Document of The World Bank Report No: ICR00004338 IMPLEMENTATION COMPLETION AND RESULTS REPORT (IDA 40920-GH, IDA 42130-GH and IDA 42140-BJ) ON CREDITS IN THE AMOUNT OF SDR 25.6 MILLION (US$40 MILLION EQUIVALENT) AND SDR 30.8 MILLION (US$45 MILLION EQUIVALENT) TO THE REPUBLIC OF GHANA IN SUPPORT OF THE FIRST AND SECOND PHASE OF THE US$100 MILLION COASTAL TRANSMISSION BACKBONE SUBPROGRAM OF THE US$350 MILLION WEST AFRICA POWER POOL PROGRAM AND A CREDIT IN THE AMOUNT OF SDR 10.1 MILLION (US$15 MILLION EQUIVALENT) TO THE REPUBLIC OF BENIN IN SUPPORT OF THE SECOND PHASE OF THE US$100 MILLION COASTAL TRANSMISSION BACKBONE SUBPROGRAM OF THE US$350 MILLION WEST AFRICA POWER POOL PROGRAM February 28, 2018 Energy and Extractives Global Practice Africa Region CURRENCY EQUIVALENTS (Exchange Rate Effective September 30, 2017) Currency Unit = Ghanaian cedi (GHS) for Ghana; and CFA Franc (CFAF) for Togo/Benin GHS 1.00 = US$0.23 US$1.00 GHS 4.43 CFAF 1.00 US$0.00182 US$1 = CFAF 548 FISCAL YEAR January 1 – December 31 ABBREVIATIONS AND ACRONYMS AfDB African Development Bank APL Adaptable Program Lending B/C Benefit/Cost BOAD Banque Ouest Africaine de Développement (Bank for West Africa Development) CEB Communauté Électrique du Bénin (Togo/Benin Bi-national Electricity Company) CIE Compagnie Ivoirienne d’Electricité (Ivorian Electricity Operation Company) CLSG Côte d’Ivoire, Liberia, Sierra Leone, Guinea CPS Country Partnership Strategy CTB Coastal Transmission Backbone ECOWAS Economic Community of West African States EEP ECOWAS Energy Protocol EIB European Investment Bank EMP Environmental Management Plan EMS Energy Management System FM Financial Management GRIDCo Ghana Grid Company ICR Implementation Completion and Results Report ISR Implementation Status and Results Report KfW Kreditanstalt für Wiederaufbau M&E Monitoring and Evaluation MMEE Ministère des Mines de l’Energie et de l’Eau (Ministry of Mines, Energy, and Water Resources) MTR Midterm Review NEPA Nigerian Electric Power Authority OPGW Optical Ground Wire PAD Project Appraisal Document PIM Project Implementation Manual PIU Project Implementation Unit PLC Power Line Carrier PST Phase Shifting Transformer QAG Quality Assurance Group RAP Resettlement Action Plan RIAS Regional Integration Assistance Strategy RTU Remote Terminal Unit SCADA Supervisory Control and Data Acquisition TICO Takoradi International Company TSO Transmission System Operator TTL Task Team Leader USAID U.S. Agency for International Development VRA Volta River Authority WAGP West African Gas Pipeline WAPP West African Power Pool Vice President: Makhtar Diop Regional Integration Director: Rachid Benmessaoud Senior Global Practice Director: Riccardo Puliti Practice Manager: Charles Cormier Project Team Leader: Sunil Mathrani ICR Team Leader: Franklin Gbedey ICR Primary Author: Fernando Lecaros WESTERN AFRICA WAPP APL 1 (1ST PHASE - COASTAL TRANSMISSION BACKBONE) REPUBLIC OF GHANA – P075994 WAPP APL 1 (2ND PHASE - COASTAL TRANSMISSION BACKBONE) REPUBLIC OF GHANA AND REPUBLIC OF BENIN – P094917 CONTENTS Data Sheet A. Basic Information........................................................................................................ i B. Key Dates .................................................................................................................... i C. Ratings Summary ....................................................................................................... ii D. Sector and Theme Codes ........................................................................................... ii E. Bank Staff .................................................................................................................. iii G. Ratings of Project Performance in ISRs .................................................................. vii H. Restructuring (if any) .............................................................................................. viii 1. Project Context, Development Objectives, and Design ......................................................... 1 2. Key Factors Affecting Implementation and Outcomes ......................................................... 8 3. Assessment of Outcomes ........................................................................................................ 15 4. Assessment of Risk to Development Outcome ..................................................................... 18 5. Assessment of Bank and Borrower Performance ................................................................ 18 6. Lessons Learned (both project-specific and of wide general application) ........................ 20 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners ................... 21 Annex 1. Project Costs and Financing ...................................................................................... 22 Annex 2. Outputs by Component .............................................................................................. 24 Annex 3. Economic and Financial Analysis.............................................................................. 27 Annex 4. Bank Lending and Implementation Support/Supervision Processes ..................... 30 Annex 5. Beneficiary Survey Results ........................................................................................ 33 Annex 6. Stakeholder Workshop Report and Results ............................................................. 34 Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR ............................. 35 Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders ............................... 61 Annex 9. List of Supporting Documents ................................................................................... 62 MAP ............................................................................................................................................. 63 DATA SHEET A. Basic Information WAPP APL 1 (1st Phase - Coastal Transmission Backbone) (P075994) Country: Western Africa Project Names: WAPP APL 1 (2nd Phase - Coastal Transmission Backbone) (P094917) P075994 Phase 1: IDA-40920 Project IDs: L/C/TF Number(s): P094917 Phase 2: IDA-42130; IDA-42140 ICR Date: 2/28/2018 ICR Type: Core ICR Ghana - Ministry of Finance and Adaptable Program Economic Planning Lending Instrument: Borrowers: Benin - Ministry of Finance and Loan Economy IDA-40920 US$40.0 Phase 1: million IDA-40920 US$40.79 million Original Total IDA-42130 US$45.0 Phase 2: Disbursed Amounts: Commitments: million IDA-42130 US$45.2 million IDA-42140 US$15.0 million IDA-42140 US$14.6 million Phase 1: US$40.0 million Revised Amounts: Phase 2: US$60.0 million Environmental Category: B Implementing Agencies: Ghana: Volta River Authority (VRA)/Ghana Grid Company (GRIDCo); Togo/Benin: Communauté Electrique du Bénin (CEB) Co-financiers and other External Partners: Phase 1: European Investment Bank, Kuwait Fund for Arab Economic Development, Borrower Phase 2: European Investment Bank, African Development Bank, KfW. B. Key Dates Process Date Process Original Date Revised / Actual Date(s) Phase 1 Phase 1 Phase 1 11/29/2005 11/01/2005 07/29/2002 Concept Review: Effectiveness: Phase 2 Phase 2 Phase 2 Ghana: 3/4/2008 Ghana: 1/30/2008 12/15/2005 Benin: 5/31/2007 Benin: 11/29/2007 Phase 1: 12/20/2010 04/04/2005 12/21/2010 Appraisal: Restructuring(s): 06/24/2013 Phase 2: 04/24/2006 06/12/2015 i Phase 1: 06/30/2005 Approval: Mid-term Review: 02/11/2008 05/15/2009 Phase 2: 06/29/2006 Phase 1 Phase 1 06/30/2009 06/30/2013 Closing: Phase 2 Phase 2 Ghana: 12/31/2010 Ghana: 06/30/2013 Benin: 12/31/2010 Benin: 06/30/2016 C. Ratings Summary C.1 Performance Rating by ICR Outcomes: Unsatisfactory Risk to Development Outcome: High Bank Performance: Moderately Unsatisfactory Ghana: Moderately Satisfactory Borrower Performance: Benin: Unsatisfactory C.2 Detailed Ratings of Bank and Borrower Performance (by ICR) Bank Ratings Borrower Ratings Moderately Ghana: Moderately Satisfactory Quality at Entry: Government: Unsatisfactory Benin: Unsatisfactory Quality of Moderately Implementing Ghana: Moderately Satisfactory Supervision: Satisfactory Agency/Agencies: Benin: Unsatisfactory Overall Bank Moderately Overall Borrower Moderately Unsatisfactory Performance: Unsatisfactory Performance: C.3 Quality at Entry and Implementation Performance Indicators Implementation QAG Assessments Indicators Rating Performance (if any) Potential Problem Quality at Entry Project at any time Yes Highly Satisfactory (QEA): Yes (Yes/No): Problem Project at any Quality of Yes None time (Yes/No): Supervision (QSA): DO rating before Unsatisfactory Closing/Inactive status: D. Sector and Theme Codes Original Actual Sector Code (as % of total Bank financing) Energy and Extractives Renewable Energy Hydro 100 100 Energy Transmission and Distribution 5 5 Other Energy and Extractives 45 45 ii Theme Code (as % of total Bank financing) Economic Policy-Trade 33 33 Private Sector Development 67 67 Regional integration E. Bank Staff Positions At Approval At ICR Regional Vice President: Gobind T. Nankani Makhtar Diop Country Director: Mark D. Tomlinson Rachid Benmessaoud Senior Global Practice n.a. Riccardo Puliti Director: Practice Manager: Subramaniam V. Iyer Charles Joseph Cormier Task Team Leader(s): Amarquaye Armar Sunil W. Mathrani ICR Primary Author: Fernando Lecaros ICR Contributing Author: Franklin Koffi Gbedey F. Results Framework Analysis Project Development Objectives Original PDO The PDOs recorded in the Credit Agreements were stated as the following: First Phase of Coastal Transmission Backbone Project. 1 The objectives of the project are to extend the lifetime and improve the quality of the bulk power transmission system by providing investment support to replace and expand facilities and by providing technical assistance. Second Phase of the Coastal Transmission Backbone Project. 2 The objective of the project is to assist the recipient in developing a more stable and reliable exchange of electricity among the national power systems of the WAPP “Zone A” Coastal States. 