FOR PUBLIC DISCLOSURE Aide-Mémoire Ghana: Implementation Support Virtual Mission Ghana Electricity Development and Access Project (GEDAP) - P074191 June 18th, 2018 The World Bank conducted a virtual implementation mission1 in Ghana on June 18th, 2018 with the purpose to update all the agreed actions from the earlier implementation support mission from the Ghana Electricity Development and Access Project (GEDAP). The team acknowledges the cordiality and collaboration of the Project Implementation Unit of the GEDAP project in preparing for the issues raised with the proposed, and later agreed agenda, before the mission. A detailed list of people met is presented in Annex I. This Aide-Mémoire summarizes the findings and recommendations of this mission. In line with the Bank’s access to information policy, this Aide Memoire will be disclosed as public. MAIN RESULTS o Action Plan. The team agreed to an action plan, given the upcoming project closing date of January 2019. For the activities that have been delayed, the team agreed to complete all the required No-Objections and update of STEP to have the final procurement plan in the system by July 1st, 2018. o Overdue audits. The Government has informed the Bank that the 2016 Audit of ECG will be delivered by July 1st and the 2017 Audit of ECG will be delivered by August 2018. The delays with the delivery was a response to the change of administration and the required review of them. o Actions for management. There were two activities that have been monitored since June 2016, the status of the cash waterfall mechanism and the synchronization and regularization of the commercial operations of ECG across the country. For the first of the mentioned activities, the submitted bids are being evaluated and will be completed by July 1st, 2018. For the second activity, the irregularities in the commercial management systems have been resolved. The consultant was recalled to train and reset the system. This will be updated in the next ISR. o Legal covenants. There are two legal covenants with a pending resolution, one, related to the hiring of management support services for ECG, and the bulk power supply between ECG and VRA. For both issues, the Government expressed that the first condition has been fulfilled with a management contract in the Ashanti region, followed by the new management contract financed under MCC, and the second, a draft contract has been issued, which will be provided as evidence. o Results. The GEDAP team provided an updated results matrix from the project, to ensure adequate registry of the achievements reached by December 2017, and they are part of this Aide Memoire in Annex II. 1 The mission team was led by Shinya Nishimura (Senior Financial Specialist, Team Leader), joined by the following team members: Adebayo Adeniyi (Senior Procurement Specialist), Robert Wallace Degraft-Hanson (Senior financial specialist), Ayishetu Terewina (Team Assistant) and Dante Mossi (Senior Operations Officer). 1 FOR PUBLIC DISCLOSURE I. PROGRESS IN PROJECT IMPLEMENTATION 1. The mission agreed to meet with the GEDAP PIU to discuss key bottlenecks for project implementation given the impeding project closing date of January 2019. The mission updated the status of all actions and prepared an action plan towards the last supervision mission to be held by December 2018, before the project closing date. Below in Table 1, find a summary of the key disbursement data of the project. Table 1: Key disbursement data for the project Credit Number IDA 43560 IDA 47300 IDA 56290 TOTAL Approved amount $ 83,189,160.00 $65,031,120.00 $ 60,104,520.00 $208,324,800.00 Cancelled $0 $0 $0 $0 Disbursed $82,817,048.89 $64,943,761.89 $6,129,459.46 $153,890,270.24 Undisbursed $0.00 $87,358.11 $ 53,975,060.54 $54,062,418.65 Special $0 $0 $0 $0 Commitments Funds available $0.00 $87,358.11 $ 53,975,060.54 $54,062,418.65 Percent disbursed 100.00% 99.87% 10.20% 73.87% Approval Date July 26, 2007 June 29, 2010 April 30, 2015 Closing Date July 31, 2017 January 31, 2017 January 31, 2019 2. Procurement. There was a discussion of the status of the current activities in the procurement pipeline, which can be summarized in Table 2 below. Table 2: Procurement activities