Document of The WorlcdBank
FOR OFFICIAL 1USEONLY Public Disclosure Authorized
Report No. 4360-CY
STAFF APPRAISAL REPORT Public Disclosure Authorized
CYPRUS
ENERGY PLANNING AND CONSERVATION PROJECT Public Disclosure Authorized
April 20, 1983
Projects Department
Public Disclosure Authorized Europe, Middle East and North Africa Regional Office
This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS -
Currency Unit = Cyprus Pound (CE) Ct 1 = 1,000 mils CZ 1 = US$2.00 US$l million= CE 2 million
WEIGHTS AND MEASURES
kV kilovolt kW = kilowatt MW = 1,000 kW kWh = kilowatt-hour GWh (Gigawatt-hour) 1,000,000 kWh kVA = kilovolt-ampere Mi1VA = Megavolt-ampere = 1,000 kVA Mile = 1.609 km "r ton = metri-c ton
GLOSSARY AND ABBREVIATIONS
EAC = Electricity Authority of Cyprus MCI = Ministry of CoTmwerceand Industry AREC = Applied Renewable Energy Center HTI = Higher Technical Institute EAU = Energy Advisory Unit KIBTEK = Turkish Cypriot Electricity Authority
FISCAL YEAR January 1 to December 31
_/ Adjusted as of February 1983, FOR OFFICIALUSE ONLY
CYPRUS
ENERGY PLANNING AND CONSERVATIONPROJECT
Table of Contents
Page No.
I. POWER AND ENERGY SECTOR ...... 1
A. Energy Sector...... 1 Commercial Energy Balances ...... 1 Energy Resources ...... 3 Energy Pricing ...... 3 Energy=.. Policy ...... 5 Organization ...... 5
B. Power Subsector ...... 6 Background ...... 6 Organization of EAC ...... ,.. 6 Training . 7 Existing Facilities ...... 7 Operations ...... 7 Unbilled Consumption ...... 8 Electricity Tariffs ...... 8 Sales ..... 9 Bank's Participation in the Power Subsector ...... 9 EAC's 1983-1987 Expansiorn Program .10
II. THE PROJECT ...... 11
Project Objectives and Description . .11 Project Costs .. 12 Project Financing ...... 13 Project Implementation . .13 MCI Component Implementation . .14 EAC Component Implementation . .14 Studies and Consultancy Services . .15 Procurement ...... 15 Disbursements ...... 16 Environmental Aspects .. 16
The report'was prepared by Messrs. W. Hamlet (Financial Analyst), K. Sheorey (Engineer), I. Johnson (Economist), R. Dosik (New Energy Sources Adviser, Energy Department) and A. Malik (Renewable Energy Specialist, Energy Department) on the basis of an appraisal mission to Cyprus during January/February 1983.
This document has a restricted distribution and may be used by recipients only in the performance of I their official duties. Its contents may not otherwise be disclosed without World Bank authorization. Page No.
III. FINANCE ...... 17
Accounts ...... 17 EAC's Billings and Accounts Receivables ...... 17 EAC's Taxes and Duties ...... 17 Past Performance and Present Position of EAC ...... 17 Financing Plan ...... 18 EAC's Future Performance ...... 19 Financial Covenants ...... 19 Audit ...... 20 Insurance ...... 20 Monitoring System ...... 21
TV. BENEFITS, JUSTIFICATION AIND RISKS ...... 22
MCI Component ...... 22 EAC Component ...... 23 Least Cost Alternative ...... 23 Economic Rate of Return - EAC Component .23 Sensitivity Analysis .. 24 Risks .. 24
V. AGREEMENTS TO BE REACHED.25
ANNEXES
1.1 Electricity Authority of Cyprus - Organization Chart: ..... 26 1.2 Electricity Sales in GWh by Categories 1976-1987 . . 27 i.3 Description of EAC's Expansion Program for 1983-1987 28 1.4 EAC Expansion Plan 1983-1987, Existing and Planned Facilities ...... 30 1.5 EAC Expansion Plan 1983-1987, Costs .. 31 2.1 Project Description ...... 32 2.2 MCI Component - Project Costs ...... 44 2.3 EAC Component - Project Costs ...... 45 2.4 EAC Component - Project Implementation Schedule ...... 46 2.5 MCI Component - Project Implementation Schedule ...... 47 2.6 Estimated Disbursement Schedule for the MCI Component .... 49 2.7 Estimated Disbursement Schedule for the EAC Component .... 51 2.8 MCI and EAC Components - Disbursement Profiles ...... 52 3.1 Income Statements for the Years Ended December 31, 1977-1987 ...... 53 3.2 Balance Sheets for the Years Ended December 31, 1977-1987 ...... 54 3.3 Sources and Applications of Funds Statements for the Years Ended December 31, 1977-1987 ...... 55 3.4 Notes and Assumptions for Financial Forecasts ...... 56 - 11l1 -
ANNEXES (Contd)
4.1 Actual and Forecast of Energy Generated, Sold, Installed Capacity, Maximum Demand and Annual Load Factor ...... 58 4,2 EAC Component - Economic Rate o:E Return ...... 59 5.1 Selected Documents Available in the Project File ...... 60
MAP
IBRD lb999R
April 1983 (1350P, p.2 7-2 9)
I. POWER AND ENERGY SECTOR
A. Energy Sector
Commercial Energy Balances
1.01 The petroleum products consumed in Cyprus are gasoline, aviation fuel, kerosene, gas oil, LPG and light and heavy fuel oil. Gasoline and aviation fuel are used exclusively in the transport sector; kerosene in the household sector; gas oil (diesel) in the transport, industrial, commercial and agricultural sectors; LPG in the household sector and a small volume in the industrial sector (bricks, mining); and heavy fuel oil in the industrial (cement) and power sectors. Commerce and industry accounted for about 65% of total electricity sales in 1982 to the Government-controlled 1/ areas of Cyprus.
1.02 Since 1970 growth in the consumption of energy has been somewhat erratic due to the political, economic and demographic disruptions following the 1974 events, as well as the international changes in the price of oil in the post 1974 period. Since 1975 growth in petroleum product consumption has averaged 6% annually, although this has varied over that time from over 10% per annum to below 4% per annum. Electricity growth (including the unbilled portion to the area not under Government's control) has averaged 6.3 percent annually, and total energy consumption has increased by an average of approximately 5.5 percent per annum. This implies an elasticity with respect to real GDP of about 1.2. The dependency of Cyprus on imported fuel and the large investment required to meet the demand for electricity places a severe financial burden on the country. To decrease dependency on imported fuel requires tne development of renewable energy sources, the generation of electricity as efficiently as possible, and the conservation and management of electricity load requirements to reduce plant investment. The proposed Loan would finance studies, equipment, training and consulting to enable Government to develop economic renewable energy sources and to establish efficient generation and load control measures to conserve fuel.
1.03 Growth of energy consumption will depend critically upon the future success of Government policy measures in, the fields of conservation and interfuel substitution. The energy balance shown in Table 1 assumes a 4% GDP growth rate and estimates that demand for energy will rise by about 4% per annum through 1986. The 1986 energy balance implies a growth in the energy import bill of 21% over the 1981 figure, equivalent to C£ 120 million (equivalent to US$240 million) in 1982 terms. However with a vigorous conservation program, especially in the industrial, electricity and transport sectors, it is estimated that by 1986 an overall saving of about 9% on projected consumption could be mnade equivalent to C£ 34 million per annum (in 1982 terms).
1/ Since 1974 the island has been defacto divided into two political/economic zones. The north is under the control of the Turkish Cypriots while the south is under the control of the Government of Cyprus. Project activities are confined to the Government-controlled area of Cyprus. - 2 -
Table l: Commercial Energy Balances ('000 toe)
1981 1986
A. Supply
Imports Crude 576 538 Petroleum Products 368 606 Total 944 1,144 Less Refinery Losses (16) (18) Total 928 1,126
B. Consumption
Fuel Electricity Total Direct (Equivalent) Energy Tons Tons Tons Sector '000 % 000 % 000 %
1981 Domestic and Commercial 74 8 137 42 211 23 Industrial 269 29 78 24 347 37 Transport 241 26 - - 241 26 Agriculture 18 2 13 4 31 3 Public Lighting - - 7 2 7 1 Unbilled Elect. /1 - - 91 28 91 10 Electricity Gen. 326 35 - - - - Total 928 100 326 100 928 100
1986 Domestic and Commercial 99 9 159 40 248 22 Industrial 342 29 84 24 428 38 Transport 319 27 - - 293 26 Agriculture 23 2 16 4 45 4 PuDlic Lighting - - 6 3 11 1 Unbilled Elect. /1 - - 78 29 101 9 Elect. Gen. 343 33 - - - - Total 1,126 100 343 100 1,126 100
Source: Bank estimates, based on "Cyprus: Current Economic Positions and Prospects for Growth During the Five-Year Plan," January 1983, World Bank document, Report No. 4069-CY. Data modified on the basis of information given to the Bank appraisal mission.
/I Supplied to the areas not under Government's control and for which no payment is received.
(1350P, p.2 ) Energy Resources
1.04 Cyprus has no known commercialLy exploitable conventional energy resources and, therefore, continues to be totally dependent upon imported energy, primarily crude oil and petroleum products. Imported petroleum products constitute about 20% of total imports to Cyprus. Given the difficult balance of payments situation of Cyprus, considerable efforts must be devoted to energy conservation and to the maximum economic utilization of the island's renewable energy resources. The indigenous energy resources have not, as yet, been well delineated but include solar, wind and biomass.
1.05 Solar energy has been actively developed for residential water heating but this is a renewable energy resource with broader potential which the Government should continue to develop. Solar water heaters could be employed not only in the household sector but also to help provide process heat in industry and hot water for commercial and public buildings (e.g., hotels, hospitals). Solar energy may also be used in agriculture for crop drying and greenhouse heating and the application of passive solar design techniques can help to reduce the amount of energy required for heating and cooling buildings. The other resources with economic potential are wind for water pumping, and biogas using municipal waste and pig manure. The development of these renewable energy resources can only make a modest contribution to meeting Cyprus' energy needs over the medium to long term but such a contribution is likely to be a useful adjunct to the Government's energy rationalization and conservation program. The precise extent of economic renewable energy applications has yet to be fully evaluated.
1.06 At present there is no detailed program for the development of Cyprus' renewable energy resources and the Government has given priority to developing such a program based on:
(a) a detailed resource assessment, especially of wind regimes and solar intensity including mapping of resources.
(b) a careful economic and technical appraisal of the various applications of renewable energy technology in Cyprus; and
(c) a review of the most appropriate institutional mechanisms for developing renewable energy, including price incentives, training, and information efforts that would be required to support such a program.
Energy Pricing
1.07 Government policy is to set the average price (weighted) of petroleum products at about 10% above border prices (weighted) but to cross subsidize products for various social and economic objectives. The domestic price of petroleum products is reviewed annually by MCI in collaboration with the local oil companies. MCI, after reviewing annual financial reports from the petroleum distribution companies and sales targets for the ensuing year, set prices to ensure that, within the price levels indicated by the companies, Government energy pricing policy is adhered to. Price proposals are then submitted to an ad hoc Prices Committee prior to formal approval. The price of gasoline is set high enough to much more than cover the subsidies to all - 4 - other users of petroleum products (Table 2). The oil companies are responsible for all imports other than those made by EAC and the cement companies which, in addition to local purchases, contract and import directly supplementary quantities of fuel oil. EAC's local purchases of fuel oil are subsidized. The cross subsidy program "taxes" primarily the transport sector and "subsidizes" the industrial, commercial and electricity sectors. Energy pricing is included in tiheconsultant's terms of reference for the Energy Planning sub-component (para. 2.01). Assurances were obtained that Government would review with the Bank the consultant's findings and recommendations, particularly those relating to energy pricing,not later than December 31, 1984.
Table 2: PETROLEUM PRODUCT PRICES (US /Ton) /1
Imported Consumption /2 "Subsidy" (-) Domestic Prices ('000 Tons) and "Taxes" Prices (CIF) /2 1981 (USV'00o)
Gasoline 935 399 99 53,064 Kerosene 362 379 8 (136) Aviation Fuel 362 379 84 (1,428) Gas Oil 340 374 158 (5,372) Light Fuel Oil 175 206 71 (2,201) Heavy Fuel Oil 143 187 /3 414 /3 (3,432) LPG 324 494 35 (5,950) Average (Weighted) 302 279
Source: MCI, Bank estimates.
/1 Estimates, on the basis of current Mediterranean FOB prices, adjusted for handling, transportation and marketing. /2 Actuals not adjusted to tons of oil equivalent. /3 dowever, EAC and the cement companies bought 336,000 tons of heavy fuel oil; thlerefore,the balance of 78,000 tons was at the subsidized price.
1.08 EAC determines the level and structure of the electricity tariffs subject to approval by the Co-uncil of Ministers. Tariffs are subject to an automatic fuel adjustment clause. The present average revenue of 41.3 mils (Cf)/kWh_/ compares with the long-run narginal cost of supply estimated at 34 mils (CW)/kWn. However, the present revenues remain below a level required to ensure the financial viability of EAC. To alleviate the situation, the Governmenitrecently converted its loans of CZ9 million to EAC to equity, which enabled EAC to meet its debt obligations in 1982. EAC's electricity tariffs are discussed in para. 1.23.
1/ This includes the unbilled consumption. The average revenue for electricity actually billed and paid for is 53.4 mils (CE/kWh). -5--
Energy Policy
1.09 The dependency of Cyprus on imported fuel and the large investment required to meet the demand for electricity places a severe financial burden on tilecountry. To decrease dependency on imported fuel requires the development of renewable energy sources, the generation of electricity as efficiently as possible, and the conservation and management of electricity load requirements to reduce plant investment to meet demand. The energy policy is directed towards four major goals:
(a) The conservation of energy in all sectors of the economy;
(b) The development of indigenous energy resources in order to reduce dependence on eniergy imports;
(c) The diversification of the energy economy in order to reduce dependence on a single-product energy import, i.e., oil; and
(d) The diversification of the sources of energy imports in order to reduce dependence on a single or limited number of supply sources.
The Government has earmarked over 30 actions which are to be implemented over the 1982-86 Plan period, although an assessment of priorities for actions has yet to be undertaken. These measures will need to be translated into a phased and coordinated program of action. In 1982, the Government commissioned a study to review the costs and benefits of diversifying the energy economy by the substitution of coal for fuel oil. The study was completed at the end of 1982 and the various Government agencies are currently reviewing the results of the study (para. 4.05). The proposed Loan would finance studies, equipment, training and consulting services to enable Government to develop economical renewable energy sources and to establish efficient generation and load control measures to conserve fuel.
Organization
1.10 Major energy policy decisions are made by the Council of Ministers. The Ministry of Commerce and Industry (MCI) has general responsibility for the energy sector. An Energy Advisory Unit (EAU) has recently been established in MCI to provide conservation services and advice to industry and commerce. EAU is also responsible for renewable energy but it has not so far had the resources to play an active role in this field. EAU has initiated some work on the establishment of standards for solar collectors, and some useful research is being done by other agencies, but there has been no concerted effort by the Government to systematically evaluate Cyprus' renewable energy resources, to plan their development or to promote their commercial application. The Cyprus Development Bank (CDB) is responsible for financing energy conservation schemes in cooperation with MCI. Public electricity supply is the responsibility of the Electricity Authority of Cyprus (EAC) (paras. 1.13 and 1.14). Cyprus has one oil refinery owned and operated by the Cyprus Petroleum Refinery Limited, of which the Government owns 35% of the shares (but 50% of the voting power) and three oil companies (two multinational and one local) the balance. 1.11 EAU will continue to act as the focal point for aLl non-power energy-related development, including conservation and renewables. Since renewables and conservation are relatively new fields of activity in Cyprus, trained manpower is scarce. The engineers assigned to the EAU received training in energy audits from UNDP consultants and have made a number of energy surveys in selected sectors. MCI is currently financing training overseas for key staff. Nevertheless, EAU is still an embryonic institution and will require further staff strengthening if it is to adequately meet its objectives as defined by the fourth plan. The Project will strengthen EAU's institutional capacity through training and advisory services.