1 Development Credit Agreement between the GoG and IDA, Credit 4092-GH. August 31, 2005 2 Financing Agreement between the GoG and IDA, Credit 4213-GH, December 4, 2007, and Financing Agreement between the Government of Benin and IDA, Credit 4214-BJ, March 2, 2007. iii Revised Project Development Objectives (as approved by original approving authority) The PDO was not revised. Indicators Actual Value Measurement Baseline End Target Achieved at Indicator Unit Value Values Completion or Target Years PDO Result Indicators (1) Quantity (MW) of electricity traded (Import/Export) between the WAPP “Zone A” States, disaggregated by power utility CEB (115/0), CEB (240/0), CIE CEB (115/0), CIE Value (Quantitative or CIE (0/125), (0/70), PHCN MW (0/125), PHCN (0/0), Qualitative) PHCN (0/0), (0/70), VRA VRA (90/80) VRA (90/80) (20/80) Date achieved 30-Jun-2005 30-Jun-2016 30-Jun-2016 The transmission project had not been commissioned by the completion date. Consequently, the amounts traded using the project’s infrastructure Comments were nil and the values achieved at completion were recorded as equal to the baseline to reflect this fact. (2) Level of Power Losses along the principal transmission interconnection links among WAPP “Zone A” Coastal States, disaggregated by power utility CEB (6%), CEB (2%), CIE CEB (6%), CIE Value (Quantitative or CIE (4%), Percent (2%), PHCN (4%), PHCN (8%), Qualitative) PHCN (8%), (2%), VRA (2%) VRA (4%) VRA (4%) Date achieved 30-Jun-2005 30-Jun-2016 30-Jun-2016 The transmission project had not been commissioned by the completion date. Consequently, the power losses were not reduced and the values Comments achieved at completion were recorded as equal to the baseline to reflect this fact. (3) Percent of peak power demand within the WAPP “Zone A” Coastal States met by economy power exchanges on the CTB, disaggregated by power utility CEB (57.5%), CEB (70%), CIE CEB (57.5%), CIE Value (Quantitative or Percent CIE (0%), (0%), PHCN (0%), PHCN (0%), Qualitative) PHCN (0%), (0%), VRA (1%) VRA (7.9%) VRA (7.9%) Date achieved 30-Jun-2005 30-Jun-2016 30-Jun-2016 The transmission project had not been commissioned by the completion date. Consequently, the amounts traded using the project’s infrastructure Comments were nil and the values achieved at completion were recorded as equal to the baseline to reflect this fact. iv Actual Value Measurement Baseline End Target Achieved at Indicator Unit Value Values Completion or Target Years Intermediate Results Indicators (1) Increased quantity of electricity (MW) transferred between WAPP “Zone A” Coastal States, disaggregated by power utility CEB (115), CEB (20) CIE (- CEB (115), CIE Value (Quantitative or MW CIE (125), 130) NEPA (70) (125), NEPA (0), Qualitative) NEPA (0), VRA (-150) VRA (170) VRA (170) Date achieved 30-Jun-2005 30-Jun-2016 30-Jun-2016 The transmission project had not been commissioned by the completion date. Consequently, there was no increase in the quantity of electricity Comments transferred between WAPP states using the project’s infrastructure and the values achieved at completion were recorded as equal to the baseline to reflect this fact. (2) Percent reduction in the number and frequency of power outages along the Coastal Transmission Backbone, disaggregated by power utility CEB (20), CEB (2%), CIE CEB (0%), CIE Value (Quantitative or CIE (15), Percent (2%), NEPA (0%), NEPA (0%), Qualitative) NEPA (50), (2%), VRA (2%) VRA (0%) VRA (15) Date achieved 30-Jun-2005 30-Jun-2016 30-Jun-2016 The transmission project had not been commissioned by the completion Comments date and the outages had not been reduced due to the project infrastructure. The value achieved at completion was recorded as nil. (3) Percent reduction in the detection/response time for operation problems along the Coastal Transmission Backbone, disaggregated by power utility. CEB (4days), CIE CEB (4days), CIE (2days), CEB (2%), CIE Value (Quantitative or (2days), NEPA Days NEPA (2%), NEPA Qualitative) (5days), VRA (5days), (2%), VRA (2%) (2days) VRA (2days) Date achieved 30-Jun-2005 30-Jun-2016 30-Jun-2016 The transmission project has not been commissioned and the Comments detection/response time has not been reduced. (4) Deployment of Emergency Preparedness Plans for Strategic Hydropower stations (Akosombo, Kpong, Nangbeto) in the WAPP "Zone A" Coastal States. Value (Quantitative or Text Not in place Deployed Deployed Qualitative) Date achieved Not agreed yet 02-Oct-2006 31-Dec-2009 20-Dec-2013 Comments Target fully achieved. v Actual Value Measurement Baseline End Target Achieved at Indicator Unit Value Values Completion or Target Years (5) Power Sector M&E data of the ECOWAS member states collected, analyzed, and disseminated. Value (Quantitative or Text Not in place 100% in place Completed Qualitative) Date achieved 02-Oct-2006 30-Jun-2016 14-Apr-2016 Comments Target fully achieved. (6) Fully implemented and well-functioning WAPP Cooperation Agreement for the Coastal Transmission Backbone. Value (Quantitative or Fully Text Not in place Not in place Qualitative) Implemented Date achieved 02-Oct-2006 30-Dec-2016 30-Jun-2016 Comments Not achieved. (7) Quantity of electricity (MW) delivered through completed transmission line and substations. CEB (0), CEB (20), CIE Value (Quantitative or CIE (0), CEB (0), CIE (0), MW (15), PHCN (50), Qualitative) PHCN(0), PHCN(0), VRA (0) VRA (15) VRA (0) Date achieved 30-Jun-2005 30-Dec-2016 30-Dec-2016 Comments Not achieved. (8)Reduction in outages due to the commissioning of the transmission line and substations. CEB (0), CEB (3), CIE (2), Value (Quantitative or CIE (0), CEB (0), CIE (0), Hours PHCN(0), VRA Qualitative) PHCN(0), PHCN(0), VRA (0) (3) VRA (0) Date achieved 30-Jun-2005 30-Dec-2016 30-Dec-2016 Comments Not achieved. (9) Improvement of voltage by the increase of the reactive power due to the commissioning of the transmission line and substations. Value (Quantitative or CEB (0), CEB (50), VRA Number CEB (0), VRA (0) Qualitative) VRA (0) (70) Date achieved 30-Jun-2005 30-Dec-2016 30-Dec-2016 Comments Not achieved. vi G. Ratings of Project Performance in ISRs Phase 1 Date ISR Actual Disbursements No. DO IP Archived (US$ million) 01 13-Dec-2005 Satisfactory Satisfactory 0.00 02 30-Jun-2006 Satisfactory Satisfactory 0.00 03 28-Dec-2006 Satisfactory Satisfactory 0.00 Moderately 04 27-Jun-2007 Satisfactory 3.36 Satisfactory 05 17-Dec-2007 Satisfactory Satisfactory 3.36 Moderately Moderately 06 02-Jun-2008 6.18 Unsatisfactory Unsatisfactory Moderately Moderately 07 23-Dec-2008 11.50 Satisfactory Unsatisfactory Moderately Moderately 08 22-Jun-2009 13.50 Satisfactory Satisfactory Moderately Moderately 09 16-Dec-2009 13.90 Satisfactory Satisfactory Moderately Moderately 10 14-Jun-2010 16.06 Satisfactory Satisfactory Moderately Moderately 11 27-Mar-2011 25.65 Satisfactory Satisfactory Moderately 12 08-Jan-2012 Satisfactory 32.82 Satisfactory Moderately 13 18-Jul-2012 Satisfactory 35.10 Unsatisfactory Moderately 14 28-Apr-2013 Satisfactory 36.56 Unsatisfactory Phase 2 Date ISR Actual Disbursements No. DO IP Archived (US$ million) 01 05-Oct-2006 Satisfactory Satisfactory 0.00 Moderately 02 27-Jun-2007 Satisfactory 0.00 Unsatisfactory 03 17-Dec-2007 Satisfactory Satisfactory 0.00 Moderately Moderately 04 02-Jun-2008 0.25 Satisfactory Satisfactory vii Moderately Moderately 05 23-Dec-2008 2.86 Unsatisfactory Unsatisfactory Moderately Moderately 06 18-Jun-2009 3.23 Unsatisfactory Unsatisfactory Moderately Moderately 07 16-Dec-2009 7.84 Unsatisfactory Unsatisfactory Moderately Moderately 08 14-Jun-2010 10.03 Unsatisfactory Unsatisfactory Moderately Moderately 09 25-Mar-2011 16.43 Unsatisfactory Unsatisfactory Moderately Moderately 10 07-Jan-2012 28.31 Unsatisfactory Unsatisfactory Moderately Moderately 11 27-Jun-2012 33.56 Unsatisfactory Satisfactory Moderately Moderately 12 07-Jun-2013 41.27 Unsatisfactory Satisfactory Moderately Moderately 13 22-Feb-2014 50.95 Unsatisfactory Satisfactory Moderately Moderately 14 03-Dec-2014 52.67 Unsatisfactory Unsatisfactory Moderately Moderately 15 25-Feb-2015 54.47 Unsatisfactory Unsatisfactory 16 08-Oct-2015 Unsatisfactory Unsatisfactory 56.87 17 25-May-2016 Unsatisfactory Unsatisfactory 58.12 H. Restructuring (if any) ISR Ratings Amount Board at Disbursed at Restructuring Reason for Restructuring and Key Approved PDO Restructuring Restructuring Date(s) Changes Made Change in US$, DO IP millions Ghana component: Transfer of implementation from the VRA to GRIDCo, extension of closing 12/20/2010 N MU MU 14.61 date to June 30, 2013, and revision of Results Framework (3 new intermediate indicators added) Benin component: Extension of closing date to June 30, 2013, change of disbursements category 12/21/2010 N MU MU 14.61 to include expenses related to works, and revision of Results Framework (3 new intermediate indicators added) viii Benin: Extension of closing date 06/24/2013 N MU MS 42.25 to June 30, 2015 Benin: Extension of closing date 06/12/2015 N MU MU 55.86 to June 30, 2016 I. Disbursement Profiles Phase 1 Phase 2 ix 1. Project Context, Development Objectives, and Design 1. The Economic Community of West African States (ECOWAS) is a regional group of 15 West African countries, 3 which was founded to achieve ‘collective self-sufficiency’ for member states. The principle goal of the community is to create a single trading bloc through the establishment of an open, unified, regional economic and trading union in West Africa, through, among others, the setting up of regional markets for infrastructure services, including electricity. 2. Energy cooperation. As part of its overall mission, the community’s vision is to develop and establish the West African Power Pool (WAPP) 4—a cooperative power pooling mechanism for integrating national power system operations into a unified regional electricity market—with the expectation that such a mechanism will, over the medium to long term, provide its citizens with a stable and reliable electricity supply at affordable costs. The WAPP states ratified the ECOWAS Energy Protocol (EEP) in 2006, which set up a unified regional umbrella to facilitate harmonization of legal, regulatory, and institutional frameworks necessary for the establishment of the regional power market. One of the underlying planks of WAPP was the West African Gas Pipeline (WAGP) Project, which was developed concurrently with the electricity network to bring natural gas from Nigeria to Benin, Togo, and Ghana to permit large-scale expansion of lower-cost combined-cycle gas-based power generation. The WAGP would thus provide access for the subregion to Nigeria’s enormous gas reserves. 