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FOR OFFICIAL USE ONLY Report No: PAD3316 INTERNATIONAL DEVELOPMENT ASSOCIATION PROJECT APPRAISAL DOCUMENT ON A PROPOSED GRANT IN THE AMOUNT OF SDR22.9 MILLION (US$31.7 MILLION EQUIVALENT) TO THE REPUBLIC OF TAJIKISTAN FOR A RURAL ELECTRIFICATION PROJECT June 18, 2019 Energy & Extractives Global Practice Europe And Central Asia Region 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 (Exchange Rate Effective April 30, 2019) Currency Unit = Tajik Somoni US$1 = TJS9.4393 US$1 = SDR0.7216 FISCAL YEAR January 1 - December 31 Regional Vice President: Cyril E Muller Country Director: Lilia Burunciuc Senior Global Practice Director: Riccardo Puliti Practice Manager: Sameer Shukla Task Team Leader(s): Artur Kochnakyan, Takhmina Mukhamedova ABBREVIATIONS AND ACRONYMS AKFED Aga Khan Fund for Economic Development ASTER Advanced Spaceborne Thermal Emission and Reflection Radiometer BDU Business Development Unit BESS Battery Energy Storage System BT Barqi Tojik CAPS Central Asia Power System CASA Central Asia South Asia CHP Combined Heat and Power Plant CPF Country Partnership Framework CRI Corporate Results Indicator DA Designated Account DABS Da Afghanistan Breshna Sherkat DCC Development Coordination Council DFIL Disbursement and Financial Information Letter DH District Heating DRR Disaster Risk Reduction DTM Digital Terrain Model EA Environmental Assessment EBITDA Earnings Before Interest, Taxes, and Depreciation ECA Europe and Central Asia EE Energy Efficiency EIRR Economic Internal Rate of Return E&S Environmental and Social ESIA Environmental and Social Impact Assessment ESMF Environmental and Social Management Framework ESMP Environmental and Social Management Plan ESPMU Energy Sector Project Management Unit ESRS Environmental and Social Review Summary ESS Environmental and Social Standard EU European Union FCV Fragility, Conflict and Violence FM Financial Management FIRR Financial Internal Rate of Return GAP Gender Action Plan Gcal Gigacalories FY Fiscal Year GBAO Gorno-Badakhshan Autonomous Oblast GDP Gross Domestic Product GAP Gender Action Plan GHG Greenhouse Gas HFO Heavy Fuel Oil HH Household HPP Hydropower Plant GDP Gross Domestic Product GoT Government of Tajikistan GRM Grievance Redress Mechanism GRS Grievance Redress Service (WB) GWh Giga-watt hour IA Implementing Agency IDA International Development Association IE Independent Evaluation IFR Interim Financial Report IPF Investment Project Financing IPP Independent Power Producer IPSAS International Public Sector Accounting Standards ISP Implementation Support Plan KfW Kreditanstalt für Wiederaufbau Km Kilometer kV Kilovolt kW Kilowatt kWh Kilowatt hour LCOH Levelized Cost of Heating masl Meters above sea level M&E Monitoring and Evaluation MIS Management Information System MOF Ministry of Finance MW Mega-watt NASA National Aeronautical and Space Administration NBT National Bank of Tajikistan NEET Not being in Employment, Education, or Training NGO Non-governmental Organization NPV Net Present Value ODA Official Development Assistance OHL Overhead Line O&M Operations and Maintenance OP Operational Policy (WB) PDO Project Development Objective PEC Pamir Energy Company POM Project Operations Manual PPA Power Purchase Agreement PPSD Project Procurement Strategy for Development PMC Project Management Consultant PDSI Project Design, Supply, and Install RE Renewable Energy REDP Rural Economy Development Project REP Rural Electrification Project RFB Request for Bids RMR Risk Mitigation Regime ROR Run-of-River RSP Resilience Strengthening Program RPF Resettlement Policy Framework SAR Spaceborne Synthetic Aperture Radar SECO State Secretariat for Economic Affairs SE PMUES State Enterprise Project Management Unit for the Energy Sector SERSP Socio-Economic Resilience Strengthening Program SOE State Owned Enterprise TALCO Tajikistan Aluminum Company TJS Tajik Somoni TSA Target Social Assistance USAID United States Agency for International Development VAT Value Added Tax The World Bank Rural Electrification Project (P170132) TABLE OF CONTENTS DATASHEET ........................................................................................................................... 1 I. STRATEGIC CONTEXT ...................................................................................................... 8 A. Country Context ............................................................................................................................... 8 B. Sectoral and Institutional Context ................................................................................................. 10 II. PROJECT DESCRIPTION .................................................................................................. 