B. Power Subsector
Background
1.12 EAC was formed by the integration of 16 separate local power enterprises. Since its establishment, EAC has acquired control of all public power supplies and serves all major population centers including all villages in soutlh Cyprus as of 1979. After 1974, the island was dei-acto divided with the Turkish Cypriots controlling the northiern part (about 36% of the island). EAC no longer has access to the electricity facilities (about 17% of EAC's assets as of 1974) in the area not under Government's control which is being operated by the Turkish Cypriot Elect-ricity Authority (KIBTEK). EAC has continued to supply power to the area not under Government's control even though it is unable to collect payment for power consumed in that area (para 1.22).
Organization of EAC
1.13 EAC is managed by a Board composed of a Chairman, a Vice-Chairman and five members. The Board is appointecd by the Council of Ministers for a five-year term. The Board appoints the Chief Executive Off-icer of EAC, the General Manager. The present General Manager, who also holds the post of Clhief Engineer has been associated wi-th EAC for many years.
1.14 Annex 1.1 shows the present organization of EAC. At present most of the EAC's operations are managed from its head office in Nicosia with three area offices handling transmission and distribution system operations. The power station superintendents in charge of individual power stations are responsible to the Generation Engineer at the head office.
1.15 At the end of 1982, EAC's permanent staff totalled 1,548 compared to 1,435 at the end of 1979, and comprised 152 professional engineers, 9 professional accounting and administrative staff, 261 accounting, administrative and clerical staff, 44 meter readers and collectors, 890 skilled technical staff and 192 semi-skilled and unskilled staff. The present staffing is adequate and will not increase substantially during 1983-87 due to placement of surplus Dhekelia 'A' power station staff resulting from the gradual retirement of old generating units in the power station. -7-
Training
1.16 EAC encourages the upgrading of its experienced staff through courses and training. It also arranges special overseas training; in 1980/81, 16 senior staff members attended 10 international conferences and seminars, and 16 staff members went on educational visits to power utilities in other countries. Also, about 210 EAC employees; attended seminars, courses, and conferences organized by EAC and professional institutions in Cyprus. The training program is adequate for EAC's needs.
Existing Facilities
1.17 At the end of 1982, EAC's generating capacity totalled 324 MW from thermal power stations located at Dhekelia and Moni on the southern coast of the island, as shown in the map attached (IBRD 16999). The Dhekelia 'A' power station capacity is 84 MW, comprising of two 7-MW and five 14-MW units commissioned during the period 1952-1963. The construction of Dhekelia 'B' power station with a capacity of 120 MW (two 60-MW units) was completed in December 1982, and the first unit started in December 1982 while the second unit is scheduled for commissioning in April/May 1983. With the stabilization of these new units EAC plans to gradually withdraw the old units of Dhekelia 'A' powei station. The Moni power station has a capacity of 180 MW, with six 30-MW units commissioned from 1966 to 1976. Dhekelia 'A' station's thermal efficiency of 20% compared to the Moni station's thermal efficiency of 29% and anticipated Dhekelia 'B' station's thermal efficiency of 33% reflects improvements and use of energy-efficient larger modern unit type sets. KIBTEK has installed capacity of about 60 MW in gas turbines which have been operated occasionally for short periods only, probably due to high cost of fuel and foreign exchange shortage. At present, I-Lowever,this capacity could not be considered as available for system operations. The other power generation facilities in Cyprus, of about 12 MW, are a mini-hydro power station, standby sets at industrial plants, hospitals, communication centers and airfields and a small combined desalination power installation at Dhekelia UK base.
1.18 At the end of 1982, EAC's transmission system comprised 78 circuit miles of 132-kV lines, 6 circuit miles of 132-kV underground cables, 188 circuit miles of 132-kV lines operated at 66 kV, 376 circuit miles of 66-kV lines; and total transformer capacities comprised 508 MVA of 132 and 66-kV, step-down, 420 MVA of interbus and 388 MVA of step-up transformer units. Most new 132-kV lines constructed during the past decade operate at 66 kV. EAC has primary distribution at 11 kV consisting of 1,802 miles of overhead circuits, 366 miles of underground cables, and 590 MVA of distribution transformer capacity. Its medium and low voltage grid extends to about 2,589 miles of overhead lines and 146 miles of underground cables.
Operations
1.19 Of the total installed generating capacity of 384 MW by April/May 1983, EAC proposes to retire two 7-MW and three 14-MW units of Dhekelia 'A' thereby reducing the installed generating capacity to 328 MW. The firm capacity accordingly would be 268 MW, the estimated peak load during 1983 being 221 MW. Considering the anticipated relief in peak demand from 1985 onward employing load management techniques, EAC has now proposed the addition - 8 - of 60 MW generating capacity in 1988 instead of 1987. EAC plans to retire the remaining two units of 14 MW at Dhekelia 'A' power station in 1991. EAC has satisfactorily maintained the plant and facilities, and for the size of the system, has a satisfactory reliability record.
1.20 In 1981 the total system losses were 11.1% and are expected to be 10.8% from 1982 onwards. Generating station energy consumption in 1982 is estimated at 4.5% of the energy generated while transmission and distribution losses are estimated to be 6.3%. The system losses are reasonable. The annual load factor for the system in 1981 was 60.7% being the highest for the decade and is expected to be about 58.7% in the future.
1.21 Dispatching and load forecasts for the area not under Government's control are based on historical data of electric energy supplied to the area. Under the present conditions dispatching, load forecasting and maintenance of common facilities along the border are very difficult. Restoration of electric service, following outages, is often delayed because of problems of access to facilities along the border between the area not under Government's control and the area under Government's control.
Unbilled Consumpti_n
1.22 EAC's most serious operational problem is its inability to secure payment for consumption of electricity in the area not under Government's control. The unbilled consumption annually is equivalent to about 20% of EAG's revenues, The total amount of unbilled consumption since 1974, as of December 31, 1982 was estimated at C£ 39.2 million, the equivalent of US$78.4 million. The problem of unbilled consumption is part of a broader political problem which can only be resolved within the context of a more general settlement between the Greek and Turkish communities. Consequently, EAC is dependent on its electricity tariffs to provide revenues sufficient to cover the deficit of the unbilled consumption.
Electricity Tariffs
1.23 Under the Electricity Development Law of 1952, EAC is free to determine the level and structure of its tariffs subject to approval by the Council of Ministers. The guiding principles are that revenues should be sufficient to meet operating expenses (including depreciation) and debt service, and to generate funds for system expansion. An automatic fuel adjustment clause was made effective in May 1977 to compensate for the rapid rise in fuel prices. Electricity tariffs (including fuel adjustments) were increased 270% from an average 14.5 mils (CE/kWh) in 1974 to an average of 53.4 mils (CW/kWh) in 1982. The last tariff increase was implemented in two stages: (i) 9% effective November 1, 1980, and (ii) 2% effective June 1, 1981. The average revenue per kWh (about US$0.ll/IcWh) is high compared to other countries in the region 1/.
I! Portugal US$0.06/kWh, Yugoslavia US$0.03/kWh, Jordan US$Q.07/kWh, Turkey US$0.05/kWh. -9--
Sales
1.24 Annex 1.2 gives actual sales by category for the years 1976 to 1981 and forecast of sales from 1982 to 1987. The annual growth in consumption of electricity in the Government controlled area reduced from 8.4% in 1977 to 1.7% in 1981 and is estimated to be 3.5% in 1982. The lower growth in 1981 was mainly due to lower sales to industrial consumers on account of the current recession. The annual growth in sales in the area not under Government's control dropped from 10.5% in 1977 to 3.7% in 1981, and is estimated to be 5.1% in 1982. The annual growth in total sales including the unbilled consumption is expected to be in the range of 3.4% to 3.8% for the years 1983 to 1987 and is reasonable considering the growth of the tourist industry in Cyprus and the trend of consumption in the country.
1.25 Sales by categories to customers in the Government controlled area for tiheyears 1981 (actual) and 1987 (estimated) are as follows: Estimated No. of No. of Consumers Consumers 9a egor2 End of 1981 % End of 1987 %
Domestic 152,072 79.9 189,700 78.1 Commercial 28,891 15.2 41,100 16.9 Industrial 6,210 3.3 8,000 3.3 Irrigation 1,622 0.9 2,300 0.9 Public Lighting 1,459 0.7 1,900 0.8
Total 190,254 100.0 243,000 100.0
No data regarding consumers is available for the area not under Government's control. The consultants for the Load Management Study estimate that 22% of EAC's peak demand in 1982 (Annex 4.1) would be due to consumers in that area, the estimated unbilled consumption for 1982 being 222 GWh (20% of total consumption).
Bank's Participation in the Power Subsector
1.26 The Bank has been closely involved in EAC's development since the early 1960's having made a total of five loans to assist in financing the expansion of Moni power station and expanding the transmission and distribution facilities. The Loan amounts for 335-CY, 494-CY, 649-CY, 831-CY and 1873-CY were US$21.0, 2.8, 5.0, 9.0 and 16.0 million respectively. The Bank's introduction of international competitive bidding methods helped EAC to achieve substantial savings. In particular, due to savings in costs, the disbursements (US$16.4 and 2.3 million respectively) against the first two loans, 335-CY and 494-CY, were less than the Loan amounts. The projects under the first four loans have been satisfactorily completed and the fifth loan, 1873-CY, is expected to be completed in 1984. Through these five loans the Bank has promoted and encouraged substantial institution- building and assisted EAC to develop into a modern and well-managed utility. - 10
EAC's 1983-1987 Expansion Program
1.27 EAC's expansion programs (including the 1980-1984 expansion program financed under Loan 1873-CY) is based on least cost alternative (para. 4.05) and has been updated at intervals. The expansion program for 1983-1987 includes the consultants' recommendations submitted in 1980 and 1983, and consists of:
(i) investment for additional 60 MW generating capacity to be commissioned in 1988;
(ii) the expansion and reinforcemient of the existing transmission system; and
(iii) the extension and reinforcement of the 11-kV medium and low voltage distribution networks in urban and rural areas.
The program excluding the Project 1/ component is described in detail in Annex 1.3. Annex 1.4 gives the details of the existing and planned facilities while Annex 1.5 gives the breakdown of cost:s on a year-to-year basis, The program financing is discussed in detail in para. 3.08 and is summarized below:
In millions of CE In millions of US$ Local Foreign Total Local Foreign Total
Generation 2.5 3.9 6.4 5,0 7.8 12.8 Transmission 4.1 4.0 8.1 8.2 8.0 16.2 Distribution 11.2 7.8 19.0 22.4 15.6 38.0 EAC component of project 0.6 3.3 3.9 1.2 6.6 7.8 Miscellaneous 0.3 2.2 2.5 0.6 4.4 5.0
Total 18.7 21.2 39.9 37.4 42.4 79.8
1/ The Project component is fully described in Chapter II. - 11 -
II. THE PROJECT
Project Objectives and Description
2.01 The objective of the Project is to improve energy planning and conservation. The Project would strengthen MCI's institutional capabilities in the fields of energy planning and implementation of conservation and renewable energy projects in order that appropriate recommendations may be made to the Government regarding energy supply and conservation options. The Project would also facilitate effective power use by improving the operational efficiency of the electricity system through the implementation of proven load dispatch and management techniques and installation of energy efficient equipment for generation plant. The load management sub-component would also provide data to assist in the preparation of an appropriate energy pricing policy. The Project would include training, advisory and consultancy services, studies and equipment to both MCI and EAC. The Bank-financed Project would consist of the following:
(a) An Energy Planning component to include the collection of existing energy data and preparation of energy balances; a detailed optimum medium-term energy master plan, including recommendations for energy pricing; and a long-term energy plan.
(b) Strengthening of MCI's existing energy audit capabilities through intensive field training, provision of additional instrumentation equipment, experienced executive and operational personnel to advise on mnanagerialand organization techniques to operate the unit to meet the objective of improving and accelerating energy conservation in industry and commerce.
(c) A Renewable Energy component in which assistance would be provided for the creation of a solar and wind resource measurement network, for the establishment within MCI of a center that would serve as the focal point for the Cypriot renewable energy program, and for test facilities, studies and pilot/demonstration projects involving the most promising applications of renewable energy technology in Cyprus using solar, wind and biomass resources.
(d) Assistance to EAC for energy conservation through;
(i) the development of a load management and efficient load dispatch program;
(ii) the development of an energy conservation project for Moni power station; and
(iii) a feasibility study for standby and peaking generation requirements.
A detailed description of Project componerLtS is given in Annex 2.1. - 12 -
Project Costs
2.02 Project costs are summarized in the following table:
C£ 000's US$ OOO's Local Foreign Total Local Foreign Total
Assistance to MCI (a) Energy Planning Component 62 135 197 125 270 395
(b) Streilgthening of MCI's Energy Audit Capabilities - 250 250 - 500 500
(c) Renewable Energy Applied Renewable Energy Center :305 708 1,013 609 1,417 2,026 Resource Assessment Network 35 112 147 70 224 294 Solar Water Heating L31 190 321 262 379 641 Solar Heating and Cooling of Buildings 28 83 111 56 166 222 Solar Crop Drying 15 7 22 30 14 44 Solar Greenhouses 115 49 164 230 98 328 Solar Ponds 6 24 30 12 48 60 Windmills for Water Pumping 23 30 53 46 60 106 Biogas 57 116 173 114 232 346 Physical Contingencies 12 27 39 24 54 78 Price Contingencies 40 59 99 80 118 198
Total 767 1,405 2,172 1,533 2,810 4,343
Total MCI Components 829 1,790 2,619 1,658 3,580 5,238
(d) Assistance to EAC Load Management and Efficient Load Dispatch 305 1,495 1,800 610 2,990 3,600 Energy Conservation for Moni Power Station 155 1,017 1,172 310 2,034 2,344 Studies 8 97 105 16 194 210 Physical Contingencies 31 168 199 62 336 398 Price Contingencies 127 529 656 254 1,058 1,312
Total EAC Component 626 3,306 3,932 1,252 6,612 7,864
Total Project Cost 1,455 5,096 6,551 2,910 10,192 13,102 - 13 -
Project costs for the MCI components of the Project are based on estimates in the following reports included in the Project File:
(i) "Cyprus Renewable Energy/Conservation Project, Renewable Energy Component" prepared by the Bank;
(ii) "Appraisal of Energy Conservation, Sub-Project, Cyprus" prepared by the Bank; and
(iii) "Proposal to Carry Out Cyprus Energy Planning Project" prepared by consultants.
Project costs for the MCI components are set out by years in Annex 2.2. Project costs of the EAC component are based on the estimates in the studies mentioned in para. 2.07 and revised by the mission after discussions with EAC. The base costs are as of the end of December 1982. In view of the details available, physical contingencies have not been provided for the efficient load dispatch equipment, while 5% has been added for load management equipment and 10% has been provided for F[oni power station energy conservation equipment to allow for quantity uncertairntiesand design changes during implementation. Allowances 1/ of 8.0% in 1983, 7.5% in 1984, 7% in 1985 and 6% in 1986 onwards have been added for future escalation of foreign costs in accordance with the current estimates of expected international price trends. Allowances for local price contingencies have been made made at the rate of 9.5% in 1983, and 9% from 1984 through 19,87. Project costs for the EAC component by years are detailed in Annex 2.3. Consultants' costs for the MCI and EAC components, on the basis of 250 man-months, average about US$10,000 per man-month.
Project Financing
2.03 The Project would be financed by two Bank loans: one to EAC, with the guarantee of the Republic of Cyprus, and the second to the Republic of Cyprus for the MCI components of thieProjiect. The proposed Bank loans of US$6.6 million and US$3.6 million would finance 100% of the estimated foreign exchange costs of the Project. The local costs of the MCI components of the Project, estimated at US$1.7 million for the energy planning component, the renewable energy component and strengtherlingof MCI's energy audit capability would be funded by Government's budget allocations to MCI. The local costs of the EAC component, estimated at US$1.2 million, would be funded from EAC's internal cash generation. Government and EAC have indicated that because of the relatively small amount of the Bank's front-end fee, the fee would be paid up-front of the loan.
