Document of The World Bank
FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No. 15413
IMPLEMENTATIONCOMPLETION REPORT
SRI LANKA Public Disclosure Authorized
POWER DISTRIBUTION AND TRANSMISSION PROJECT (Credit 1933-CE)
Public Disclosure Authorized March 18, 1996
Energy and Project Finance Division Public Disclosure Authorized Country Department I South 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
Currency Unit = SL Rupees (SLRs) Appraisal year 1988 :US$1 = SLRs 32.0 Intervening year 1991 US$1 = SLRs 40.1 Completion year 1994 US$1 = SLRs 50.4
MEASURES AND EQUIVALENTS
1 kilometer (km) = 0.6214 miles (mi) 1 meter (m) = 39.37 inches (in) 1 kilovolt (kV) = 1,000 volts (v) 1 megawatt (MW) = 1,000 kilowatts (kW) = 1,000,000 watts 1 gigawatt hour (GWh) = 1,000,000 kilowatt hours (kWh) I MVA = 1,000 kilovolt amperes I MVAR = 1,000 kilovolt amperes reactive
ABBREVIATIONS AND ACRONYMS
CEB - Ceylon Electricity Board EIRR - Economic Internal Rate of Return GOSL - Government of Sri Lanka GTZ - Gesellschaft fuir Technische Zusammenarbeit ICR - Implementation Completion Report IDA - International Development Association KGMP - Kalu Ganga Multipurpose Project LECO - Lanka Electricity Company Limited OECF - Overseas Economic Cooperation Fund of Japan ROR - Rate of Return SAR - Staff Appraisal Report SCADA - Supervisory Control and Data Acquisition UNDP - United Nations Development Programme wtp - willingness to pay
FISCAL YEAR
January 1 - December 31 FOR OFFICIALUSE ONLY
IMPLEMENTATION COMPLETION REPORT
SRI LANKA
POWER DISTRIBUTION AND TRANSMISSION PROJECT (Credit 1933-CE)
Table of Contents
Page No.
PREFACE
EVALUATION SUMMARY ...... i
PART I PROJECT IMPLEMENTATION ASSESSMENT ...... 1
Project Identity and Background ...... 1
A. Statement/Evaluation of Objectives. 2 Project Objectives. 2 Project Description. 2
B. Achievement of Objectives. 3 Macroeconomic Policies. 3 Sectoral Policies. 3 Financial Objectives. 4 Institutional Development Objectives. 5 Physical Objectives. 5 Economic Analysis. 5
C. Major Factors Affecting the Project. 5 Factors not generally subject to Government Control. 5 Factors generally subject to Government Control. 6 Factors generally subject to Implementing Agency Control. 6 Project Costs and Financing. 6 Project Implementation. 7 Environentv. 7
D. Project Sustainability ...... 7
E. IDA's Performance. 7 Project Identification. 7 Project Preparation. 8 Project Appraisal. 8 Project Supervision. 8
Thisdocument has a restricteddistribution and may be usedby recipients only in theperformance of their officialduties. Its contentsmay not otherwisebe disclosedwithout World Bank authorization. F. Performance of Borrower and Beneficiary ...... 9 Project Identification, Preparation and Appraisal .9...... 9 Project Implementation .9...... 9
G. Assessment of Outcome ...... 9
H. Future Operation ...... 9
I. Key Lessons Learned ...... 10
PART II STATISTICAL ANNEXES .. 11
Table 1: Summary of Assessments ...... 11 Table 2: Related Bank Loan and Credits ...... 12 Table 3: Project Timetable ...... 13 Table 4: Credit Disbursements: Cumulative Estimated and Actual .13 Table 5A: Key Indicators for Project Implementation - Distribution Works .14 Table 5B: Key Indicators for Project Implementation - Transmission Works .15 Table 6: Key Indicators for Project Operation .16 Table 7: Studies Included in Project .17 Table 8A: Project Costs .18 Table 8B: Project Financing ...... 18 Table 9: Economic Costs and Benefits ...... 19 Table 10: Status of Legal Covenants ...... 20 Table 11: Compliance with Operational Manual Statements ...... 23 Table 12: Bank Resources: Staff Inputs ...... 23 Table 13 Bank Resources: Missions ...... 24
Appendices:
A. Missions's Aide Memoire (September 27 - October 13, 1995) with Operational Plan . 25 B. Borrower's Evaluation ...... 34 C. Ceylon Electricity Board's Financial Statements ...... 44 D. Economic Internal Rate of Return ...... 47 E. Changes in Project Scope ...... 48 F. Local Authority Electricity Schemes Taken ...... 50
Map IBRD No. 27602 IMPLEMENTATIONCOMPLETION REPORT
SRI LANKA
POWER DISTRIBUTIONAND TRANSMISSIONPROJECT (Credit 1933-CE)
Preface
This is the ImplementationCompletion Report (ICR) for the Power Distributionand TransmissionProject in Sri Lanka for whichCr. 1933-CEin the amount of SDR 29.2 million (US$40.5 million equivalent)was approved on June 23, 1988. The Credit was closed on December31, 1994, as originally scheduled. Final disbursement took place on July 6, 1995, at which time a balance of SDR 15.5 million (US$21.5 million equivalent)was cancelled. Cofinancingof US$31.0 million was provided by the Overseas EconomicCooperation Fund of Japan (OECF).
The ICR was prepared by Messrs. Somin Mukherji, Financial Analyst, and Mohinder Manrai, Consultant(Power Engineer), Energy and Project Finance Division, Country DepartmentI of the South Asia RegionalOffice. It has been reviewed by Messrs. Per Ljung, Chief, Energy and Project Finance Divisionand FakhruddinAhmed, Project Adviser, Country Department I.
Preparation of this ICR began just before IDA's completion mission (September27 to October 13, 1995.) It is based on material in the Project file. The Borrower contributedto preparation of the ICR by preparing its own evaluationof the Project's execution; its commentson the draft ICR will be invited. OECF joined the completionmission and although they were invitedto commenton the draft ICR, no commentswere received to date. However, because the componentswhich OECF financedare now scheduled for completion by July 1997, a separate evaluation for inclusion in this ICR is not expected.
IMPLEMENTATIONCOMPLETION REPORT
SRI LANKA
POWER DISTRIBUTIONAND TRANSMISSIONPROJECT (Credit 1933-CE)
Evaluation Summary
Introduction
The Bank Group's involvementwith Sri Lanka's power sub-sectorbegan in 1954 when a loan (Ln. 101-CE) was made to the Government of Sri Lanka (GOSL) for the expansion of an Aberdeen-Laksapanahydroelectric scheme. Since then the Bank Group, through ten additional loans/credits, has been actively involved in providing resources needed for the developmentof the sub- sector in terms of capacity to meet demand at least cost, to improve the quality and reliability of supply and to encourageinstitutional reforms.
The Project (made effective in 1988) was the tenth in the sector and is followedby one ongoing project. Prior to 1988, the Ceylon Electricity Board (CEB) was responsiblefor about 75% of the total electricity sales in Sri Lanka; the sale of the balance 25% was carried out by Lanka Electricity Company Limited and 212 licensees (Local Authorities). This fragmentation of responsibility for distribution was recognized as a major impedimentto the efficient operation and development of the power sub-sector. Under the NinthPower Project (Cr. 1736-CE),GOSL/CEB agreed to prepare a master plan for the developmentof distributionsystems; the master plan includedboth institutionalrequirements to rehabilitatethe systemsand appropriateorganizational/institutional reforms (para. 7). Consultantswere appointed in October 1987, and based on their recommendations,GOSL adopted an action plan to take over all the licenseesin a phased manner. In the initial phase, the plan includedCEB's taking over 133 licensees, which was financedunder this Project, and Lanka Electricity Company Limited taking over 23 licensees,which was financedby the Asian DevelopmentBank (ADB). The remaining56 licensees are being taken over by CEBunder the ongoingSecond Power Distributionand TransmissionProject (Cr. 2297-CE).
Objectives
The principalobjectives of the Project were to: rationalizethe organizationof the power distribution system; rehabilitate and expand the distribution systems managedby the licensees; reduce systems losses and improve the quality of electricity supply; implementCEB's least-cost transmission expansion program; strengthen CEB institutionallythrough the corporate-widecomputerization of its billing system; train staff in computerized accounts and engineering; improve CEB's financial performanceby reducing accounts receivablefrom licensees; and assist in the optimal developmentof the KaluGanga basin's land and water resources. The objectiveswere clear, realistic and consistentwith IDA's and GOSL's strategy for the power sub-sector (paras. 3 and 4).
ImplementationExperience and Results
The Project substantiallyachieved its major objectives and its overall assessmentwas satisfactory(para. 32). The sectoral(para. 8) and institutionalobjectives (para. 12) were met adequately and, on completion, the physical objectives will be met satisfactorilyas well (para. 13). Through the handing over of licensees' distribution systemsto CEB, the organizationof the power sector has been -ii- rationalized. Subsequently, necessary investments were made for rehabilitation and expansion of these distribution systems with adequate focus on reduction of systems losses and improvement in the quality of electricity supply. Additional transmission capacity was provided in accord with CEB's least-cost transmission expansion program. Appropriate consultancy services and training was provided to promote institutional development in certain selected areas on computerized accounts and engineering. However, during restructuring of the Project in November 1993, computerization of CEB's billing systems was taken out of the Project scope as CEB agreed to finance it out of its own resources. The original Project completion period of five years was realistic. However, due to implementation problems primarily arising out of procurement related issues, Project completion has been delayed (para. 20). The financial objective was to ensure CEB's sustainable financial viability through attainment of a satisfactory annual rate of return (ROR), while ensuring adequate cash flow so that debt service coverage is maintained at a minimum level of 1.5. Although during Project implementation (1988-1994) tariffs were increased at an annual average rate of about 16%, most of the increases occurred in FYs 93 and 94 (in aggregate, 48% for the two years). Thus, during most of the Project implementation period, CEB failed to meet the covenanted ROR target of 8%. The achievement of financial objectives was therefore partial (paras. 9-1 1). In spite of IDA's repeated reminders, GOSL/CEB did not demonstrate adequate commitment to meet the covenants satisfactorily; as a consequence, IDA decided to close the Credit without an extension (paras. 2 and 9).
The key factors that affected the timely achievement of physical objectives were: (a) security considerations in the Northern Province that resulted in reduction and modification of the transmission works; processing of alternate works took time and delayed the implementation; (b) protracted procurement procedures; (c) limited work force; (d) undue priority granted to rural electrification schemes which diverted manpower resources from the Project; and (e) an exodus of qualified and experienced engineers and accountants to other countries.
IDA and CEB jointly prepared the Project which was a part of CEB's least cost expansion and rehabilitation program, and their performance during the identification and preparation stages were satisfactory (paras. 26, 27 and 30). During appraisal, IDA did not fully assess the security risks in the Northern and Eastern Provinces nor the adequacy of CEB's work force to implement work related to the rehabilitation and augmentation of the distribution system. Also, the delays in procurement were not anticipated. All other factors and risks were fully assessed, and mitigating steps were included in the Project design. Overall, appraisal of the Project was satisfactory (para. 28). Satisfactory supervision of the Project was also carried out by IDA on a regular basis (para. 29). CEB's financial performance was unsatisfactory as it could not meet all the financial covenants. Its performance during implementation was therefore deficient (para. 21).
The Project's estimated cost at appraisal was US$113.0 million, including contingencies, duties and taxes. Of this, the foreign exchange cost was estimated at US$61.0 million, with financing from IDA (US$36.0 million) and the Overseas Economic Cooperation Fund (US$25.0 million). Local costs, estimated at US$52.0 million were to be financed by IDA (US$4.5 million), OECF (US$6.0 million) and CEB (US$41.5 million). The Project is now expected to be completed by December 1997 compared with the appraisal target of December 1993 for completion, and closure by December 1994. On completion, the Project is estimated to cost US$75.2 million with financing by IDA of US$19.4 million and by OECF of US$20.8 million (para. 22). -iii-
Project Sustainability
On completion the Project will be a part of CEB's integrated transmission and distribution system. Apart from IDA, other donors are also assisting CEB in strengthening its transmission and distribution system. Under all these projects, adequate funds for training CEB staff in major operational areas have been provided. Through significant tariff increases in FYs 93, 94 and 96, the financial health of CEB has largely been sustained. Thus, the achievements of the Project will be sustained. To ensure this, CEB has prepared a detailed Operational Plan (Appendix A) indicating how the Project will be managed in the future to maximize the benefits derived, thus ensuring Project sustainability.
Summary of Findings. Future Operations, and Key Lessons Learned
In this type of Project where major rehabilitation of distribution lines and substations is involved, detailed design and advance procurement actions should be undertaken during the preparation stage of the Project. Efforts should be directed towards the general development of local contractors for the erection and rehabilitation of transmission and distribution works. CEB's autonomy in terms of carrying out procurement should have been carefully evaluated, and prior agreements should have been sought with GOSL/CEB on procurement methodologies.
Over the last three years, CEB has not been able to add to its generation capacity. Currently, GOSL is negotiating with independent power producers to set up power plants on a BOO/BOT' basis. In addition, CEB is also negotiating with other donors (ADB, KfW and OECF) to add to its generating capacity. Unless these plants are commissioned soon, load shedding, that has already started, could increase to serious proportions. Since CEB's institutional set up is not adequate to meet the growing demands--both in quantity and quality terms--of a rapidly expanding export industry, future assistance for the sector should be appropriately oriented towards institution building, sector restructuring and enhancing the role of private enterprises in generation and distribution.
A monitorable Operational Plan has been agreed with GOSL/CEB and will be reviewed by subsequent IDA missions while supervising the remaining ongoing Project with CEB (Second Power Distribution and Transmission Project, Cr. 2297-CE). Any impact evaluation of the Project should be carried out by the Operations Evaluation Department around mid-1998, when the Project would have completed one year of operation (para. 33).
1/ BOO - Build-Own-Operate BOT - Build-Own-Transfer
IMPLEMENTATIONCOMPLETION REPORT
SRI LANKA
POWER DISTRIBUTIONAND TRANSMISSIONPROJECT (Credit 1933-CE)
PART I - PROJECT IMPLEMENTATIONASSESSMENT
Eoject Identit
Name Power Distribution& TransmissionProject Credit 1933-CE RVP Unit South Asia Region Country Sri Lanka Sector Energy Sub-sector Power
1. Ceylon Electricity Board (CEB), a statutory organization established in 1969, is the dominant entity in Sri Lanka's power sub-sector and is responsible for generation and transmission throughoutthe country and for distributionin areas that are not served by the LankaElectric Company Limited (LECO) and local authorities (licensees). During Project processing in 1988, CEB was responsiblefor about 75% of the total electricity sales; the sale of the balance was carried out by LECO and212 licensees(local authorities). This fragmentationof responsibilityfor distributionwas recognized as a major impedimentto the efficient operation and developmentof the power sub-sector. Under the immediatelypreceding Credit (Ninth Power Project, Cr. 1736-CE), GOSL/CEB agreed to prepare a master plan for the developmentof distribution systems, including both institutionalrequirements to rehabilitatethe systemsand introduceappropriate organizational/institutional reforms. Consultantswere appointedin October 1987, and based on their recommendations,GOSL adopted an action plan to take over all the licenseesin a phased manner. The plan includedCEB's taking over of 133 licensees,which was financedunder this Project, and LECO taking over 23 licenseeswhich was financed by the Asian DevelopmentBank (ADB). The 56 remaining licensees are being taken over by CEB with financial assistanceprovided under the ongoing SecondPower Distributionand TransmissionProject (Cr. 2297- CE).
2. The Project covered a five-yeartime slice of CEB's investmentplan. It was appraisedin February 1988 and the Credit was approved by IDA's Board in June 1988. The Credit and Project Agreements were signed in August 1988 and declared effective in November 1988. The Project was originally scheduledto be closedby December31, 1994. Followinga mid-term review in October 1993, a two-year extension along with inclusion of a Supervisory Control and Data Acquisition(SCADA) system was approved in November 1993; this was contingentupon GOSL/CEB's compliancewith an agreed, dated action plan that includedagreed target dates for submissionof FY92 audited accounts and various procurementrelated activities. CEB was also required to demonstrate its commitmentto meet the agreed rate of return covenant. GOSL/CEB's failure to adhere to the action plan led to project closure, as originallyscheduled, in December1994 (para. 9). Cofinancingof US$31.0 millionequivalent was provided by the Overseas Economic CooperationFund of Japan (OECF) to financevarious 132-kV transmissionworks (para. 13).