1.1 Context at Appraisal 3. The member states of ECOWAS had a population of about 258 million people in 2005, which were projected to reach 380 million by 2020. Despite the region’s large natural resources endowment, its per capita consumption of electricity was among the lowest in the world. In 2003, the combined total consumption of electricity was about 40 TWh (approximately 160 kWh per capita, compared for example to 500 kWh per capita for Nicaragua, which qualified as a lower- middle-income country), and the peak power demand was 6,500 MW. Electricity demand was projected to grow by over 7 percent per year until 2020, when electricity requirements would reach 140 GWh (approximately 370 kWh per capita) and the peak power demand would exceed 22,000 MW. 4. Faced with this power system expansion challenge, ECOWAS member states acknowledged that past efforts to achieve national self-sufficiency in electricity supply had been uneconomical because of the high cost of establishing national power generation and transmission infrastructure. They also acknowledged two major shortcomings in the region: (a) increasing reliance on hydro-based power systems would not provide sufficient regional security of electricity supply and (b) the lack of adequate transmission infrastructure (within and between national power systems) was the weakest link in the drive toward greater cooperation in power sector development. 5. Rationale for establishment of WAPP. The rationale for the establishment of WAPP was (a) the large difference in natural resource allocations among ECOWAS countries, with significant 3 Benin, Burkina Faso, Cape Verde, Côte d’Ivoire, Gambia, Ghana, Guinea, Guinea Bissau, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone, and Togo. 4 Initially set up in 1999 and converted to become a specialized institution of ECOWAS in 2006. 1 technical potential in electricity generation located in countries with modest electricity demand (such as Guinea) and (b) the inability of countries with very small markets to achieve energy self- sufficiency at affordable costs (such as Liberia). In addition, WAPP provided the ability for countries to share regional resources for the development of electricity services, namely through the development of hydropower in the Senegal and Gambia River Basins, and thermal production with Nigerian and Ivorian gas resources (as other gas deposits were not known at the time). 6. Project concept. World Bank support for WAPP was designed as an Adaptable Program Loan (APL) with three components: APL 1 for the coastal transmission backbone (CTB) connecting Côte d’Ivoire, Ghana, Togo, Benin, and Nigeria; APL 2 for the backbone connecting Senegal, Mali, Guinea, Guinea Bissau, and Gambia; and APL 3 for the backbone connecting Côte d’Ivoire, Burkina Faso, Ghana, Niger, Mali, and Nigeria. In total, these sets of operations represent over 1 billion dollars of IDA financing [US$320 million invested in WAPP APL 1 and 2, OMVS Felou Hydroelectric Project (P094916); US$41.90 million invested in the First Phase of the inter- Zonal Transmission Hub Project of WAPP (APL 3) Program (P094919); US$723 million committed for the Côte d’Ivoire, Liberia, Sierra Leone, and Guinea Power System Redevelopment (P113266), OMVG 5 Interconnection Project (P146830); and North Core/Dorsale Nord Regional Interconnector Project (P162933]. This Implementation Completion and Results Report (ICR) refers exclusively to APL 1, with two phases (Phase 1 and 2), which was designed to capture the benefits of transferring electricity from low-cost sources in Côte d’Ivoire to the load center around Accra and further east to Togo and Benin, as well as providing a connection to the Nigerian system, which would act as a backup to the Ghanaian system during critical hydrological conditions. It was also envisioned that the project would benefit from the WAGP, which was supported with a World Bank Partial Risk Guarantee and was expected to be operational by 2009; the WAGP would be used to fire gas power plants, with subsequent export of the resulting generation to other WAPP countries. 7. Regional strategy. The World Bank’s Regional Integration Assistance Strategy (RIAS) for West Africa was presented to the World Bank Board in August 2001. To reduce fragmentation of the West Africa Region’s economies, the World Bank was pursuing well-defined and phased integration efforts in key sectors where the countries would significantly benefit from cross-border trade—notably road and air transport, energy, and telecommunications. The objective of the RIAS was to help the involved countries create more regional economic opportunities through the integration of markets of goods and financial and infrastructure services. The proposed program fitted into the framework of the RIAS, and was designed to facilitate cross-border electricity trade and support the implementation of the EEP. 8. IDA financing. WAPP APL 1 was divided into two phases and involved the provision of IDA resources in the aggregate amount of US$100 million equivalent to Ghana and Benin, in three credits: a first credit (IDA-4092-GH) financing activities in Ghana (‘Phase 1’) for US$40 million, a second credit (‘Phase 2’) financing activities in Ghana (US$45 million, IDA Credit 4213-GH), and the third in Benin (US$15 million, IDA Credit 4214-BJ). 5 OMVG = Organisation pour la Mise en Valeur du Fleuve Gambie (The Gambia River Basin Development Authority); CLSG = Côte d’Ivoire, Liberia, Sierra Leone, and Guinea; OMVS = Organization pour la Mise en Valeur du Fleuve Sénégal (The Senegal River Basin Development Authority) 2 9. Project background. The utilities that would implement the project were the Volta River Authority (VRA) in Ghana, and the Togo/Benin Bi-national Electricity Company (Communauté Électrique du Bénin, CEB) in Togo/Benin. Established in 1961, the VRA was in charge of power generation, transmission, and bulk supply to two distribution companies, Electricity Company of Ghana (ECG) and Northern Electricity Distribution Company (NEDco), as well as large industrial clients. As part of its mandate, the VRA developed hydro and thermal facilities, notably the Akosombo hydro and Takoradi thermal power plants, and built Ghana’s transmission network, including the 161 kV interconnection from Aboadze in the west to Akosombo in the east. CEB is a binational company established in 1968 and co-owned by Benin and Togo; it operates as a single buyer in the wholesale electricity market and is in charge of providing bulk supply to distribution companies and large clients in each country, as well as developing regional generation projects and maintaining the transmission network. As pioneers in cross-border electricity trade in West Africa since 1972, both CEB and VRA routinely coordinated system operations and exchanged electricity under a 10-year renewable ‘Power Exchange Agreement’. Consequently, at appraisal there was a reasonable degree of assurance that the proposed APL1 would enhance the interconnection capability and build on existing technical and commercial capacity. 10. Project organization. APL1 was implemented as two different projects, namely Phase 1 and Phase 2. Phase 1 includes the investments undertaken in Ghana (IDA Credit 4092-GH), and Phase 2 includes investments both in Ghana (IDA Credit 4213-GH) and Benin (IDA Credit 4214- BJ). 1.2 Original Project Development Objectives (PDO) and Key Indicators (as approved) 11. APL Program Objective. The goal of WAPP is to establish a well-functioning, cooperative, power pooling mechanism for West Africa, as a means to increase access to stable and reliable electricity at affordable costs for the citizens of ECOWAS. The WAPP APL program was expected to help the ECOWAS member states to develop a robust infrastructure platform for WAPP, comprising three distinct but mutually reinforcing subregional infrastructure development projects: (a) WAPP APL 1: the CTB Project, (b) WAPP APL 2: the Western Zone Power Pool mechanism; and (c) WAPP APL 3: the Sahel Zone Power Pool mechanism. The WAPP APL program initially budgeted US$350 million for the three projects 6. 12. The PDOs recorded in the Credit Agreements were stated as the following: • First Phase of Coastal Transmission Backbone Project. 7 The objectives of the project are to extend the lifetime and improve the quality of the bulk power transmission system by providing investment support to replace and expand facilities and by providing technical assistance. • Second Phase of the Coastal Transmission Backbone Project. 8 The objective of the project is to assist the recipient in developing a more stable and reliable exchange 6 Ultimately a total of US$361.9 million was approved for these operations. 7 Development Credit Agreement between the GoG and IDA, Credit 4092-GH. August 31, 2005 8 Financing Agreement between the GoG and IDA, Credit 4213-GH, December 4, 2007, and Financing Agreement between the Government of Benin and IDA, Credit 4214-BJ, March 2, 2007. 3 of electricity among the national power systems of the WAPP “Zone A” Coastal States. 13. Original project indicators. 