Project Implementation
2.04 MCI would be responsible for the energy planning component, the renewable energy component including the demonstration and pilot projects
I/ Price contingencies are not included for the three consultants' studies which were completed in January 1983 and for which retroactive financing is recommended. - 14 - and the strengthening of the energy audit capability; EAC would implement the load management and efficient load dispatch scheme, the Moni power station energy conservation measures and the standby/peaking generation plant study. EAC has carried out 5 previous Bank-financed projects and is fully capable of implementing the power component of the proposed Project.
2.0( MCI Component Implementation. The proposed Project would be the first Bank-financed project to be implemented by MCI. An Energy Advisory Unit (para. 1.10) is already in place at MCI, and the UNDP has provided financing for the first six months of the services of an expatriate Advisor/Coordinator to advise and coordinate the Project beginning about mid-May 1983. The proposed Loan would finance the Advisor/Coordinator to continue his services to direct the component. It is proposed to establish an Applied Renewable Energy Center (AREC) under MCI's direction at the Higher Technical Institute (HTI) in Nicosia for tihepurpose of implementing the renewable energy components of the Project. The AREC would rely largely on the facilities (workshops, computer, etc.) of HTI but would be staffed by engineers, economists and technicians as required to implement the Project. An engineer, with qualifications acceptable to the Bank has been selected, and would be appointed by MCI to head the AREC as the Project Manager, assisted by the expatriate Advisor/Coordinator, to carry out the MCI components of the Project in accordance with the timetable (Annex 2.5) agreed with the Bank. MCI and Government recognize that the successful implementation of the components would depend upon MCI's organizing the Center and appointing staff at an early date to allow for training and to permit start-up according to the Project implementation schedule. Government has confirmed that:
(a) the allocation of the Project Manager and three staff members for the Project has been approved for the full Project period;
(b) during the first year of the Project (1984) one additional engineer, a clerical assistant, and a shorthand/typist would be employed for the Project; and
(c) any additional staff required for the Project in years 1985 and 1986 would be approved on the basis of a continuous review of the Project's work load.
These arrangements are satisfactory for implementation of the Project. Project implementation schedules for the MCI components are summarized in Annex 2.5. The Project Manager, the expatriate advisor/coordinator and the EAU staff, assisted by consultant advisers would implement the demonstration/pilot projects and carry out the various studies associated with the Project. Close collaboration between AREC and other agencies will be called for in a number of cases and appropriate arrangements for such collaboration have been made. The completian date of the MCI Project component would be December 31, 1986.
2.06 EAC Component Implementation. The installation, supervision during construction and commissioning of the works included in the project would be carried out by EAC's techinicalstaff and construction crews, and with supervisory personnel with qualification and experience satisfactory to the Bank. EAC would acquire through purchase or lease the required construction - 15 - and testing equipment. EAC Project implementation schedules are detailed in Annex 2.4. The expected completion date of the EAC Project component would be July 1, 1987.
Studies and Consultancy Services
2.07 EAC Component. On the basis of a short list of consultants and terms of reference for studies suggested by the Bank, EAC invited proposals and selected and appointed the following consultants in November 1982 according to Bank guidelines:
(i) Electricity Supply Board (ESB), Ireland for the Load Management and Efficient Load Dispatch Study; and
(ii) Preece Cardew and Rider (PCR) of UK for the Energy Conservation Study of Moni Power Station and Standby and Peaking Generation Plant Study;
to prepare details and cost estimates for the EAC component of the Project for which retroactive financing of US$0.2 miLlion is recommended in the proposed Loan.
2.08 MCI Components. Consultants (METRA International of France), acceptable to the Bank, were appointed in January 1983 for the Energy Planning component. The study is expected to beginii1n Aprl -1983, and--retroactive financing of US$100,000 is recommended for financing this portion of the study. Consultants for preparing studies for strengthening of MCI's audit capabilities, the Resource Assessment, and for the renewable component would be appointed in accordance with Bank guidelines and with terms of reference acceptable to the Bank.
2.09 Engineering. The overall responsibility for the engineering and design of all works included in the EAC components for the project would be undertaken by EAC's engineering staff which is well qualified and experienced. Services of consultants wolald be used for the design and preparation of bid documents for procurement of material, equipment and civil works for Load Management and Moni Power Station energy conservation schemes. The in-factory inspection would be carried out by consultants or EAC's staff.
Procurement
2.10 Consultants' services for the MCI and EAC components of the Project would be obtained in accordance with Bank guidelines. Contracts for supply and installation of equipment financed by the Bank would be by international competitive bidding in accordance with the Bank Guidelines for Procurement. Small items such as relays, recorders and instruments required for the EAC component, and instruments, recording devices and computer software for the MCI components which would be procured under contracts awarded on the basis of "limited international bidding" procedures satisfactory to the Bank whereby bids would be invited from a list of qualified suppliers eligible under the Guidelines and contracts awarded to the lowest evaluated bidder following the procedures under Part A of the Guidelines. Such procurement would be limited to US$60,000 per contract and US$700,000 in the aggregate for the MCI components, and US$90,000 per contract and US$300,000 in the aggregate for the - 16 -
EAC component. Procurement contracts would include appropriate provisions for inspection and supervision during construction and commissioning by the supplier. Bank financing would cover 100% of foreign exchange costs of all imported materials and equipment, installation and consultants' services included in the Project. Civil works associated with the MCI and EAC components would be contracted locally and financed as part of local costs.
Disbursemenlts
2.11 The proposed Loans, totaling US$10.2 million, wouli be disbursed as follows:
(i) MCI components (USt3.6 million) September 1983 through December 1986 - 100% of foreign cost expendi'turesof consultants' services, equipment, training, and installation; and
(ii) EAC component (US$6.6 million) September 1983 through December 1987 - 100% of foreign cost expenditures of consultants' studies, engineering services, materials, equipment, installation and commissioning of the Project.
Retroactive financing of US$300,000 (paras. 2.07 and 2.08) would be provided for consultants' services from November 1982 for providing detailed cost estimates of the Project components. The estimated schedules of disbursements for MCI are shown in Annex 2.6 and for EAC in Annex 2.7. The closing date of the Loans to MCI and EAC would be December 31, 1987. Annex 2.8 compares the profile of the disbursements with the Region-wide and Bank-wide disbursements for power sector loans. The disbursernentsunder the proposed Loan would be faster than the Region-wide and Bank-wide averages since the Projects are not as complicated as generation, transmission and distribution projects.
Environmental Aspects
2.12 Thiere are no adverse environmnentaleffects of the Project or from the overall 1983-87 expansion program of EAC, and in fact, the renewable components are expected to improve the environment through, for example, the treatment of agricultural waste products. EAC uses underground transmission and distribution in most of the urban areas and to minimize the visual impact of the power facilities it would continue this approach with the planned expansion network. EAC would take necessary measures to ensure that new additions to the generating capacity would meet the acceptable gas and dust emission standards. - 17 -
III. FINANCE
Accounts
3.01 EAC has a well-organized accounting department and an efficient computerized accounting and management information system, staffed by competent and experienced personnel. BiLling and collections, inventory control, personnel records and accounting functions are computerized. Accounting work is decentralized in three regional offices each with its own budget and accounting staff. Tight control is exercised over all expenditures and financial statements are prepared bi--monthly for management and budgetary purposes. Adequate internal auditing practices are followed by the company.
3.02 MCI's accounting, financial controls and auditing procedures are well established in accordance with the Government's prescribed accounting system and are acceptable to the Bank. MCI has agreed to maintain separate accounts for the Project components (see para. 3.12 for auditing and submission of annual accounts to the Bank and para. 3.14 for monitoring the Project).
EAC's Billings and Accounts Receivables
3.U3 EAC's consumer billing arrangemeantsare satisfactory; and its accounts receivable for electricity suppLy, excluding the unbilled consumption in the area not under Government's control, are within acceptable limits. Large consumers' (industrial and commercial) meters are read and billed monthly; domestic meters are read cyclically and billed at two-month intervals. All consumer bills are mailed1 and settlement of the account is required within 15 days of the billing date.
EAC's Taxes and Duties
3.04 EAC is exempt from sales taxes, municipal taxes and import duties, but is subject to income taxes. However, because of investment allowances and othier deductions and carry forward of losses, EAC has not been liable for any income tax payments in previous years.
Past Performance and Present Position of EAC
3.05 Loan 1873-CY requires that EAC earn a rate of return of at least 3% in 1980, 47 in 1981, 5% in 1982 and 6% thereafter on average net fixed assets in service and revalued from time to time beginning in 1980. EAC's electricity tariff structure includes an automatic fuel adjustment clause, which has allowed EAC to pass on fuel price increases to the consumer. Because electricity sales to the area not under Government's control produce no revenue, EAC has not been able to achieve the agreed rate of return on revalued assets even though tariffs are about 20% above long-run marginal cost (para. 1.10). Indeed, EAC would have achieved an average rate of return on revalued assets of 12.4% from 1979 through 1981 if these unbilled sales would have been billed and included as EAC revenues. As a result of insufficient earnings, due to unbilled sales to the area not under Government's control, EAC has had to resort to increased borrowings since 1974. During 1978 and 1979, EAC's net revenues fell short of covering its debt service, and EAC - 18 - achieved only a breakeven debt service coverage in 1980 and 1981. In 1982, EAC would achieve a coverage of only 0.9 even after the conversion of Government loans into equity contributions. Since EAC's electricity tariffs are very high in absolute terms and above long-run marginal costs, the Bank has accepted EAC's past financial performance as satisfactory.
3.06 Beginning in fiscal year 1980 EAC has been permitted to revalue annually its assets in service for depreciation and rate-malking purposes. For revaluing assets EAC uses annual coefficients based on the general wholesale price index published by the Government. EAC submits to the Bank its accounts and financial statements with assets revalued in accordance with the methodology agreed under Loan 1873-CY and duly audited by independent auditors.
3.07 The new steam generation plant (Dhekelia 'B') and i:heassociated transmission lines are nearing completion. EAC achieved this construction program while maintaining an acceptable financial position. However, tariff increases to cover inflation are now required to meet the debt service for borrowings used to finance the 1983-1987 construction program. EAC's financial statements for years ended December 31, 1977-1981 are included in Annexes 3.1 and 3.2,
Financing Plan
3.08 EAC's planned construction and expansion program for 1983-1987 and the proposed financing plan are detai:Led in the projected Sources and Applications of Funds Statement, Annex 3.3. A summary of the projections is given below:
1983-1987 …---- 000 s…- Cf US$ %
Capital Expenditure Requirements Project 3,932 7,864 8.0 Other Investments 44,622 89,244 92.0 Total Investments 48,554 97,108 100.0
Sources of Funds Internal Cash Generation 79,960 159,920 Less Debt Service (49,551) (99,102) Less Working Capital Increase (13,055) (26,110) Net Internal Cash Generation 17,354 34,708 35.7 Customer Contributions 11,500 23,000 23.7 Total Internal Sources 28,854 57,708 59.7
Borrowings Proposed IBRD Loan 3,300 6,600 6.8 Existing IBRD Loan 5,082 10,164 10.5 EIB Loan 1,181 2,362 2.4 Multi-currency Loan 1,357 2,714 2.8 Other 8,780 17,560 18.1 Total Borrowing 19,700 39,400 40.6
Total Sources 48,554 97,108 100.0 . 19 -
To attain the projected level of internal cash generation would require a tariff increase effective July 1, 1983 of an overall average of 15%, with additional increases of 10% in 1985 and 7% in 1987. The proposed tariff increases are projected to provide from internal cash generation, after debt service and increases in working capital, about US$34.7 million (equal to about 36% of the total capital expenditure requirements); and customer contributions would provide about US$23 million (about 24% of the capital expenditure requirements). Of the required borrowings of US$39.4 million, US$16.5 million is already secured through existing IBRD, European Investment Bank (EIB) and multi-currency loans, leaving US$22.9 million to be secured. Discussions are presently underway with EIB for partial financing of the program, and suppliers' credits and local bank borrowing are expected to provide US$13.6 million for financing the balance required for the expansion of the generation and transmission components of the program. The distribution component of the program costing about US$9.3 million is expected to be financed largely by borrowings from local banks.
3.09 The Energy Planning component, the Renewable Energy component, and the Strengthening of MCI's Energy Audit Capability component of the Project would be carried out by MCI. The proposed Bank loan would finance US$3.6 million, providing 100% of the foreign exchange cost of the MCI components of the Project. Government, through annual budget allocations, would provide MCI withi all of the associated local costs (US$1.6 million) of those components.
EAC's Future Performance
3.10 The financial projections for EAC (Annexes 3.1, 3.2 and 3.4) include the tariff increases of 15% effective July 1, 1983, 10% in 1985 and 7% in 1987, which are needed to achieve rates of return on revalued assets, without taking into account the value of the unbilled consumption, of about 5.1% in 1983, 5.8% in 1984, 6.8% in 1985, 5.8% in 1986, and 5.7% in 1987. Debt service would be covered 1.4 times in 1983 and increase annually to more than 2 times by 1987. Total internal sources (internal cash generation and customer contributions) after debt service and working capital would provide financing for about 60% of EAC's total construction program for 1983-1987. If the unbilled electricity revenues were included in the rate of return calculations, EAC would earn an average of 15% on revalued assets for the years 1983-1987.
Financial Covenants
3.11 The rate of return and debt service covenants of previous Bank Loans to EAC served to ensure a viable financial position for EAC. The financial covenants of the earlier loans require EAC to earn a 9% rate of return on revalued assets and to achieve a debt service coverage of 1.5. However, in view of EAC's inability to collect for sales to the area not under Government's control, Loan 1873-CY reduced the rate of return to 3% in 1980, 4/% in 1981, 5% in 1982, and 6% in 1983 and thereafter, and modified EAC's debt service coverage from 1.5 to 1.3 for 1980-1982. As noted above, EAC's existing electricity tariffs are already about 20% above the long-run marginal cost of electricity. Therefore, tariff policy alone cannot reasonably be expected to provide sufficient revenues to meet the rate of return requirement - 20 - and to cover EAG's debt service from 1983 onward. A 15% overall tariff increase effective July 1, 1983 would provide revenues sufficient to enable EAC to earn a 5% rate of return on revalued assets for 1983, and would cover the 1983 debt service requirements. However, it would be appropriate to allow flexibility in the timing and the amount of the tariff increase, and to permit Government and EAC to take other possible measures towards ensuring EAC's financial viability; such as, reduction in interest rates through Government assumption of EAC's debt, subsidies to offset unbilled sales to the area not under Government's control, etc. Therefore, assurances were obtained that as a condition of Loan effectiveness of the proposed Loan to EAC, Government and EAC will have taken all measures, including but not limited to a tariff increase, to enable EAC to achieve a 3% rate of return on revalued assets for 1983. Assurances were also obtained that EAC would:
(i) not incur any long-term debt, except as the Bank and EAC shall otherwise agree, unless a reasonable forecast of its net revenues for each year during the term of the debt to be incurred shall be for 1983 not less than 1.4 times its debt service requirements, and for each year thereafter, not less than 1.5 times its debt service requirements for such year; and
(ii) from time to time EAC shall take all steps necessary to obtain such adjustments in its electricity tariffs as will provide it with revenues sufficient to yield an annual rate of return on average net fixed assets revalued of (a) at least 9% in the fiscal years following such time as it shall be enabled to charge and collect payment for power provided by it and consumed throughout the Republic of Cyprus, and (b) until such time at least 5% in fiscal years 1983-1987 and 6% in ithe following fiscal years.
Audit
3.12 Under existing Loans, EAC is required to submit its audited financial statements to the Bank within four months after the end of the fiscal year. EAG's financial statements are audited by an internationally known independent auditing firm satisfactory to the Bank, and audit reports have been submitted to the Bank within the agreed time. The existing auditing covenant would be repeated in the proposed Loan. MCI's accounts are audited by the Auditor-General who is independent of the Government, and this arrangement is acceptable to the Bank for the purpose of auditing Project expenditures. MCI has agreed to submit to the Bank its annual statement of expendicures for the Project component:sas audited by auditors satisfactory to the Bank not later than six months aftler the end of each fiscal year.
