Philippines: Power Transmission Reinforcement Project
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Completion Report Project Number: 31433 Loan Number: 1590-PHI August 2006 Philippines: Power Transmission Reinforcement Project CURRENCY EQUIVALENTS Currency Unit – Peso (P) At Appraisal At Project Completion 18 November 1997 29 April 2006 P1.00 = $0.0294 $0.0193 $1.00 = P34.05 P51.775 ABBREVIATIONS ADB – Asian Development Bank DENR – Department of Environment and Natural Resources DSCR – debt service coverage ratio EIRR – economic internal rate of return EPIRA – Electric Power Industry Reform Act ERC – Energy Regulatory Commission FIRR – financial internal rate of return IPP – independent power producer ICC – Investment Coordination Committee NPC – National Power Corporation O&M – operation and maintenance PCB – power circuit breaker PCR – project completion report PMO – project management office PSALM – Power Sector Assets and Liabilities Management Corporation RORB – return of rate base ROW – right-of-way Transco – National Transmission Corporation WEIGHTS AND MEASURES GWh (gigawatt-hour) – equivalent to 1,000 megawatt-hour Km (kilometer) – equivalent to 1,000 meters kV (kilovolt) – unit of electrical power equal to 1,000 volts kWh (kilowatt-hour) – unit of energy MVA (megavolt-ampere) – unit of apparent power MW (megawatt) – unit of power, equal to 1 million watts NOTES (i) The fiscal year of the Government and NPC ends on 31 December. (ii) In this report, "$" refers to US dollars. Vice President C. L. Greenwood, Jr., Operations Group 2 Director General R. M. Nag, Southeast Asia Department Director J. R. Cooney, Infrastructure Division, Southeast Asia Department Team leader Y. Zhai, Principal Energy Specialist, Southeast Asia Department Team members H. Tabin, Assistant Project Analyst, Southeast Asia Department Y. Tsujiki, Financial Specialist, Southeast Asia Department CONTENTS Page BASIC DATA i MAPS I. PROJECT DESCRIPTION 1 II. EVALUATION OF DESIGN AND IMPLEMENTATION 1 A. Relevance of Design and Formulation 1 B. Project Outputs 2 C. Project Costs 4 D. Disbursements 4 E. Project Schedule 4 F. Implementation Arrangements 5 G. Conditions and Covenants 5 H. Consultant Recruitment and Procurement 7 I. Performance of Consultants, Contractors, and Suppliers 7 J. Performance of the Borrower and the Executing Agency 8 K. Performance of the Asian Development Bank 8 III. EVALUATION OF PERFORMANCE 9 A. Relevance 9 B. Effectiveness in Achieving Outcome 9 C. Efficiency in Achievement of Outputs and Purpose 9 D. Preliminary Assessment of Sustainability 10 E. Environmental, Sociocultural, and Other Impacts 11 IV. OVERALL ASSESSMENT AND RECOMMENDATIONS 12 A. Overall Assessment 12 B. Lessons Learned 12 C. Recommendations 13 APPENDIXES 1. Project Framework 15 2. Chronology of Events 17 3. Actual Disbursements 21 4. Implementation Schedule (Appraisal vs. Actual) 22 5. Status of Compliance with Loan Covenants 23 6. Financial and Economic Analysis of the Project 26 i BASIC DATA A. Loan Identification 1. Country Philippines 2. Loan Number 1590-PHI 3. Project Title Power Transmission Reinforcement Project 4. Borrower National Power Corporation 5. Executing Agency National Transmission Corporation 6. Amount of Loan $191.4 million 7. Project Completion Report PCR: PHI 949 Number B. Loan Data 1. Appraisal – Date Started 11 August 1997 – Date Completed 