9 The Phase 1 and Phase 2 Project Appraisal Documents (PADs) identified WAPP APL 1 indicators as follows: PDO Indicators • Quantity (MW) of electricity traded (Import/Export) between the WAPP “Zone A” States, disaggregated by power utility. • Level of Power Losses along the principal transmission interconnection links among WAPP “Zone A” Coastal States, disaggregated by power utility. • Percent of the peak power demand within the WAPP “Zone A” Coastal States met by economy power exchanges on the CTB, disaggregated by power utility. Intermediate Outcome Indicators • Increased quantity of electricity (MW) transferred between WAPP “Zone A” Coastal States, disaggregated by power utility. • Percent reduction in the number and frequency of power outages linked to malfunctions along the Coastal Transmission Backbone, disaggregated by power utility. • Percent reduction in the detection/response time for operation problems along the Coastal Transmission Backbone, disaggregated by power utility. • Deployment of Emergency Preparedness Plans for Strategic Hydropower stations (Akosombo, Kpong, Nangbeto) in the WAPP "Zone A" Coastal States. • Power Sector M&E data of the ECOWAS member states collected, analyzed, and disseminated. • Fully implemented and well-functioning Operational Security and Mitigation Plan. 9 Phase 1 PAD, Annex 3, Results Framework 4 1.3 Revised PDO (as approved by original approving authority) and Key Indicators, and reasons/justification 14. Phase 1 of the project was restructured in December 2010. The PDO was not revised. Three additional intermediate outcome indicators were added: • Quantity of electricity (MW) delivered through completed transmission line and substations. • Reduction in outages due to the commissioning of the transmission line and substations. • Improvement of voltage by the increase of the reactive power due to the commissioning of the transmission line and substations. 15. The additional indicators were justified because in the original Results Framework, benefits of the project could not be assessed until all project works were completed. This anomaly was raised during the Quality Assurance Group (QAG) Learning Review of Regional Projects in November 2009. The new indicators were added to reflect results of intermediate achievements such as the energy delivered through the Tema–Ghana border transmission line and the improvement in the voltage level by the increase of reactive power. 1.4 Main Beneficiaries 16. The Phase 1 PAD identified the direct and indirect beneficiaries as the five member states participating in the project (Benin, Togo, Ghana, Côte d’Ivoire, and Nigeria). The direct beneficiaries of the project were the VRA and CEB, the power utilities that implemented the project. By extension, the ultimate beneficiaries are consumers in the five countries, who would be provided with better service quality, greater continuity of supply, and lower prices. 1.5 Original Components (as approved) 17. The infrastructure supported by the WAPP APL 1 project was intended to complete and put into full operation the entire 330 kV CTB by 2009, in two tranches. The first tranche (FY05) of the WAPP APL 1 project would provide the VRA with investment support to expand transmission capacity, extend the operational lifetime of key transmission facilities, and improve the quality and reliability of bulk power transfers along the Aboadze-Volta segment of the 330 kV CTB. Subsequently, the second tranche (FY06) of the WAPP APL 1 project would provide investment support to both the VRA and CEB. The APL 1 project included three components to be financed within the two phases indicated earlier, as follows: 5 Component 1: Construction of the 330 kV Coastal Transmission Backbone • Phase 1 subcomponent. Support to the VRA to extend the operational lifetime of key transmission facilities, and improve the quality and reliability of bulk power transfers along the Aboadze-Tema 10 segment • Phase 2 subcomponent. Co-financing of the remaining segments of the CTB: Prestea-Aboadze (Ghana); Tema (Ghana)-Mome Hagou (Togo); and Momé Hagou- Sakété (Benin). Component 2: Upgrade of System Control Centers • Phase 1 subcomponent. Upgrade of the VRA System Control Center in Tema, Ghana • Phase 2 subcomponent. Upgrade of CEB System Control Center in Lomé, Togo Component 3: Upgrade of Strategic Power Generation and/or Transmission Assets • Phase 1 subcomponent. Upgrade of switchyard at Akosombo Generation Station and Tema Substation (Ghana) • Phase 2 subcomponent. Relocation of CEB gas turbines to Maria Gleta Terminal of the WAGP in Benin 18. It is worth noting, that financing for the second phase components in Togo/Benin included IDA, the African Development Bank (AfDB), and Kreditanstalt für Wiederaufbau (KfW)), which was only secured late in the project, with an important impact on the PDOs. IDA’s contribution to this tranche was limited to the CEB System Control Center and the financing of the engineering supervision of the project. 1.6 Revised Components 19. Project components did not change. 1.7 Other significant changes 20. Ghana Credit restructuring. The PDO remained unchanged. The Credit was restructured in December 2010 to address the following: (a) Institutional changes in the Ghanaian power sector. The sector was reformed, which included unbundling and the creation of a separate transmission enterprise, Ghana Grid Company (GRIDCo), which assumed the VRA’s transmission assets and became responsible for project implementation; the restructuring formally transferred the corresponding project obligations from the VRA to GRIDCo. 10 Designated as Volta in the PAD 6 (b) The slow pace of disbursements. Disbursements in early 2010 amounted to only 5 percent of the Credit, which was partially attributed to delays regarding the expected completion of the Supervisory Control and Data Acquisition/Energy Management System (SCADA/EMS). However, by the end of the year, the major EMS contract was on its way to be signed, and by late 2012, disbursements had increased to 32 percent. Based on these considerations, the restructuring acknowledged the likely completion of the project within two to three years and extended the closing date to June 30, 2013. (c) Tracking project progress. As noted above, the restructuring recognized that the benefits of the project could not be assessed until all works were completed. To track project progress, three new indicators were added to the Results Framework (MW delivered through the transmission line, reduction in outages associated with the transmission line, and voltage profile improvement due to an increase of reactive power from the transmission line). 21. Togo/Benin Credit restructuring. The PDO remained unchanged. The Credit was restructured in December 2010 to address the following: (a) The slow pace of disbursements. As of November 2010, only 10 percent of the Credit had been disbursed. The main delay was attributed to procurement obstacles encountered in the implementation of the SCADA/EMS system, which represented 80 percent of the Credit. At restructuring, the pace of procurement had improved during the past months and the bidding process for the upgrade of the SCADA/EMS was in its final phase, with a bid opening date set for February 23, 2011. As a result, the closing date was extended from December 31, 2010 to June 30, 2013. The extension was further justified because of the delay in securing financing for the Togo portion of the 330 kV transmission line from other financiers (AfDB and KfW). (b) Allowing the disbursement for works to implement the SCADA/EMS system. The restructuring included a change in the disbursements category (changed from goods to goods and works) (c) Tracking project progress. In this regard, the restructuring was identical to the Ghana Credit restructuring, with the addition of the same intermediate indicators, and for the same reason. 22. Further Togo/Benin extensions. The 330 kV transmission line and substations in Togo and Benin (Phase 2 of the construction of the 330 kV CTB) were executed by CEB and cofinanced by IDA, AfDB, and KfW; the latter two agencies financed the bulk of the project, and IDA financed the engineering supervision services. The financing arrangements with the AfDB and KfW were not agreed until 2010, and according to publicly available data (published on its website), the AfDB approved the project in 2007 but it only became effective in January 2012. Because IDA’s participation was linked to the implementation of the transmission and substation works, two more project extensions were granted for the Togo/Benin component, to June 30, 2015, and subsequently to June 30, 2016. 7 2. Key Factors Affecting Implementation and Outcomes 2.1 Project Preparation, Design and Quality at Entry 23. Soundness of the background analysis. The overall project concept, and the APL choice, was sensible because it provided an integrated approach to supporting the ECOWAS regional integration strategy through WAPP. APL 1 was designed to support the interconnection of the major electricity production/consumption centers (from Côte d’Ivoire in the west to Nigeria in the east) through high-capacity transmission lines. The overall design relied on studies undertaken by the WAPP Institutional and Technical Working Groups, including the instruments for implementing power exchanges within the different country clusters developing interconnections, and a U.S. Agency for International Development (USAID)-supported revision/update of the ‘West Africa Regional Transmission Study’. However, the project-specific engineering background studies together with the bidding documents were not prepared before Board presentation, so lengthy delays were unavoidable from the start. The PAD indicated that preparation of engineering design and bidding documents were to be financed by Phase 1 resources. Similarly, financing for CEB requirements would be provided as part of Phase 2. 24. Assessment of project design. The project was technically straightforward; it involved the construction of transmission lines and associated substations over well-known terrain, together with control centers. However, with hindsight it is hard to avoid concluding that there was a significant technical oversight in the failure to anticipate the difficulty in frequency synchronization between the Ghanaian and Nigerian power systems. In addition, the PDO and results indicators were designed to capture the objectives and development outcomes of all collective investments by cofinanciers and were not ring-fenced to solely measure the impact of IDA’s investments. As such, the design of the project was very ambitious and did not adequately foresee delays (procurement and implementation) that required strong donor coordination and institutional capacity to address. Finally, WAPP had not assigned IDA as the lead coordinating agency to provide supervision support. In subsequent WAPP projects, WAPP agreed upfront to identify a lead development agency, which provides better implementation support. In that regard, IDA was able to identify funding gaps early on and play its role of donor of last resort more proactively. 