Insurance
3.13 EAC's insurance arrangements are consistent with sound public utility practices and acceptable to the Bank and cover risks of fire, explosion and theft of or damage to inventories. Self-insurance provides for breakdown of machinery and electrical damage, which is satisfactory, considering EAC's high operation and maintenance standards. - 21 -
Monitoring System
3.14 Key indicators presently used to monitor EAC's technical and financial performance under Loan 1873-CY are satisfactory to the Bank for monitoring the EAC components of the Project. MCI has agreed to prepare reports to facilitate monitoring the implementation of MCI's components of the Project. - 22 -
IV. BENEFITS AND JUSTIFICATION
MCI Components
4.01 The planning and the energy conservation components have pervasive and favorable economic implications. They underlie the justification of the Project. Unfortunately, they cannot be quantified. The energy masterplan which will be an ouput (Annex 2.1) of the planning component:will provide Government with the information required to make decisions regarding key issues in the optimal development of the energy sector and will assist in ensuring that costly investment mistalces are avoided. Furthermore, the planning component will strengthen the institutional capabiLity of EAU to analyze and present to Government future energy-related options. The potential savings of energy in Cyprus are considerable (para. 1.03) and under the energy conservation component the training and advice given to EAU should enable the unit to develop, within the project period, a pipeline of about 60 viable conservation projects in the industry and commerce sectors. In addition, EAU would be equipped to give advice and information on energy conservation. The pipeline of projects generated would be submitted to the Cyprus Development Bank for possible J-inancing.
4.02 The objective of the renewable energy component Jisto provide Cyprus with a solid foundation for developing a sustained and meaningful renewable energy program. This it would do, first, by assisting Cyprus in building the information/planning and institutional infrastructure necessary for the systematic development of its renewable energy resources. The establishment of a solar and wind measurement network would provide basic data presently lacking on Cyprus' most important resources, while priorities for the application of renewable energy technology would be evaluated and an action plan prepared as part of the energy planning study. The Applied Renewable Energy Center to be established under the project would serve as a focal point for the country's renewable energy effort. It would provide the Government with technical and economic advice on renewable energy development, undertake research and development where needed to adapt technology to Cypriot requirements, test and promote the application of renewable energy technology through pilot/demonstration projects and other means and assist in and coordinate the work of other agencies in the renewable energy field.
4.03 The second major thrust of the component is to support concrete activities designed to improve and/or initiate the commercialization of the most promising applications of renewable energy in Cyprus. In the one area in which Cyprus has already begun to make good use of its renewable resources, domestic solar water heating, the project would improve the efficiency of locally made equipment and increase consumer confidence in the technology. In the other areas of solar technology, and in the use of wind power and biogas, the project would support demonstration/pilot projects and studies that would enable Cyprus to evaluate their commercial potential. The demonstration/pilot projects involve applications of renewable energy technology that appear to be technically and economically ready for utilization in Cyprus but with which firsthand experience, carefully monitored and evaluated, is needed before their role can be accurately assessed. Each of these project activities focuses on renewable energy applications that appear to have good potential for displacing petroleum imports and improving the energy ef-ficiency,and therefore the economic competitiveness, of Cypriot industry and agriculture. - 23 -
EAC Component
4.04 Load Forecast. Annex 4.1 gives the details of EAC's forecast based on the available details of load growth in the Government controlled area and on the assumptions that load growth in the area not under Government's control will follow the trend in the previous years. The load growth associated with tourist industry and the pumping load from 1987 onwards for the Southern conveyor scheme have been considered. Given the uncertain political situation and lack of data on future generation andc load growth in the area not under Government's control, EAC has reasonably presumed that it would be generating electricity to meet future system requirement of the area not under Government's control. The overall annual load growth during 1983 through 1986 has been assessed at 3.5% and is reasonable.
Least Cost Alternative
4.05 EAC with the assistance of its consultants (PCR) considered in 1978 various alternatives for the 1980-84 generation and transmission program. The Bank reviewed the consultant's report and agreed with EAC that it represented the least cost expansion program. The program has, however, been updated regularly on the basis of new information available. For example, in 1980 PCR updated EAC's proposals for the Moni-Limassol-Paphos system development scheme for 1980-87. EAC's generation program is based on the use of oil as fuel. The oil price increases in recent years made EAC consider using alternate fuels for electricity generation as well as investment in equipment to improve fuel efficiency. Consultants (Bechtel) have recently submitted their report on the use of coal for generation and it is under careful consideration by EAC and the Government. The consultant's (P('R)report on improving fuel efficiency at Moni power station and the load dispatch and management study (ESB) have been completed, their recommendation accepted by EAC and the Bank, and form part of the Project.
Economic Rate of Return - EAC Component
4.06 The Project constitutes about 10% of the cost of EAC's 1983-1987 Expansion Program. Annex 4.2 gives the cost and benefit streams for the Project. Cost streams are those associated with:
(i) installation of new efficient oil burners, variable speed fan drives, new air heater seals, oxygen control instrumentation equipment for dosing of fuel additives, on-load condenser cleaning equipment, an auxiliary steam turbine generator of 3-MW nominal ouput and an additional stage of feeder water heating and
(ii) installation of a mini-computer, frequency meter, recorder underfrequency relays, loadlmanagement equipment and receivers. - 24 -
The benefit streams are those associated with:
(i) improved thermal efficiency of the four units of Moni power station;
(ii) savings in total fuel costs on account of implementing Efficient Load Dispatch; and
(iii) savings on account of deferred capital investmrentdue to one year's delay in commissioning of additional 60-MW generation capacity in 1988 instead of 1987.
Certain benefits such as improved reliability and quality of supply to the consumer and improved availability and reduction in maintenance costs at Moni power station have not been quantified. Further consultants (ESB), on the basis of case studies, noted a reduction in total fuel costs of 1 to 2% due to Efficient Load Dispatch and suggested considering a reduction of 0.5% in the total fuel costs. However, for the Economic Rate of Return (ERR) calculations, a reduction of only 0.25% in the total fuel costs is assumed. Similarly, for the purposes of ERR it is assumed that generation is allocated equally among the six units of Moni power station even though it would be possible to allocate more generation to the fuel efficient f-ourunits. The ERR on the project is about 22%. If the preferential allocation for the four units of Moni power station is assumecl and reduction of 0.5%' in total fuel cost instead of 0.25% is considered the ERR on the project would be 32%.
Sensitivity Analysis
4.07 A 20% reduction in the benefits due to improvement in thermal efficiency of Moni power station lowers the ERR to 18%. A 25% reduction in benefits associated with Efficient Load Dispatch would bring the ERR down to 20%. If the costs associated with cost streams are increased by 10% and simultaneously the benefits associated with Moni power station and Efficient Load Dispatch are reduced by 10%, the ERR is reduced to 16%.
Risks
4.U8 There are no special risks involved in the EAC component of the project where the equipment proposed has been tested and used by other utilities and installation of the material and equipment would follow normal practices and procedures. The studies provided in the Project for the renewable energy component are expected to adapt technology now being applied in many countries to conditions in Cyprus through the pilot/demonstration projects. However, as the renewable component of the Project would be the first project of this nature to be undertaken by MCI intensive supervision and monitoring of the Project implementation by the Bank would be required. - 25 --
V. AGREEMENTSREACHED AND RECOMMENDATION
5.01 Assurances were obtained that Government would:
(i) review with the Bank the consultant's study and recommendations, particularly those for energy pricing by December 31, 1984 (para. 1.07);
(ii) appoint consultants in accordance with the Bank guidelines for the MCI components of the Project (para. 2.08);
(iii) maintain separate accounts for all the MCI components (para. 3.02);
(iv) submit to the Bank not later than six months after the end of each fiscal year its annual statement of expenditures for the MCI components, as audited by auditors satisfactory to the Bank (para. 3.12); and
(v) provide to the Bank reports and key indicators to facilitate monitoring the implementation of MCI's renewable energy component of the Project (para. 3.14).
5.02 Assurances were obtained that EAC would:
(i) not incur any long-term debt, except as the Bank and the Borrower shall otherwise agree, unless a reasonable forecast of its net revenues for each year during the term of the debt to be incurred shall be for 1983 not less than 1.4 times its debt service requirements, and for each year thereafter, not less than 1.5 times its debt service requirements for such year (para. 3.11);
(ii) from time to time take all steps necessary to obtain such adjustments in its electricity tariffs as will provide revenues sufficient to yield an annual rate of return on average net fixed assets revalued of (a) at least 9% in the fiscal years following such time as it shall be enabled to charge and collect payment for power provided by it and consumed throughout the Republic of Cyprus, and (b) until that time, at least 5% in fiscal years 1983-1987 and 6% in the following years (para. 3.11); and
(iii) continue to appoint independent auditors satisfactory to the Bank, and to submit its audited financial statements to the Bank not later than four months after the end of each fiscal year (para. 3.12).
5.03 A condition of effectiveness of the Loan to EAC would be that Government and EAC will have taken all measures, including but not limited to a tariff increase to enable EAC to achieve a 5% rate of return on revalued assets for 1983 (para. 3.11).
5.04 In view of the agreements reached as indicated above, the Project is suitable for a Loan of US$3.6 million to the Republic of Cyprus for the MCI component, and a Loan of US$6.6 million to EAC with the guarantee of the Republic of Cyprus for a 15-year term including a three-year grace period.
April 1983 (1350P, p.1-25) - 26 -
CYPRUS ENERGYFLANNING AND CONSERVATIONPROJECT Organization Chart for EAC
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ENERGY PLANNING AND CONSERVATION PROJECT
EAC Component
Sales in GWh by Categories (1976-1987)
------Actual------Estimated------No./ Category 1976 1977 1978 1979 1980 1981 1982 1983 1984 1989 19R6 1987
I Domestic 130.50 145.61 162.94 175.26 183.24 191.66 199.12 206.36 213.69 220.20 ?26.92 233.8q
2 Commercial 161.00 168.38 182.82 209.32 218.71 233.79 250.22 260.36 270.90 282.43 294.45 307.45
3. Industrial 215.53 233.12 248.39 241.10 257.30 242.78 241.34 248.70 256.30 264.58 273.14 282.51
4. Irrigationl 13.47 18.13 19.78 37.50 39.76 42.10 45.24 46.94 48.68 50.51 52.36 94.40
5. Public Lighting 16.77 17.34 18.22 18.62 19.79 20.57 20.57 20.60 20.80 21.01 21.?2 21.46
6. T'otal Billed Consumption in SoUthern Area 537.27 582.58 632.15 681.80 718.80 730.90 756.49 782.96 810.37 938.73 R68.09 qo0.21
7. Unbilled Consumption in Northera Area 157.70 174.30 185.10 196.30 203.80 211.30 222.00 230.00 238.00 246.00 279.00 264.00
8. Total Sales 694.97 756.88 817.25 878.10 922.60 942.20 978.49 1,012.96 1,048.37 1,084.73 1,123.09 1,164.21
9. Number of Consumers in Southern Area 137,833 147,469 158,073 168,122 178,873 190,254 201,965 211j300 220,1n0 22830sn 939sjnn 243.00n
February 1983 11351P, p. 1) - 28 -
ANNEX 1.3 Page 1 of 2
CYPRUS
ENERGY PLANNING AND CONSERVATIONPROJECT
Description of EAC's Expansion Program for 1983-1987 (excluding the project component)
I. Dhekelia `3i Station
Tile new Dhekelia "B' stationiwill consist of 2 x 60-MW steam units, each comprising a 260 ton per hour oil-fired boiler, a 60-&MW turbo-generator, and associated auxiliaries and electrical equipment. The plant is adjacent to the existing station at Dhekelia and will be known as Dhekelia "B" Power Station. The first unit has been commissioned towards the end of 1982 and the second unit wili be in operation by April/May 1983. An investment for additional 60 MW capacity required in 1988 has been included.
II. Transmission System
The maain items of the transmission system extensions are:
(i) Transmission line between Dhekelia and Athalassa with interbus transformers at Dhekelia. This line is associated with the Dhekelia "B" Power Station and will be used to transmit bulk energy to the Athalassa substation, mainly to cover the needs of Nicosia town and surrounding area;
(ii) Transmission system extensions and reinforcement in the Moni-Limassol-Paphos areas are required to meet increased demand resulting from industrial, tourism and agriculture investments including irrigation projects financed by the Bank in the Limassol and Paphos areas. These extensions cover the Moni-Polemidhia 132/66-kY Overhead line, the tee-off to Ayia Phyla and Yermasoyia sub-stations, the Polemidhia-Episkopi 132/66-kV Overhead line and the stringing of the second circuit between Episkopi and Paphos substations;
(iii) The establishment of the Yermasoyia and Ayia Phyla 132/11-kV substations and uprating of the Polemidhia substation to 132 kV to meet load growth stemming from tourism and industrial investments in the Limassol area as well as increasing domestic demand;
(iv) The Moni-Pyrgos-Mari transmission line reinforcement and the establishinentof a new substation at Mari to meet the increase in demand from industrial development in this area. Demand from the Cement Industry in the Pyrgos-Mari area is estimated to be in the region of 30 MW by 1984. In addition, the new Fertilizers and Sulphuric Acid Industry load is expected to reach 5MVA while the demand of the nearby Radio Relay Station would be 6 MVA by 1984; -290 - ANNEX 1.3 Page 2 of 2
(v) The reinforcement of the Alambra, Kophinou 66/11-kV and Athalassa 66/11-kV substations are required to meet industrial, domestic water supply and irrigation loads in these areas. The Vassilikos-Pendaskinos Water Resources Development and Nicosia Water Supply Projects are expected to have an ultimate demand of the order of 3 MVA;
(vi) Reinforcement of the Sotera and Cape Greco substations and the establishment of Ay. Nicolas 16/11 kV Substation is necessary to meet increased demand especially from tourism;
(vii) Reinforcement of the Nicosia District Office L32/ll--kV substation and Larnaca 66/11-kV substation is required to meet increasing demand from existing and new consumers in these towns; and
(viii) Reinforcement of the Orounda '56/llkV substation and the establishment of the Ergates 66/llkv Substation is required to meet increasing demands from existing and new consumers mostly for irrigation and from the establishment of a new industrial estate.
IL. Distribution System
The distribution system extension and reinforcement is designed to meet increased demands from existing consumers, new major industrial and commercial consumers and the low cost refugee housing development. It will also cover the additional demands due to expansion of the Limassol and Larnaca harbors, development of the Larnaca International Airport, supply to Paphos Airport, new and existing industrial estates and tourism development along the entire coast from Cape Greco to Polis.
The planned distribution system extensions and reinforcement will benefit about 41,000 new consumers, out of which 16,250 rural, who will be connected on the system during the period 1983-1987.