A. Statement/Evaluationof Objectives
3. Project Objectives: The principal objectives of the Project were to: rationalize the organizationof the power distributionsystem; rehabilitateand expand the distribution system managed by the licensees;reduce systems losses and improve the quality of electricity supply; implementCEB's least-cost transmission expansionprogram; strengthen CEB institutionally through the corporate-wide computerizationof its billing system; train staff in computerizedaccounts and engineering; improve CEB's financial performance by reducing accounts receivable from licensees; and assist in the optimal developmentof the Kalu Gangabasin's land and water resources. Based on the findings of the mid-term review in October 1993, the Project was restructuredand IDA tentatively agreed to finance a SCADA System (para. 2). However, this componentnever materializeddue to procurementdelays and closure of the Credit. Also, during the mid-term reviewmission, CEB agreed to financefrom its own resources, instead of from the Credit proceeds, the procurementof a decentralizedbilling system and cost of local constructioncontractors; the restructuredProject reflected these changes (paras. 22 and 23).2
4. The power distributioncomponent of the Project was complimentaryto the Ninth Power Project (Cr. 1736-CE) and in effect extendedthe geographic coverage of CEB's distributionnetwork. The transmissioncomponent was part of CEB's least-costtransmission investmentprogram, while the feasibility study for the Kalu Ganga MultipurposeProject (KGMP) facilitated a change in design from a reservoir type multipurposeproject to a run-of-the-rivertype power project in one of the country's major river basins. The consultancystudies were aimed at institutionalbuilding efforts with special emphasisin assistingCEB in the procurementprocessing for the Project's major investmentcomponents. The Project's objectives were clear, realistic and consistent with IDA's strategy for Sri Lanka's power sub-sector. These were also consistent with GOSL's energy strategy which included, inter alia, improvingthe quality and reliability of electricity supply and efficiency in the operation of the power system. The Project was well designed to meet these objectives and was a part of CEB's least-cost investment program; as such, it was not complex or demanding for CEB. As a condition of Credit effectiveness, GOSL was required to promulgate its legislation that enabled CEB to take over the licensees. There was no other risk perceived that could adversely effect project effectiveness.
5. Project Description: In order to achievethe above objectives,the followingcomponents were includedunder the Project:
(a) a five-year time slice of CEB's expenditures to rehabilitate, develop, and expand distribution systems to be taken over from selected licensees;
(b) the constructionof about 230 km of 132-kV transmission lines, the reconductoringof about 150 km of 132-kVtransmission lines, and the constructionand augmentationof related substations;
2/ Changes in Project scope are detailed in AppendixE. - 3 -
(c) consulting services to: (i) develop a decentralized, computerized billing system and a management information system (MIS); (ii) assist CEB in the preparation of the detailed specifications and design of the 132-kV transmission systems3 in (b) above and preparation of bidding documents for major transmission contracts; (iii) assist CEB in carrying out a tariff study; (iv) assist in the development of a training program for middle level technical officers; (v) assist in the establishment of a consumer relations unit; and (vi) assist in monitoring the continued implementation of CEB's new organizational structure; and
(d) a feasibility study for the KGMP.
B. Achievement of Objectives
6. Macroeconomic Policies: The Project design did not envisage any macroeconomic policy improvement measures. However, sectoral policies aimed at overall improvement of the sector were addressed and are discussed below.
7. Sectoral Policies: A major issue that impeded the sector's development and efficient operation was the fragmentation of responsibility for the electricity supply among CEB, LECO and the local authorities (licensees). Most of the licensees were inefficient and faced serious problems including: (a) high systems losses (averaging about 25%), (b) unreliable, poor quality and deteriorating supply, (c) high accounts payable to CEB (averaging about 5.5 months' billing in 1987), (d) long delays in connecting new consumers, and (e) shortages of competent staff.4 This was a major sectoral issue and GOSL was seriously considering the need for rationalization of the power distribution system. The Project addressed this sectoral issue by facilitating the gradual takeover of these licensees (para. 1). In addition, the lack of detailed knowledge of the country's hydropotential and its development was a major hindrance to the development of hydropower in Sri Lanka. This was addressed by carrying out a Master Plan Study in April 1986 from financing made available through the German Agency for Technical Cooperation (GTZ)5 . The Master Plan Study was complemented by a pre-feasibility study on the KGMP financed by UNDP and executed by IDA. Thereafter, the feasibility study of the Kukule hydropower project (a component of the KGMP) was carried out through finances made available under the Project; based on the findings of this report, construction of the Kukule hydropower project is now being financed by OECF. The Project also assisted CEB in implementation of its least-cost transmission expansion plan. And, finally, the Project addressed a major issue of CEB's institutional weaknesses through various studies and technical assistance.
8. Overall, the sectoral policy objectives were satisfactorily achieved. With a far more rationalized distribution system in operation now, losses in the past licensees' areas have reduced from an average of 25% in 1988 to an average of 18.3% at the end of 1994. However, the takeover of
3/ The scope of the transmission works was subsequently changed (para. 23)
4/ At the time of project preparation CEB was responsible for about 75% of total electricity sales, while LECO and the licensees were responsible for the balance of 25%.
5/ Gesellschaft fur Technische Zusammenarbeit -4- licensees distribution resulted in an increase in CEB overall systems losses from 16.4% in FY85 to 17.8% in FY93 and 18.3% in FY94.6 Power generation, though not included within the scope of the Project, continues to be poorly managed while the absence of transparent regulatory and contractual frameworks' has resulted in limited progress in attracting IndependentPower Producers.
9. FinancialObjectives: The financial objectiveswere to ensure CEB's continuedfinancial viability through attainmentof a satisfactoryROR of 8 % and an adequate cash flow so that debt service coverage ratio was maintained at a minimum level of 1.5. Although during Project implementation (1989-1994)tariffs were increasedat an annual averagerate of about 16% (from SLRs 1.66/kWhto SLRs 3.44/kWh), most of the increaseoccurred in FYs 93 and 94 (in aggregate48 % for the two years). Thus, during most of the project implementationperiod, CEB failed to meet the covenantedROR target of 8 %. In short, the major reasons for CEB's non-compliancewith the ROR covenant are as follows: (a) inadequatetariff increases; (b) increasingsystem losses; (c) GOSL's decision in May 1994 to roll back tariffs to the pre-February 1994 levels for the first 0-100 kWh domestic consumptionblock; this block accountedfor about 17% of the overall sales. With this adjustment,the tariff for the above block is only SLRs 1.62/kWh (US$ 0.03/kWh) and is about 47% of the average revenue rate; and (d) abolition of a fuel surcharge in effect from February 1994. Lack of commitmenton GOSL/CEB's part to comply with the agreed covenantsand with the agreed action plan (para. 2) led to the Credit's closure without further considerationof the two-yearextension which had been approvedconditionally. More recently, however, CEB's finalized FY94 accounts indicatethat its ROR attained at the end of 1994 was close to the agreed target of 8.0%;' in comparison,the RORs attained for FYs 92 and 93 were 4.1 % and 4.6% respectively. In January 1996, CEB implementedanother tariff increase of about 10% which should ensure that it continues to meet the 8% ROR target. CEB has generally been in compliance with the debt service coverage ratio covenant. A comparison of CEB's financial statementsbetween appraisal estimates and actuals is provided in AppendixC.
10. As of the end of December 1994, CEB's total receivables were satisfactoryand were at SLRs 2,979 million or at a level of 2.6 months of annual electricity sales (against a target level of 3 months). However, the receivablesfrom the low voltage private and governmentconsumers were at a level of 4.5 months and were unsatisfactory. CEB will continue to address this issue and necessary follow-upwill be carried out throughclose monitoringand supervisionof the ongoingproject (Cr. 2297- CE).
11. CEB was consistentlylate in submittingits annual audit reports and audited accounts;the audit reports for FYs 92 and 93 were late by eleven months(para. 19). Apart from delays in finalization of CEB's accounts, these delays have also been caused at the Auditor General's (CEB's auditors) office. However, with the submissionof the reports for FY94 in January 1996, the situation has improved considerably.Thus, the overall financial objectiveswere partially met.
6/ These are based on FY93 (audited)and FY94 (pre-audited)statements. More recently, recalculationsmade (because of faulty meter readings) indicatethe actuals to be marginallyhigher (Part II, Table 6, No. 9).
7/ A study to examine the legal and regulatoryframework and policy initiativesrequired to promoteprivate sector participationin power sector developmentis in progress now; this is being financedunder Japanese Grant Fund No. 21361.
8/ The actual ROR for 1994 was 7.9%. 12. InstitutionalDeveloRment Objectives: CEB's capability to plan, design, construct and maintain its sub-transmissionand distribution system inproved significantly under this Project. The preparation of the distribution 1986 Master Plan (para. 7), helped CEB take over the operations of licenseesin a smooth manner. During the takeoverof 133 licenseesunder the Project, more than 2,000 staff of the local authorities were affected. Of this, about 60% were absorbed in CEB after necessary screening/testsand training, andthe balanceopted to retire with pensionbenefits under LocalGovernment Pension Schemes. This transition process was carried out smoothly. Thus, the achievement of institutionaldevelopment objectives was substantialand satisfactory.
13. PhysicalObjectives: CEB carried out a detailedsurvey and used a computeraided design packageto identifyreinforcement and expansionrequirements of the licensees' distributionsystems. The key indicators for Project implementationon appraisal estimates, detailed survey, design estimates and expectedachievements on completionfor the distributioncomponents are includedin Part II, Table 5A. Based on technical specificationsprepared by a U.K. consultant and financedunder the Credit, CEB prepared bid documents for the 132-kVtransmission works for the IDA-financedcomponents and used the services of a joint venture consultancyfrom Japan and Germany for the OECF- financed 132-kV transmissionworks. The key indicatorsfor Project implementationof the transmissioncomponents (both IDA and OECF financed)are includedin Part II, Table 5B. Overall, the Project on its completion,will achieve its physical objectives satisfactorily--albeitwith significantdelays.
14. It is noteworthy to mention that both the IDA-financed and the OECF-financed componentsunderwent considerable modifications. GOSL/CEBconfirmed that the works as originally appraisedcould not be implementeddue to prevailing security reasons, and alternateworks were needed to meet the growing demand; these modificationswere agreed by IDA and OECF.
15. Economic Analysis: The Project was a part of CEB's least-costexpansion program, and during appraisal, the economic internal rate of return (EIRR) on CEB's investment program for generation, transmissionand distributionfor the period 1988-2002was estimated at 7.7%. With actual data for the period 1988-1994,the EIRR is now estimated at 10.2%, which is higher thanthe appraisal estimate.9 The assumptions used for calculating the EIRR are shown in Part II, Table 9 and the calculations,in AppendixD.
C. Major Factors Affectingthe Project
16. Factors not generallysubject to Governmentcontrol: Due to security considerationsin the Northern Province, the scope of the transmissionworks had to be modifiedand reduced. Processing of alternative works took time and consequentlydelayed Project implementation.
17. Throughout the implementationperiod, the exodus of qualified and experiencedengineers and accountantsto other countries continued. To this end, GOSL/CEBoffered various incentivesbut the impact so far has been minimal. This adversely affectedProject implementation.
2/ In addition, the SAR had also calculatedthe EIRR on the basis of consumer willingnessto pay (wtp) for the incrementalelectricity sales. Becauseof lack of necessary informationon the methodologyadopted during appraisal, it was not possible to replicatethe process and calculate the EIRR througha comparableassessment of wtp. - 6 - 18. Factors generally subject to Government control: Although by statute, CEB is an autonomous body, the extent of autonomy and authority vested in CEB is quite limited. CEB enjoys limitedauthority for procurementof materials and suppliesrequired for carrying out its mandate(efficient generation and supply of electricity) effectively,and currently is entitled to procure materials (or enter into turnkey contract agreements) for a threshold value of only up to SLRs 20 million'0 which is insignificantand totally inadequatefor proper functioningof a modern power utility. For amounts above this threshold, variousgovernment-appointed committees and agenciesare involved, and, in general, the approval process delays the entire implementationprocess.
19. Throughoutmost of the implementationperiod, CEBwas not in compliancewith a major financial covenant. Tariff increases (that are subject to governmentalapproval) were inadequateand delayed;this resulted in violation of the ROR covenant during the 1988-93 period. However, following major increases in FYs 93 and 94, CEB is now basically meeting the 8% ROR target. In addition, CEB has consistentlyfailed to submit its auditedfinancial statements in a timely manner; CEB's audits are carried out by the Auditor General's (AG) office and delays in the AG's office have contributed to the overall delays in submissionof audit reports (para. 11). These factors have adversely affected compliancewith the financial objectives of the Project. More recently, however, the ROR has improved, and with additional staff recruited at the AG's office, delays in submissionof audited accounts have also reduced significantly.
20. Factorsgenerallv subiect to implementingagencv control: Implementationof distribution works has been poor; overall implementationhas been only 32% as of August 1995 as comparedto appraisal estimates of 100% by the end of December 1993. The delays were primarily due to: (a) protractedprocurement procedures includingdelays in preparationof bid documents;(b) poor inventory management;(c) limitedconstruction work force; thoughefforts were made to engage local contractors, only a few had the necessaryequipment and transportationarrangements; (d) priority given by CEB to expansion and erection of rural electrificationschemes instead of rehabilitationof existing distribution networks; and (e) resistancefrom consumersto the unplannedshutdowns enforced by CEB to construct and rehabilitate the lines and substations. Implementation of the transmission works (including constructionof eight kIn of 132-kVloop line and the constructionof a 132-kVsubstation at Chilaw) were delayed because of delays in land acquisition.
21. The above factors adversely affectedsmooth implementationof the Project.
22. Proiect Costs and Financing: Based on early 1988 prices, the Project's estimated cost at appraisal was US$113.0 million, includingcontingencies, duties and taxes. Of this, the foreign cost was estimated at US$61.0 million, with financingfrom IDA (US$36.0 million) and OECF (US$25.0 million); and the local cost was estimatedat US$52.0million, with financingfrom IDA (US$4.5 million equivalent), OECF (US$6.0 million equivalent)and CEB (US$41.5million equivalent). On completion in December 1997, the total cost of the Project, as revised (para. 3), is now estimated to be US$75.2 million, with the foreignexchange cost being US$37.6million. The considerablesavings generatedwere primarily due to: (a) appreciationof SDR against US$, and (b) lower bid prices than appraisalestimates. The original and final Project costs and financing plan are shown in Part II, Tables 8A and 8B.
10/ At IDA's persistentrequest, in July 1994, GOSLenhanced CEB's authorityand the thresholdwas increasedfrom SLRs. 20 million to SLRs. 100 million, i.e., about US$2.0 millionequivalent (para. 31). 23. Project Implementation: During negotiations it was agreed that the Project would be completedby December31, 1993,and the Project Closing Date was establishedone year later. Due to civil disturbancesin the Mannar area, IDA agreed in September1991 to GOSL/CEB's request to modify the scope of the Project (para. 3). The following modifications were agreed upon: the planned constructionof the 132-kVtransmission line between Anuradpura-Mannarwith a new 132-kVsubstation at Mannar were replaced by the constructionof a new substationat Chilaw (includingeight km of loop line) and the augmentationof two substationsat Ratmalanaand Pannipitiya. Subsequently,following the mid-term review of October 1993, IDA agreed to: (a) restructurethe Project by includingfinancing of a SCADA system from expected savings (paras. 3 and 22), and (b) extend the Credit Closing Date by two years (until the end of December 1996). These agreements were however contingent upon GOSL/CEB's strict adherenceto a dated action plan as agreed with IDA. Failure on GOSL/CEB's part to comply with the agreed action plan resulted in Project closure on December31, 1994 (para. 2). The estimated and actual disbursementsare shown in Part II, Table 4. Disbursementsof SDR 13.7 million (US$19.4 million equivalent) were made until July 6, 1995, and an outstandingbalance of SDR 15.5 million (US$21.5million equivalent)was cancelled. The main reasons for these cancellationswere: (a) appreciationof SDR against US$; (b) lower bid prices than appraisal estimates; and (c) GOSL/CEB's inabilityto adhere to the agreed action plan.