25. Adequacy of the Government’s commitment. The project was prepared within the ECOWAS framework in which the member countries were committed to improving the performance of their respective power sectors. The ability to support the project was evidenced by a long history of cross-border electricity trade between Côte d’Ivoire, Ghana, and Togo/Benin. The Governments had also agreed to the EEP in 2003 to set up a unified regional umbrella to facilitate harmonization of legal, regulatory, and institutional frameworks for WAPP, the WAGP, and other similar regional energy initiatives; Ghana, Benin, and Togo ratified the EEP between 2005 and 2008. 26. Assessment of risks. The risks identified at preparation were mainly associated with the policies of the governments involved, which required adhering to the principles and treaties required for the success of the interconnection project, such as minimizing self-sufficiency policies in favor of lower-cost regional development options, or adhering to integrated power system planning. The risk of governments ignoring these principles was mitigated by the explicit 8 commitment to ECOWAS on the part of participating governments. The risk associated with implementation capacity of the APL was mentioned with regard to some national and multinational power utilities; this risk would be mitigated by relying on the expertise of leading utilities in the WAPP region. Risks associated with engineering and technical implementation were assessed as low in consideration of the use of basic and well-developed standard designs and construction techniques. The risks associated with donor coordination and a design that required the sequencing of investments of several donors was not acknowledged at preparation. As a result, project partners failed to establish a joint implementation committee to coordinate the actions of the two implementing agencies (VRA/GRIDCo and CEB), and a lead donor was not appointed. As these risks were not mitigated, the Ghana portion of the line was completed in 2014, five years behind schedule) whereas the Togo/Benin portion is still under construction because of challenges related to contractors and other factors. 27. Finally, the activities of the IDA-funded owners’ engineer were entirely dependent on the timing and pace of execution of the transmission line construction financed by other donors, which were beyond the control of IDA. At design/appraisal, the World Bank’s project team did not anticipate the risks associated with funding a component entirely linked to a non-World Bank source of financing. The IDA-supported aspects were delayed because of the pace of construction of the components it did not finance but for which IDA was financing the supervision engineer. 28. Quality at entry. The project underwent a Quality at Entry Assessment by QAG in June 2007 and was awarded a Highly Satisfactory rating. With hindsight, this rating appears unjustified, given the design flaws described in the preceding paragraphs. 2.2 Implementation 29. Phase 1 was executed in Ghana by VRA whereas Phase 2 was executed in Ghana by the VRA/GRIDCo and in Benin by CEB. Hereafter, for clarity, the projects will be analyzed as the ‘Ghana component’ (Phase 1 and part of Phase 2), and the ‘Benin component’ (Phase 2) based on the location of the investment. Ghana Component Implementation 30. The project experienced significant implementation problems, which translated into project delays. The factors behind the project delays include the following: (a) Late start. Although the project was approved in June 2005 (Phase 1) and June 2006 (Phase 2), effectiveness for the latter was delayed until November 2007 due to noncompliance with the VRA’s solvency requirements per the legal covenants. (b) Changes to the Ghanaian procurement laws. By May 2009, when the midterm review (MTR) took place, disbursements were only around 20 percent for the two credits; the delay was due to complying with Ghana’s new procurement statutes; however, the project had awarded contracts equivalent to 56 percent of the total credit amount. (c) Ghana power sector reforms. Unbundling of the sector required creating a separate transmission company, GRIDCo, which would take over the responsibility of 9 implementing the project. The World Bank MTR mission concluded that GRIDCo was not in a position to do so due to weaknesses in a number of areas, most notably financial management (FM), which therefore remained with the VRA. The sector unbundling was not anticipated at design and took up senior management attention to the detriment of WAPP matters. (d) Transmission line rerouting. The Ghana transmission line component also suffered implementation delays associated with rerouting in the northern Accra suburbs when it was determined that keeping the original route would give rise to unacceptably large compensation expenses. This added about 10 km to the overall length of the line. (e) Project management weaknesses. The May 2009 MTR identified the need to increase Project Implementation Unit (PIU) capacity to advance the project; it recommended, among others, the appointment of a ‘substantive full-time WAPP project director’, reinforcement of the contracts/procurement unit with additional staff, closer follow-up of payments to contractors, and updating of design and costing of interconnection between the 330 kV line and existing substations. Management strengthening was identified as a significant need for the SCADA/EMS, because the management team was not in place by the MTR and would be delayed until end-2011 (f) The transmission component (lines and substations) progressed well, but the SCADA/EMS component suffered delays, partly due to its technical complexity and the need to switch to a two-stage procurement process. Ultimately, the difficulties surmounted and the transmission line from Tema to Aboadze and its related substations were commissioned in late 2009. The Akosombo and Kpong generating station reinforcements, together with the SCADA/EMS control center, were implemented by June 2013, when both Ghana credits closed. 31. MTR of Ghana component. 11 As noted above, the review took place in May 2009 and identified the sources of project delays. The main findings regarded the delays in execution, and slow disbursements due in part to cumbersome VRA/GoG procedures for submitting Withdrawal Applications to the World Bank, which included going through the GoG’s approval. At the time, the biggest outstanding item was the SCADA/EMS component (to be financed partly in Phase 2), for which the contract award was expected in October 2009. The MTR mission also undertook a full due diligence review of GRIDCo's capabilities to be formally responsible for project execution in place of the VRA and concluded that while technical and operational matters were being handled by GRIDCo, key FM arrangements were not yet in place to endorse the transfer of the project to GRIDCo; the arrangements were expected to be completed by end-October 2009. Given the expected implementation time of two years, the MTR recommended a closing date extension of 24 months. The subsequent restructuring extended the closing date to June 30, 2013. The recommended restructuring for Phase 2 was limited to the Ghana component (Credit 4213-GH). 11 Implementation Status and Results Report (ISR) Phase 1 Sequence #8, June 17, 2009 10 Benin Component Implementation 32. This component also experienced major delays in its execution; it was approved in June 2006 with an original closing date of December 2010; the final closing date was June 2016. The factors behind the delays include the following: (a) Late start. Although the project was approved in June 2006, effectiveness was delayed until November 2007 (in Benin, the ratification of the National Assembly and the legal opinion were delayed). (b) Insufficient staff resources dedicated to the project. The May 2009 MTR notes that the EMS/SCADA component (two-thirds of the World Bank’s credit) was delayed because of unsatisfactory performance of CEB’s engineering consultants, and also because CEB had assigned insufficient staff resources to the project. The EMS/SCADA contract was awarded in October 2011 and signed in January 2012. (c) Changes to EMS/SCADA contractual specifications. The original contract was modified to switch from the existing communication system to a fiber optic system. (d) Delayed financial arrangements for the transmission works and substations. These elements, which were executed by CEB, were to be mainly financed by the AfDB, and the German development agency, KfW; IDA’s participation was limited to the engineering supervision. CEB was late in complying with conditions required by the AfDB and KfW; as a result, although the AfDB approved the project in April 2007 it was only initiated five years later, in January 2012; similarly, KfW only agreed to participate in 2011. 12 (e) Contractual disputes between CEB and the transmission contractor. The transmission lines required to link Togo/Benin with Ghana and Nigeria have not been completed due to continuous strife between the contractor and CEB regarding payments due. 13 33. MTR of Benin component. The MTR took place together with the Ghana MTR in May 2009. It reported the delay in producing the bidding documents for the SCADA/EMS because of the poor performance of CEB consultants and brought it to the attention of CEB, together with the need for CEB to dedicate more staff to project implementation. The MTR mission also appraised management regarding the need for project extensions because of the delay on the SCADA/EMS component and the fact that the transmission component had not been initiated. 34. Lack of frequency synchronization between Nigeria and Ghana. An obstacle to having benefits of the project materialize lies in the difficulty of maintaining a constant frequency across the Ghana and Nigerian power systems. In particular, the Nigerian power system experiences erratic frequency shifts that impede maintaining the interconnection operational on an extended 12 At appraisal, Togo was ineligible for IDA, so Benin had to take on 100 percent of the Credit. Later Togo’s IDA envelope was tiny and there was no scope of getting additional IDA funding for an AF. 13 The World Bank team was deeply involved in attempts to broker solutions to the CEB-contractor disputes during joint supervision missions with KfW and AfDB. 11 basis, which would result in frequent shutdowns in Ghana’s power supply that would be unacceptable to its customers. The problem had not been identified at design but has been known since project initiation has and is yet to be solved; actions within the Nigeria power system are urgently needed if the project is to become operational when the Togo/Benin component is achieved. 