March 1983 (1351P, p.2-3) - 3C - ANNEX 1.4
CYPRIJS
ENERGY PLANNING AND CONSERVATION PROJECT
EAC Expansion Plan 1983-1987, Existing and Planned Facilities
Estimated net Existing increase/decrease Estimated total Item Quantity Dec. 31, 1982 1983-1987 Dec. 31, 1987
Generation Plant Units No. 14 -4 10
Capacity MW 324 4 328
13L-KV (constructed) transmission lines cct. miles 265.6 158.4 424
132-sV Underground caoies cct. miles 6.2 - 6.2 ob-KV Transiission lines cct. miles 375.9 -38.2 337.7
i1/b6-kV step-up transformers No. 10 - t0
MVA 240 - 240
11/132-kV and 11/142-kV step-up transformers No. 3 1 4
A.VA 148 73 221
132/666-V Scep-down and 6b/132-kV step-up No. 8 2 In
interbus transtoriners M4VA 420 90 510
J32/11.5-kV,132/3.45-KV, 66/11.5-icV,66/3.3-kV No. 68 11 79
step-down transforiners MS/A 508 190 498 i1-kV overhead lines miles 1,802.5 175 1,977.5
11-KV underground caDles miles 366 94 460 i1-KV ground maounteddistribution transformers No. 988 285 1,273
MVA 406 104 51l
Pole caounteddistrioucion transformers No. 2,576 585 3,161
MVA 184 55 239
LV overnead Lines miles 2,588.6 345 2,933.6
LV underground cables miles 146.4 40 186.4
No. of consumers No. 201,965 41,035 243,000
FebrUary 1983 21351P, P. 4) CYPRUS
ENERGY PLANNING AND CONSERVATION PROJECT
EAC Expansion Plan 1983-1987 Costs (US$ 000's)
1983 1984 1985 1986 1987 1983--1997 Locai Foreign Local Foreiocal cal Foreign Local Fo ein Local Foreign Local F'oreign Total A GENERATION i) Material, Equipment and Fees 424 - 258 440 1,356 2,358 1,188 2,476 3,226 S,274 8,00 ii) Physical Contingencies - - - - 38 - 204 338 178 358 420 696 1,116 iii) Price Contingencies - 74 88 560 754 658 1,010 1,292 1 2 3 144 TOTAL A 424 - - - 370 528 2,120 3,450 2,024 3,844 4,938 7,822 12,760 iS 'TANSXI S SION i) Material and Equipment 5,408 4,138 576 1,214 614 576 222 460 112 440 6,932 6,828 13,760 ii) Physical Contingencies 488 194 58 122 62 58 22 46 12 44 642 464 1,106 ii) Price Contingencies 258 172 92 162 168 128 88 142 60 172 666 776 1,442 TrOTAL 0 6,154 4,504 726 1,498 844 762 332 648 184 656 8,240 8,068 16,308 C DiSTRlBUEJ10i i) Material and Equipment 3,316 2,398 3,216 2,360 3,216 2,360 3,216 2,360 3,216 2,360 16,180 11,838 28,018 ii) Physical Contingencies 332 240 322 236 322 236 322 236 322 236 1,620 1,184 iii) Price Contingencies 2,8(4 174 106 510 _312 874 524 1,272 726 1,704t 924 4,534 2,';92 7 126 TOTAL C 3,8222,744 4,048 2,908 4,412 3,12( 4,810 3,32? 5,242 3,520 22,334 15,614 37,448 U CAC PROJECT COMPONENT i) Material, Equipmnent, Fees & Studies 4 152 262 1,36b 440 2,776 148 610 82 314 036 5,218 i,154 ii) Physical contingencies - - 16 64 32 214 10 42 4 16 62 336 3q9 iii) Price coatingencies 4 38 152 116 602 58 182 42 118 254 1,058 1,312 TrOTAL 0) 4 156 316 1,582 588 3,592 216 8-34 128 448 '1,5252 6,612 7,864 MISCELLANEO'US I) O-Lfice Equip., Vehicles & 104 Meters 678 80 704 72 674 66 67L 62 670 3R4 3,402 3,786 ii) Physical Contingencies 10 68 8 70 8 68 6 68 6 66 38 34n 378 iii) Price Contingencies 6 28 12 94 20 148 28 210 32 264 98 744 847 TOi'AL E 120 724 100 868 100 890 100 954 100 1,000 520 4,486 5,0n06
TOJAr. A '- U + C + D + E 1(),524 8,178 5,190 6,856 6,314 8,892 7,578 9,208 7,678 9,4R6 37,284 47,602 70,88(,
February 1983 (1351P p. 5) - 32 - ANNEX 2.1 Page 1 of 11
CYP'US
ENERGY PLANNING AND CONSERVATION PROJECT
PROJECT DESCRIPTION
MCI Project Component
1. Assistance to MCI consists of three interrelated sub-components:
(1) Energy Planning Sub-component; (2) Renewable Energy; and (3) Energy Conservation.
2. The above components build upon the initial work and studies prepared by various consultants under a UNDP-financed program of assistance.
I. Energy Planning Sub-component
3. This sub-component is as follows:
(a) A detailed medium-term energy masterplan consisting of actions to be taken by the Government in the key areas of renewable energy, demand management, the pricing of energy and interfuel substitution options. The consultants will prepare in close collaboration with the Government a program of actions to be implemented over the 1985-1990 period.
(b) A long-term energy plan and policy including likely scenarios for the demand and supply of energy.
(c) Strengthen MCI's capabilities in energy planning by the collection of energy data and developing more fully through training, capabilities in the techniques of planning, analysis and policy formulation.
4. The work program for the study is organized into three phases as outlined below and shown in Attachment 1. A Steering Committee, consisting of representatives of MCI, the Planning Bureau, EAC, Ministry of Finance and the Statistics Department will be established to monitor and guide the work of the consultants. To the extent possible and appropriate the Bank will participate in the Steering Committee meetings convened to review and discuss the reports prepared by the consultants at the end of each phase.
(a) Phase 1 - Diagnostic study and collection of data - This phase will include the following:
(i) Collection of data, preparation of detailed energy balances, identification of data gaps. - 33 - ANNEX 2.1 Page 2 of 11
(ii) Analysis of pricing policy.
(iii) Analysis of existing legislation relating to energy.
(iv) Elaboration, on basis of available data, of economic cost of energy supply options.
(b) Phase 2 - Medium-term masterplan - This phase will include the following:
(i) Detailed analysis of energy demand, potential for energy conservation and energy substitution by end use.
(ii) Demand forecasts to 1985 and 1990.
(iii) Recommended pricing policy, actions to be taken, and an implementation program.
(iv) Recommended actions to improve incentives for energy conservation.
(v) In conjunction with the renewable energy component a medium-term program for the development of renewable energy including the level and likely sources of finance for such a program.
(vi) Detailed energy balances for 1985 and 1990.
On the basis of the review by the Steering Committee a series of recommendations will be submitted to the Government and the Bank for consideration by December 1984.
(c) Phase 3 - Long-term planning and institutional strengthening - This will include;
(i) Strengthening planning capabilities within MCI.
(ii) Development of the energy data collection procedures established in Phase 1.
(iii) Proposals for any appropriate hardware and software requirements.
(iv) Training program. - 34 - ANNEX 2.1 Page 3 of 11
5. The outputs of the Energy P'lanning sub-component will be as follows:
(i) Inception Report -- at the end of Phase 1. This will include a detailed energy balance for 1982, analysis of energy demand, revriew of available data and identification of data gaps; diagnostic review of energy related activities in Cyprus including existing legislation, energy pricing and subsidies policy, availability of existing data (cost, resources, etc.) of energy supply options. The Steering Committee will review the report and within three weeks of submission prepare comments and any revisions.
(ii) Medium-Term Masterplan - Draft report for review/discussion by the Steering Committee will be prepared at the end of Phase 2. The niasterplan will provide a coherent set of planned actions and an appropriate implementation plan for a 5-year period (1985-1990) in the fields of conservation in the various sectors of the economy and including energy pricing policies, incentives and regulatory measures and the likely size, scope and sources of finance for a conservation and renewable program; the development of new supply options including their likely costs to the economy as well as an implementation plan to 1990; and the identification of any future training requirements and training programs for MCI staff. The report would be supported by ainexes detailing energy data. On the basis of modifications by the Steering Committee the plan would be submitted to the Government for their review. The Bank would participate in this review.
(iii) Long-Term Planning Report - Discussion report prepared at end of Phase 3 outlining alternative long-term strategies and scenarios and impact of policies and actions taken in 1985-1990 period on evolution of energy demand and supply.
(iv) Strengthening Planning Capabilities - Assistance by consultants will strengthen MCI's staff in the field of planning. Outputs are as follows:
(a) Trained Staff - MCI will nominate a staff member to act as project manager and work in close collaboration with the consultants. On-the-job training will be given by consultants in the various aspects of energy planning as outlined in the three phases. - 35 - ANNEX2.1 Page 4 ot 11
(b) Improved data collection, collation and analysis procedures. At present virtually no data/information on energy is collected by the EAU. While the data requirements for EAU will be relatively small and may in fact be available in other Government departments no system has yet been developed to collect this information. The consultants will recommend improvements to the present system and will assist EAU in its implementation. The consultants will assess the eaxtent to which it is appropriate to develop a simple simulation model for energy planning in Cyprus and whether modifications to existing data storage facilities are required. IL appropriate the consultants will prepare the specifications for such a modeL.
(c) Training programs - The consuiltants will identify appropriate short-term traLning programs for MCI staff in the fields of energy pLanninag,policy formulation and analysis and will, if possible, identify sources of finance or training grants for such programs.
II. Renewable Energy SbcpntS
6. The Cypriot Government has assigned high priority to the development of renewable sources of energy. While a limited number of studies and other work in renewable energy have already been carried out much remains to be done in such areas as planning and resource assessment3 research and development, demonstration and coTmercialization and training and institution building before Cyprus' renewable energy resources can be developed on a meaningful scale. The 10 sub-projects which make up the sub-component will provide assistance in these areas. While they cover a number of diverse fields, the sub-projects are in fact interlinked and constitute a package which would provide Cyprus with a solid foundation for the development of its renewable energy sources. The sub-comiponentincludes the following.
Resource Assessment
7. Comprehensive information about the availability of solar and wind resources is fundamental to the development of a renewable energy program in Cyprus. The resource assessment sub-project will establish a national solar and wind resource measuring network, covering about 10-12 locations in the country (the exact number will be determnined through site surveys). Mechanisms will be developed for systematically analyzing the resulting data, archiving it and making it available to the users in the renewable energy field, along with relevant past climatological data collected at - 36 -- ANNEX 2.1 Page 5 of 11 existing meteorological stations. The sub-project will be implemented with the assistance of the Meteorological Department under the guidance of project (AREC) technical staff. Financing will be provided for the necessary measurement and data processing equipment, together with the technical assistance required in site selection, analysis and archiving of data.
8. The performance of most solar and wind energy systems is highly site-specific and accurate solar and wind resource information (as well as data about other climatalogical variables) is essential to their correct design. Without adequate resource information, the systems are likely to have to be over-sized to ensure adequate output and, thus, to be unnecessarily costly. The resource assessment sub-project will therefore be crucial to the development of technically adequate, least-cost solar and wind energy systems in Cyprus. The resource data will also be a major input to the planning study.
Solar Water Heating
9. The sub-project would: (i) establish indoor and outdoor test facilities to certify the locally manufactured solar water heating systems/sub-systems as to performance and construction quality; (ii) test and demonstrate the use of solar water heating systems for commercial and industrial (process heat) applications on four buildings, each typically deploying a flat plate collector array of 500 sq. ft.; (iii) provide technical assistance to local manufacturers--through establishment of test rigs and adaptation program at AREC--to help improve the performance and reliability of Cypriot solar water heating systems/sub-systems to internationally accepted standards; and (iv) train, at AREC, local engineers in the public and private sector to help them learn the latest techniques needed for designing domestic, commercial and industrial solar water heating systems.
10. Solar water heating using flat plate collectors is the most commercial of the renewable energy technologies today and its widespread use in homes in Cyprus is evidence of its economic attractiveness to consumers there. However, Cypriot water heaters do not perform as efficiently and are not as well constructed as they need to be if the full benefits of residential applications are to be realized and the potentially much larger commercial and industrial markets have not yet been touched. By providing the facilities and technical assistance necessary for the upgrading of locally manufactured systemnsand testing and demonstrating applications outside the residential sector in hotels, in hospitals and other public buildings, and in industry the sub-project would help to substantially increase the contribution of this technology to meeting Cyprus' energy needs. - 37 -
ANNEX 2.1 Page 6 of 11
Passive Solar Heating and Cooling of Buildings l1. This sub-project includes a study which would review the existing as well as projected building stock (donmestic,commercial, institutional and industrial) in the country and associated energy demand patterns in order to develop a detailed plan for minimizing energy consumption. The study will concentrate on three main areas: (a) the 'envelope' of thebbuildings, (b) hteating,ventilating and air conditioning equipment, and (c) appliances and lighting. In addition to these technical aspects, the conservation plan will address economic, financial, and policy issues. The sub-project would also provide technical assistance to acquaint local engineers in the public and private sectors with the use of latest passive solar designs and conservation measures which can help reduce significantly the energy demand in buildings. This sub-project will be implemented by AREC in close collaboration with the Ministry of Communication and Works (MCW).
12. Currently, about 25% of the total consumption of electric energy takes place in the domestic sector and 30% in the commercial sector and it is believed that a very high percentage of this is attributable to heating and cooling. The potential for energy saving in existing as well as projected buildings appears to be considerable. Experience in many countries shows that energy requirements can be substantially reduced both through conventional conservation measures (e.g., insulation) and through the "passive solar" design which maximizes the sun's contribution to meeting winter heating needs while minimizing summer cooling loads (e.g., by siting and glazing buildings for maximum energy efficiency and through the use of special design features such as overhangs). The study included in the sub-project will seek to quantify the conservation potential and develop a strategy for realizing this potential. The technical assistance to the Cypriot architects and engineers will help to develop the indigenous capability necessary to implement the measures recommended.
Solar Greenhouses
13. Through this sub-project, ongoing work on "tactive"'solar systems for heating greenhouses will be supplemented by a program to develop "passive" solar greenhouses. The active systems typically use a collector array to heat conventionally designed greenhouses while the passive systems rely on changes in greenhouse designs to reduce heating and cooling loads. The sub-project would involve the installation of 10-15 prototype greenhouses (each typically with a plant canopy area of 120 sq. ft.) that would demonstrate various ways and means of substantially reducing the energy load of existing commercial greenhouses in Cyprus (e.g., through addition of movable insulation, rock/water heat storage). It would help to develop and standardize for widespread installation inexpensive, energy efficient greenhouse designs which make maximal use of solar energy. The prototype greenhouses will be built on the premises of Agricultural Research Institute (ARI) and tested by ARI staff. Technical guidance for the sub-project will be provided by AREC staff. - 38 - ANNEX 2.1 Page 7 of 11
14. The use of greenhouses for growing fruits, vegetables and flowers has been increasing rapidly. Greenhouse area currently stands at about 90 hectares and is to be more than doubled with the help of a Bank Loan 1988-CY. Winter heating is often necessary to obtain maximum yields. The total energy consumption in greenhouses in Cyprus is probably in excess of 25% of the energy consumnption in agricultural sector. Given the sunny winters in Cyprus and the recent advances in construction of energy efficient solar greenhouses, it is quite possible to reduce heating bills of the existing (through retrofit measures) as well as future greenhouses by well over 33%. The energy efficient greenhouses will also drastically reduce the temperature build-up in summer which would prolong the growing season by making it possible to use the greenhouses in all but the hottest months. Since solar features can usually be included in greenhouses without increasing costs, the economics of solar greenhouses promises to be far superior to that of conventional greenhouses.
Solar Crop Drying
15. This sub-project would develop a pilot solar system for drying grapes, evaluate its performance and develop recommendations for the future use of solar drying techniques for grapes and other promising crops. A grape warehouse, with a properly oriented and tilted roof, would be modified to test and demonstrate a simple, low cost solar air heating system. After installation, the system will be subjected to performance evaluation for about a year. In the off-season, when grapes are not being dried, alternate uses for the dryer (e.g., heating of adjacent buildings) will be investigated.
16. Table grapes constitute the largest agricultural crop in Cyprus. About 5% of grapes are converted through normal outdoor sun drying into raisins, which are a preferred product both for domestic and export markets. ARI has estimated that, if a drying process is evolved which can result in more uniform and better quality raisins, raisin production could be more than tripled. Solar crop drying is one such process. It has been successfully used on a number of crops (including grapes) in different countries. The technology is simple, inexpensive and readily adaptable for use in Cyprus. Solar crop drying not only eliminates the danger of rain but also has the advantages of accelerated and more uniform drying, improvement in product quality, and avoidance of contamination with mud (which occurs in sun drying) and need for subsequent washing.
Solar Ponds
17. The sub-project consists of a study of the potential for solar ponds. This technology involves the use of large salt water ponds as solar collectors from which heat can be drawn off for power generation and other purposes. Small- and medium-size ponds are being operated, mainly for research and development purposes in a number of countries and a large (5 MW peak capacity) pond is under construction in Israel. - 39 -
ANNEX 2.1 Page 8 of 11
18. A number of small salt lakes near Larnaca and a large one near Limassol may be suitable sites for solar ponds. They have a theoretical potential of generating well over 250 MW of thermal energy (to meet diverse end uses such as desalination, industrial process heat, space heating and cooling, etc.) or well over 50 MW of electrical energy. Although solar pond technology has not been commercially proven, it seems sufficiently promising to warrant consideration in countries like Cyprus where suitable sites may exist and where there are few other indigenous energy resources. The study would make a preliminary assessment of the potential for solar ponds in Cyprus and, if the findings are positive, recommend measures for the development of this potential if and when the technology develops to the point at which this becomes feasible. The study will be supervised by AREC in close collaboration with EAC and the Water Development Department.