15 A. Project Development Objective..................................................................................................... 15 B. Project Components ...................................................................................................................... 16 C. Project Beneficiaries ...................................................................................................................... 19 D. Results Chain ................................................................................................................................. 19 E. Rationale for Bank Involvement and Role of Partners ................................................................... 20 F. Lessons Learned and Reflected in the Project Design ................................................................... 22 III. IMPLEMENTATION ARRANGEMENTS ............................................................................ 23 A. Institutional and Implementation Arrangements.......................................................................... 23 B. Results Monitoring and Evaluation Arrangements ........................................................................ 25 C. Sustainability .................................................................................................................................. 25 IV. PROJECT APPRAISAL SUMMARY ................................................................................... 26 A. Technical, Economic and Financial Analysis .............................................................................. 26 B. Fiduciary .................................................................................................................................... 31 C. Legal Operational Policies ......................................................................................................... 32 V. GRIEVANCE REDRESS SERVICES ..................................................................................... 37 VI. KEY RISKS ..................................................................................................................... 38 VII. RESULTS FRAMEWORK AND MONITORING ................................................................... 40 ANNEX 1: Implementation Arrangements and Support Plan .......................................... 46 ANNEX 2: Detailed Project Description .......................................................................... 49 ANNEX 3: Financial Management, Disbursements, and Procurement ............................. 63 ANNEX 4: Economic and Financial Analyses ................................................................... 69 ANNEX 5: Operational Policy 7.50 with Respect to Sebzor HPP and Small Hydros ........... 90 The World Bank Rural Electrification Project (P170132) DATASHEET BASIC INFORMATION BASIC_INFO_TABLE Country Project Name Tajikistan Rural Electrification Project Project ID Financing Instrument Environmental and Social Risk Classification Investment Project P170132 Substantial Financing Financing & Implementation Modalities [ ] Multiphase Programmatic Approach (MPA) [ ] Contingent Emergency Response Component (CERC) [ ] Series of Projects (SOP) [ ] Fragile State(s) [ ] Disbursement-linked Indicators (DLIs) [ ] Small State(s) [ ] Financial Intermediaries (FI) [✓] Fragile within a non-fragile Country [ ] Project-Based Guarantee [ ] Conflict [ ] Deferred Drawdown [ ] Responding to Natural or Man-made Disaster [ ] Alternate Procurement Arrangements (APA) Expected Approval Date Expected Closing Date 20-Jun-2019 31-Dec-2025 Bank/IFC Collaboration No Proposed Development Objective(s) The project development objective is to provide electricity access to target settlements in GBAO and Khatlon regions of Tajikistan. Components Component Name Cost (US$, millions) Page 1 of 91 The World Bank Rural Electrification Project (P170132) Component 1: Provision of electricity access to target settlements in GBAO region 25.2 Component 2: Provision of electricity access to target settlements in Khatlon region 6.5 Organizations Borrower: Republic of Tajikistan Implementing Agency: Pamir Energy Company Barqi Tojik PROJECT FINANCING DATA (US$, Millions) SUMMARY-NewFin1 Total Project Cost 31.70 Total Financing 31.70 of which IBRD/IDA 31.70 Financing Gap 0.00 DETAILS-NewFinEnh1 World Bank Group Financing International Development Association (IDA) 31.70 IDA Grant 31.70 IDA Resources (in US$, Millions) Credit Amount Grant Amount Guarantee Amount Total Amount Transitional Support 31.70 0.00 0.00 31.70 Total 31.70 0.00 0.00 31.70 Expected Disbursements (in US$, Millions) WB Fiscal Year 2020 2021 2022 2023 2024 2025 2026 Annual 2.00
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