14 IDA is helping the WAPP Secretariat to address the issue with a synchronization study and will assist with the implementation of its recommendations under WAPP’s ongoing CLSG project. 2.3 Monitoring and Evaluation (M&E) Design, Implementation, and Utilization 35. M&E Design. The overall APL 1 design visualized (a) an M&E system to be developed with the ECOWAS Energy Observatory during the APL 1 project for the entire WAPP APL program (building upon the existing country-specific M&E systems); (b) M&E data sources, to be maintained as part of the management information system of each utility; (c) M&E capacity building for in-house dedicated units in each utility, harmonizing and standardizing data collection and analysis; and (d) use of M&E reports to be disseminated through quarterly reports to assess progress toward the achievement of WAPP APL Program Development Objectives. 36. The key indicators proposed for monitoring project outcomes (electricity trade indicators and loss reduction) are well chosen for a scenario in which the project is completed and operating. However, the intermediate indicator for the infrastructure development (transmission lines and substations) does not monitor project progress and is practically identical to the outcome indicator for trade; similarly, the intermediate indicators for the control centers component and the generation station improvement assume that the system is already operating and would better qualify as an outcome indicator. The indicators for the institutional component (data collection and publication, together with implementation of the WAPP Cooperation Agreement) are well chosen to reflect improvements in coordination among WAPP “Zone A” Coastal States. 37. M&E implementation. Due to the limitations of the indicators, ISRs registered “not possible until the cross-border 330 kV interconnections are completed.” Thus, the restructuring of both the Ghana and Benin component included additional intermediate indicators that monitored energy flows through completed lines and substations. However, due to the linear nature of the project, its components cannot operate independently, and practically every transmission link must operate to monitor results. Consequently, the new intermediate indicators did not improve project monitoring. Other indicators were effective in monitoring project activities, that is, (a) deployment of emergency preparedness plans for strategic hydropower stations (deployed) and (b) the two indicators associated with institutional capacity building. 38. M&E utilization. Due to the lack of significance of the indicators, they were not useful in tracking project implementation for the main transmission investments of the project. 14 Nigeria exports to Benin and Ghana to Togo. The electrical frontier between the two systems is Togo. Since Ghana is linked to Republic of Cote d’Ivoire and thereby to Burkina Faso as well, the negative consequences of Nigeria tripping Ghana are huge for the whole subregion. 12 2.4 Safeguard and Fiduciary Compliance Ghana Component 39. The project triggered two safeguard policies: environmental assessment and involuntary resettlement, which reflect the typical impacts of building transmission lines. As noted in the PAD, the project raised no environmental policy, regulatory, and institutional issues that would compromise people’s health from environmental risks and pollution. 40. Environmental. The Ghana component complied with environmental safeguard policies. The project was classified as category B. The VRA prepared an Environmental Management Plan (EMP) that it included in the bidding documents. The Tema-Aboadze line runs mainly parallel to an existing transmission line (the 161 kV line), and final designs avoided areas that could be considered environmentally sensitive. The MTR documented site visits during construction for the Ghana component and verified that the contractor was observing the environmental guidelines. The 330 kV transmission lines and substations were completed in 2009, shortly after the MTR. 41. Social. The Ghana component complied partially with social constraints. The VRA prepared a Resettlement Action Plan (RAP) before implementation. During project construction, affected populations were compensated according to the VRA’s valuation of crops, land, and buildings or, if affected people disagreed, following the results of an independent valuation paid by the VRA. About 1,700 persons were affected. The MTR noted that the project was not in compliance with World Bank policies because construction started before compensation. By 2011, the VRA had fully settled outstanding compensation to all affected parties, including landowners and stone crackers, that were affected by the passage of the 330 kV line at Kwabenya. 42. FM. The principal FM challenge for the Ghana component was the transition from VRA management to GRIDCo, which took place between 2009 and 2010. The World Bank supervised the transition arrangements to assure that procedures would be up to standard in the areas of finance and accounting, budgeting, financial reporting, internal control, record keeping, and information systems. The MTR rated FM arrangements as Moderately Satisfactory. 43. Procurement. The project was delayed initially due to a new procurement law (2005– 2006) in Ghana, but once procedures became more regular implementation proceeded at a normal pace. Procurement was executed by the two implementing organizations (VRA/GRIDCo and CEB); no major issues or obstacles were encountered. Benin Component 44. Environmental and social. The project triggered the environmental assessment safeguard. The investments under the Phase 2 project were categorized as category B. For civil works, the project consisted of upgrades to system control and communications hardware. Environmental concerns were limited to ensuring adequate management of potential construction impacts and to identifying and attending to possible site remediation issues at existing substations. The Benin component did not raise any social safeguard issues because implementation did not require acquisition of land or resettlement of communities or people. 13 45. FM. The rating for fiduciary aspects of the project was consistently low throughout execution. However, CEB complied with the World Bank’s basic FM requirements and its performance was rated as Moderately Satisfactory. 2.5 Post-completion Operation/Next Phase 46. Complementary projects/conditions. For the CTB to operate as intended, that is, by transporting energy to be produced in the Takoradi region of Ghana to Togo/Benin and transporting energy from Nigeria to Ghana, the following conditions must be fulfilled: (a) The Benin component must be completed. Although the remaining work is not very significant, a solution to the differences between CEB and its contractor must be found for the physical infrastructure of the project to be finished. The AfDB funding for this component closed at end-2017. All equipment to complete the project has been procured but CEB has to find alternative financing to replace the AfDB and is thus unable to commit to a firm completion date. (b) The WAGP project should operate commercially. Although the pipeline and its compression stations have been available since late 2009, contracts for delivery of Nigerian gas must be met in full for adequate gas to be supplied to power plants in Ghana for conversion to electricity to be exported to Togo/Benin. More power trade must necessarily be based on natural gas, the cheapest fuel source, regardless of whether it is sourced in Nigeria as envisaged at appraisal or from Ghana’s own gas reserves, which had not even been discovered when this project was designed. In both cases, full use of the WAGP’s gas transmission capacity will be needed. This is turn will require revisions to the existing commercial and contractual frameworks linking the four country shareholders of the WAGP. (c) Synchronization of Ghana and Nigeria power grids should be achieved. Overcoming the problem requires investments in Nigeria to provide better frequency regulation, which are beyond the control of CEB and GRIDCo, as well as the continuous availability of a minimum level of spinning reserve in the power interconnected systems. It will require the implementation of the recommendations of the WAPP system synchronization study [governors and Static Var Compensators (SVC)] and the availability of at least 3 percent of spinning reserve in the system. (d) Commercial coordination of WAPP power exchanges. This consists of implementing the WAPP protocols for improving power trade among the participating utilities, particularly with regard to timely payment for power sales. In this area, the World Bank is conducting analytical work at the request of Côte d’Ivoire to address the securitization of payments under WAPP, and updating its engagement strategy under WAPP to assist in the creation of an electricity market 47. Follow-on projects. If the above conditions can be achieved, the next step will consist of ramping up power production with either more gas from Nigeria through the WAGP or from Ghana’s Sankofa gas field. The CTB Project will only then be able to fulfill the original objective of providing lower-cost power supply to Togo and Benin. 