Wind-pumps
19. Tne purpose oL this sub-project is to evaluate the technical and economic performance of various wind-pumping systems and to prepare a program for their application in Cyprus. Both traditional Cypriot windmills and aodern, imported systems would be evaluated through the establishment of on-farm pilot installations. A large number of disused windmills (typically of 14' diameter) that have been replaced by diesel pumps exist in Cyprus. Up to 10 of tnese would be refurbished and reactivated under the project. In addition 5 new pumps of both 14' and 25' diameter would be installed, also to operate in tandem with diesels in a "fuel-saver" mode, These installations would be carefully monitored and their performance compared. AREC would be responsible for implementing the project in collaboration with the Ministry of Water Development. A considerable number of farmers have evinced interest in water pumping and participants would be chosen from among those who are most able and willing to cooperate in the installation and monitoring of the pumps.
20. Wind-pumping is a well known technology and Bank and other studies have shown that, even where average wind speeds are moderate (i.e., 4 M/S or more), windmaills are likely to be the least cost alternative in comparison with both conventional pumps and other renewable technologies. Cyprus has a wind regime which is more tnan adequate for water pumping and windm.ills offer potential for significant fuel savings. A recent study estimates that, if 20% of the existing 5,000 boreholes were equipped with 14' or 25' d4ameter windmills, annual fuel savings of about 1,300 and 7,000 toe, respectively, would be possible. This should be economically attractive to Cypriot farmers. Although imported 14' and 25' diameter wind-pumps would cost about $2,400 and q9,000, installed, preliminary estimates indicate that, if operated in tandem with existing diesel engines, annual fuel saving of the order of 4500 and q2,500 could be achieved, giving rates of return of about 15. and 25%, respectively. For refurbished wiindmills, the economics would be even better. - 40 - ANNEX 2.1 Page 9 of 11
Biogas
21. Under this sub-project a pilot commercial biogas system would be instalied for testing and demonstration purposes on a 7,000 pig swinery near Nicosia. The system would consist basically of a biogas digester with a capacity of about 420/m3 and a 65 HP motor-generator set. The exact dimensions and output of the biogas systema will depend on a number of factors (e.g., retention time, animal weight) which will be decided through a design study included in the sub-project but the typical daily output from a 7,000 pig swinery can be expected to be approxirmately850 m3 of gas, which would be about sufficient to meet the swinery's 350,000 kWh annual power needs. AREC would be responsible for the installation and evaluation of the biogas system in collaboration with ARI. The swinery would operate and maintain the system, would keep the detailed records necessary for performance monitoring and would provide free access to the facility for demonstration purposes.
22, Biogas systems of the type to be installed under the sub-project are in commercial operation in the US and Europe and in the Philippines and some other developing countries. They are proving to be well adapted to meeting the energy and environmental needs of modern large-scale livestock enterprises such as now exist in Cyprus. Pork production on the island has shifted from the small producer to large mechanized feeding operations. In these swineries the manure is collected in a wet slurry form that can be fed directly into a biodigester without further processing or the addition of water. The biogas production potential from the swineries is about 20,000 m3/day, equivalent to about 3,500 toe per annum. The swineries should find biogas an attractive investment. A commercial installation (i.e., without the instrumentation, etc., needed for demonstration purposes) would cost about $180,000-200,000 and have a useful life of about 20 years; it would provide annual fuel savings of about $40,000 (at the average EAC tariff of $0.11 kWh), resulting in a rate of return in excess of 15%. Additional benefits can be expected from the use of the residue from the digestion process as a fertilizer and/or as an animal or fish food. The environmental benefits of biodigestion may be of even greater importance, although difficult to quantify, since it provides a solution to the waste disposal problem caused by the concentration of a large number of swineries in the Nicosia area.
Applied Renewable Energy Center (AREC)
23. The project will provide the technical assistance and facilities necessary for the establishment of a national renewable energy center. AREC will serve as a focal point for Cyprus' renewable energy program. It will be the MCI agency responsible for implementing the renewable energy component of the project and, thereafter, for carrying out the renewable energy program recommended in the planning study. AREC's specific functions will be to; - 41 - ANNEX 2.1 Page 10 of 11
(1) provide the Government with expert technical and economic advice on renewable energy policies and projects;
(2) assist in standardization of renewable energy systems produced and/or marketed in Cyprus;
(3) undertake the adaptive research which will be necessary in many cases before renewable energy technologies can be applied effectively in Cyprus; and
(4) promote the widespread use of renewable energy technology through pilot/demonstration projects and other commercialization schemes.
24. In performing these functions, AREC's principal role will be a coordinating one; as a small entity with limited resources it will have to draw neavily on the capabilities of other government agencies, and of the private sector.
25. AREC will be headed by a project manager who will be responsible to the Section Chief, Energy Advisory Unit in MCI. He will be assisted by an adviser/coordinator who will be an expatriate with well established technical qualifications in renewable energy and substantial management experience. To initiate its activities AREC will have 3 full-time Cypriot staff members who will be assisted by 3 expatriate experts. AREC will be located at the premises of the Higher Technical Institute (HTI) which has agreed to share its workshop, computer and otner facilities with AREC. Additional equipment and facilities needed by AREC will be provided under the Project.
III. Energy Conservation
26. The sub-component consists of a technical assistance program for the Energy Advisory Unit. Its main objective is to improve and accelerate energy conservation in industry and commerce. Its secondary objective is to develop an Energy Conservation Scheme (ECS) with defined targets for motivation and subsequent achievement monitoring. The sub-component will be implemented with the assistance of consultants. The sub-component comprises the following:
- Intensive field training for a nucleus (3) of the Unit's engineers.
- Further academic training for one engineer.
- Advice on the managerial and organizational techniques required for the Unit to operate with maximum effectiveness.
- Experienced executive and operational personnel during the first year of the ECS to ensure its satisfactory establishment, and some additional equipment and instrumentation. - 42 - ANNEX 2.1 Page 11 of 11
27. The Unit will be able to secure the implementation of a number of conservation projects during the Scheme's first 3 years. The confidence and experience thereby gained will enable the service to expand and develop and so realize the conservation potential nationwide. This sub-component is expected to result in the generation of about 60 projects in industry and commerce, diversified by size and sector, during the Scheme's first 3 years. The energy savings are valued at about $0.4 million al year.
IV. EAC Project Component
(i) Efficient Load Dispatch - Acquisition and installation of: a) precision frequency meter; b) frequency recorder; c) high speed recording and logging instrument; d) ten under-frequency relay units; and e) mini computer with peripherals.
(ii) Efficient Load Management - Acquisition and installation of: a) three injection transmitters; b) 25,000 water heater receivers; c) 4,000 receivers to replace existing time switches for meters controlling water pumping/irrigation, off peak storage heating, street lighting and central air conditioning; and d) 60 units for metering equipment for high tension and low tension installations availing incentive tariffs.
(iii) Moni Power Station Energy Conservation Scheme - Acquisition and installation (for units 3, 4? 5 and 6) of: a) steam atomized oil burners to replace the existing inefficient pressure jet-type oil burners; b) variable speed drives for forced draft fans for better combustion control; c) improved air heater seals to reduce air leakage; d) oxygen control system to improve the boiler efficiency; e) injection equipment for fuel additives; f) on-load condenser cleaning equipment; g) auxiliary turbine generator of 3 MW nominal rating with associated steam piping, switchgear, instrument control and feed water heaters; and h) plastic balls to provide a blanket for five surge tanks.
(iv) Consultants' Services - To appoint consultants and carry out:
a) Study for efficient load dispatch and load management and prepare cost estimates, schedule of materials and equipment required ((i) and (ii) above);
b) Design and engineering for preparation of bid specifications for equipment stipulated in (ii) above;
c) Study for Conservation scheme for Moni power station and prepare cost estimates, schedules of materials and equipment required for improving the efficiency of the power station ((iii) above);
d) Design and engineering for preparation of bid specifications for equipment required for modifications proposed according to c) above; and
e) Study for standby/peaking generation plant required for EAC's system.
March 1983 (1351P, p.2l-3 1) ANNEX 2.1 -43 - Attachment 1 Page 1 of I
CYPRUS
ENERGY PLANNING AND CONSERVATION PROJECT
Energy Planning Subcornponent - Work Program
Collection and Analysisof the current Evaluationof Collation _ of Data energy system nationalenergy resources W
Energy-balance Diagnosisof the current for 19 2 energy system
Detailedanalysis of energydemand
potentialfor energyconservation
. potentialfor energy substitution
Demandforecasts __ to _1985 1990 _ Energymaster plan for 1985 - 1990
Conventional Renewable energies energies
Energy balance
1985 - 1990
Survey of long term 7 Strengthening strategiesand scplanning capabilities
I - 44 - ANNEX 2.2
CYPRUS
ENERGY PLANNING AND CONS]3RVATION PROJECT
II Comonents
1983 1984 1985 1986 Total 1983-1986 Local Poreaio Local Foreigo Local Foreign Local Foreign Local Foreign Total
(A) Energ Paog dDta Base onmultants 85.1 182.4 36.5 78.2 - _ 121.6 260.6 382.2 Coot-ngemicis 2.4 6.6 1.0 2.8 - -- 3,4 9.4 12.9 rotal Energy Pla.ing and Data 3aie 87.5 189.0 37.5 __ __ _ 125.011.0 270.1)_29. li) Renewable Energy I' 1() Applied Renetable Energy Center B.ildi.gs 90.0 - 8.0 - 9.0 - 10)7.0 - 107.0
Rq,uipment - - 68.0 245.0 60.0 93.0 71.0 82.0 199.n 420.0 619.n Consultanes - - 90.0 279.0 100.0 309.0 110.0 190.0 300.0 778.0 1,072.0 Traiciog - - ~ ~ ~~~~~78.0 ~- ~ ~~~~~99.0 ~~~-- 45.5 - 222.5 222,5 Contingencies _ _ 25.0 45.0 9.5 36.0 11.0 0.5 4S.5 91.5 127.0 Total Applied Renewable Energy Cenoer _ - 273.0 647.0 177.5 537.0 201.0 318.0 651.5 1,5n2.0 2,153,5 (ii) Resource A~ss.easet quipetment _ 3.0 165.0 3.5 9.0 4.0 9.0 10.5 183.0 193.5 ConsuEtants - - 21.5 30.0 17.5 5.0 20.0 5.5 59.0 40.5 99.5 Co.t.hge-cies - -1.6 _15.0 1.5 1.5 1.5 1.5 4.9 18.0 22.9 Total Resource Asses. t - 26.3 210 2.5 15.5 25.5 16.0 74.3 _41.$ 315. (iii) Solor Wacer tloting Soilar - - 28.5 - 4.0 - 4.5 - 37.0 - 37.n Equipment - - 81.5 320.0 51.0 5.0 41.0 5.0 173.5 350.0 523.5 Conoultants - - 13.0 30.0 13.0 - 13.0 - 3q.(0 3(5.0 69.0 Niscellaneous - - 2.0 - 5.0 - 4.0 - 11.0 - lI.0 Contingencies - - 8.7 24.5 5.0 1.8 4.6 0.4 19.3 26.7 49.n Total Solar Water Heating - _ 133.7 374.5 78.0 26.8 67.1 5.4 278.8 406.7 6958S (iv) Solar Heatin.g& Cooling of Suildn-gs Equipment - - - - - 55.0 - - - 59.0 S9.0 Consultants - - 15.5 99.5 16.0 9.0 16.5 - 48.0 108.5 156.5 M-acellonou - - 2.0 - 6.0 -8. - A.0 Conti.ge-cres - - 1.0 7.0 1.2 4.1 1.6 _ 3.8 11.5 15.3 Total Solar Heating 6 Cooling of Buildings - - 16.5 106.5 19.2 68.5 24.1 - 59.8 17S.0 234.R (v) Solar Crop Drycng Equipment - - 2.5 - 21.0 14.0 3.0 - 26.5 14.0 40.5 Co.s..tants - 2.0 - 1.5 3.5 - 3.5 Miscellaneous - - 0 - 0.5 - 1.5 2.03 2.0 Contingencies 0.2 1.7 1.0 0.4 2.3 1.0 49.3 T.tai Solar Crop Drying = - 2.7 - 25.2 15.0 6.4 _ 34.3 1S.0 4Q.3 (vi) Solar Greenhouses Eqaipr ent - - 120.0 55.0 40.0 10.0 - - 160.0 65.0 229.0 Co.nultance - - 42.0 30.5 21.0 1.S - - 63.0 32.0 95.0 Miscellaneous - - 3.5 - 4.5 - -- 8.0 - 9.0 Contingencies - 11.5 5.9 4.5 0.8 - - 16.0 6.7 22.7 Total Solar Greenhouses - - 177.0 91.4 70.0 12.3 - - 247.0 103.7 350.7 Ivii) Solar Ponds Equipment - - 3.0 - - - - - 3.0 - 3.0 Consultants - - 6.0 48.0 - - - 6.0 48.0 94.0 Miscellaneous - - 5.0 - - - - - 5.0 - 5.0 Contingencies - - 1.0 3.5 - - - _ 1.0 3.5 4.5 Total Solar Ponds - _ 15.0 51.5 = = - - 19.0 51.5 6(6.5 (vtii) Windmills Equipment - - 14.0 40.0 1.0 - 1.0 - 16.8 40.0 s6.n Consultants - - 13.5 10.3 7.0 10.3 - - 20.9 20.6 41.1 Miscellaneous - - 3.0 - 6.0 - 1.0 - 10.0 - 10.0 Contingencies - - 2.1 3.5 1.0 0.7 - - 3.1 4.2 7.3 Total Windmills - _ 32.6 53.8 15.0 11.0 2.0 - 49.6 64.R 114.4 (is) Biogas _ _ Equipment - - 30.0 75.0 56.5 145.0 3.0 - 89.5 220.0 309.9 Consultants ' 6.5 12.0 7.5 - 7.5 - 21.5 12.0 33.9 Miscallaneoos - - - 1.5 - 2.0 - 3.5 - 3.5 Contingencies - - 2.5 6.0 4.5 12.0 0.8 - 7.9 18.0 29.9 'otatl Biogas - - 39.0 93.0 78-0 157.0 13.3 _ 122.3 290.0 372.3 Total Reeewabie Energy - = 715.8 477.4 843.1 339.4 339.4 1 T9T. 4 2R
(C) Strengthening of MNI's Audit Capabilities Equipment - - - 50.0 - - - - - 90.0 50.0 Consultant- - - 270.0 - 54.0 - - - 324.0 324.0 Training - 40.0 - 50.0 - - - - - 90.8 90.0 Contingencies - - - 30.0 6.0 - _ - 36.0 36.0 Total Strengthening of MCI', s Audit Capabilities - 40.0 - 400-0 _ 60.0 - - - 900.0 900.0
Total MCI Components 87.5 229.0 753.3 2108.7 477.4 903.1 339.4 339.4 1,657.6 3,580.2 5237.8
1/ UNDP funding first sin months of consultants' cost in 1983.
Miscellaneous items include computer time, laboratory tests, publications and reports.