4 September 1997 2. Loan Negotiations – Date Started 10 November 1997 – Date Completed 18 November 1997 3. Date of Board Approval 16 December 1997 4. Date of Loan Agreement 21 January 1998 5. Date of Loan Effectiveness – In Loan Agreement 21 April 1998 – Actual 3 April 1998 – Number of Extensions 0 6. Closing Date – In Loan Agreement 30 June 2002 – Actual 1 April 2005 – Number of Extensions 2 7. Terms of Loan – Interest Rate Pool-based variable lending rate system for US dollar loans, and subject to ADB’s standard commitment fees – Maturity (years) 20 – Grace Period (years) 4 ii 8. Disbursements a. Dates Initial Disbursement Final Disbursement Time Interval 1 December 1998 1 April 2005 76 months Effective Date Original Closing Date Time Interval 3 April 1998 30 June 2002 51 months b. Amount ($ million) Category Last Net or Original Revised Amount Amount Amount Undisbursed Subloan Allocation Allocation Canceled Available Disbursed Balance OCR 191.4 43.3 145.6 43.3 43.3 2.5a Total 191.4 43.3 145.6 43.3 43.3 2.5 OCR = ordinary capital resources. a Canceled on loan closure, 1 April 2005. C. Project Data 1. Project Cost ($ million) Cost Appraisal Estimate Actual Foreign Exchange Cost 211.0 116.2 Local Cost 93.2 83.7 Total 304.2 199.9 2. Financing Plan ($ million) Cost Appraisal Estimate Actual Implementation Costs ADB-Financed 167.3 35.2 Borrower-Financed 69.2 90.3 Other External Financing 43.6 66.3 Total 280.1 191.8 IDC Costs ADB-Financed 24.1 8.1 Borrower-Financed 0.0 Total 304.2 199.9 ADB = Asian Development Bank, IDC = interest during construction. iii 3. Cost Breakdown By Project Component ($ million) Item Appraisal Estimate Actual ($ million equivalent) ($ million equivalent) Foreign Local Total Foreign Local Total Part A: Leyte-Cebu uprating 104.5 8.1 112.6 61.1 13.0 74.1 Part B: Batangas reinforcement 61.0 71.4 132.4 46.0 70.5 116.5 Part C: Consultancy 0.8 0.2 1.0 1.0 0.2 1.2 Subtotal 166.3 79.7 246.0 108.1 83.7 191.8 Contingencies 20.6 13.5 34.1 IDC on ADB Loan 24.1 24.1 8.1 8.1 Total 211.0 93.2 304.2 116.2 83.7 199.9 IDC = interest during construction. Source: Asian Development Bank estimates. 4. Project Schedule Item Appraisal Estimate Actual Part A: Leyte-Cebu submarine interconnection a. Uprating of Leyte-Cebu Interconnection Project Bid Opening 1 October 1998 30 July 2003 Contract Effectiveness 30 April 1999 June 2004 Interconnection Completion 23 October 2000 October 2005 b. Repair of Damaged Leyte-Cebu Submarine Cables 3 and 4 (Phase I)—Turnkey Bid Opening 31 August 2000 31 August 2000 Contract Effectiveness 28 February 2002 16 July 2002 Repair Completion 27 August 2002 2 October 2002 Part B: Batangas transmission reinforcement a. Supply and Delivery of Substation Equipment Substation Equipment for San Pascual and Sta. Rita Bid Opening 30 April 1998 29 January 1999 Contract Effectiveness 30 December 1998 14 February 2002 Contract Completion 27 August 2002 12 October 2002 Batangas Substation 30 April 1998 29 January 1999 Bid Opening 30 December 1998 12 December 2001 Contract Effectiveness 27 August 1999 9 August 2002 Contract Completion Makban A Switchyard 30 April 1998 29 January 1999 Bid Opening 30 December 1998 14 February 2002 Contract Effectiveness 27 August 1999 12 October 2002 Contract Completion Biñan Substation 30 April 1998 29 January 1999 Bid Opening 30 December 1998 12 December 2001 Contract Effectiveness 27 August 