24. Environment: The Project's direct adverse impact was limited to constructionof new lines and sub-stations. The ecological impact of the distribution lines was regulated by Sri Lanka's existinglaws, includingthe Electricity Act, the Flora and Fauna Act, and the Forestry Ordinance. These laws adequatelyregulated any adverse ecologicalimpact from the Project. On the other hand, the Project had a positive impact by providinga higher quality of life by replacing kerosene lamps with electricity, which is efficient, clean and relativelysafe comparedto kerosene lamps.
D. Project Sustainability
25. On completion(expected in July 1997), the Project will be a part of CEB's integrated transmission and distribution system. A follow-upProject" was approved by IDA to strengthen the transmissionand distributionsystem of CEB even further. In addition, other donors are also providing assistance to CEB. Under all these projects, substantial funds for training in all spheres of CEB's operations have been provided. With CEB's improvingfinancial performanceand continuedfocus on providing appropriate training to its staff, the major objectives of the Project will be sustained. The detailed OperationalPlan that CEB has prepared will ensure future sustainabilityof the Project (Annex 1 of AppendixA).
E. IDA's Performance
26. Project Identification: The Project was identifiedin 1987 to complementthe Ninth Power Project (Cr. 1736-CE)which addressedenergy conservationand resource use efficiency issues through the reductionof systemslosses in CEB's distributionsystem. In addition, the Projectprovided necessary support to GOSL's reform plans in taking over 133 poorly performing licensees by CEB. This is
11/ Cr. 2297, refer Part II, Table 2. -8 - consistent with the Bank's and GOSL's strategy for the power sub-sector,and IDA's role in this regard was satisfactory.
27. Project Preparation: IDA assisted CEB in the preparationof the Project and identified distinctcomponents keeping in viewGOSL's reform objectivesfor the sector, CEB's least-costexpansion plan, and IDA's strategy for the sub-sector's development. All technical, financial, economic, institutional and environmental aspects were reviewed carefully and included in the Project scope wherever necessary. The performanceof IDA in Project preparation was satisfactory.
28. Project Appraisal: Pre-appraisal and appraisal of the Project was carried out during December 1987 - February 1988 by two economists, a financial analyst, a power engineer and an operations assistant; most of the technical issues were addressed in the earlier stages of Project processing. The time spent on appraisal was appropriate and adequate. In addition to the aspects mentioned above (paras. 26, 27), IDA also reviewed the commitmentof GOSL and CEB towards the Project's objectives during appraisal. CEB appointedan experiencedtransmission engineer as Project Manager in its transmissionproject unit who was directly responsiblefor Project implementation. The Project was a part of CEB's least-cost development program and both GOSL and CEB were fully committedto it. With a decentralizedmanagement structure that resulted from studies carried out under the sixth Power Project (Cr. 1048-CE),the capacity and capabilityof CEB in implementingthe Project was reviewed and found to be adequate. However, the appraisalmission also concludedthat CEB would require technical assistance for preparing detailed design and for training CEB staff in certain critical areas which were considerednecessary to ensure Project sustainability. Necessaryprovisions were made in the Project for financingappropriate training measures. The lending instrument,financial package and the cofinancingarrangements (with OECF) were also appropriate. Basedon experiencein Sri Lanka and in the region, the implementationschedule was optimistic, especiallysince advanceprocurement actions were not taken. Except for the security situation in the Northern and Eastern Provinces, and the adequacyof CEB's work force to implementall work related to the rehabilitationand augmentationof the distribution systems, all other risks were identified during appraisal. Overall, the appraisal of the Project by IDA was satisfactory.
29. Project SuDervision: The Project was regularly supervisedby IDA staff with thirteen missionsfielded during the life of the Project includingan in-depth, mid-termreview. The skill mix and duration of the missions were adequate, and recommendationsof the missions were reflected in the country implementationreviews. The Bank's Resident Mission in Sri Lanka played a key role during the missions. The supervisionmissions identified the implementationproblems and also recommended appropriateremedial measures. To enforce the compliancewith financialcovenants (para. 9), remedies were sought by IDA in January 1993 through threatening suspensionof disbursement for all ongoing power sector credits to Sri Lanka. As a result, major tariff increases of about 48% in two years were effected in FYs 93 and 94 (para. 9). In respondingto the changed security environmentin the Northern Province, IDA was flexible in changingthe Project scope in September1991. Subsequently,during the mid-term review, because of the need for a SCADA system and as a result of potential savings being available, IDA agreed to restructurethe project and include financingof the SCADA system (para. 23). No significant deviations were made from the Bank's policies and procedures. Overall, Project supervisionwas carried out in a satisfactorymanner. - 9 - F. Performanceof the Borrower and Beneficiary
30. Proiect Identification, Preparation and Appraisal: During Project identification, CEB recognizedthe importanceof planning and design of a power distribution system. It had establisheda "Loss Reduction Cell" earlier which, in August 1984, was converted to a full-fledged "Distribution Developmentand RehabilitationBranch." It also acquired a distribution study software package and prepared a Project Document in April 1985. Further, CEB engaged consultants to rationalize its fragmented distribution system (para. 1). The consultants' draft report formed the basis for IDA to prepare and appraise the Project to which CEB was fully committed. CEB's performance during identification,preparation and appraisal was satisfactory.
31. Project Implementation: During implementation,counterpart funds were provided by CEB in a timely manner. The training componentwas also properly utilized. CEB appointedcompetent staff to supervise and monitor the Project. However, there were frequent changes of key Project staff which disrupted Project implementation. Progress reports were prepared in a timely manner and were adequatefor IDA to monitorthe performanceof the Project. CEB fully cooperatedwith IDA supervision missions. The sectoral policy issues (except in the generation area) were addressed by GOSL/CEB satisfactorily (paras. 7-8). Institutional development objectives were met substantially, and, on completion, the physical objectives will be met substantially as well (paras. 12 and 13). There were protracted delays in the evaluationof bids and award of contracts. These issues were raised repeatedly by IDA supervisionmissions, and GOSL/CEBwas responsivepartially and modified the thresholdsfor procurement approval (para. 18). While CEB has not been in compliancein the past with the major financialcovenants (paras. 9 and 19), its performancehas, of late, improved. CEB's overallperformance in the implementationof the Project was deficient (para. 21).
G. Assessment of Outcome
32. The Project substantiallyachieved its sectoral and institutionalobjectives. The physical objectives will also be substantiallyachieved on completion, but the financial objectives could not be achieved satisfactorily. With CEB's improving financial performanceand continuedfocus on overall institutionalstrengthening by providing appropriate training to its staff, the overall objectives of the Project would be sustainable(para. 25). The actual total Project cost and its foreign component are within the SAR estimates. The EIRR of 10.2% is higher than the appraisalestimate (para. 15). Overall assessmentof the Project is satisfactory.
H. Future Operation
33. Althoughduring appraisal an operationalplan was not agreed with GOSL/CEB,such a monitorableplan was agreed during the implementationcompletion mission (October 1995). The plan provides for technical inputs from CEB at agreed intervals. It also addresses issues required for satisfactoryfuture financial operation of the Project. Implementationof the plan will be monitored by IDA as a part of its supervisionof the ongoing Project (Cr. 2297-CE). An impact evaluation of the Project should be carried out by the OperationsEvaluation Department around mid-1998,when one year of operation after full completionof the Project will have been completed. - 10-
I. Key Lessons Learned-
34. Implementationof the Project suffereddue to: (a) revisionsin Project scope and design; (b) changes in the routes of the sub-transmissionlines; (c) poor inventory control of materials; (d) protractedprocurement procedures; (e) oppositionfrom consumersagainst frequent shut-downs; (f) civil unrest initially in the whole country and later in the Northern and Eastern provinces; (g) protests from the landowners for constructing the lines across their land; and (h) delay by the contractors. The followingare the key lessons learned:
(i) advanceprocurement actions (e.g., preparation of bid documents,hiring of consultants) shouldbe tied up with various stages of project processing. CEB staff should familiarize themselveswith Bank's standard bidding documents;
(ii) CEB's financial authority to handle procurement decisions (independent of GOSL's interventions)should be enhanced;
(iii) during the initialstages of project preparation,comprehensive training programs with an objective of overall institutional strengthening should be developed and agreed. Thereafter, during implementation,all training activitiesshould be regularly followedup and impact assessmentcarried out, both on an individual level and corporate wide;
(iv) security risks shouldbe properly evaluatedand works in security prone areas should not be included in the scope of a future project;
(v) efforts should be made by CEB to develop local contractors for the erection of power lines and sub-stations. Because local contractors have limitedequipment and vehicles, CEB could rent out their own equipment and vehicles; and
(vi) land acquisitionand compensationprocedures should be simplified.
35. Although, the Bank/IDAhas supportedGOSL/CEB through 11 power sector operations (of which 10 have been closed), CEB's system losses and accounts receivablecontinue to remain high and need to be addressed. While tariffs were adjusted periodically(1988, 1990, 1993 and 1994), there has been a reluctanceon the part of GOSL/CEBto set the level and structure of tariffs appropriately. In view of the inadequatefinancial resources available for investmentsand a loomingpower crisis, GOSL is now rethinkingits power sector developmentstrategy includingnecessary sector reforms. In addition, GOSL is activelyseeking private sector investmentsfor commissioningnew generationfacilities. Indeed,' the agreementsrelated to the first privately owned, IFC-sponsored50 MW power plant were signed in January 1996. IDA's strategy for the sector for further assistanceto Sri Lanka will be targeted towards facilitating restructuringof the sector and developingan enabling environmentfor entry of the private sector in power generation. - 11 -
PARTn - STATISTICAL ANNEXES
Table 1: Summaryof A s
A. Achievementof Obiectives Substantial Partal Neglitible Not Anplicable MacroeconomicPolicies O O 0 (1) SectorPolicies OI) 0 0 FinancialObjectives O (/) 0 0 InstitutionalDevelopment (V) O 0 0 PhysicalObjectives (/) O 0 0 PovertyReduction 0 0 0 (/) GenderConcerns O O 0 (/) OtherSocial Objectives O O 0 (1) EnvironmentalObjectives (V) O 0 0 PublicSector Management O O 0 (/) PrivateSector Development O O 0 (/) Other(specify) O O 0 (/)
B. ProiectSustainabilitv Like Unlikely Uner (^/) O' 0
C. BankPerformance Sdsrv Satisfactory Defiiejn Identification O (/) 0 PreparationAssistance El (/) 0 Appraisal E (.) E Supervision E (W) El
D. BorrowerPerformance r Satisfactory Deficient Preparation E (/) E Implementation E (/) E CovenantCompliance E E (V) Operation E E (/) (systemlosses/accounts receivable)
E. Assessmentof Outcome S ry Satisfactory Unutisfactory U E () E E - 12 -
Table 2: Related Bank Loan and Credits (from June 1980)
Credit Title Purpose Year of Approval Status
|Preceding Operations Sixth Power Project, Reinforcementand 1980 Closed, 3/88 Credit 1048-CE improvementof power transmissionand distribution system l Seventh Power Project, To strengthenthe 220-kV and 1982 Closed, 3/88 Credit 1210-CE 132-kVpower transmission system Eighth Power Project, To construct an 80 MW diesel 1982 Closed, 3/86 Loan 2187-CE power station Ninth Power Project, To improve the reliability and 1986 Closed, 6/94 Credit 1736-CE quality of power supply l FollowingOperations l Second Power Distributionand To completethe take over and 1991 Closingdate TransmissionProject, improvementof distribution scheduled6/98 Credit 2297-CE systems of 56 licensees and strengthenthe high voltage l ______system - 13 - Table 3: Project Timetable
Steps in Project Cycle | Date Planned | Date Actual/LatestEstimate
Identification/Preparation September 20 - October 2, 1987
Pre-appraisal December 7 - 21, 1987
Appraisal October 1985 February 17-29, 1988
Negotiations April 20, 1988 April 20 - 22, 1988
Board Presentation June 28, 1988 June 23, 1988
Signing August 31, 1988
Effectiveness November 23, 1988
Project Completion December 31, 1993 December 31, 1996' Credit Closing December 31, 1994 December 31, 1994
'The components financed by OECF will be completed by December 1997. Following Credit closure by IDA in 12/94, other components under construction are being financed by CEB from its own resources and will be completed by 12/96.
Table 4: Credit Disbursements: Cumulative Estimated and Actual (US$ Million)
[ [|______FY88 J FY89 | FY90 FY91 [FY92 J FY93 j FY94 FY95 [ FY96 Appraisal 0.4 1.6 7.7 16.2 24.7 31.2 36.5 40.5 40.5 Estimate
Actual 0.0 1.8 1.9 2.5 5.1 7.8 13.5 19.4 19.4
Actual as % 112.1 25.1 15.4 20.8 24.9 37.1 47.8 48.0 of Estimate
Date of Final July 6, 1995 Disbursement
Cancellation: SDR 15.5 million cancelled (US$21.5 million equivalent) Note: The fiscal years referred to above relate to the period July 1 - June 30 - 14 -
Table 5A: Key Indicators for Project Implementation
Distribution Works
INDICATORS APPRAISAL DESIGN STATUS AS EXPECTED ESTIMATES ESTIMATES OF STATUS ON AUGUST PROJECT 1995 COMPLETION DECEMBER
______1996 A. LV Network Improvement & Expansion
Construction of New LV Lines 900 km 900 km 590 km 900 km Rehabilitationof LV Lines 1500 km 1000 km 203 km 1000 km Reconductoringof LV Lines 700 km 700 km 173 km 700 km Conversionof LV Lines 500 km 304 km 500 km
B. MV Network Expansion & Substations
Construction of New MV Lines 600 km 600 km 145 km 600 km Augmentation of Substations 700 Nos. 47 Nos. 700 Nos. Construction of New Substations 650 Nos. 650 Nos. 248 Nos. 650 Nos.
C. ServiceConnection Improvements
Rehabilitationof Service Connections 70000 Nos. 70000 Nos. 7394 Nos. 70000 Nos. Replacementof House ServiceMeters 90000 Nos. 90000 Nos. 11973 Nos. 90000 Nos. Table SB: Key Indicators for Project Implementation
Transmission Works
INDICATORS APPRAISAL REVISEDINDICATORS STATUSON SEPTEMBER EXPECTED COMPLETIONDATE 1995 COMPLETIONDATE
IDA FINANCEDWORKS i. 72km of 132-kV double circuit line from December31, 1993 The following works were Anuradapurato Mannar with a new substituted in place of Mannar substation at Mannar works:
i. A new 132-kV substation at Commissionedin One transformerat Chilaw with an 8km loop in line September1 995 Ratmalanawas commissioned ii. Augmentationof 132-kV Substationat Pannipitiya December1 9, 1995. substations at Pannipitiyaand was commissionedin Balanceof work on Ratmalana September1 995 but the bays are expected by substation at Ratmalana the first week of April is still under construction 1996. OECFFINANCED WORKS i. 81km of 132-kV double circuit line from December31, 1993 No change in project Contract for all the lines Originally expected to Anuradapurato Puttalam component. {i-iv) signed with an be commissionedby Indianfirm in July 1995. July 1997. After ii. 62km of 132-kV double circuit line from - do - Constructionperiod is signing of contract, Embilipitiyato Matara about two years the date will be iii. Loop in & out of existing Polpitiya- - do - December1997. Anuradhapura1 32-kV Line through Ukuwelainvolving 11km of line iv. Reconductoring22km of double circuit - do - 132-kV line from Kotugoda to Bolawatta v. 9km of 132-kV double circuit line from deleted on account of security Kankasanturaiand Chunnakam situation vi. New 132-kV substations at Mataraand Substationat Kankasanturai Contract for all the Originally expected to Kankasanturai deleted on accountof security substationssigned with a be commissionedby situation joint venture of South June 1997. After Koreanand Chinesefirms signing of the vii. Augmentation of Substationsat Augmentationof Kilinochchi in June 1995. The overall contract, the revised Ukuwela, Puttalam, Embilipitiya, substation deleted due to construction period is date will be December Anuradhpuraand Kilinochchi security situation about two years. 1997. Table 6: Key Indicators in Project Operation
PERFORMANCEINDICATORS TIMING COMMENTS
1. The Plant and Equipment Register is updated regularly Regularly Regularly updated
2. The Depot System Maintenance Register is updated each quarter Regularly Updated quarterly
3. Regular maintenance work of substations and transformers including scheduled Regularly Regular maintenance carried out replacement of transformer oil is carried out
4. LV and HV breakdowns in the Provinces are monitored Monthly Monitored and monthly reported
5. Training of technical staff are carried out in accordance with an agreed Training Plan As required According to CEB normal programs
6. Procurement and installation of 70, 33-kV and 4, 11 -kV import-export meters Contract already awarded. Meters are expected to be l______installed by September 1996
7. Monitoring of distribution system losses at Provincial level Analysis is expected to start after installation of l______Import/Export meters i.e. after September 1996 I ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~0% 8. Monitoring of voltage levels of heavily loaded typical feeders in selected 40 The monitoring work started in October 1995 and will be distribution substations continued for six months and thereafter the results will be analysed before continuing the monitoring.