14 48. Sustainability. The physical sustainability of the transmission works, including substations and lines, requires standard maintenance procedures and facilities which GRIDCo and CEB have mastered as part of the usual operations of transmission facilities. However, the sustainability of the project needs to be bolstered by measures to enhance the finances of CEB and GRIDCo, whose resources ultimately depend upon income collected by the distribution companies, who are affected by high commercial losses—due, among others, to nonpayment of public sector electricity consumption in all three countries. This issue is being addressed by several ongoing IDA electricity projects and budget support operations in the three countries. Ultimately, the willingness of the generation companies to use the interconnection for cross-border sales will depend upon a resolution to the current buildup of payment arrears between utilities and the establishing of a payment security mechanism to de-risk such transactions. This is currently being addressed jointly by IDA and WAPP. 3. Assessment of Outcomes 3.1 Relevance of Objectives, Design and Implementation Relevance of objectives: High 49. The PDO (Phase 2) is to increase access of Côte d’Ivoire, Ghana, Togo/Benin, and Nigeria to more stable and reliable exchange of electricity; as explained in the PAD, the ultimate objective is a means to alleviate power supply deficits and/or to reduce their collective vulnerability to drought-induced power supply disruptions. The relevance of the objectives is judged with respect to the following: (a) World Bank RIAS. The World Bank’s RIAS was formulated in 2001 as a specific integration strategy for West Africa; it focused on efficient, region-wide infrastructure services, including energy, as a means to create a regional market. The RIAS was updated in 2008 where it recommends, as critical, the support to the ECOWAS initiative to establish an interconnected electricity market. The 2011 progress report on RIAS reaffirms the need for a continued emphasis on cross-border interconnectors. (b) AfDB RIAS (2014–2023), which coincides with the World Bank’s strategy in supporting regional interconnections as a means to increase energy affordability and improve coverage. (c) Ghana Country Partnership Strategy (CPS) 2013–2016. The CPS summarizes the GoG’s strategy and emphasizes that in terms of specific infrastructure sectors, the critical focus for the GoG is the power sector, with a key goal to expand supply; the CPS was prepared when the Ghana component of the project was being finalized, which explains why the interconnection is not mentioned as a CPS priority. (d) Benin CPS. The World Bank’s focus was oriented toward four sectors (energy, transport, ICT, and urban development); the project was considered an element of the World Bank’s first pillar of support (increasing sustainable growth, competitiveness, and employment). 15 50. In consequence, the project continues to be relevant to the overall WAPP development strategy, and its concept continues to reflect the best approach to developing an interconnection between Côte d’Ivoire and Nigeria. Relevance of design: Modest 51. Project design regarding the components was straightforward and relevant to achieving the project objectives: the infrastructure conceived in the project, consisting of transmission lines, substations, and control centers would, when implemented, support the benefits of interconnection and hence the PDO. Project organization design was inadequate, given the lack of an overall WAPP coordination group to ensure that the Ghana and Benin components would be implemented simultaneously and that donors would implement the project concurrently, with the ability for a donor of last resort to intervene in the case of financing gaps; this was a significant failing toward achieving the PDO. Finally, the design did not consider the obstacles imposed by the power fluctuations in the Nigerian system, which could spread westward and lead to disconnections of the Ghana and Côte d’Ivoire systems, which were known at the time of project preparation. However, because no technical analysis of the challenge of synchronization had been done at that early stage, the implications seem not to have been considered in project design. Relevance of implementation: Modest 52. Project implementation remained relevant to achieving the PDO despite the setbacks associated with a weak organization, insofar as it achieved the infrastructure goals associated with the Ghana component and the SCADA/EMS of the Benin component; the World Bank was powerless to address the implementation issues of the Benin component due to its minority participation in the financing of the transmission components, which have yet to be completed. Consequently, the rating reflects the incomplete implementation of the project and the consequent inability to achieve the PDO. 3.2 Achievement of Project Development Objectives Rating: Modest 53. The PDO is to increase access of Côte d’Ivoire, Ghana, Togo/Benin, and Nigeria to more stable and reliable electricity as a means to alleviate power supply deficits and/or to reduce their collective vulnerability to drought-induced power supply disruptions. 54. The PDO indicators as reflected in the final ISR of May 2016 are as shown in table 1. 16 Table 1. PDO Indicators’ Evaluation in Final ISR PDO Indicator Target Achieved Comment 1. Quantity (MW) of electricity traded CEB (240/0), CIE CEB (115/0), CIE (Import/Export) between the WAPP (0/70), PHCN (0/125), PHCN "Zone A" Coastal States, (0/70), VRA (20/80) (0/0), VRA (90/80) disaggregated by power utility. The values at closure 2. Level of power losses (%) along the are the same as the principal transmission CEB (2%), CIE CEB (6%), CIE baseline for all three interconnection links among WAPP (2%), PHCN (2%), (4%), PHCN (8%), indicators because the "Zone A" Coastal States, VRA (2%) VRA (4%) project was not fully disaggregated by power utility implemented. None of 3. Percent of the peak power demand the targets were in WAPP "Zone A" Coastal States CEB (70%), CIE CEB (57.5%), CIE achieved. met by economy power exchanges (0%), PHCN (0%), (0%), PHCN (0%), on the CTB, disaggregated by power VRA (1%) VRA (7.9%) utility. Note: CIE = Compagnie Ivoirienne d’Electricité (Ivorian Electricity Operation Company); NEPA = Nigerian Electric Power Authority; PHCN = Power Holding Company of Nigeria. 55. The project has not established the entirety of the infrastructure required to achieve the PDO and the final ISR rated progress toward achievement of the PDO as Unsatisfactory. However, the investments will eventually be completed, and therefore achievement of the PDO is possible at some point within the next 1–2 years, as the obstacles to completion (mainly CEB’s disputes with contractors) are resolved through negotiations or arbitration. Ultimately Benin and Togo may be called upon to finance the remaining works. Although the necessary amount is relatively modest (US$5–6 million), it is beyond CEB’s internal financing capability at present. 3.3 Efficiency Rating: Negligible 56. The project cannot reasonably be evaluated as a regional project given that it has not been completed and that trade among the countries in the region using this infrastructure is not taking place. However, the investments made within Ghana are operational and have the potential to generate benefits by channeling low-cost energy from Aboadze to Tema. Annex 3 analyzes the project’s performance within Ghana; three conclusions were reached: (a) under the current loading of the transmission line (around 15 percent on average with respect to a 400 MW nominal capacity) the project yields unsatisfactory economic indices (Benefit/Cost [B/C] ratio below 1 and internal rate of return below 12 percent); (b) with an increase of the load factor to around 70 percent, the project becomes acceptable while maintaining a modest unit cost differential between the western and eastern areas of US$0.01 per kWh; and (c) with a combined increase in the load factor together with a larger cost differential, the internal rate of return increases to an acceptable level of 12 percent. A better economic result can only be achieved if the remaining investments of the project are implemented together with enhanced natural gas supply. 3.4 Justification of Overall Outcome Rating: Unsatisfactory 57. Although the project objective remains highly relevant, the final outcome rating is Unsatisfactory due to the modest design and implementation and negligible efficiency. This is 17 because project activities were not completed at the time of the project closing; however, as indicated, its benefits can be expected to materialize sometime in the future. 3.5 Overarching Themes, Other Outcomes and Impacts (a) Poverty Impacts, Gender Aspects, and Social Development 58. When completed and operating, the project has the potential to lower electricity costs and improve the access rate, which would benefit large numbers of poor households. At project closure, such impacts had not materialized. (b) Institutional Change/Strengthening 59. No institutional impact was associated with the project. (c) Other Unintended Outcomes and Impacts (positive or negative) 60. None 3.6 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops 61. Not Applicable 4. Assessment of Risk to Development Outcome Rating: High 62. The best outcome scenario would require having CEB complete the infrastructure component of Togo and Benin. However, given the precedents of the last two years, it may happen that construction stagnates and that the contracts lapse, thereby requiring retendering under a fresh source of financing. If the transmission lines are completed, a good outcome would require significant power trade using the network; for this to occur, there must be sufficient generation surpluses to distribute. Finally, the network synchronization issue will have to be solved for larger volumes to be traded and payment mechanisms/financial discipline improved for the project to be utilized adequately. The combination of these factors conjures a fragile vision for the ultimate success of the project, given that the failure of any one of them would negate the benefits of the interconnection. 