. If co.;.racts for (.in:.truct;n, are to 1e fir.,i:iced, will Yes. thvi-,he let on a cc..;)et;tiie oasis to nrrximum extent practicable? 3. VAA ._c.621" . If for cznstruction of prOduct ive enL,'rpriT o, wil aggre r atO value of afsistance to he furnished by the U.S. not exceed S100 million? C. Other Ves.ric tirn, 1 FAA 'er . 201(d). if dov. loo;ent loan, N.A. is interust rate o,"least 2,.per annum duringi (jrarL pnriod and aL least 3% per annum thereafter? 2. fM c 31(). If f,,nd is established -:Tc-')y N.A. U..S. contrit.uLions and adminis- .. ternd h,/an intrri tj;ona)I oranization, dnt, Comptroller General have audit rii(tis? 3. F Ar F .. r e n Ye s.. prde TLi ,. or issistinc the Yes. fnriqn aid projects or activIt.es of C. 'rnuri'.t-ifloc countri,!s, contrary to the ,est interests of the U.S.? 4. I'AA . "" _. Is fi :, cin(; , -t Mi; t'0 LtnI used, *",t waiver,w for Yes. ul'rcase, lo .. ;- ,. .I. c" ha :e of rtor ven:le .-,.'.d outside the U.S. or quaranty f such transaction? (Annex K) Page 9 of 9 I AIDIIANOiOUK 3, A:,;)(r 3:11 love.nler 10, 1976 GC(3)-3 5. W'I arrangements preclude use of financing: ,I.FAA Sic. 114. to p$y for performance of abortions nr to motivate or coerce Yes. persons to practice abortions? b. FAA S'c. 620( ;j. to cuiperisate Iwers-or .-proaprated nationalized Yes. property? c. FAA SLc. 660. to finance police trainj o o-Dir law enforcement Yes. assistance, except for narcotics programs? d. FAA Sec. 662. for CIA activities? Yes. :. Ap. Se.c. 1,03. to pay pensions, etc., for mI tary peFrsonnel ? Yes. f. App. S:c. 106. to pay U.N. assess- ments? Yes 9. A j,. Sec. 107. to carry out provi-Y sions of -A- Sections 209(d) and 251(h)? (transfr tu multilateral organization for lending). h. ALi. [,c 5,1 to be used for Yes. publicity or propaq,.),nda purposer, within U.S. rot authorizud by Congress? ,WAILABLE COPY ANNEX L UNITED STATES AGENCY FOR INTERNATIONAL DEVELOPMENT AMERICAN EMBASSY AMMAN - JORDAN June 21, 1977 CERTIFICATION PURSUANT TO SECTION 611 (e) OF THE FOREIGN ASSISTANCE ACT OF 1961 AS AMENDED I, Christopher H. Russell, the principal officer of the Agency for International Development in Jordan, having taken into account, among other things, the maintenance and utilization of projects in Jordan previously financed or assisted by the United States, do hereby certify that in my judgement Jordan has both the financial capability and the human resources capability to effectively maintain and utilize the capital assistance project, Amman Area Rural/Urban Electrification. Christopher H. Russell AID Director Date: -..- c 1V? ) DRAFT Page 1 of 3 GC/NE:JMILLER:ew 8/2/77 PROJECT AUTHORIZATION AND REQUEST FOR ALLOTMENT OF FUNDS Name of Country: Jordan Name of Project: Rural and Urban EeTectrH fication Number of Project: 278-0209 Pursuant to Part II,Chapter 4, Section 532 of the Foreign Assistance Act of 1961, as amended, I hereby authorize a Loan to Jordan (the "Cooperating Country") of not to exceed Nine Million United States Dollars ($9,000,000) to help in financing certain foreign exchange and local currency costs of goods and services required for the project as described in the following paragraph. The project consists of providing throuqh the Jordan Electric Power Company (JEPCO) the financing required to establish an electrifi and two suburban communities cation system in approximately thirty-five villages/in the rural vicinity of Amman and to reinforce the existing Amman system. The entire amount of A.I.D. financing will be obligated when the Project Agreement is executed. I hereby authorize the initiation of negotiations and execution of the Project Acrreement by the-officer to whom such authority has been delegated in accordance with A.I.D. regulations and Delegations of Authority subject to the following essential terms and covenants and major conditions together with such other terms and conditions as A.I.D. may deem appropriate: a. Interest Rate and Terms of Repayment The Cooperating Country shall repay the Loan to A.I.D. in United Pa.Ze 2 of 3 -2- States Dollars within forty (40) years from the date of first disburse ment of the Ilnan, inrliidinq a grace period of not to exceed ten (10) years. The Cooperating Country shall pay to A.I.D. in United States Dollars interest from the date of first disbursement of the Loan at the rate of (a) two percent (2%) per annum during the first ten (10) years, and (b) three percent (3%) per annum thereafter, on the outstanding disbursed balance of the Loan and on any due and unpaid interest accrued thereon. b. Source and Origin of Goods and Services Goods and Services financed by A.I.D. under the project shall have their source and origin in the Cooperating Country, in the United States or in countries included in A.I.D. Geographic Code 941, except as A.I.D. may otherwise agree in writing. c. Prior to any disbursement, or the issuance of any commitment documents under the Project Agreement to finance procurement of equipment and materials, Borrower shall, except as A.I.D. may otherwise agree in writing, furnish in form and substance satisfactory to A.I.D.: (1) An agreement between the Borrower and the Jordan Electricity Administration (JEA) making the proceeds of the Loan available to the JEA and authorizing JEA to make the proceeds of the Loan available to JEPCO. (2) An agreement between the JEA and JEPCO making the proceeds of the Loan available to JEPCO. (3) Detailed plans for the design of distribution system; bidding documents, (including technical specifications); and proposed warehousing and inventory control procedures. ANNEX M Pag' 3 of 3 -3 (4) Evidence that an additional pole plant has been purchased and that plans for its operation have been made. e. Prior to any disbursements of funds for participation in local costs financing of construction/erection services, Borrower shall, except as A.I.D. may otherwise agree in writing, furnish in form and substance satisfactory to A.I.D.: (1) A plan and schedule of JEPCO's proposed construction/erection/ installation and timetables for utilization of all procurement items. (2) A plan for providing supervision of construction. (3) Evidence that an additional pole planthas been constructed and is capable of supplying poles of adequate quality needed for construction of the Project in accordance with the construction schedule. Joseph C. Wheeler Bureau for Near East Date Clearance: NE/CD:TLustig NE/DP:BLangmaid NE/ME:NSweet NE/GC:RMeighan