9. Reduce system losses by at least I % in 1994 and 1995 Annually The losses have been re-calculated by CEB after the review of incorrect meter readings. Based on revised information CEB has calculated losses at 21.46% in FY93, 18.85% in l ______FY94,and 18.46%in FY95(until June 1995).
10. Reduce the operations and maintenance cost, expressed as a percentage of Annually By reducing the staff and amalgamating the routine distribution capital cost distribution maintenance and rehabilitation of works, CEB is reducing operation and maintenance cost. The 0 & M cost expressed as a percentage of gross distribution fixed assets were 4.6%, 3.7%, and 3.5% in FYs 92,93 and 94 respectively.
11. Replacing of defective meters of bulk supply consumers There is an ongoing project to identify defective bulk supply meters. It is expected to check all these meters and replace l______them by September 1996.
12. Sealing of metering equipment of buik supply consumers by copper seals All old and new bulk supply meters are expected to be sealed l______with new copper seals by September 1996. - 17 -
Table 7: Studies Induded in Project
Study Purpose Status Impact Tariff and load To assist CEB in identifying The report was Tariffs were restructured managementstudy. load managementmeasures submittedin and increasedby about and reforming its tariff December 1990 30% in July 1993. structure to better reflect the Subsequently,another cost of supplyingdifferent tariff increaseof about loads. 30% was effected in February 1994.
Feasibility study for To assist CEB in carrying out The report was Investmentprogram the KGMP. the optimal developmentof submitted in March recommendedby the plan the land and water (including 1993. is being implementedby hydroelectric)resources of the OECF. Kalu Ganga Basin. Review of CEB's To re-examineCEB's The report was Based on the organization organizationalstructure, to submitted in May recommendationsof the structure. identify necessary changesto 1991. study, CEB reorganized support the decentralizationof the unit structures of the the distributionfunction to the AdditionalGeneral provincial division level and to Managers and the Deputy strengthenCEB's overall General Managersin April operationaland financial 1991. management capacity. - 18 -
Table 8A: Project Costs
Appraisal Estimate (US$M) Estimate (US$M) as of Item December 1995 Local | Foreign | Total Local | Foreign | Total ______Costs J Costs _ Costs Costs _ 1. Distribution Rehabilitation 23.8 17.3 41.1 15.7 9.1 24.8 2. TransmissionSystem Expansion 13.4 24.3 37.7 19.8 23.9 43.7 3. Decentralized Computer Billing 0.2 1.8 2.0 0.0 0.3 0.3 System l
4. Consultancy, Project 3.8 3.4 7.2 0.0 0.9 0.9 Administration and Training l
5. Kalu Ganga Studies 0.6 2.3 2.9 2.0 3.5 5.5 Total Baseline Cost 41.8 49.1 90.9 37.5 37.7 75.2
Physical Contingency 4.2 4.9 9.1 Price Contingency 6.0 7.0 13.0 Total Project Cost 52.1 61.0 113.0 37.5 37.7 75.2
Table 8B: Project Financing
Appraisal Estimate (US$M) Estimate (US$M) as of Source December 1995 Local l Foreign | Total Local Foreign Total lCosts | Costs | | Costs Costs IDA 4.5 36.0 40.5 0.5 18.9 19.4 OECF (Japan) 6.0 25.0 31.0 2.2 18.6 20.8 CEB 41.5 0.0 41.5 35.0 0.0 35.0 Total 52.0 61.0 113.0 37.7 37.6 75.2 - 19 -
Table 9: Economic Costs and Benefits
Assumptions Costs Benefits 1. The Project is a part of CEB's 1. Capital investmentcosts for 1. Incremental revenue from sale least-cost developmentprogram generation, transmission of electricity. Actual benefits and the economic internal rate and distribution of CEB's from 1988 to 1994, which of return was calculated on the overall investment was frozen until 2024. entire investmentprogram of program. CEB for the period 1988-1994.
2. The benefit period of the 2. Incrementaloperational and 2. According to the methodology program extends from 1988 to maintenancecosts of used in the SAR, the 2024, when the equipment CEB's system. Actual willingnessto pay (wtp) has providedunder the Project is costs from 1988 to 1994, been measured in the expectedto have substantially which was frozen until following manner: completed its useful life. 2024. (a) historical consumer tariffs; and 3. All cost and benefit streams have been expressed in 1988 (b) for residential and street prices using IMF deflation lighting consumers: on factors. Foreign costs have weightedaverage tariff rate been measuredusing border for incremental consumption prices. Local costs for in the respective categories, materials and equipmenthave and, for commercial, hotels been expressed in terms of and industrial consumers: in equivalent border prices using terms of incremental operating the standard conversionfactor costs of meeting their of 0.75 and unskilled labor demandsfor electricity using using a factor of 0.80. auto-generatorsthat are displacedby public supply of electricity.
4. No residual value of fixed These two approaches(a) and assets are taken into account. (b) have been adopted to calculate EIRRs.
Economic Internal Rate of Return: Appraisal Estimate: 7.7% Actual: 10.2% Table 10: Status of Legal Covenants
Original Revised Covenant Fulfillment Fulfillment Agreement Section Type Status Date Date Description of Covenant Couments Credit 3.04 2 CD 12/31/88 The Borrowershall take or cause to be In compliance from July 1991. takenall measuresnecessary to ensure thaton and afterDecember 31, 1988 totatdues for electricitysupplied by the Boardshall not exceedthree months billing. Credit 3.05 5 CD 10/31/89 The Borrowershall carry out by October The tariffand loadmanagement study 31, 1989a tariffand loadmanagement was completedin December1990 and the studyand, thereafter,modify the tariffswere restructuredand Board'stariffs taking into account the increasedin July1993. Another recommendationsof the abovestudy. increasein tariffswas effectedin ______February1994. Credit 3.06 2 C The Borrowershall take all necessary The ROR improvedfrom 4.6Xas of FY93 actionsto enablethe Board to effect to 7.9% as of FY94. adjustmentsin its tariffsto enableit to complywith the rateof return O I______covenantof the ProjectAgreement. Credit 3.07 12 C The Borrowershalt carry out a satisfactoryprogram to redeployor retirethe staffof the localauthority distributionsystems transferred to the Board. Credit 3.08 12 C The BorrowershalL take measures for the transferof distributionsystems from the localauthorities to the Board. Credit 4.01(b)(ii) 1 C The Borrowershall furnish to IDAnot laterthan six monthsafter the end of each fiscalyear (i) an auditreport on the SpecialAccount, and (ii)a separateopinion by auditorsas to whetherthe statementsof expenditure submittedduring each fiscaL year can be reliedupon to supportthe related withdrawals. Project 4.01(b)(ii) 1 CD The Boardshall submit to IDA not later Unauditedstatements for FY94,due than:(a) fourmonths after the end of end-April95 were submittedto IDA in eachyear, the unauditedfinancial mid-May95. The FY94 auditedaccounts statementsfor suchyear; and (b) ten (dueend-October 1995) were submitted monthsafter the end of eachyear, in January1996, implyinga delay of certifiedcopies of its financial threemonths. statements. Original Revised Covenant FulfilImentFulfillment Agreement Section Type Status Date Date Descriptionof Covenant Comments Project 4.02 2 C The Board shallmaintain a debt service For FY94the coveragewas at 2.3. coverageof not lessthan 1.5. Project 4.03 2 C The Board shall,before the end of each The ROR improvedfrom 4.6%as of FY93 fiscalyear, adjust the tariffsto to 7.9% as of FY94. providesufficient revenue to cover operatingexpenses including taxes, if any,and straight-linedepreciation, and to providean annualreturn on currentvaLue of its net fixedassets in serviceof not lessthan eight percent. l Project Schedule2 12 C The BoardshaLl carry out a programto retrainthose staff of the locaL authoritydistribution systems transferredto the Board. Project Schedule2 5 CD 12/31/88 The BoardshaLL commence by December The Boardis developinga systemfor 31, 1988 the implementationof a decentralizedbilling in phases. This programfor the developmentof a will be implementedin one province, decentralizedcomputerized billing i.e.,North-Western, by February1996 systemand upgradingof its management and in four otherprovinces _ informationsystem. thereafter.The secondstage, comprisingfive remaining provinces, will be implementedafter observing the performanceof the fiveprovinces coveringthe firststage. Project Schedule2 2 C 12/31/88 The Boardshall take all measures As of December31, 1994, the total necessaryto ensurethat on and after dues fromconsumers were equal to 2.5 December31, 1988,total biLLs due from monthsof biltings. consumersfor electricitysupplied by the BoardshaLl not exceedthree months'billing. l Project Schedule2 5 C For the purposesof self-insuranceof One-tenthof 1% of CEB's revalued its assets,the BoardshaLl, within 11 fixedassets are being depositedin monthsof the end of the fiscalyear, the escrowaccount. depositits annuaLprovision to the insurancereserve in an insurance escrowaccount with an independent financialinstitution. Project ScheduLe2 5 CD The Boardshall, by October31, 1989, The tariffand toadmanagement study carry out a tariffand loadmanagement was completedin December1990 and the studyand, thereafter, modify the tariffswere restructuredand Board'stariffs taking into account the increasedin July 1993. Another recommendationsof the abovestudy. increasein tariffswas effectedin February1994. Cont Tyes:
1. Accounts/audit S. Indigernus People 2. Fincisl perfor_ance/generate revenue froa beneficieries 9. Nnitoring, review, and reporting 3. Ftowand utilizationof projectfunds 10. Project ieptmmntation not covered by categories 1-9 4. Counterpart tunding II. Sectoral or cross-sectoral budgetary or other resource allocation 5. Nanagment aspects of the project or executing agency 12. Sectoral or cross-sectoral policy/regulatory/institutional action 6. Enviremnntal covenwnts 13 Other 7. Involuntary resettleement
C a covenant complied with CD a cooplied with after delay KC = not coplied with CP = cooplied with partially
Question: Is the selection of covenants appropriate? Have any proved to be ineffective or superfluous? Which, if any, additional covenants would have been useful? Answer: Selection of covenants was appropriate. No covenant was superfluous. The receivables covenant (Section 3.04 of OCA) should have provided for separate monitoring of receivables due from the goverrnent departments nd local authorities as was done under Section 3.03 of OCA of Credit 1736-Ci. Ouestion Are there any general problems or issues relating to conpliance with covenants under the project? Answer: Yes. The Audit Report has invariabty been submitted late. This is a countrywide issue.
* :o..hal9133 U - 23 - Table 11: Compliancewith OperationalManual Statements
There has not been any significantlack of compliancewith Bank's Operational Manual statementsunder this project.
Table 12: Bank Resources:Staff Inputs
Stage of Projectcycle Planned | Actual Weeks US$ Weeks US$ Preparation to appraisal N/A N/A 40.3 69.5
Appraisal N/A N/A 7.0 11.7
Negotiationsthrough N/A N/A 7.6 13.2 Board approval
Supervision N/A N/A 61.6 188.1
Completion N/A N/A 5.8 18.6
TOTAL N/A N/A 122.3 301.1
N/A - Not Available - 24 - Table 13: Bank Resources: Missions
Stage of Month/year Number Days in Specialized Performance rating Project cycle of field'" staff skills Types of persons represented Implemen- Develop- problems
status impact
Identification Sept-Oct 1987 6 13 ECN/EGR/FNA- OPN
Pre-Appraisal Dec 1987 5 15 ECN/EGR/FNA OPN
Appraisal through Feb 1988 2 13 EGR/FNA - - Board approval______
Supervision Mar 1989 2 17 EGR/FNA 2 1 PM
Sep 1989 2 l1 ECN/FNA 2 2 LC/PR
Dec 1989'3 2 8 EGRIEGR - -
Mar-Apr 1990 2 31 EGR/FNA 2 2 FP
Oct-Nov 1990 2 21 EGR/FNA 2 2
Feb-Mar 1991 2 21 EGRIFNA 2 2
Jul-Aug 1991 2 16 EGR/FNA 2 2 PR/PM
Oct-Nov 1991 2 16 EGR/FNA 2 2
May 1992 2 14 EGR/FNA 2 2 PR
Dec 1992 1 7 EGR 2 2 LC/FP
Oct 1993 2 17 EGR/FNA 3 2 FP/PR/PM
Jul-Aug 1994 2 13 EGR/OPN U S FP/LC
Apr 1995 2 13 EGR/FNA S S LC/FP/PR
Completion Oct 1995 2 18 EGR/FNA
Key: EGR : Power Engineer FNA : Financial Analyst ECN : Economist OPN : Operations Assistant
LC : Compliance with Legal Covenants FP : Financial Performance PR : Procurement Progress PM : Project Management Performance
12/ Days spent in field are for combinedmissions and include time spent for other projects as well.
13/ This missionwas focussed on followingup with GOSLon the principal findings of the KGMP; as such there was no overall Project Supervisionand Form 590 was not prepared. - 25 - Appendix A Page 1 of 6
SRI LANKA CompletionMission, Cr. 1933-CE September 26 - October 13. 1995
Aide Memoire'
1. Introduction. An IDA power sector mission comprising Messrs. Somin Mukherji, Financial Analyst and M.P. Manrai, Power Engineer (Consultant), visited Sri Lanka during the period September 26 to October 13, 1995 to supervise and prepare the Implementation Completion Report (ICR) of Power Distribution and Transmission project, Credit 1933-CE closed on December 31, 1994.
2. The Project was co-financed by Overseas Economic Cooperation Fund of Japan (OECF) (para. 8). The mission would like to thank OECF's Colombo office for providing the mission with an opportunity to discuss various issues pertaining to Project implementation. The mission would also like to thank the officials and staff of the Ministry of Irrigation, Power and Energy (MIP&E), the Ministry of Finance (MOF), Board of Investment (BOI), Lanka Electricity Company (Pvt) Limited (LECO) and the Ceylon Electricity Board (CEB) for all the courtesies and assistance extended to the mission. The aide memoire summarizes the mission's findings and the agreements reached with the Government of Sri Lanka (GOSL) and CEB regarding the above project. The aide memoire is subject to IDA management's review and concurrence.
3. Background. A credit of SDR 29.2 million (equivalent to US$ 40.5 million) was approved by the IDA Board on June 23, 1988, and became effective on November 23, 1988. Following a mid-term review during November 1993, IDA agreed to: (i) a GOSL/CEB request to extend the Credit Closing date by two years (until December 31, 1996), and (ii) incorporate a Supervisory Control and Data Acquisition equipment (SCADA) in the Project scope subject to GOSL/CEB implementing an agreed action plan. Because GOSL/CEB did not show any commitment in implementing the above plan, IDA closed the Credit on December 31, 1994 as originally scheduled. Final disbursement took place on July 6, 1995, at which time a balance of SDR 15.5 million (US$21.5 million) equivalent was cancelled.