February 1983 (1351P, p.7) - 45- ANN 7.3-Y
CYPRUS
rhERGY PLANNING AND CDNSERVATION PROJECT
SAL. Component
01050 Clf 1983 1984 1985 1986 1987 ------1963-1Q87…------Local Foroign Local Foreign Local Foreign Local Foreign Local Foreign lncal Corel TL Tooal bodo Maoogaoomll anld IL-apatoS rioteot Load A tr-ici,nt Load Diaparoth ,. ir-q-e-cy Motor 1 2 - 1 ------I 1 4 ii. Freq-oacy Recorder 1 2 - I ------1 3 slL. Fr-qdeocy Caoioorcor - L ------i-. ogsh Speoed Oc-rdor - - 1 13 ------I 13 1I v. Mioi Loc0pdecr - 6 1 24 ------1 3n 11 01. *Jondr-rreqo.acy Relays - - 3 20 3 22 - 2 - - 5 44 r0 cii. Ploysicoc Cooriooeacies------oldb-rOCAL \A) 2 LI 5 59 3 22 - 2 - - 15 4 1354 d Loao Loodagneorn i. iJect-o HqMipTOCO- - - - 43 55 348 - 13 - - 55 LOS4 410 oo. dLoer Rioter Leceiro - - 70 315 39 174 35 158 32 142 176 76q 965 iii. Recevers for -toeroog - - 14 63 14 63 - I - 1 27 172 156 iv. MleOOcri.g - - g 14 9 14 9 14 9 14 36 56 07 BASLd OST - - 93 435 117 599 44 186 41 157 795 1377 7,6:2 o. PnysocoL Cootoogeso lea (5) - - 5 22 6 30 2 8 2 8 15 0Q R4 SRB-iOoA cd)- - 98 4 57 123 629 46 195 43 165 310 1,446 1 756 Sdo-l3Co.- Is c) 2 11 103 516 126 651 46 197 43 165 320 1, S45 1 ,60 no. Price Coacilogooicoes IdE+ U) - - 15 62 31 131 17 55 25 59 84 307 301 iUB-r-134A. 2 IL L18 378 L57 782 63 2S2 64 224 4M04 1,847 7,251 C c'OgOOOeering F.L'o - 12 - 12 - - - - _ - - 24 74 ii. Pooco Coooglnoelccen _ I - i ------2 2 S3B-fRl. - 13 - 13 ------26 ?S D Codslcal ta Study L. Scody Locluoiog L,ad RecorJera - 20 6 43 ------663 69 Sdo-IUTco. - 20 6 43 ------6 63 60 LOiaL 1 2 44 124 634 157 782 63 252 64 224 4l0n 10ql4 2
11 Xoninos St-eation 000r6y Coaservacion Scoeene A dcilero i. coonoes - - 2 7 2 56 1 7 - - S 75 75 o. corooste dpeed Fan Onions - - 3 4 3 32 2 4- _ 8 40 4R it. Air Heater deals - - 8 16 8 128 4, 16 - - 20 160 1Rn on. Oxygen Control Instrorsentarino - - - 1 1 2 - 1 - - 1 9 107 v. Fool Adoitose Injoction Sqoipoceot - - - 3 1 1 - _ _ - I L1 5 B Tornines t. Condenser Cloaning dqoipmeot - - 5 14 25 112 9 14 - - 35 145 175 on. Auoiliary '.oroine Generator - - 2 55 67 425 18 75 - - 85 555 640 tii.oSurgeTotcokPlascic Balls - - - - - 6 - -- - - 6 6 BASr COST (Ao+8) - - 25 1100 150 767 30 117 - - T55 1 S TT1q Pnysical &ooltsngoncieo (tO!,) - - 3 10 10 77 3 12 - - 16 00 119 I U8GI'll, - - 28 110 110 844 33 129 - - 171 1,083 1,294 Proce CoooLngeaoiea - - 4 13 27 1711 12 36 0 0 43 219 262 RAd-fOCAL al- 32 1 12 1 14 45 165 - - 214 1,502 1,516 C Soginee 0006 i.rones - 33 ------33 33 iO. Price Cdnttgnoies - 1 _ - - _ I- - -I I I ii 5-1316 t. - 34 ------34 54 D Conssoltanta' dtooy i. Utdd - _ 1 23 _ - _ - - _ 1 23 24 SCa-TOtoL - - 1 23 - - - - - I 23 74 L)CfAL 1L - 34 33 144 137 1,014 45 165 - - 215 1,3n 1,574
111 dlatodsy/i'oooo,sgi Gonerocoos Stody i. Study - - 1 11 ------1 11 12 iOCA. Id - - I 11 ------I 11 12
f34Al PROJ3CC GoSd 2 78 158 791 294 1,796 118 477 64 774 626 3,3n6 3,932
Febroary 19Y3 (I1SIP p. 8) - 46 - ANNEX 2.4
CYPRUS ENERGYPLANNING AND CONSERVATION PROJECT EACComponent
YEAR 1983 1984 '1985 1986 1987 DESCRPTIONQUARTERS 2 3 4 12 3j I 2 3 4 3 4 4. LOADMANAGEMENT 1 a, Appoint EngineeringConsultant b. PrepareBid Specitications&lInvite Bids c. Fvoluate Bids&Award Contract
d. Ma.nufacture&Deliverl1st BatchoafReceiVers - e Erectl1stBatchoftReceivers
t. Manufacture& DeliverInjection Equipmnent - g Erect& Commissioninjection Eaupmnent h Manufacture& DeliverMetering Equipment
i.Erect MeteringEquipmnent - Manisfacture& Deliver2nd Batch at Recevers ...... kErect 2ra Batcn ot Receivers iinvite Bidstar 3rd & 4th Batch of Receivers m FinailizeAward at Contract nManufacture & Deliver3ra & 4th Batcn of Receivers
'2.E~FICIENT LOAD DISPATCH- a. Appoint Consultant b, PrepareBiai Specifications & InviteBids c AWaraIContract d Deliver& InstallFrequtency Meter & Recroercra e Invite Bidstar UnderirequencyRelays t. AwairdContract g, Deliver& install UndertrequencyReicays hi Invite Basfor Mini Computer iAward Contract Send Stafftar Training k Deliver& InstallMini Computer
3. MONMPOWER STATION CONSERZVATION SCHEME j~i a Appoint EngineeringConsultant b ComnpleteDesign & BidSpecifications c. IssueBid Specifications d Award Contract e Manufaicture& DeliverAux TuroineGenerator
fInstall & CommissionAux. Turbine Generator i g. Invite& FinalizeBids for CondenserCleaning
hManufacture &Deliver&Commission Condenser Cleaning Equipment i. ssue& FincaizeAwara far Oil Burners Deliver& InstallBurners k Issue& FinalizeAward torVariable Drivesftar Fans I. Deliver& InstallDrives m issue & FinailizeAward ot Contract forAir HeaiterSeals & OirygenTrim Equipment ll
n- Dediver& install Seals& Oxygen~Til` EqUipment .* - - - - Word BanK-24798 ANNEX 2.5 Pgge 1 of 2
CY'PRUS ENERGYPLANNING AND CONSERVATIONPROJECT MCI Component
YEAR 1983 1984 1985 1986 1987 DESCRIPTION QAGF12 34 7 7r~ r h ~ 1 '
I. APPLIEDRENEWABLE ENERGY CENTER (AREC) r{- - - Zi1 I Appoint Coordinmato(expatrate) i 2 Appoint Other Expatriates I
3 stabijsh Executive Board & Linkages with O'her Organizations
4 Prepare Builaing Rd Specs, Invte Bias&.I Evaluate Bids.
5 PrseDareEquiprem Spect nvite bads& _____ EvajluateBids 6 De verEquipmnentto S'e i 7 ConstructoBuilding & ErectEqui!pmentI 8 Execu,a aot Salar.Wind & BiogasJ Sub-compounds ~t- - _ ____
II. SOLARAN'D WND ENERGYMEAURING NEIWORK t I Appoint Consutcnfr
2. Site Selection I
Evaiuate
4.D ie Equipment,insfall &TanLocal StaffI I S. Analyze ExistingMeteorological Data 6. TranrsferData to LJ.SAto Analyze I
III SOLARWATER HEATING A. STAN~DARDIZATION& TREAINING
1. Preaare Equipment Soecs..invie Bids& EvaluateI
2 Deliver Equipment to Site I 3. In'srallOutdoor Paciclities 4. Prepare Bui d g Specs. Invre BidsA& Evqluate 5 Camnpete Ru,ding Consrruotors
6. Install Indoor Equipment & Comparative iest
7.Training ot Local Engineers& Development o
SystemStandards a .I 8. Standaraization & SncskedownTests
B.DEMONSTRATION ,I 1.Select Rui dlng. Design Site, Prepare Specs &
2 Delieruante l Equipment & .rs-rurmentation[
3. Shakedown Tests 4. Analyze Dota. Prepare Recommendoalon & I Demonstrate -
[V.SOLAR HEATING AND COOLINGOF BUILDINGS II 1 Appoor Consultants
2 Complete SafSwore& Train Local Engineers I 3 Seiecr Building, Design~Pass.ive Studies. Prepare Ruilding Specs.,Invite Rids & Evaluate ,
4. ConstructBuild ngj i. DemoAnustrate Anlye1ubitReo- 5.DeornAcustriat.Aae eSbitIeo
Wo'd Rank-24799 -48-
ANNEX 2.5
CYPRIJS Page. 2 of 2 ENERGYPLANNING AND CONSERVATION PROJECT MCI Componeni (Continued)
YEAR 1983 1984 1985 198 1987 DESCRIPTION QATR 1 213 1 213 4 1 2 3 4 2 3 4 2 3 4
1 Prepare TOR Invite & Evaluate BEds QARE 1 3 - - - 1F- 2. aboratory Tests& Collection of Data 3 PrepareStudy I ~
`,ASOLAR CROP DRYING I Select Siee.System Desgn, Prepare Specs, InveiteBids & Eaoluate
2 Deliver Material, Fabricate, Instail Erect& TesT
3. Acquire & Analyze Date Prepare Report &I Demonstrate i - n i MiI.SOLAR GREENHOUSES I 1. AppoaintConsustont
2. Prepare Equipment Specs invite & Evaluate Bids
3. Design Phase I Greenhouses
4 Deliver Materials, CansTructGreenhouses. Instaillinstruments & Cairry-out Shakediown Test Phase 5. Acquire & Analyze Data -Phase I Greenhouses
6. Design & Construct Improved Phase Greenhouses
7 Acquire & Analyze PhiaseIt Doat
8 Demonetration & Final Recocmmendations--
til.WINDMILLSIJ
2 Select Site Prepare Equipment Specs. invites & Evaluate Bids for 5 New Windmills
3 Prepare Equipment Specs, Invite & Evaluate Bids far Reactivation ot Wincamills
5. Delivery ot Motericas tar Reactivation ot Windmills
6 Erect & Install Instrumentson New Wind-,iiis. 7 Data Acquisition & Analysisat New & Activated Werdmills
8 Demonsrrarion & Fnal Report -
IX.BIOGAS H I Appaint Consultant
2SelectSite. Invite & EvaluacteBids * T
3 Prepare Sire.Erect & Commission
4.Data Acquisitfon.Analyze. Recommend & . . [ i -WrdSn-82 - 49 - ANNEX 2.6 Page 1 of 2
CYPRUS
ENERGY PLANNING AND CONSERVATION PROJECT
Estimated Disbursement Schledulefor the MCI Component
Disbursement Bank Fiscal Year Cumulative Undisbursed and Quarter (uS$ Millions Equivalent) %
1984
September 30, 1983 0.21 94 December 31, 1983 0.35 90 March 31, 1984 1.14 68 June 30, 1984 1.67 53
1985
September 30, 1984 1.99 44 December 31, 1984 2.34 35 March 31, 1985 2.65 26 June 30, 1985 2.82 21
1986 September 30 1985 3.02 16 December 31, 1985 3.24 9 March 31, 1986 3.31 8 June 30, 1986 3.39 5
1987
September 30, 1986 3.47 3 December 31, 1986 3.58 0
February 1983 (1351P, p.9 ) 50 - ANNEX 2.6 Page 2 of 2
CYPRIUS
ENERGY PLANNING AND CONSERVATION PROJECT
Allocation of Loan Proceeds for the MCI Component
Amotunt of the Loan % of Allocated (Expressed Expenditures Category in US$ Equivalent to be Financed
(1) Consulting Services 1,654,200 100% of foreign expenditures
(2) Equipment 1,397,000 100% of foreign expenditures
(3) Training 312,500 100% of foreign expenditures
(4) Unallocated 216,500
Total MCI Components 3,580,200
February 1983 (1351P, p.10) - 51 - ANNEX 2.7
CYPRUS
ENERGY PLANNING AND CONSERVATION PROJECT
Estimated Schedule of Disbursement: EAC Component
Bank Fiscal Year Cumulative Disbursement and Quarter at end Gf Quarter
in US$ million in %
1984
September 30, 1983 0.07 1.06 December 31, 1983 0.16 2.42 March 31, 1984 0.40 6.05 June 30, 1984 0.76 11.50
1985
September 30, 1984 1.16 17.55 December 31, 1984 174 26.32 March 31, 1985 2.58 39.03 June 30, 1985 3.60 54.46
19 8
September 30, 1985 4.43 67.02 December 31, 1985 5.33 8D.63 i1arch 31, 1986 5.59 84.57 June 30, 1986 5.85 88.50
1987
September 30, 1986 6.02 91.07 December 31, 1986 6.16 93.19 March 31, 1987 6.28 95.01 June 30, 1987 6.41 96.97
1988
September 30, 1987 6.51 98.49 December 31, 1987 6.61 100.00
February 1983 (1351P, p. 11) CYPRUS ENERGYPLANNING AND CONSERVATIONPROJECT MCI AND EAC COMPONENTS
1e0 r n < 1 ~~~-_------<
-o ErEiNA R0IDN , -> 90 _ Z,,bRD POWER SECTOR
80 - / // /8 HA cOIPNE-> // MCICOMPI I
70 - <----EACCOMPONENT/<--DANIWME 1BRD POWERSECTOR
z~~~~~~~~~~~~~~~~~~
LLI~~~~~~~~~~~~~~~~ D: 60 / /'
L3J~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~0
0 1 2/S 4 7 NO. OF YEARS FROMAPPROVAL CYPRtJS
ELECTRICITY AUTHIORITY OF CYPRtJS
ENEKGY PLANNING ANO CONSERVATION PROJECT
Incomile Statements for the Years ended December 31, 1977-1987 CE 1,000
------Actual ------Projected ------1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987
Generation - GWn 849 915 977 1,034 1,00(1 1,097 1,136 1,175 1,216 1,259 1,3n6 Sales - GWh - 8illed 583 632 682 719 731 756 783 810 834 86R 900 Unbitled 174 _185 196 204 211 222 230 238 246 255 264
Total Sales - GWh 757 817 878 923 942 978 1,013 1,048 1,089 1,123 1,164
Average Revenue per KWh billed 21.37 21.69 26.08 35.16 51.29 53.37 58.21 65.11 71.51 74.86 7q.9q Average Revenue per iWh Unbilled 16.75 15.87 19.75 28.58 41.27 42.89 43.77 46.66 49.27 52.08 54.93
Operating Incomue Revenues from - 31iled Sales 12,451 13,708 17,181 25,27) 37,488 40,345 45,578 92,74? 60,0nn 64,978 71,637 - UabilledA ,092 2,93G8 3,877 5,831 8 , 707 9,522 10,067 11_105 12,120 13,2Rn 14 907 OLtner Income 62 41 27 35 30 40 60 A0 In 12n 14n
Total Operating Revenues 15,433 16,687 21,685 31,141 46,225 49,907 59,705 63,927 72,220 78,378 86,160
Operating Lxpenses Fuel 7,601 7,414 10,713 16,030 2:3,875 24,540 24,444 26,843 29,596 32,970 15,957 Operation and Maintenance 2,826 3,522 4,305 5,713 7,040 8,260 9,912 11,564 13,216 14,868 16,52n Dlepreciation 1,400 1,420 1,543 3,2o2 3,878 4,352 5,787 7,130 8,097 9,236 10,397
Total Operating Expenses 11,827 12,356 16,561 25,005 34,793 37,152 40,143 45,537 50,909 56,674 62,834
Net Operating Income 3,60o 4,331 5,124 6,13o 11,432 12,755 15,562 18,390 21,311 21,704 73,335 Less Unbilled Consuiaption 2,920 2,938 3,877 5,831 8,707 9,522 10,067 11,105 12,120 13,280 14,397
Total 686 1,393 1,247 305 2,725 3,233 5,495 7,289 9,191 8,424 8,938 Less Interest Expense 1,216 1,234 1,394 2,1063 4,615 5,561 5,273 4,813 4,268 3,922 3.094
Net lncome (530) 159 (147) (1,758) (1,890) (2,328) 222 2,472 4,923 4,0n2 9,84/4
Average Net Fixed Assets!/ 23,617 23,999 24,632 60,638 1 646,823 82,776 108,1145 124,875 13S,737 146,3R0 196,434 Rate of Keturn 2.9' 5.8/ 5.1% t.5% 4! 4.0% 3.97 5.1% 5.8% 6.8% 5.8% 5 .7%
1/ Assets revalued from 1980 onward. ilarcn 1983 (1351P, Page 12) CYPRUS
ELECTRICITY AUTHORITY OF CYPRUS
ENERGY PLANNING AND CONSERVATION PROJECT
Balance Sheets for the Years Ended December 31, 1977-1987 C£ 1,000
------Actual ------Project,d ------1977 1978 1979 1980 1981 1982 1983 1q84 1985 IQ86 1987 ASSETS Gross Fixed Assets in Service /I 44,248 48,526 51,149 121,836 138,997 180,045 220,037 250,3(2 284,873 371,587 362,S47 Less Accumulated Depreciation 21,010 23,766 26,64 57,322 69,866 100,369 120,310 143,431 170,219 201n49 Net Fixed Assets in Service 23,238 24,760 24,504 64,514 69,131 96,421 119,668 130,092 741,392 191,36R 161 49 Work in Progress 1,886 194 333 4,532 16,791 10,768 561 214 686 4,799 Q,81A Gross Fixed Assets 25,124 24,954 24,837 69,046 85,922 107,189 120,229 130,296 142,078 196,167 171,317 Investments Stock Redemption Fund 95 243 447 663 891 1,130 1,382 1,647 1,(25 2,216 ?,9?2
Current Assets Casn and dank Balances 217 42 25 392 457 60 100 0on 16n 241 73 Accounts Receivable i,5bO 1,822 2,601 3,413 5,006 5,385 6,135 7,070 7,976 8,S79 9,870 inventories 3,290 3,369 4,357 7,071 7,398 7,086 8,954 9,902 1n,786 11,628 13,337 Total Current Assets 5,067 5,233 6,983 10,876 12,861 12,531 15,189 17,072 18,922 20,444 23,28(
tOTALASSETS 30,286 30,430 32,267 80,585 99,674 120,850 136,800 149,n01 167,Q29 178,827 197,119
LIABILlIlES Equity Retained Earnings 5,480 5,639 5,492 3,734 1,844 (484) (262) 2,210 7,133 11,635 17,479 0 Governmnent Loans 7,884 7,884 7,884 9,104 9,104 ------Government Grant - - - - - 9,104 9,104 9,104 9,104 q,104 q,1n4 Revaluation Reserve - - _ 41,683 48,853 57,759 68,882 81,365 94,876 109,606 1?7,789 rotal Equity 13,364 13,523 13,376 54,521 59,801 66,379 77,724 92,679 111,113 130,349 197,371
Long-Term Debt Proposed IBRD Loan ------78 869 2,5278 ,671 9,615 IdRD Loans 7,621 6,761 5,878 4,935 5,597 6,550 9,682 9,605 8,495 7,353 6,174
E1d Loans - - - - 2,491 4,569 5,736 5,489 5,214 4,90o 4,967
EAC Guaranteed Stock - - 3,000 3,000 3,000 4,400 4,400 3,700 3,0n0 3,0n0 1,5n0
Multi-currency Loans - - 188 5,598 8,658 9,558 11,056 8,292 9,528 2,764 _
Supplier's Credits - - - 781 3,657 14,933 14,579 12,637 In,758 9,267 8,037
Local Bank Loans 5,105 5,841 1,947 1,524 1,420 ------Proposed Loans ------2,925 5,5Q4
Total Long-term Debt 12,726 12,602 11,013 15,838 24,823 40,010 45,531 40,5Q9 35,573 37,R8R 28,4R7
Current Liabilities Long-term Debt Maturing in One Year 1,567 1,550 1,584 1,402 1,831 2,760 4,457 6,730 6,865 5,977 7,Q94 Acceptance Financing for Fuel - - 2,996 4,000 3,500 4,000 4,500 5,000 5,500 6,000 6,5n0 2 4 Other 2,629 2,755 3,298 4,824 9,719 7,701 4,588 4,014 3,9 ?,617 1,767
Total Current Liabilities 4,196 4,305 7,878 10,226 15,050 14,461 13,545 15,744 16,289 19,594 16 ,61
fOTAL LIABILICIES 30,286 4 32,267 80,585 99,674 120,850 136,800 149,015 167,Q25 178,827 197,119
Debt/Equily Ratio /1 49/51 48/52 45/55 23/77 29/71 38/62 37/63 30/70 24/76 2/Rn 16/R4,
Current Ratio 1.2 1.2 .89 1.06 .85 .87 1.12 1.08 1.16 1.31 1.43
/1 Assets Revalued 1980-1987.