1999 9 August 2002 Contract Completion Telecommunication and Protection System 30 April 1998 29 January 1999 Bid Opening 30 December 1998 29 October 2001 Contract Effectiveness 27 August 1999 26 June 2002 Contract Completion iv Item Appraisal Estimate Actual b. Supply and Delivery of Transmission Line Materials Steel Tower Structure San Pascual Cogeneration Transmission Lines Bid Opening 30 April 1998 6 May 1999 Contract Effectiveness 31 December 1998 9 July 2001 Contract Completion 29 July 1999 4 February 2002 Power Conductor, Overhead Ground Wire, Guy Wire San Pascual Cogeneration Transmission Lines Bid Opening 30 April 1998 6 May 1999 Contract Effectiveness 31 December 1998 18 July 2001 Contract Completion 27 October 1999 14 May 2002 Insulators and Insulators Assemblies San Pascual Cogeneration Transmission Lines Bid Opening 30 April 1998 6 May 1999 Contract Effectiveness 31 December 1998 29 October 2001 Contract Completion 29 June 1999 27 April 2002 Line Hardware and Accessories San Pascual Cogeneration Transmission Lines Bid Opening 30 April 19998 6 May 1999 Contract Effectiveness 31 December 1998 22 January 2001 Contract Completion 29 June 1999 21 July 2001 Composite Optical Group Wire San Pascual Cogeneration Transmission Lines Bid Opening 30 April 1998 6 May 1999 Contract Effectiveness 31 December 1998 31 January 2001 Contract Completion 29 June 1999 30 July 2001 5. Project Performance Report Ratings Ratings Development Implementation Implementation Period Objectives Progress From 1 October 2000 to 31 December 2000 Satisfactory Partly Satisfactory From 1 January 2001 to 30 June 2001 Satisfactory Partly Satisfactory From 1 July 2001 to 31 December 2001 Satisfactory Partly Satisfactory From 1 January 2002 to 31 March 2002 Satisfactory Partly Satisfactory From 1 April 2002 to 30 June 2002 Satisfactory Partly Satisfactory From 1 July 2002 to 30 September 2002 Satisfactory Partly Satisfactory From 1 October 2002 to 31 December 2002 Satisfactory Partly Satisfactory From 1 January 2003 to 31 March 2003 Satisfactory Partly Satisfactory From 1 April 2003 to 30 June 2003 Satisfactory Partly Satisfactory v Ratings Development Implementation Implementation Period Objectives Progress From 1 July 2003 to 30 September 2003 Satisfactory Partly Satisfactory From 1 October 2003 to 31 December 2003 Satisfactory Partly Satisfactory From 1 January 2004 to 29 February 2004 Satisfactory Partly Satisfactory From 1 March 2004 to 31 March 2004 Satisfactory Satisfactory From 1 April 2004 to 30 June 2004 Satisfactory Partly Satisfactory From 1 July 2004 to 30 September 2004 Satisfactory Partly Satisfactory From 1 October 2004 to 31 December 2004 Satisfactory Partly Satisfactory From 1 January 2005 to 31 March 2005 Satisfactory Partly Satisfactory From 1 April 2005 to 30 April 2005 Satisfactory Partly Satisfactory D. Data on Asian Development Bank Missions No. of No. of Specialization Name of Mission Date Persons Person- of Members1 Days Fact-Finding 29 April–19 May 1997 6 45 a, b, d, e, h Appraisal 11 August–4 September 1997 9 90 a, b, c, d, e, f, h Inception 17 April 1997 5 5 a, b, e Review 9–20 October 2000 3 20 a, g, i Review 15–23 October 2001 3 15 a, g, i Review 12–16 August 2002 3 15 a, g, i Project Completion Review 10–11 and 17–19 April 2006 3 15 a, g, i Note: The project completion report was prepared by Yongping Zhai, Principal Energy Specialist.