Project Components
4. The project consisted of the following components:
Distribution (Part A of Schedule 2 of the DCA): The rehabilitation and expansion of distribution systems transferred to the Board from local authorities licensees;
Transmission (Part B of Schedule 2 of the DCA): The construction of about 226 km of 132-kV transmission lines, the reconductoring of about 22 km of 132-kV transmission lines and the construction and augmentation of related sub-stations;
Institution (Part C of Schedule 2 of the DCA): The strengthening of the Board through:
(a) the development of a decentralized computerized billing system and upgrading its management information system;
'I/ Modified version - 26 - Appendix A Page 2 of 6
(b) the training of engineers and other staff;
(c) the dissemination of power related information; and
(d) improvements in the Board's organization and management.
Technical Assistance (Part D of Schedule 2 of the DCA): The provision of technical assistance to the Board in:
(a) the review of the detailed specifications and design of the 132-kV transmission system;
(b) the review of bidding documents for major transmission contracts; and
(c) improving the methodology of tariff studies and carrying out of a tariff study.
Study (Part E of Schedule 2 of the DCA): the carrying out of a feasibility study for the Kalu Ganga multipurpose project.
5. Restructuring of the Project. In September 1991, GOSL/CEB requested IDA to substitute the originally appraised 72 km of 132-kV Anuradhapura-Mannar transmission line including two terminal substations with a new 132-kV substation at Chilaw including a 8 km loop transmission line and to augment the existing 132-kV transformer capacities at Ratamalana and Pannipitiya. GOSL explained that it was not possible to implement the works at Mannar due to security reasons and it was necessary to construct the alternative works to meet the growing load demand. IDA agreed to GOSL's request. The cost of the new substituted works was almost equal to the original works.
6. In November 1993, GOSL/CEB requested IDA to extend the Credit Closing date by two years and finance the SCADA equipment estimated at about US$ 11.0 million under the Credit as there were US $ savings due to favorable SDR/US$ exchange rate and also because CEB was able to get cheaper bids for distribution materials compared to the appraisal estimates. As explained above (para 3), the Credit was closed on the original Closing date of December 31, 1994.
7. Project Status
Distribution. The fragmentation of responsibility for distribution amongst CEB, LECO and more than 200 licensees was a major impediment to the efficient operation of the power system. Therefore, GOSL decided that either CEB or LECO should take over the licensees in a phased manner. CEB took over all 133 licensees' distribution system as appraised. Necessary legislation for the take over was approved by GOSL in September 1988 through amendment of the Act. After a detailed survey, distribution work components were found slightly different from the appraisal estimate. Their details and indicators for their implementation are included in Annex 1-A.2 All material required for these works has been procured but the progress in physical implementation has been slow and, as of the end of August
2/ Now included in Part II, Table 5A - 27 - Appendix A Page 3 of 6
1995, it was only 31.5 %. CEB agreed with the mission to reinforcethe constructiongangs and complete the entire work not later than December31, 1996.
8. Transmission. IDA financedthe constructionof a new 132-kVsubstation at Chilaw and augmentationof 132-kVsubstations at Ratmalanaand Pannipitiya. These works have been implemented through supply and erect type of contracts. IDA also financedthe supplyof materials for 8 km of 132- kV line, which was constructedby CEB through its force account. Whereas, Pannipitiyasubstation and 8 km of 132-kV transmission lines were commnissionedand are operational since July and September 1995, respectively, some structure and switch gear erection works are still pending at Ratmalana; in addition, some defects at Chilaw substationneeds to be rectified soon. These works are expectedto be completedby the end of November 1995.
9. OECF, after deleting some works from its original scope, cofinanced the following transmission works under OECF Loan SL-P21:
(i) 81 km of new 132-kVdouble circuit (DC) line from Anuradhapurato Puttalam;
(ii) 62 km of new 132-kVDC line from Embilipitiyato Matara;
(iii) loop in and out of the existing 132-kV DC line from Polpitiyato Anuradhapurathrough Ukuwala(11 km);
(iv) reconductoringof 22 km of existing 132-kV DC line between Kotugodaand Bolawatte with a higher size conductor;
(v) a new 132-kVsubstation at Matara; and
(vi) augmentation of 132-kV substations at Ukuwala, Puttalam, Embilipitiya and Anuradhapura.
10. Very recently, in June/July 1995, the contracts for the above OECF financed transmissionlines have been awardedto an Indian firm (at J Yen 1041 million) and for the substations to a joint venture of firms from South Korea and China (at J Yen 624 million). The constructionperiod for both these works is about 28 months. The implementationof these works is to be supervisedby a joint venture consultancyfirm from Japan and Germany. The status of implementationof the above is included in Annex 1-B.3 OECF explained that the delays were caused by the late appointment of consultantsand the abnormaltime taken to design the works, prepare the bidding documents, invitebids, evaluate them and finally award the contracts. OCEF agreed with the mission's view that the procurementprocedures in Sri Lanka are now getting more protracted.
11. Institutionalstrengthening
(a) Decentralizedcomputerized billing system: During Project implementation,it was agreed that this work would be financed by CEB from its own resources (instead of being
3/ Now includedin Part 1, Table 5B - 28 - AppendixA Page 4 of 6
financedby IDA) and implementedby CEB. The systemis being developedin house by CEB in three stages: I(A), I(B) and II. Under Stage I(A), the billing system will be developedand implementedin the Western-Northprovince. In Stage I(B) this will be extendedto four more provinces (Western-South,Colombo city, Central and Southern) and the Head Quarters. Under Stage II, the system will be expanded to include the remaining five provinces. On completion of all these stages, a totally integrated decentralizedbilling system will be in operation. A contract for Stage I(A) was awarded in October 1995; trial runs are expected by end February 1996. Stage I(B) will be completed by August 1996, CEB has allocated SLRs. 30 million for this purpose. Thereafter Stage II will be completedby June 1997 provided the functioningof Stage I is successful. Recently, CEB has placed the EDP unit under AGM (Planning). The mission was informed that a proposal has been submittedto the Board for strengthening of the Unit. The mission recommends that the proposal should be reviewed by the Board.
(b) CEB, with assistance of their consultants BEI (UK), completed a training program of middle level technicalofficers in January 1990. The duration of the technicalassistance was 3 man months at a cost of PD STG 25,800 plus SLRs.109,500. In addition, 24 engineers and one accountant were deputed to EGAT Bangkokfor training in Project Managementat a cost of US$37,500.
(c) BEI (UK) was retained as consultantsfor a period of 3 man monthsto strengthenCEB's consumer education unit. The cost was PD STG 20,802 plus SLRs. 132,537. The consultant's report was made available in May 1989.
(d) CEB engaged EDF (France) to review its organization structure. Based on the consultants'recommendations, CEB reorganizedthe unit structure of AGMs and DGMs in April 1991. The consultancycost was FF 2,557,521 plus SLRs. 657,000.
12. TechnicalAssistance
(a) CEB engaged the services of EwbankPreece Ltd (UK) to prepare specificationsand bid documents for the 132-kV Anuradhapura-Mannar line at PD. STG. 11,920 plus SLRs. 13,190. Because the substitutedChilaw, Ratmalana,and Pannipitiyasubstations (para 5) were simpler in design, CEB prepared the specificationsand bid documentsitself and did not engage consultants.
(b) CEB engagedEDF (France) to carry out a tariff study. The study report was completed in August 1990. The consultancyfee was FF 1,498,363 and SLRs.78,000.
Kalu Ganga Multi-purposeBasin Study and Kukule HydropowerProject
13. CEB engaged a joint venture comprising Nippon Koei (Japan), Lahmeyer International (Germany)and Electro Watt of Switzerlandfor preparing a feasibilityreport and the biddingdocuments under a UNDP financedand Bank executed project. A Panel of Experts (POE) was also appointed to review the Joint Venture's work. The report and bid documents were completed in March 1993. Subsequently,OECF provided the financingfor constructingthe project. GOSL recentlypermitted CEB - 29 - Appendix A Page 5 of 6 to short list the consultantsin accord with the guidelinesof OECF. CEB is now invitingproposals from the short-listed consultants. The project completionis now delayed by two years and is expected to be completed by 2002.
Disbursement
14. The credit was closed on December 31, 1994. A grace period was provided for the submissionof withdrawal applicationsagainst eligible expendituresincurred before December31, 1994. Final disbursementtook place on July 5, 1995, at which time an amount of SDR 13.7 million had been disbursed and the balance of SDR 15.5 million was cancelled. Amountsdeposited in the special account were adjusted against withdrawalproceeds.
CEB OperationalPerformance
15. The key project operationindicators and monitoringmilestones are includedin Annex-2.4 The recalculatedsystems losses in FY94 were 18.85% comparedto 21.46% in 1993. These losses are recalculatedevery year by CEB based on review of complaints filed by the consumersalleging incorrect meter reading and wrong billing. Operationand maintenancecost as a percentageof gross distribution fixed assets were at 4.6%, 3.7% and 3.5% during FYs 92, 93 and 94 respectively, implyinga reducing trend. CEB explained that it was trying to reduce them still further.
Status of Covenants
16. Audit reports and auditedaccounts: The mission was handed over CEB's FY93 (due in October 1994) audit report along with its audited accounts; thereby implyinga delay of eleven months. Submissionof the FY92 auditedaccounts were also delayedby elevenmonths. The mission was pleased to note that owing to appropriate strengtheningof the Auditor General's office, the draft FY94 audited accounts(due in October 1995) are under review now and are expectedto be finalizedand forwardedto IDA by end of November 1995; i.e., with a delay of about one month. This would imply a significant improvementover past performanceon timely submissionof audited accounts. It is expectedthat in the future i.e., starting in FY95, audit reports would be submittedon time. The FY94 audit report on special accountsand statementof expenditureswere submitted in early July 1995, implyinga delay of less than a month.
17. Compliancewith financialcovenants: Rate of Return (ROR): In accordwith Sec. 4.03(a) of the Project Agreement, CEB is required to earn a ROR of 8% each year during the entire project implementationperiod. In FY93, CEB's attained ROR was 4.6%, and for FY94, this is estimatedto be at 7.8%; implying non-compliance. Debt Service Coverage (D/S) Ratio: As agreed, CEB's D/S ratio is required to be not less than 1.5 times. CEB has been in compliancewith this covenant; the D/S ratio for FY93 was 1.7 times while for FY94, unauditedaccounts indicate this ratio to be at 2.3. The FY94 results will be verified after receipt and analysis of the audited accounts when they are made available.
18. Accountsreceivable: As agreed, CEB is required to maintain its overall accounts receivableat a level of not exceedingthree months' billings. As of December1994, CEB's total accounts
4/ Now includedin Part II, Table 6 - 30 - Appendix A Page 6 of 6 receivablewas at 2.6 months of averagemonthly billings, thereby indicatingcompliance with the agreed covenant.
19. The status of compliancewith covenants is includedin Annex-3.5
Operation Plan
20. The mission discussed and agreed with CEB on Operational Plan (Annex-4)6 for the operation phase of the project. Since the distribution and transmission works constructedunder the project will be integratedwithin CEB's overall system,their operationwill be subject to normal operation and maintenancework of CEB. Further, since the Project has not been completed, the OperationalPlan incorporatesthe completiondates of the various componentsand provides indicatorsfor monitoringthe Project's operationand its developmentimpacts. SubsequentIDA missionswill monitorthese indicators.
ImplementationCompletion Report
21. In accord with IDA guidelines, after completion of each project, an Implementation CompletionReport (ICR) is required. Very recently, IDA has prepared and circulateda final ICR for the Ninth Power Project (Credit 1736-CE). The mission collecteddata for the preparation of its section of ICR for this Project. The missionprovided necessary advice and support to CEB for preparing its own contributionfor the ICR. It was agreed that CEB will forward to IDA, through Departmentof External Resources, its evaluationreport by October 31, 1995.
22. As indicatedearlier in para 3, about 53% of the Credit amount (about US$21.5 million) has been cancelled. A table comparing the category wise actual expenditure with SAR estimates is included in Annex-6.7 It will be seen that a major portion of the cancelledamount relates to distribution work component. The savings accrued due to: (i) favorable SDR/US$ exchange rate, (ii) lower than estimated bid prices, (iii) procurementof poles and erection of lines by CEB from their own resources. The delays in implementationtook place because CEB's resourceswere diverted to other priority areas, includingrural electrification. In addition, material is not procured on time and even after procurement, it remains in the store for a long time before appropriateusage. As identifiedby CEB in its reports, the distributionorganizational set up requires review and its method to plan, design, procure and implement the works need to be revamped. A typical procurementprocess generally undergoes inordinate delays on accountof reviewsby a large number of scrutinizingbodies includingTender Evaluation Committee (TEC), MinistryTender Board(MTB), CabinetAppointed Tender Board(CATB) and the Cabinet. Unless GOSL/CEB overcomethese self imposedbarriers, disbursementand project implementationwill continue to remain unsatisfactory.
5/ Now included in Appendix A, pages 7-10
6/ Now included in Appendix A, pages 7-10
7/ Now included in Part 11, Table 4 Appendix A Annex I Page I of 3
POWER DISTRIBUTION & TRANSMISSION PROJECT OPERATION PLAN
OPERATIONAL ISSUES STRATEGY PERFORMANCE INDICATORS TIMING
Project Completion
The Project is incomplete whereas material needed CEB to complete the distribution i. Completion of LV network December 1996 for distribution work has been provided, overall works through force account and to physical erection is only 31.5 % as of August 95. expedite the OECF financed ii. Completion of MV network - do - IDA financed transmission works are almost transmission works through supply & commissioned but OECF financed works are way erect contractors. iii. Completion of service connection work - do - behind schedule. iv. Completion of IDA-financed Energized augmentation of 132-kV substation at December 19, 1995 Ratmalana
v. Completion of OECF financed 1 32-kV End December 1997 W transmission works (originally June 1997) Project Operation
Facilities constructed under the project should be The works commissioned under the i. The plant & equipment register of the Regularly operated and maintained efficiently. project are being integrated within taken over of distribution systems and CEB's overall system. A comparison 132-kV substations is updated regularly. will be made with the licensees' performance to analyze the change in ii. The depot system maintenance register Quarterly quality of supply. is updated each quarter.
iii. Maintenance work of substations Regularly including scheduled replacement of transformer oil is carried out regularly.
iv. LV and HV breakdowns of taken over Monthly systems are monitored monthly.
v. Training of technical staff is carried out As per plan in accord with an approved training plan. Appendix A Annex I Page 2 of 3
OPERATIONAL ISSUES STRATEGY PERFORMANCE INDICATORS TIMING
Project Operation
Efficient operation of the system should CEB will monitor the system losses i. Monitoring voltage levels at The monitoring work has started in October 1 995 lead to reduction of distribution system and variation in voltages in the 40 preselected feeders. and will be continued for six months and thereafter losses and restriction in variation of licensees' system taken over. CEB the results will be analysed before continuing the voltages. Further addition of 1 32-kV will select 40 feeders. To monitor monitoring. transformers at the grid substation losses province-wise, CEB will should avoid the overloading. analyze the energy sold with energy imported. CEB will take ii. Install 70 and 4 Nos. Contracts for meters were awarded in October aggressive steps to detect and stop import/export meters at 33 & 1995. pilferage of electrical energy. 1 1-kV respectively for the above analysis.
iii. Analyze the losses The analysis will start after import/export meters province-wise. mentioned in para. (ii) are installed (September 1 996). t t.i
iv. Reduce system losses by 1 The losses have been re-calculated by CEB after % annually. the review of incorrect meter readings. Based on revised information, CEB has calculated losses in 1993 at 21.46% in 1994 at 18.85% and at 18.46% in 1995 (up to June 1995).
v. Reduce operation and By reducing the staff and amalgamating the routine
maintenance cost distribution maintenance and rehabilitation of - works, CEB is reducing operation and maintenance cost. The 0 & M cost expressed as a percentage of gross distribution fixed assets was 4.6%, 3.7%, and 3.5% during FYs 92, 93 and 94 respectively.
vi. Replace defective meters There is an ongoing project to identify defective of bulk supply consumers. bulk supply meters. It is expected to check all these meters and replace themnby September 1996.
vii. CEB will set off a special Unit will be fully operational by early 1996. Also it unit to detect and stop is expected that all old and new bulk supply meters pilferage of electric energy. would ba sealed with new copper seals by September 1996 to prevent tampering and pilferage. AppendixA Annex I Page 3 of 3
OPERATIONAL ISSUES STRATEGY PERFORMANCE INDICATORS TIMING Compliance with Covenants:
CEB should, before the beginning of each fiscal year, For FY96, the anticipated tariff Compliance with the revenue Each year adjust the tariffs so as to ensure that their revenue increase of about 10%, effective covenants projections are sufficient to earn a rate of return of beginning of the year, is expected to 8% on current value of its net fixed assets. CEB enable CEB to meet its revenue also needs to ensure that its debt service coverage covenant. CEB will continue with its ratio is maintained at a minimum of 1.5. CEB's efforts each year and ensure that the audited accounts are required to be submitted within ROR covenant is complied with. ten months of the end of each fiscal year. With additional staff deputed by the Each year AG, audit work of the FY94 accounts Submission of audited accounts are expected to be finalized with a within ten months of the end of delay of one month. each fiscal year
wj - 34 - Appendix B Page 1 of 9
IMPLEMENTATION COMPLETION REPORT
Power Distribution & Transmission Project IDA Credit 1933-CE
Borrower's Evaluation'
1. BORROWER'S ASSESSMENT
A. Introduction
In June 1988 an IDA Credit 1933-CE amounting to SDR 29.2 million (about US$40.5 million) was approved by IDA Board for GOSL/CEB to plan, design and implement a Power Distribution Transmission Project.