Marcn 19B3 kliSiP, p. 13) - 55 - ANNEX 3.3
CYPRUS
ELECTRICITY AUTHORITY OF CYPRUS
ENERGY PLANNING AND CONSERVATION PROJECT
Sources and Applications of Funds Statements for the Years Ended December 31, 1982-1987 C£ 1,000
…---…------Projected… 1982 1983 1984 1985 1986 1987
Sources of Funds Net Operating Income 3,233 5,495 7,285 9,191 8,424 8,938 Depreciation 1/ 4,400 5,847 7,193 8,169 9,310 10,436
Internal Cdsn Geaeration 7,633 11,342 14,478 17,3O0 17,734 19,374 Consumers' Contributions 2,000 2,100 2,200 2,300 2,400 2,500
Borrowinngs Proposed 1BRJ Loan - 78 791 1,796 417 218 IBRD kExistLingLoans) 1,685 4,082 1,000 - - - Elb 2,028 1,i81 - - - - Multi-currencyLoans - 2,480 - - - - Suppliers' Credits 12,697 1,357 - Governm.ent TemporaryLoan - - - - - Loca 1 Otner - 2,925 3,375
Iotal dorrowings 16,410 9,178 1,791 1,796 3,342 3,593 ixcnange Loss 1,900 800 - - - -
rOTAL SOURCES 27,943 23,420 18,469 21,456 23,476 25,467
Applications of Funds Constructioa 18,761 9,6o4 6,977 8,740 il,069 11,904
Debt Service: mnortization 2,433 3,012 4,722 7,008 7,156 6,283 Interest 5,561 5,273 4,813 8 3,922 3,094
total Debt Service 7,994 8,285 9,535 11,276 11,078 9,377
Cnange in Working Capital 1,188 5,271 1,957 1,440 1,329 4,186
fOfAL APPLiCATIONS 27,943 23,420 18,469 21,456 23,476 25,467 Net Interndl Casht Generation as % of Construction (lI%) (34%) 35% 64% 51% 48% Times Deot Service Covered by Net Revenues .9 1.4 1.5 1.5 1.6 2.1
1/ Includes depreciation for transportation utility.
larcn 1963 (l35iP, p. 20) - 56 --
ANNEX 3.4 Page 1 of 2
CYPRUS,
ELECTRICITY AUTHORITY OF CYPRUS
ENERGY PLANNING AND OOlNSERVATIONPROJECT
Notes and Assumptions for Financial Forecasts
A. Income Statements
1. Sales of electricity are based on EAC's estimated Load growth. The forecasts assume annual energy sales growth of 3.5% for 1983-1986 and 3.7% for 1987. Average tariff increases of 15% effective July 1, 1983, 10% from January 1, 1985 and 7% from January 1, 1987.
2. Sales to consumers in the area not under Government's control are assumed to increase by 3.5% in 1983 and 1984, 3.4% in 1985, 3.7% in 1986, and 3.5/. in 1987.
3. Fuel cost increases would be recovered through the fuel adjustment surcharge.
4. Operation and maintenance costs are assumed to increase 20% p.a. for 1983-1987.
5. Depreciation for 1983-1987 is calculated on revalued assets.
6. EAC does not capitalize interest during construction, all interest expense is charged to year interest expense is incurred. Interest charges include an exchange loss arising from the conversion of loans in foreign currencies and are covered by tariff increases. Front-end fee of the Loan would be paid in advance by EAC.
B. Balance Sheet
7. Gross fixed assets in service were revalued in 1980 based on revaluation factors from assets in service as of December 31, 1979 using 1952 as a base-price year. For 1983-1987 annual coefficients of about 7.5% are used to reflect average inflation rates. Asset values reflect cost of plant in the occupied area and are also revalued.
8. Inventories are assumed to increase during 1983-1987 in keeping with operation requirements.
9. Accounts receivables are forecast to average 40 days of sales. - 57 -
ANNEX 3.4 Page 2 of 2
10. Customers' contributions are assumed to increase by C£2,100,000 in 1983, C£2,200,000 in 1984, Cf£ 2,300,000 in 1985, C£2,400,000 in 1986 and CE2,500,000 in 1987. Asset values on the Balance Sheet are net of customer contributions.
April 1983 (1351P, p. 15-16) CYPRUS
ENERGY PLANNING AND CONSERVATION PROJECT
EAC Component
Actual (up to 1981) and Forecast (1982 to 1990) of Energy Generated, Energy Sold, Installed Capacity, Maximum Demand and Annual Load Factor
Annual System Unbilled Installed Firm Load Actual Energy Generated Energy Sold 10/ Losses 1/ Consumption 6/ Capacity Capacity 2/ Maximuim Demand Factor GWl Growth I GWh Growth X % % MW MW MW Growth % % L971 618.2 9.7 503.3 9.3 13.0 5.5 174 144 146.2 16.2 48.3 i972 715.7 15.8 591.3 17.5 12.4 5.0 204 174 154.3 5.5 52.R 1973 781.7 9.2 651.6 10.2 11.8 4.8 204 174 161.3 4.5 55.1 1974 693.2 -11.3 563.2 -13.b 13.4 5.3 204 174 175.6 8.9 45.1 1975 098.4 0.8 475.0 -15.6 12.6 20.1 234 204 145.0 -17.4 55.0 1976 782.7 12.1 537.3 13.1 11.2 20.1 264 234 157.0 8.3 5(.8 i977 848.o 8.4 582.6 8.4 10.8 20.5 264 234 171.3 9.1 53.8 1978 914.5 7.8 632.2 8.5 10.7 20.3 264 234 180.0 5.1 5R.0 1979 977.3 6.9 681.8 7.9 10.15 20.1 264 234 194.0 7.R 57.5 1980 1,034.4 5.8 718.8 5.4 10.8 19.7 264 234 198.3 7.2 59. 4 1981 1,060.1 71 2.5 730.9 1.7 11.1 19.95 264 234 199.3 0.5 6n.7
Average annuaL m increase 1971-81 6.1 4.8 4.6
Forecast 1982 1,097 3.5 756.5 3.5 10.8 20.25 324 3/ 264 213 7 58.7 1983 1,136 3.5 783.0 3.5 10.8 20.25 328 4/ 268 221 3.5 5R.7 1984 1,i7j 3.5 810.4 3.5 10.8 20.25 328 268 228 3.5 SR.9 198) 1,217 3.5 838.7 3.5 10.8 20.25 328 268 236 9/ 3.5 58.8 1986 1,259 3.5 868.1 3.5 10.8 20.25 328 268 245 3.5 58.7 1987 i,3U6 3.7 9V0.2 3.7 10.8 20.25 328 268 254 3.7 58.7 1988 1,354 3.7 933.5 3.7 10.8 20.25 388 5/ 328 263 3.7 58.8 1989 1,407 3.9 969.9 3.9 10.8 20.25 388 328 273 3.9 58.8 i990 8/ 1,464 :4.1 1,009.7 4.1 10.8 20.25 388 328 289 4.1 58.7
1/ Includes stations' auxiliaries. 2/ Installed capacity less largest unit. 3/ Dhekelia "8" Unit L of 60 MW comunissioned. 4/ Dhekelia "8" Oniit 2 of 60 MW commissioned and, 2x7-MW and 3x14-MW units retired at D)hekelia "A". 5/ Generating Capacity of 60 MW scheduled for commissioning in 1988. 6/ Electrical energy supplied to area not under Government's control as % of energy generated for which no billing can he undertaken at oresent. 7/ includes 0.3 GWh purchased. > 8/ The 2x14-MW units at Dhekelia "A" retired in 1991. 2 9/ rne Maximum Demands from 1985 onwards do not include the effect of load management measures which are anticipated to give a relief of 5 MW for x 1985, 10 MW for 1986 anid 15 MW for 1987. 10/ Does not include energy sold to area not under Govern,sent's control.
April 1983 (1351P p. 17) CYPRUS
ENERGY PLANNING AND CONSERVATION PROJECT - EAC Component
Economic Rate of Return
------Cost Streams------Benefit Streams------Generation Moni Efficient Moni Efficient Total by 4 sets Cost of Total Cost Conservation Load D)ispatch Conservation Load Load Generation of Moni P.S. Fuel of Fuel Scheme and Management Scheme 4/ Dispatch 5/ Management 6/ YEAR GWh GWh CE/in ton XIODD C_ XlDOO Cf X1Doo CE XIOOD Cf X1000 Cf £ X1OOO Cf 1983 1,136 315 85 26,206 33 45 - -- 1984 1,175 342 87 27,781 162 680 - - 33 1985 1,217 370 89 29,111 954 777 277 73 234 1986 1,259 397 91 30,460 162 243 374 76 4S9 1987 1,306 428 94 32,655 - 208 417 82 401 1988 1,354 427 97 34,900 - 180 429 87 165 19d9 1,407 280 99 36,740 - 180 287 92 23 1990 1,464 318 102 39,421 - - 336 Q9 - 1991 1,522 340 104 41,780 - - 366 104 - 1992 1,518 362 106 44,048 - - 398 110 - 1993 l,ob6 400 109 46,999 - 6 452 117 - 1994 1,693 461 I/ 1ll 49,183 - 48 530 123 - 1995 1,753 418 113 51,771 - 25 489 129 - 1996 1,814 429 115 53,475 - 2 511 134 - 1997 1,878 266 2/ 117 57,197 - - 322 143 - 1998 1,943 78 120 60,438 - - 97 151 - 1999 2,007 110 122 63,508 - - 139 159 - 2000 2,074 172 125 68,321 - - 223 168 - 2001 2,142 102 127 70,537 - - 134 176 - 2002 2,213 78 130 74,558 - - 103 186 - 2003 2,286 75 132 76,999 - 6 103 192 - 2004 2,357 - 3/ 135 82,342 - 48 - 206 - 2005 2,4J0 - 138 86,779 - 25 - 217 - 2006 2,505 - 140 90,754 - 2 - 227 - 2007 2,583 - i45 95,585 - - - 239 - 2008 2, h3 - 146 100,613 - - - 252 - 2009 2,740 - 146 103,522 - - - 259 - 2010 2,819 - 146 106,507 - - - 266 - 20Ii 2-901 - 146 109,605 - - - 274 - 2012 2,965 - 146 112,779 - - - 282 -
1/ Moni units I and 2 retired in 1994. 2/ Moni units 3 and 4 retired in 1997. 3/ Moni units 5 and 6 retired in 2004. 4/ Benefit due to improvements in Boilers and Condensers of units 3,4,5 and 6 assumed froin 1985 onwards, while that due to Auxiliary Steam tu,rhine generator and additional feed heating stage assumed from 2nd quarter of 1985. The total benefit is estimated at 10.36 m ton/GWh. 5/ Benefit due to implementation of efficient load Dispatch estimated at 0.25X of total fuel costs. 6/ Load Management benefit is on account of deferred capital investment due to delay by one year in commissionirng of additional 60 MW capacity.
larccl 1983 I (135lP p. 18) -- 60 - ANNEX 5.1
CY.PRUS
ENERGY PLANNING AND CONSERVATION PROJECT
Selected Documents Available in the Project File
EAC Component:
1. Audited Accounts as of December 31, 1981.
2. Report on Moni-Limassol-Paphos System Development 1980-1987.
3. Draft Report - Efficient Load Dispatch.
4. Load Control Study.
5. Study into Methiods of Energy Conservation at Moni Power Station.
6. Study of the Requirements of Stand-by Generation Plant.
7. Annual Report and Accounts 1981.
MCI Component
1. Renewable Energy Component for Cyprus Renewable/Conservation Project.
2. Appraisal of Energy Conservation Sub-Project, Cyprus.
3. Consultant's Report on Energy Project Appraisal Mission.
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April 1983 (1351, p. 19)
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