under the project Activity Reference No. / Description Estimated Process Status Activity Status Amount (US$) GH-MOE-20291-CS-QCBS / Consultancy Services for Cleared Estimation of Level of Suppressed Demand in ECG 250,000.00 Under Implementation GH-MOE-20294-CS-QCBS / Consultancy Services for Cleared Studies to Upgrade ECG's Sub-Transmission Voltage from 250,000.00 Under Implementation 11kV and 33kV to 69kV GH-MOE-20237-CS-QCBS / Consultancy Services for Cleared 1,000,000.00 Under Implementation Preparation of 10 Year Master Plan for ECG GH-MOE-20290-CS-QCBS / Consultancy Services for Cleared 250,000.00 Under Implementation Determining Cost of Unserved Energy to ECG GH-MOE-54588-CS-QCBS / Impact of Grid Intensification Not yet cleared 500,000.00 Submitted Under GEDAP1 GH-MOE-20285-GO-RFQ / Supply and Installation of 54 No. Cleared 43,000.00 Pending Implementation Desktop and 45 No. Laptop Computers & Accessories GH-MOE-20269-GO-RFB / Supply of 23No. Pickup Project Cleared 805,000.00 Pending Implementation Vehicles GH-MOE-20272-GO-RFB / Supply and Installation of 78,000 Cleared SMART AMR Metering for Prepayment Customers in the 32,655,000.00 Under Implementation Tema South District of ECG GH-MOE-20279-GO-RFB / Supply and Installation of 25,000 Cleared 18,350,000.00 Under Review No. Bulk Metering GH-MOE-20283-GO-RFB / Supply and Installation of Meter Cleared 3,070,000.00 Pending Implementation Data Management System & Metering Monitoring Centers a. There are two activities that the Government expressed the highest priority in moving forward: The Supply and Installation of 78,000 SMART AMR Metering for Prepayment Customers in the Tema’s South District of ECG and Supply and 2 FOR PUBLIC DISCLOSURE Installation of 25,000 No. Bulk Metering, which have been submitted since February 2018, and the Bank team committed to provide a No Objection shortly, after some additional requirements for information are made. b. The activity GH-MOE-54588-CS-QCBS / Impact of Grid Intensification Under GEDAP1 which has been included in the project procurement plan is yet to be approved. c. The consultancy for the management of the outage system (CMS) will be cancelled, as this activity will be picked up by the Millennium Challenge Corporation (MCC). 3. Audits. The GEDAP team informed that the Board of ECG had cleared the 2016 audit a week earlier, and the delivery to the Bank will take place by June 22nd. At the same time, given that the same auditor was chosen, the 2017 audit is expected to be delivered to the Bank by August 2018. 4. Pending actions for management. The team had highlighted to key actions for management that through time had not been updated. First, Engage with MoF and MoEn on the current status of the energy sector SOEs financial status, cash waterfall mechanism and debt restructuring efforts, which has been launched by the Government, bonds were issued to settle debts and the Cash Waterfall Mechanism will start its implementation by August 2018, thus this activity will be updated as completed; and secondly, Engage ECG on discussions about synchronizing and regularizing the commercial operations across ECG based on a plan to be formulated by utility operation consultants (both domestic and international), which was solved, as ECG hired a consultancy to deal with the billing of ECG throughout the country (GEDAP to provide a report as evidence); thus this action will be marked as completed. 5. Legal covenants. There are two pending legal covenants: (1) Finance Agreement: Sec V. F. Description :ECG to hire management support services, which has progressed into a pilot experience in the Ashanti Region, and now with an international management contract (with the support of MCC), thus, this covenant will be marked as complied with; and (2) Finance Agreement :Section V.A of Schedule 2 | Description :Not later than July 31, 2016, the Recipient shall ensure that VRA and ECG shall enter into a bulk power supply contract for the sale and purchase of power upon consultation with the Association, which contract has been drafted and negotiated, and would enter into effect by October 2018, pending of the related contract described in the earlier legal covenant. 