B. Project Obiectives
The principal Project objectives were to meet the ever increasing load demand consequent to rapid rural electrification and industrialisation. Also, the life styles of the people were rapidly changing due to free availability of utility electrical appliances for which the supply authority had to cater an adequate supply of power devoid of frequent failures and maintaining the supply voltage at adequate levels, rendering of prompt bills to consumersto ensure prompt revenue collection. Also required were adequate and suitable office accommodation, stores, and warehouse space for areas outside Colombo suburbs due to decentralisation. In addition, it was also necessary for CEB management, technical and support staff to acquire new techniques and skills to manage the rapidly increasing functions due to ever increasing activities within CEB.
C. Desimn
To achieve the above objectives, the following project components of the project were designed -
(i) Transmission Works (IDA)
Original proposal was to construct: (a) A double circuit 132-kV line of about 120 km from Anuradhapura to Mannar, and (b) 2x10 MVA 132/33-kV grid substation with IDA financing of US$6.8 million at Mannar.
Due to disturbances in the area this proposal was cancelled and in lieu it was proposed to construct a grid substation at Chilaw with 2x31.5 MVA transformers with a short double circuit 132-kV line of about 8.0 km. Further augmentation of the existing Pannipitiya grid substation and augmentation and rehabilitation of Ratmalana grid substation was also planned. The total value of the contract award in 1993 was IJS$6.3 million.
GOSL/CEB approached IDA in September 1991 seeking IDA approval for the substitution. IDA agreed to this. The transmission component also provided OECF cofinancing for the following transmission works under Loan SL-P21.
This section is the Borrower's contribution and is not attributable to IDA. A copy of the original letter dated is in the Project file. - 35 - Appendix B Page 2 of 9
The Credit closed on 31st December 1994 before the Chilaw grid substation work was completed and the remaining erection cost (foreign) was met from CEB funds amounting to SLRs 14.0 million.
(ii) Transmission Works OECF
Construction of approximately 22 km of 132-kV double circuit transmission line using ZEBRA conductors to replace the existing 132-kV double circuit COYOTE line between Kotugoda and Bolawatta.
Construction of approximately 81 km of 132-kV double circuit transmission line using LYNX conductors between Anuradhapura and Puttalam.
Construction of approximately 62 km of 132-kV double circuit transmission line using LYNX conductors between Matara and Embilipitiya.
Construction of approximately 11 km of 132-kV double circuit transmission line using LYNX conductors to make the Polpitiya and Anuradhapura transmission line in-out at Ukuwela.
Construction of a new 132/33-kV 2x31.5 MVA grid substation at Matara.
Augmentation of the grid substation at Ukuwela to 2x31.5 MVA and making the Polpitiya- Anuradhapura transmission line in-out.
Construction of additional 2 Nos. of 132-kV feeder bays together with a bus section circuit breaker on the existing single busbar at Puttalam.
Construction of additional 2 Nos. of 132-kV feeder bays at Embilipitiya.
(iii) Distribution Local Authorities Systems
Studies showed that local authority distribution systems were not maintained in the least and were treated by the local bodies as only a source of revenue irrespective of the quality of supply offered to the long suffering consumers. The distribution systems suffered from heavy voltage drops, frequent failures and large power losses. It was noted that the local authorities were operating a system which was totally non-economic, and they did not have the finances to effect any improvements. In addition these licensees owed CEB large amounts of money accumulated over a long period for energy purchased and CEB was in no position to disconnect the supply as any disconnectionwould affect a large number of consumers who invariably would have paid the licensees for energy used. Thus CEB was placed in a very tricky situation.
The takeover of 133 licensees systems was planned and included under the Power Distribution and Transmission Project in order to provide a satisfactory service to the consumers as well as to take into account new growth in the areas.
In general a licensee had a number of 33-kV/LV or I1-kV/LV substations which were the property of CEB. The supply was metered on the LV side and the distribution lines from the substation remained the property of the licensees. These LV lines were haphazardly loaded with no considerationgiven to power losses, extended over considerablelengths with no consideration given to stipulated voltage levels at the consumers terminals and were subject to frequent - 36 - Appendix B Page 3 of 9
interruptions due to bad maintenance and inadequate protection provided on the LV lines. In most cases the protection was non-existent and faults were invariably cleared on the high voltage side isolating the entire substation out of the system.
It was decided after taking over to completely rehabilitate the system including adding new substations, upgrading the MV lines from I 1-kV to 33-kV to lower power losses, and transmit more bulks of power, changing practically all line supports and conductors, service connections, cut-outs and where necessary the meters. It cannot be over-emphasisedthat most of the relevant pieces of equipment mentioned are well over 30 to 40 years old and have surpassed their usual electrical life expectancy.
Local Authority Electricity Undertakings were not managed in an economical and logical way. As stated, their prime aim was revenue collection irrespective of the profitability of the system. Adding new loads to existing lines already having high power losses and operated at low levels of supply voltage at the consumers terminals would only result in poor efficiency. The logic of the takeover was to give a satisfactory electricity supply to about 180,000 consumers (installations).
Also, it was noted that usually licensees charge more from consumers compared to CEB, and it was thought prudent to have an uniform tariff structure.
(iv) Civil Works and Buildings
Coming under civil works and buildings, 16 Projects were to be constructed under separate contracts. All these projects were to have helped in the expansion of the electricity distribution facilities providing new area engineers' offices and electrical superintendents depot buildings in different parts of the island.
(v) Decentralised Computerised Billing System
The CEB billing system was processed on a IBM S/36 mini computer located at the Head Office. The system's capacity was estimated to serve about 500,000 consumers but due to rapid rural electrification and other reasons the number of consumers reached 1,000,000 by the year 1988. Also, the planned drive toward decentralisation was envisaged to afford a better and improved service and demandedbilling to be centralised to the provinces. The Project was intended to set- up a Head Office/Provincial/AreaComputer Network and install a billing system at the provincial level. Areas could have access to the billing system via the network. Similarly, management information about billing could be fed to the head office computer from the provinces.
(vi) Technical Training
Also part of this Credit was disbursed for training and used to finance technical assistance for tariff study. In this respect a number of senior engineers and accountants, engineers, electrical superintendents and other staff were sent on various training courses and scholarship studies which were very beneficial in improving and upgrading the technical, accounting and management functions of CEB as a whole.
(vii) Kukule Ganga Hvdro Project and Feasibility Study
A very important project component was the feasibility study of the Kukule Ganga Electric Power Project. With rapid growth in electricity demand after 1990 (average about 8.5 per cent increase during the past five years), the generating capacity of the system needed to be expanded to meet - 37 - Appendix B Page 4 of 9
this demand. In this context the Kalu Ganga Multi-purpose Project was selected for a feasibility study in order to investigatecomprehensive development of Sri Lanka's major river basin of Kalu Ganga. However, after detailed investigation it was decided to develop this as a run-of-river plant of 70 MW and annual energy generation of 305 MW.
D. Detailed Project Implementation
(i) Chilaw. Pannipitiva & Ratmalana Grid Substations
The transmission Planning Branch of CEB had studied at length the existing and future system requirements and recommended the reinforcement of the system. Accordingly, the design consisted of a 132/33-kV grid substation consisting of 2 132/33-kV 31.5 MVA outdoor transformers, an indoor 33-kV bus-bar with 8 outgoing 33-kV control panels and associated switchgear. The double circuit 132-kV overhead transmission line to bring in power to this substation was a T-off connection from the existing line from Bolawatte to Puttalam and is approximately 8 km in length using a LYNX conductor.
At Pannipitiya and Ratmalana one transformer each of 31.5 MVA was added by extending the 132-kV bus-bar and effecting modification/additionsto the 33-kV side.
(ii) Distribution System
For the 133 licensees, the design involved primarily the design of MV line networks to feed the new distribution substations constructed to meet the growing needs. Identificationof load centres and the design of new distribution substations and their location accordingly was possible. The reconductoring of LV lines with a thicker conductor, conversion of single phase lines to two phase and three phase as required, and augmentation of distribution and primary substations was planned.
A major portion of the design work fo LV and MV lines was carried out using computer software developed by U.S. based consultants.
(iii) Civil Works
Design for civil works was totally handled by the Civil Works and Buildings Branch of CEB. The tender documents had to receive the approval of the World Bank. The draft tender documents for procurement of civil works were revised from the comments given by the World Bank.
(iv) Decentralised Computer Billing System
Under the Decentralised Computer Billing Project the exiting billing system was studied and documented comprehensivelyby the consultants. This system was used as the basic system. It was decided to adopt a decentralised processing approach rather than centralised processing (mainframe) for the proposed system. Further billing software was to run on a Distributed Data Based Management System (DRDBMS).
Data Entry and query facilities were to be given to the areas whereas bill processing was to be done at the provincial level. Top managementof CEB was to be given summarisedinformation and the ability to query any details when required. - 38 - Appendix B Page 5 of 9
(v) Kukule Ganga Hydro Project and Feasibility Study
The principal design features of the Kukule Ganga Hydro Electric Project are as follows -
Type - run of the river Full Supply Level (FSL) - 206 masl. Minimum Operating Level (MOL) - 204 masl. Regulating Capacity of Head Pond - 1.67 MCM Catchment Area - 312 sq.km. Annual Average Inflow - 30.4 M3/Sec.
Power Plant
Head Race Tunnel D/L - 4.8 M/5,650 m. High Pressure Tunnel D/L - 4.8 M/205 m. Tail Race Tunnel D/L - 4.8 M/1600 m. Power House - Underground. Installed Capacity - 70 MW(2x35 MW). Normal Tail Water Level - 21.0 masl.
Performance
Peak Power Discharge - 47.5 M3/S. Annual Average Energy Production - 317 GWh.
Inundation Effect
Total headpond surface area - 88 ha. (including river surface of 69 ha).
Population Effected Agricultural Land Submerged - 15 ha.
E. Implementation
(i) Transmission
Chilaw, Pannipitiya and Ratmalanaworks are handled on a turnkey contract by the Joint Venture of firms from Germany, Sweden/Indiaand Sri Lanka. The construction period was 24 months, and the completion date was fixed at June 1995.
132-kV double circuit line was designed and is wholly handled by the transmission construction units of CEB. The line materials and accessories were supplied by Thai and Indian contractors who are presently executing transmission projects for CEB. Both the Chilaw grid substation and the line along with Pannipitiya grid substation were commissioned in earl September 1995 whereas Ratmalanagrid substation is expectedto be commissionedby the end of November 1995.
(ii) Takeover of 133 Licensees
The work implemented and the progress are roughly as follows - - 39 - Appendix B Page 6 of 9
New MV lines - 142 km (23% of scope) New Substations - 244 Nos. (37% of scope) New LV lines - 586 km (65% of scope) LV Line Rehabilitation - 676 km (31 % of scope) Rehabilitation - 7394 Nos. (10% of scope)
The work is expected to be completed by 31st December 1996. The work is handled by the provincial units of CEB, utilising CEB's own work force as well as contractors on a short term basis. CEB's own vehicles and construction equipment procured under other project as well as under this Project have been utilised for the work. The contractors gangs have been using their own vehicles, tools, and construction equipment and as a result of the increase in the number of contractors gangs. It is envisaged to: (a) make available CEB vehicles, tools, and equipment to contractors gangs, and (b) absorb "Labour only" construction gangs to strengthen CEB's work force.
The main reasons for the delay are design changes necessary to incorporate the fast developing loads, civil unrest that causes damage to CEB property (transformers and vehicles), delays in ordering and the procurement of materials. Private sector constructionunits for this type of work were small in number and time was needed for these units to be established and trained.
(iii) Civil Works
For civil works, tenders were invited for 9 projects, and 5 were awarded by 31st December 1994 (Credit closing date). SLRs. 4,419 million has been paid to the contractors by the Credit closing date.
The project performance is as follows -
Work is in progress in the construction of 2 area engineer offices, and 3 electrical superintendents depots. All works are scheduled for completion by 31st December 1995.
(iv) Decentralised Computer Billing Project was deleted from IDA scope, and CEB decided to implement it from its own resources.
(v) Training for personnel was carried out successfully and to the benefit of CEB.
(vi) Kukule Ganga Hydro Electric Proiect
The contract for the consultancy was made on 24th April 1991 with the Joint Venture team of foreign consultants consisting from Japan, Switzerland, and Germany. The foreign consultants were assisted by counterpart staff comprised of CEB engineers and with local consultants from CEB, etc.
A panel of experts was also appointed to review the consultants work during the feasibility study. The date of commencement of engineering services was 5th June 1991. The Project ended on 31st March 1993.
(vii) In November 1993 GOSL/CEB requested IDA, during mid term review of the Project, to extend the Credit closing date by another year up to December 1996 and to finance SCADA equipment at an estimated cost of US$11.0 million as there was savings due to a favourable exchange rate of SDR vs. US dollar and distribution material prices were cheaper than appraisal estimate. IDA agreed to GOSL/CEB's request subject to GOSL/CEB adhering to the agreed action plan. - 40 - Appendix B Page 7 of 9
Because GOSL/CEB did not agree to any tariff increase, an important item of agreed action plan, IDA closed the Credit on December 1994, as scheduled, without any extensions.
(viii) The reasons for savings in the project cost are stated in Annex 1.
F. Operation Experience
(i) At Pannipitiya and Ratmalana the additional transformers will be connected to the existing 33-kV bus-bars and as such the operating experience is an enhancement of the existing ones. The additional transformers at these grid substations will considerably improve the reliability of supply to a large area outside Colombo. In fact the frequency of breakdowns due to overloading will be reduced much and improved substantially. Three large local body areas will directly benefit and at the same time the primary substation at Kirulapone constructed under another project for the Colombo City will also be able to obtain additional power.
(ii) The 133 licensees taken over will be integrated with the works in the normal CEB electricity distribution system, and the same organisational set-up will be responsible for carrying out the maintenance and operation works. Nevertheless, the maintenance staff, vehicles, etc. will have to be enhanced proportionally depending on the size of the licensee absorbed into individual maintenance depots.
(iii) Civil Works - Operation experience not applicable.
(iv) Decentralised Computerised Billing Proiect - Not applicable.
(v) Training - Not applicable.
(vi) Kukule Ganga Project - Not applicable.
G. Evaluation of Borrower's Perfornance
(i) Chilaw. Pannipitiya and Ratmalana Grid Substations
There was a delay in effecting the mobilisation advance to the contractor by CEB which caused a 45 day delay to the Project. Also, on material procurement contract which was divided into four packages, there were substantial delays due to the contractor disagreeing to supply materials at his originally offered price.
At the Chilaw grid substation the outgoing feeders from the indoor 33-kV panel will be via single core 33-kV cables directly connected to overhead lines. Considering the frequent faults due to uncleared trees on the route of the existing 33-kV lines, and frequent and heavy lightning encountered in the area, it is inevitable that the insulation properties of these 33-kV cables will, in the long run, be impaired and weakened.
It is not in the best sense of technicality to accept what is offered. In an area like this it would have been ideal to have all 33-kV equipment outdoor, though a large land space would have been required, but the saving in land cannot be compared to a trouble free supply with outdoor 33-kV switchgear. - 41 - AppendixB Page 8 of 10
(ii) On the subject of taking over 133 licensees, due to non-availabilityof modern technology and computerdesign systems,implementation and identificationof systemchanges work was delayed. Also, due to civil unrest in the country, resources were shifted by CEB to other priority activities; thus, implementationwas delayed further.
Some of the key lessons learned that may be useful in the future are as follows -
(a) large projects to be carried out expedientlyrequire a change of frameworkof the present organisationalset-up;
(b) planning work should be facilitatedwith modern equipmentsuch as computersystems to enhance and expedite the planning, design and executionprocess;
(c) the training of personnel in modern techniquesis necessary; and,
(d) the retention of trained personnel requires offering incentives.
(iii) On civil works time was taken to revise CEB conditionsof tender and contractto suit the World Bank Bidding Documents in procurementof works.
(iv) DecentralisedComputerised Billing Project
The World Bank had recommendedto evaluate bids on a two stage bidding process.
The evaluationled to problems due to the two stage nature of the biddingand evaluation. When bids were technically evaluated certain outside members of the TEC challenged the marking scheme, which was developedfrom the World Bank's weightages. The evaluationwas unduly delayed as TEC meetings could not be convened due to non-availabilityof members. There shouldbe a straightforwardmethod of evaluatingbids and persons too busy in other fields should not be appointedmembers of a TEC. In the future, frequent monitoringof a TEC is necessary and a target date should be given to complete evaluation. In this particular case, CEB decided to provide the decentralisedcomputerised billing system from its own resources.
(v) Training
In this respect, the borrower was able to fully make use of the credit facilities to train a large number of officers in fields useful to CEB. The trainees have shown the benefits of the training receivedby way of better managementof the utility.
(vi) Kukule Ganga Hydro Electric Project
The appointmentof a panel of experts to review the consultants study at various stages has lead to a more robust layout of the power plant thereby saving costs on the overall project. They have also pointed out various technicalaspects related to the project which led to a better design.
However, in certain instancesthere were few differencesof opinionbetween the consultantsand the panel of experts. The appointmentof POE however, was very useful to CEB. It may be advisableto appoint a POE for all major projects that are complex in nature. - 42 - AppendixB Page 9 of 9
H. Evaluationof Bank Performance
There were no cash flow problems to meet contractors' and other bills. CEB is thankful for the credit facilities extendedby the Bankand their very strict control over disbursement. The borrower experienced very strict supervisionand adhered to rules of the Bank in procurement.
One of the key lessons learned in negotiatingwith the Bank is that communicationbetween banks and the borrower is protracted. Communicationshould be fast and responses quick for speedy decisions and implementation. For future projects the following suggestionsshould be taken seriously:
(i) the Bank should have a permanent representativein each country of operation for on-going supervision/decisionmaking;
(ii) the representativeshould be responsible for all correspondenceand documents;and,
(iii) the representativeshould identify all corrective measures and suggest action while regularly monitoringthe project.
Plan for OperationalPhase of the Project.
(i) InstallationArrangements
The works and services that are to be completedand commissionedunder this Project will be integrated with the works in the normal CEB system and the same organisationalset-up will be responsiblefor carrying out the maintenanceand operation of the works.
The project components that integrate with the CEB distribution system will be operatedusing CEB's establishedset comprisingA.G.M. (Distribution& CustomerServices), D.G.M. in charge of provinces, Area Engineer and finally to the Depot Level Manager by Electrical Superintendents.
The details of all plant and equipmentare maintainedin a plant and equipment register by each maintenancedepot. The components on which regular maintenancehas to be carried out are entered in a depot system maintenanceregister.
Work is planned using schedules of tasks, frequencies, standard gang compositionsand work standards taking remedial action regarding any deficiencies of staff observed using long establishedset-up in CEB which has been functioningsatisfactorily.
Progressof maintenancework and systemoperations are carefully recordedand maintained;there is an establishedreporting system to furnish managementinformation reports to all those who are in need of these reports and on which important decision making has to be made.
(ii) PerformanceIndicators
It is suggested that performance indicators, such as the reduction in technical power loss in distributionnetworks, reductionin the variation of voltagebetween peak and off-peaktimes, and reductionof systemoutages per month are established. By monitoringthem over a period of 3 years the performanceof the project can be assessed. - 43 - Appendix B Annex 1 Reasonsfor Savngs in the Project Cost
Part A - Distribution
The main reasons attributed is due to the slow process of drawing up specificationfor ordering of materials. Furthermore, there were savings due to the favourableexchange rate of SDR versus US$. Under Civil Works it was advised by the World Bank that only works which could be constructedby the Credit closing date would be financed.
Part B - Transmission Systems
It is to be noted that under this item originally the Project scopecovered a 120kmdouble circuit 132-kVline from Anuradhapurato Mannar with a 2x10 MVA 132/33-kVgrid substation.
Due to unstable conditionsin the area, this project was cancelledand in place it was plannedto constructa 2x31.5 MVA 132/33-kVgrid substationat Chilaw and a short 8.0km 132-kVdouble circuit line. Hence, the undisbursed balance is due to change in scope of the work, and not due to any under-utilisation. Under the OECF scope, transmissionworks located in the Northern province were deleted from the project.
Part C - Decentralised Computer Billing
The undisbursedbalance is due to financingof the project from CEB's own funds instead of IDA funds.
Part D - Consultancy. & Training
This componentconsisted of technicalassistance through consultancy services for project implementationsupport, institutiondevelopment assistance, feasibilitystudies as well as for training of CEB staff in utility management. The amount was well spent. -44-
SRI LANKA AppendixC CEYLONELECTRICITY BOARD Page1 of 3 POWER DISTRIBUTIONAND TRANSMISSIONPROJECT (CR. 1933-CE) IMPLEMENTATIONCOMPLETION REPORT
IncomeStatemients
SLRS. MILLION FISCAL YEAR ENDING 1987 1088 1989 1990 1991 1992 1993 1994
DECEMBER 31 SAR ACT. SMSAR ACT. S A. S A
KWhGENERATED (MILLIONS) 2707 2701 3004 2799 3202 28158 3415 3145 3657 3378 38J0 3539 4204 4204 4535 4363 KVYhSOLD (RMLUONS) Z248 2258 2538 2370 2735 2354 2954 2608 3182 2742 3429 2869 3700 3270 3991 3585 SYSTEM LOSS (%) 17 16 16 1s 14 18 13 17 13 19 12 19 12 22 12 18 AVE. TARIFF/KWh SOLD(CENTS) 1.48 1.47 1.76 1.70 1.97 1.66 2.21 2.15 2.21 2.24 227 2.32 2.43 2.57 2.43 3.44
OPERATING REVENUE SALES OF ELECTRICITY 3327 3319 44e6 4018 5396 3918 6521 5809 7024 6144 7796 66f53 9001 839s 9709 12256 FUELSURCHARGE 841 1259 147 236 360 60 610 24 671 502 442 1727 825 366 1425 958 OTHER OPERATING REVENUES 123 127 129 141 136 263 142 561 15o 1008 157 594 16s 1202 173 859 OTHER REVENUE 2J9 364 133 22 48 143 2e 70 34 64 55 96 146 is 308 549 TOTALOPERATING REVENUES 4580 5069 4875 4824 5941 4384 7299 6264 78t78 7715 8450 9070 10137 9979 11615 14Uf
OPERATING EXPENSES FUEL COST 81e 1223 143 229 350 so 592 24 651 479 429 1645 801 349 1383 912 OPERATION MAINTENANCE 501 528 623 724 688 825 770 1274 882 1698 1117 1631 1293 1U82 1366 1989 TURNOVERTAX 124 137 138 128 172 119 213 169 230 199 247 366 294 438 333 6e1 ADMINISTRATION & OTHER 183 351 225 345 248 508 272 529 299 421 329 611 362 741 399 843 DEPRECIATION 1003 802 116 1038 1331 1307 1491 1397 1765 2064 23 2134 258s 2875 2732 332 TOTAL OPERAnNG EXPENSES 2627 3041 2297 2464 2788 2619 3339 3393 38t28 4881 4356 6589 5336 628s 6213 7767
NET OPERATING INCOME 1953 2028 2578 2160 3153 1565 3959 2871 4050 2857 4095 2481 4801 3694 5402 65ss
INT.CHARGEDTOOPERATIONS 1026 813 1300 979 1717 640 2173 1200 2487 2457 2545 2111 2507 2345 2540 2741
INCOME 927 1215 1278 1181 1430 925 17Jf6 1671 1583 400 1550 370 2294 1349 2862 4114 LESS: EXP.IN FEAS.STUDIES 1108 0 0 45 30 18 0 17 _ _ 0 95 0 85 0 305 NETPROFIT 819 1215 1218 1136 1406 907 17Wt 16s4 15s3 393 1550 275 2294 1264 2t862 3809
RATE OF RETURN ON AV.NET FIXED ASSETS IN OPERATION 8.s 8.7 9.8 7.9 10.7 5.1 12.3 7.7 10.5 6.4 8.o 4.1 8.1 4.e 8.9 7.9
Note: The aoal. for fhI padod FYJ7s63 we taken from ihi ICR for Cr. 1736-CE and updated for FY94. -45-
SRI LANKA AppendixC CEYLONELECTRICITY BOARD Page2 of 3 POWER DISTRIBUTIONAND TRANSMISSIONPROJECT (CR. 1933-CE) IMPLEMENTATIONCOMPLETION REPORT
BalanceSheets
SLRS. MILUON FISCAL YEAR ENDED 1987 1988 1989 1990 1991 1992 1993 1994
DECEMBER 31 SAR | ACT. SAR F ACT, S | AC
ASSETS FIXED ASSETS GROSS FIXED ASSETS 35937 35884 41940 43220 46n70 49028 52643 65516 65003 72670 83900 106556 88478 122449 93669 133637 LESS: CUM.DEPRECIATION 8830 8789 10661 11367 12831 13789 14754 19312 17109 22737 19941 26645 22786 31622 25814 36950 NET FIXED ASSETS 27107 27095 31279 31853 34139 35239 37889 46204 47894 49933 63959 79911 65692 90827 67855 96687
CONSTRUCTION IN PROGRESS 5545 4996 9744 9534 15823 15030 20419 23134 15395 27773 2571 6120 2989 3832 4277 4919
TOTAL FIXED ASSETS 32652 32091 41023 41387 49962 50269 58308 69338 63289 77706 66530 88031 68681 94659 72132 101605
INVESTMENTS 204 219 271 295 305 325 321 340 331 340 341 347 351 485 361 635 INSURANCE ESCR 141 147 183 181 230 188 282 217 347 271 431 332 520 435 613 553
CURRENT ASSETS CASH 1917 2518 743 1396 227 841 292 428 379 692 724 151 2187 1107 3970 5688 INVENTORIES 1078 1178 1049 1651 1169 2030 1316 2210 1625 2414 2098 2698 2212 2512 2342 3048 ACCOUNTS RECEI 1042 1093 1153 1678 1439 1497 1783 1600 1924 1416 2060 1919 2457 2300 2783 2766 OTHER RECEIVAB 789 2621 909 3435 716 2775 527 2202 580 2201 638 3054 701 1288 772 2234 TOTAL CURRENT ASSETS 4826 7410 3854 8160 3551 7143 3918 6440 4508 6723 5520 7822 7557 7207 9867 13735
TOTAL ASSETS 37823 39867 45331 50023 54048 57926 62829 76335 68475 85040 72822 94532 77109 102786 82973 116528
EQUITY AND LIABILrITES EQUITY EQUITY 7565 7333 7723 8038 8304 8047 8784 8048 9235 84W8 9884 9155 10540 9907 11130 10620 CONSUMERS' CON 2345 2125 2793 2284 3282 3079 3745 3412 4242 4102 4797 4561 5403 5850 6067 6824 REVALUATION SU 10141 10777 12174 158641 14051 18843 15758 29403 17273 33074 18950 37642 19781 44829 20635 51171 RETAINED EARNIN 6081 6472 7299 7623 8706 8513 10492 10152 12074 10532 13824 10808 15918 11598 18779 15381 TOTALEQUITY 26132 26707 29989 33584 34342 38482 38779 51015 42824 56176 47255 62166 51642 72184 56611 83996
LONGTERMDEBT 10234 10834 137sB 13636 18044 16617 22238 20836 23586 24049 23169 24753 22780 25233 23412 25311
CURRENT LIABIluTI 1455 2326 1555 2803 1662 2827 1813 4484 20e4 4814 2397 7613 2685 5369 2948 7220
TOTAL EQUITY AND LIABILITIES 37821 39867 45330 50023 54048 57926 62830 76335 68474 85040 72821 94532 77107 102786 82971 118528
EUrTY AS % OF DEBT+EQUITY 72 71 6s 71 66 71 64 71 64 70 67 72 69 74 71 77 DEBT AS % OF DEBT+EQUITY 28 29 31 29 34 29 36 29 36 30 33 28 31 26 29 21 CURRENT RATIO 3.3 3.2 2.5 2.9 2.1 2.5 2.2 1.4 2.2 1.4 2.3 1.0 2.8 1.3 3.3 1.9 -46-
SRI LANKA AppendixC CEYLON ELECTRICITY BOARD Page 3 of 3 POWER DISTRIBUTION AND TRANSMISSION PROJECT (CR. 1933-CE) IMvPLEMENTATIONCOMPLETION REPORT
Sources and Applications of Funds Statements
SLRS. MILLION 1987 1988 1989 1990 1991 1992 1993 1994
SA C. SR|ASAR AR |ACT SAR |ACT. SR|AT A C A C. SR|AT
SOURCES OF FUNDS INTERNAL SOURCES NET INCOME AVAILABLE 1953 2028 2578 2160 3153 1565 3959 2871 4050 2857 4095 2481 4801 3694 5402 6855 ADD:DEPRECLATION 1003 802 1168 1077 1331 1307 1491 1364 1765 2064 2234 2136 2586 2915 2732 3362 LESS: EXP.IN FEAS.STUDIES 108 0 60 45 30 18 0 17 0 7 0 95 0 85 0 305 INT. FUNDS GENERATED 2848 2830 3686 3192 4454 2554 5450 4218 5815 4914 6329 4522 7387 6524 8134 9912
EQUITY CONTRIBUTIONS 315 82 158 703 507 11 406 1 377 420 575 687 582 751 590 713
OTHER CONTRIBUTIONS 365 145 448 159 489 795 463 332 496 690 555 459 607 1289 663 973
TOTAL BORROWINGS 2260 2694 4125 3165 4842 3354 4779 4597 1917 3620 1262 2144 1334 712 2498 1720
TOTALSOURCES OF FUNDS 5788 5751 8417 7219 10292 7014 11098 9148 8605 9644 8721 7812 9910 9276 11885 13318
APPLICATIONS OF FUNDS
CAPITAL INVESTMENTS TOTAL INV. PROGRAM 5236 4119 7508 5470 8318 6988 8057 9872 5156 6760 3725 5891 3831 4326 5328 3967 OTHERINVESTMENTS 10 25 67 76 34 30 16 16 10 0 10 7 10 125 10 150 TOTAL INVESTMENTS 5246 4144 7575 5546 8352 7018 8073 9S88 5166 6760 3735 5898 3841 4451 5338 4117
DEBT SERVICE INTEREST 1026 813 1300 979 1717 640 2173 1200 2467 2457 2545 2111 2507 2345 2540 2741 AMORTIZATION 563 396 574 364 584 373 585 378 569 407 1679 1440 1723 1474 1867 1642 TOTAL DEBT SERVICE 1589 1209 1874 1343 2301 1013 2758 1578 3036 2864 4Z24 3551 4230 3819 4407 4383
INSURANCE ESCROWACCT 36 46 42 57 47 25 53 41 65 67 84 63 88 108 94 144
CH.IN WORKING CAPrTAL CASH INCREASE -1953 -1351 -1174 -1122 -516 -555 65 -413 87 264 345 -541 1463 956 1783 4580 OTHER THAN CASH INC. 870 1702 101 1395 107 -4W8 151 -1947 251 -311 333 -1159 288 -58 263 94 NET INCREASE -1083 351 -1073 273 -409 -1041 216 -2360 338 *47 678 -1700 1751 898 2046 4675
TOTALAPPLICATIONS OF FUNDS 5788 5750 8418 7219 10291 7015 11100 9147 8605 9644 8721 7812 9910 9276 11885 13318
DEBT SERVICE COVERAGE 1.8 2.3 2.0 2.4 1.9 2.8 2.0 2.7 1.9 1.7 1.5 1.3 1.7 1.7 1.8 2.3 Note: During FY93, Rs. 731 million wastransferred from Current Liabilitiesto Long Term Debts. -47- Appendix D Page 1 of 1 SRI LANKA POWER DISTRIBUTION AND REHABILITATION PROJECT
Economic Internal Rate of Return (SL Rs. Million)
Capital Operations Benefits Balance Year Cost & Maintenance
1987 0.0 0.0 0.0 0.0 1988 4424.8 126.6 364.4 -4187.0 1989 5101.4 143.2 -121.1 -5365.6 1990 5939.8 328.5 550.5 -5717.7 1991 3747.6 498.3 512.9 -3733.0 1992 2923.9 487.5 479.7 -2931.8 1993 1589.7 409.9 1025.2 -974.4 1994 1600.9 376.4 3199.0 1221.7 1995 736.6 4290.8 3554.2 1996 736.6 4290.8 3554.2 1997 736.6 4290.8 3554.2 1998 736.6 4290.8 3554.2 1999 736.6 4290.8 3554.2 2000 736.6 4290.8 3554.2 2001 736.6 4290.8 3554.2 2002 736.6 4290.8 3554.2 2003 736.6 4290.8 3554.2 2004 736.6 4290.8 3554.2 2005 736.6 4290.8 3554.2 2006 736.6 4290.8 3554.2 2007 736.6 4290.8 3554.2 2008 736.6 4290.8 3554.2 2009 736.6 4290.8 3554.2 2010 736.6 4290.8 3554.2 2011 736.6 4290.8 3554.2 2012 736.6 4290.8 3554.2 2013 736.6 4290.8 3554.2 2014 736.6 4290.8 3554.2 2015 736.6 4290.8 3554.2 2016 736.6 4290.8 3554.2 2017 736.6 4290.8 3554.2 2018 736.6 4290.8 3554.2 2019 736.6 4290.8 3554.2 2020 736.6 4290.8 3554.2 2021 736.6 4290.8 3554.2 2022 736.6 4290.8 3554.2 2023 736.6 4290.8 3554.2 2024 736.6 4290.8 3554.2
Economic Rate of Return: 10.2%
Note: Upto FY93, the analysis uses the same inputs as used for the ICR of Cr. 1736-CE and updates for FY94 SRI LANKA Ap iendixE POWER DISTRIBUTION AND TRANSMISSION PROJECT (CR. 1933-CE) Page I of 2 IMPLEMENTATION COMPLETION REPORT
Changes in Project Scope
Between Credit Effectiveness (1988) anidclosure (1994), the scope of the Project (finanicedby the Credit) was chianged several times. The details of these changes are summarized below:
Project scope as appraisedl _ Project scope as amenlded in Project scope as restructured Project scope as of Credit closure in December 1994 Septemlber 1991 in October 1993 A. DISTRIBUTION COMPONENT No change No change No change; following Project closure, CEB is carrying out necessary works to comnpletethe implementation; these are Investments related to CEB's expenditures in being funded from its own resources. All material required rehabilitating, developing and expanding distribution lor implementatioll has been procured but progress in systems to be taken over from 133 licenseces implementation has been slow and as of the end of August 1995, it was only 31.5%. Detailed status of ongoing distribution works is included in Part 11,Table SA.