6. Results. The GEDAP team revise the current indicators and shared an update of the results indicators with the Bank team, and they are included as Annex II of this Aide Memoire. 3 FOR PUBLIC DISCLOSURE II. NEXT STEPS Activity Responsible Completion Date Agency All no-objections of the project have been WB July 1st, 2018 provided and the procurement plan has been updated to include the impact assessment of grid intensification under GEDAP. 2016 Audit to be delivered to the WB GEDAP July 1st, 2018 2017 Audit to be delivered to the WB GEDAP August 31st, 2018 Action: Engage ECG on discussions about GEDAP To provide report synchronizing and regularizing the commercial prepared by consultant by operations across ECG based on a plan to be August 31st, 2018 formulated by utility operation consultants (both domestic and international) the Recipient shall ensure that VRA and ECG shall GEDAP To provide a draft enter into a bulk power supply contract for the contract between VRA sale and purchase of power upon consultation and ECG by August 31st, with the Association 2018 4 FOR PUBLIC DISCLOSURE Annex I: List of officials met Name Institution Role Andrew Tonto Barfour GEDAP Project Coordinator Henry Vanderpuye GEDAP Access manager Kwadwo Obeng ECG Director Engineering, ECG Edem Heletsi GEDAP Procurement Specialist Desmond Agyeman GEDAP Project Engineer, ECG Shinya Nishimura WB Senior Financial Specialist, Team Leader Ayishetu Terewina WB Program Assistant Robert Degraft-Hanson WB Senior Financial Officer Adebayo Adeniyi WB Senior Procurement Specialist Dante Mossi WB Senior Operations Officer 5 FOR PUBLIC DISCLOSURE Annex II: Project indicators Project Development Objective Indicators PHINDPDOTBL �Direct project beneficiaries (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 1,300,000.00 1,460,000.00 1,710,000.00 1,950,000.00 Date 01-Apr-2007 30-Dec-2016 31-Dec-2017 31-Jan-2019 PHINDPDOTBL �Female beneficiaries (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 51.00 51.00 51.00 51.00 PHINDPDOTBL �ECG Performance Verification Index (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 68.90% 87.64% 92.38% 90% Date 01-Apr-2007 30-Dec-2016 31-Dec-2017 31-Jan-2019 Overall Comments None 6 FOR PUBLIC DISCLOSURE Global Environmental Objective Indicators PHINDGEO TBL �Tonnes of CO2 Avoided through the adoption of Renewable Energy (Amount(USD), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 2,500,000.00 3,387,000.00 250,000.00 Date 27-Apr-2014 30-Dec-2016 31-Dec-2017 31-Jan-2019 Overall Comments None Intermediate Results Indicators PHINDIRITB L �Average annual hours of unplanned power outages per consumer in ECG system (Hours, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 200.00 145.00 114.00 90.00 Date 01-Apr-2007 30-Dec-2016 31-Dec-2017 31-Jan-2019 PHINDIRITB L �Annual ratio of ECG revenues over its costs (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.95 1.04 0.88 >1 Date 31-Dec-2011 30-Dec-2016 31-Dec-2017 31-Jan-2019 7 FOR PUBLIC DISCLOSURE PHINDIRITB L �Electricity losses per year in the project area (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 26.00 23.80 24.25 20.00 Date 01-Apr-2007 30-Dec-2016 31-Dec-2017 31-Jan-2019 PHINDIRITB L �Total net injected generation (Megawatt hour(MWh), Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 8,370,000.00 9,344,570.00 9,782,873.00 11,570,000.00 PHINDIRITB L �Electricity losses per year in the project area- Technical (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 10.20 10.50 10.55 10.20 PHINDIRITB L �Electricity losses per year in the project area- Non-Technical (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 13.90 13.30 13.70 9.80 8 FOR PUBLIC DISCLOSURE PHINDIRITB L �Billed revenue (GWh) in the targeted consumer segments (above 600 units/month) (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 3,592.00 4,272.93 3,717.69 5,851.00 Date 31-Dec-2014 30-Dec-2016 31-Dec-2017 31-Jan-2019 PHINDIRITB L �ECGannual accounts receivable (excluding government agencies and departments and the Ghana Water Company Ltd) equivalent to numberof days of annual sales (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 150 days 134 days 183 days 90 days Date 01-Apr-2007 30-Dec-2016 31-Dec-2017 31-Jan-2019 Overall Comments None 9