B. TRANSMISSION COMPONENT
Investnents related to CEB's expenditures in:
(i) Construction of about 230 km of1132-kV transmission line as under:
(a) in and out of Polipitiya-Anuradhpura 132-kV (a) No change (a) No change (a) No change line at Ukuwela substation (7 km)
(b) Anuradhpura-Mannar (72km) (b) dropped (b) dropped (b) dropped
(c) Kanikesanithurai-Chunnakam (9 kin) (c) No change (c) No change (c) No change
(d) Puttalam-Anuradhpura (80 ksin) (d) No change (d) No change (d) No change
(e) Embilipitiya-Matara (62 km) (e) No change (e) No change (e) No change
(ii) Reconductoring of 150 km of 132-kV lines (ii) No change (ii) No change (ii) No change (iii) Construction of new 132/33-kV substations at:
(a) Mannar (a) dropped (a) droped (a) dropped
(b) Kankesanthurai (b) No change (b) No change (b) No change
(c) Matara (c) No change (c) No change (c) No change
added (d) Chilaw substation with (d) No change (d) No change 8 km of loop line Appendix E Page 2 of 2 Project scope as appraised Project scope as amenided Ptojctas pprasedSeptemiber s .op in Project scope as restructured Project scope as of:Creditclosure iiDeceijber 1994: 1991 in October 1993 ...... (iv) Augmentationi of existing 132/33-kV substations at:
(a) Ukuwela (a) No change (a) No chanige (a) No change (b) Kiliiochiciii (b) No change (b) No change (b) No change (c) Anuradhpura (c) No change (c) No change (c) No change (d) Puttalam (d) No change (d) No change (d) No change added (e) two substations at (e) No change (e) No change Ratmalana and Panripitiya
Detailed status of the ongoing transmission works is included in Part 11,Table 5B C. CONSULTING SERVICES TO:
(i) develop a decentralized computerized billiig (i) No change (i) dropped; CEB decided to (i) dropped system and a management itifonnationi system carry out this study from their (MIS); own resources (ii) assist CEB in the preparation ol the detaiiled (ii) No change (ii) No change (ii) No change specirications and design ol tlie 132-kV transmission systems of B(i) above and preparation of the bidding documents for the major transmission. contracts;
(iii) assist CEB in carrying out a tarilf smudy; (iii) No change (iii) No cliange (iii) No change; study completed in December 1990 (iv) assist in the development of a training program (iv) No chiange (iv) No change (iv) No change; trairning carried for middle level technical officers; out in January 1990.
(v) assist in the establishmeintof a consumer relations (v) No change (v) No change (v) No change; constultaits' unit; and report finalized in May 1989
(vi) assist in monitoring the continucd (vi) No change (vi) No changc (vi) No change, study completed in May 1991 iniplementationof CEB's new organizational structure.
D. FEASIBILITY STUDY FOR THE KALU No change No change The study was completed in March 1993. GANGA MULTIPURPOSE PROJECT
E. Added component to Project closed in December 1994 and, as such, this component finance SCADA equipment could not be financed -50- Appendix F Page 1 of 4
SRI LANKA POWERDISTRIBUTION AND TRANSMISSIONPROJECT LOCALAUTHORITY ELECTRICITY SCHEMES TAKEN (Ref. May No. IBRD27602)
Local Authority Scheme Takeover Date Total LT Number of Consumers Maximum Line Length Demand (km) (kW)
I Madampe 05/17/89 10.80 898 244
2 Wennappuwa 05/24/89 16.30 1490 538
3 Kamalpattu 05/24/89 0.00 390 310
4 Lunuwila 05/24/89 8.47 368 100
5 Dankotuwa 05/24/89 16.99 985 293
6 Bope 06/22/89 23.25 1781 678
7 Lunugala 06/29/89 5.30 382 100
8 Passara 06/29/89 7.6 813 195
9 Ninthavur 08/08/89 23.00 1741 640
10 Yatakalanpattuwa 08/08/89 27.65 1524 366
11 Nattandiya 08/08/89 11.45 614 164
12 Samanthurai 08/15/89 30.23 1867 480
13 Akkaraipattu 10/11/89 38.70 2860 929
14 Andiambalama 10/31/89 24.30 892 241
15 Katana 10/31/89 37.35 1595 541
16 Kochchikade 11/01/89 24.03 1755 383
17 Henerathgoda 11/02/89 23.95 979 227
18 Aluthgamperuwa 11/02/89 36.50 2354 663
19 Habaraduwa 11/07/89 10.12 819 232
20 Ahangama 11/07/89 10.45 819 335
21 Karavaku N. 11/08/89 29.28 1752 507
22 Kalmunai 11/08/89 55.42 4225 1376
23 Karavaku S. 11/08/89 21.98 1944 520
24 Mulleriyawa 11/09/89 13.56 1247 307
25 Kattankudy 11/14/89 46.55 4389 892
26 Devinuwara 11/14/89 10.76 1056 219
27 Addalaichenai 11/15/89 13.40 411 144
28 Kaduwela 11/16/89 48.75 3870 1100
29 Galewela 11/23/89 7.69 553 170
30 Kuruwita 11/30/89 9.00 718 156
31 Homagama 12/07/89 34.56 2513 786
32 Kottawa 12/07/89 12.21 1314 445 -51- Appendix F
Page 2 of 4
Local Authority Scheme Takeover Date Total LT Number of Consumers Maximum Line Length Demand (km) (kW)
33 Meegoda 12/07/89 7.58 1105 0
34 Kadugannawa UC 01/16/90 24.90 2142 530
35 Galagedara 01/16/90 8.98 646 180
36 Kalpitiya 01/16/90 28.45 506 165
37 Pelmadulla 02/15/90 24.50 1827 600
38 Polonnaruwa 02/20/90 25.95 1862 976
39 Hingurakgoda 03/06/90 13.06 953 237
40 Kahawatta 04/24/90 9.50 794 305
41 Atakalanpanna 04/24/90 10.00 376 132
42 Rakwana 04/24/90 7.80 618 160
43 Deraniyagala 05/29/90 6.00 449 110
44 Dambadeniya 05/31/90 11.40 612 174
45 Narammala 05/31/90 30.40 1045 411
46 Alawwa 05/31/90 17.45 767 220
47 Dodangaslanda 05/31/90 17.65 281 80
48 Egodapotha-Nittambuwa 06/28/90 61.15 2023 763
49 Kalagedihena 06/28/90 16.93 855 322
50 Bemmulla 06/28/90 24.54 594 170
51 Veyangoda 06/28/90 32.81 1934 599
52 Mudunakade 07/26/90 10.85 417 116
53 Moragolla 07/26/90 6.64 534 79
54 Polgahawela 07/26/90 16.60 1487 403
55 Pothuhera 07/26/90 8.60 467 180
56 Udugaha 07/26/90 37.75 805 340
57 Mirigama 07/26/90 32.15 1509 446
58 Hanwella Udugahapattu 07/26/90 10.73 601 233
59 Hanwella Peruwa 07/26/90 6.86 1105 260
60 Padukka 07/26/90 19.72 1209 374
61 Tangalle UC 07/30/90 18.30 1606 330
62 Badulla MC 08/15/90 78.91 6438 2410
63 Dimbula-Kotagala 08/30/90 14.11 1425 458
64 Kandapola 08/30/90 28.22 723 210
65 Chilaw UC 08/30/90 33.40 4247 1567
66 Elpitiya 08/30/90 34.20 1573 429
67 Galigamuwa 08/30/90 3.90 208 67
68 Otharagandolaha Dewalagama 08/30/90 16.20 338 118 -52- Appendix F
Page 3 of 4
Local Authority Scheme Takeover Date Total LT Number of Consumers Maximum Line Length Demand (km) (kM)
69 Piliyandala 08/30/90 31.15 3686 1282
70 Dodangoda 08/30/90 33.70 1243 354
71 Beliatta 08/31/90 22.14 814 232
72 Bentota 09/11/90 21.98 1206 502
73 Adhikaripattu-Bandaragama 09/25/90 60.70 2995 845
74 Thalpitibadda-Panadura 09/25/90 33.70 1690 528
75 Ambagamuwa N. Ginigathhena 09/27/90 9.03 1039 248
76 Ambagamuwa S. Maskeliya 09/27/90 6.97 731 213
77 Yatiyantota 10/09/90 7.71 455 148
78 Dummalasurity 10/23/90 24.35 677 195
79 Udabowala 10/30/90 12.00 260 135
80 Ampitiya Gandahaya 10/30/90 35.84 2145 742
81 Kuliyapitiya UC 10/30/90 28.45 2038 717
82 Akuressa 10/30/90 16.44 1048 296
83 Kandepella Haldummulla 10/30/90 4.32 386 90
84 Koslanda 10/30/90 5.75 265 60
85 Divulapitiya 10/30/90 25.85 1165 826
86 Raigam Udugahapattu 10/30/90 16.30 637 232
87 Trincomalee UC 11/15/90 47.60 3900 2290
88 Matugama 11/27/90 43.21 1977 547
89 Putuhapuwa Teldeniya 11/29/90 1.92 104 45
90 Ragala halganoya-Udapussellawa 11/29/90 4.45 745 230
91 Puttalam UC 11/29/90 44.80 4459 1420
92 Wellawa 11/29/90 10.40 694 237
93 Boyagane-Thiranaganddahaya 11/29/90 7.85 194 80
94 Tissamaharama 11/29/90 22.16 949 512
95 Warakapola 11/29/90 16.50 1014 410
96 Agalawatte 11/29/90 10.46 589 96
97 Ganaihala-Meetalawa 12/18/90 7.30 260 96
98 Rattota 12/20/90 5.19 501 139
99 Maho 12/20/90 9.55 602 175
100 Madurawala-Anguruwatota 12/20/90 11.62 556 153
101 Diyatilaka 12/28/90 17.75 865 217
102 Pussellawa 01/24/91 7.63 710 188 -53 &ApendixF Page 4 of 4
Local Authority Scheme Takeover Date Total LT Number of Consumera Maximum Line Length Demand (km) (kO)
103 Seethawakapura UC 01/24/91 27.73 1405 527
104 Kegalle UC 01/29/91 54.00 3132 939
105 Wariyapola 01/30/91 64.73 798 301
106 Nikaweratiya 02/26/91 17.30 776 352
107 Baddegama 02/26/91 19.18 683 206
108 Niwithigala 02/27/91 15.10 582 200
109 Alawatugoda 02/28/91 46.08 2743 980
110 Ukuwela-Matale 03/26/91 14.85 822 353
111 Arambekade-Harispattuwa 03/28/91 15.17 733 185
112 Barigama-Werellagama 03/28/91 9.71 767 530
113 Ibbagamuwa 03/28/91 14.52 660 173
114 Deniyaya 03/28/91 5.09 520 116
115 Dehiowita 03/28/91 11.02 787 239
116 Batugoda 04/30/91 27.00 1505 840
117 Mawathagama-Pilassa 04/30/91 18.70 829 229
118 Hamangalla-Giriulla 04/30/91 32.67 857 225
119 Markandura-Gonawila 04/30/91 30.05 872 259
120 Pannala 04/30/91 20.75 629 210
121 Ambalantota 04/30/91 39.50 1403 524
122 Welimada 05/02/91 29.24 1114 443
123 Pundaluoya 05/29/91 5.30 475 128
124 Menikhinna 05/30/91 13.07 1708 340
125 Kundasale 05/31/91 13.57 910 200
126 Hali-Ela 06/18/91 9.74 696 212
127 Kekirawa 06/27/91 43.68 260 258
128 Horana UC 06/27/91 27.50 2499 761
129 Anuradhapura UC 07/15/91 158.64 6848 3624
130 Vavuniya UC 11/06/91 50.80 3055 1620
131 Eravur-Town 12/06/91 10.98 2670 600
132 Ruwanwella 01/28/92 18.87 966 325
133 Mawanella 03/24/92 42.09 2627 884
Totals 3,017.19 177,929 59,698
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