5. Assessment of Bank and Borrower Performance 5.1 Bank Performance (a) Bank Performance in Ensuring Quality at Entry Rating: Moderately Unsatisfactory 63. The project was rated as Highly Satisfactory in the QAG review, based upon the overall design as a regional project and its potential to provide economic benefits such as energy security and reliability of supply. The overall concept was also straightforward insofar as it did not involve any major technical obstacles. However, the QAG assessment erred (a) in not recognizing the 18 coordination challenges faced by a project executed through different country organizations, (b) in not spotting the absence of an overall WAPP coordination mechanism to take responsibility for project oversight, (c) in assuming that there was effective coordination with other donors, whereas the financial arrangements for the Benin component would take several years before becoming effective, (d) in not flagging the criticality of frequency synchronization, and (e) in not identifying the risk taken by the World Bank in financing a minor portion of the Benin component and thereby becoming subject to an implementation schedule where it had little control. These design flaws proved critical and negatively affected implementation and the achievement of the project development objective. (b) Quality of Supervision Rating: Moderately Satisfactory 64. The World Bank conducted regular missions to supervise the project, particularly for the Ghana component. World Bank supervision also benefited from having few Task Team Leaders (TTLs), thereby enabling a high degree of continuity. The shortcomings of the project regarding the Benin component cannot be attributed to World Bank supervision, which was hampered by limited leverage; nevertheless, the works which were directly financed by IDA were established correctly—mainly the CEB control center—in contrast to the rest of the Benin component which was financed by the AfDB and KfW. (c) Justification of Rating for Overall Bank Performance Rating: Moderately Unsatisfactory 65. The rating combines quality at entry and quality of supervision ratings. 5.2 Borrower Performance 66. Borrower performance is rated separately for the Ghana and Benin components and their respective governments and implementing agencies. Ghana Component - First and Second Phase of CTB Project, Credits 4092-GH and 4213-GH (a) Government Performance Rating: Moderately Satisfactory 67. The GoG supported the project throughout its implementation. Government procurement rules delayed the project initially but they were subsequently clarified and were no longer an obstacle to implementation. The Government was also instrumental in facilitating the unbundling of the power sector and resolving issues associated with the allocation of transmission responsibilities—including project implementation—to GRIDCo. (b) Implementing Agency or Agencies Performance Rating: Moderately Satisfactory 68. The VRA and GRIDCo managed their project competently and observed World Bank safeguard guidelines. There were minor failings that were detected at MTR, such as the initiation of works without having compensated potentially affected persons, and the need to reinforce the 19 PIU. Both of these failings were subsequently corrected. However, more should have been done to push proactively for a solution to the synchronization issue. (c) Justification of Rating for Overall Borrower Performance Rating: Moderately Satisfactory 69. The rating reflects the Government and implementing agency ratings, and the modest achievement of the PDO. Benin Second Phase of the CTB Project Credit 4214-BJ (a) Government Performance Rating: Unsatisfactory 70. The Governments of Togo and Benin took little interest in the project and did little to surmount the difficulties encountered by CEB, despite the potential benefits that would be reaped by their countries from the project. They did not take measures to assist CEB with nonpayment of its bills by their two distribution companies, thereby jeopardizing the sustainability of the project. (b) Implementing Agency or Agencies Performance Rating: Unsatisfactory 71. CEB managed the project poorly in terms of oversight of contractors and payments. It was unable to reach a satisfactory agreement on project completion with the transmission line contractor, and today the project faces the risk of having to be transferred to a different contractor. The lack of timely decisions on the part of CEB has been a major contributor to the problem of noncompletion. (c) Justification of Rating for Overall Borrower Performance Rating: Unsatisfactory 72. The rating reflects the Government and implementing agency ratings. 6. Lessons Learned (both project-specific and of wide general application) 73. Risks of breaking up project execution. The project was implemented independently by the VRA (subsequently GRIDCo) and CEB, despite being in many ways, an integrated endeavor that interconnected several countries. A more effective way of performing these types of projects can be through establishing a single company to build, operate, and maintain the facilities, thereby avoiding the disruptions that originate from piecemeal construction. This lesson has been applied in the case of the WAPP CLSG project. 74. Risks of minority participation in a multi-donor project. In this case, the World Bank financed the CEB control center as well as the overall supervision of the transmission line construction. As a result, despite having completed the control center component, the World Bank was forced to participate in the multi-donor financed transmission line project to the end, with little leverage on the critical transmission components of the project. It would have been preferable for World Bank participation to be limited to a single, well-defined, and free-standing component, 20 such as the CEB control center; this would have enabled the IDA financing to close earlier, reducing supervision costs and avoiding an unsatisfactory conclusion to the project. 75. Need for a high-level steering committee. The project was never given adequate prominence or attention at governmental levels. Such a committee, including representation from the funding agencies would help to address implementation problems at a much earlier stage and improve coordination among the different players. 76. Need for designation of a lead funding agency. WAPP had not assigned IDA as the lead coordinating agency for the project to provide supervision support, so IDA was not able to proactively lead actions to resolve implementation issues and funding gaps. In subsequent WAPP projects, WAPP agreed upfront to identify a lead development agency, which provides better implementation support. 77. Regional power projects are slow and costly to implement. Such operations are turning out to be more challenging than anticipated at the design stage. Subsequent ongoing WAPP projects confirm this trend and the design of future regional operations should reflect this. 78. Better design of results indicators is essential. This project suffered from two shortcomings in this regard: neither was any indicator included to measure outcomes attributable to IDA’s contribution as distinct from the whole operation nor were interim or national indicators provided. Consequently, the outcome is an ‘all-or-nothing’ affair, with no possibility of a nuanced result. 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners (a) Borrower/implementing agencies 79. A draft copy of the ICR report was shared with the Borrowers and Implementing Agencies. Comments were received from GRIDCo and included in this report. (b) Cofinanciers 80. A draft copy of the ICR report was shared with the Co-financiers and no comments were received. (c) Other partners and stakeholders Not applicable 21 Annex 1. Project Costs and Financing (a) Project Cost by Component (in US$ million equivalent) APL 1 Phase 1 (Ghana Component) Appraisal Estimate Actual/Latest Estimate Percentage of Components (US$ millions) (US$ millions) Appraisal 1. 330 kV Aboadze-Volta linea 53.21 71.95 135 2. Volta substation and Akosombo 14.00 13.55 97 switchyard upgrade 3. Project implementation support 7.50 8.38 112 4. Technical assistance 1.50 0.82 55 Total Baseline Cost 76.21 94.70 124 Physical contingencies 4.89 0.00 0 Total Project Costs 81.10 94.70 117 Interest during construction 2.40 0.00 0 Total Financing Required 83.50 94.70 113 APL 1 Phase 2 (Ghana Component) Appraisal Estimate Actual/Latest Estimate Percentage of Components (US$ millions) (US$ millions) Appraisal Component 1 33.05 33.84 102 Upgrade of Volta substation 4.03 16.56b 176 Upgrade of Akosombo substation 5.39 Kpong substation switchyard Upgrade 5.50 5.94 108 Third bulk supply point 18.13 11.34 63 Component 2 5.52 10.20 185 SCADA/EMS upgrade 5.52 10.20 185 Component 3 5.80 9.51 164 Crane rehabilitation, rust treatment at 3.00 6.38 213 Akosombo generating station Emergency preparedness plans Akosombo and Kpong generating 2.80 3.13 112 station Component 4 6.82 1.93 28 Pre-investment activities WAPP 2.42 1.93 80 VRA System Control Center Study 1.20 Not Executed Upgrade of VRA training center 3.20 Not Executed Total Baseline Cost 51.19 55.48 108 Physical contingencies 5.16 0.00 0 Price contingencies 3.65 0.00 0 Total Project Costs 60.00 55.48 92 Total Financing Required 60.00 55.48 22 APL 1 Phase 2 (Benin Component) - Bank Financing 2006 Appraisal Estimate at 2010 Actual/Latest Percentage Components Estimate Restructuring Estimate c d of Appraisal (US$ millions) (US$ millions) (US$ millions) 1. Transmission Infrastructure Development: engineering services- 1.50 1.50 1.2 87 supervision 2. Upgrade of transmission control and communications system and 9.77 13.35 12.2 125 CEB System Control Center 3 Emergency Preparedness Plan 0.60 1.00 0.9 150 Nangbeto power station 4. Project Implementation Support and Expert Advisory Panel for 0.65 0.25 0.3 31 WAPP Implementation Total Baseline Cost 12.52 16.10 14.6 117 Physical Contingencies 2.19 0.00 0.0 0 Price Contingencies 0.29 0.00 0.0 0 Total Project Costs 15.00 16.10 14.6 97 Total Financing Required 15.00 16.10 14.6 97 Source: c. Benin Phase 2 Restructuring Paper, December 2010. d. Cabira report, November 2016. Note: a. Includes the Volta System Control Center upgrade. b. Includes further switchyard upgrades in Volta and Akosombo switchyards. (b) Project Financing (Ghana Component) Appraisal Estimate Percentage of Actual/Latest Estimate (US$ millions) (US$ millions) Appraisal Phase 1 IDA 40.0 40.8 102 Kuwait Fund 17.5 12.4 70.9 VRA 14.0 41.5 296 European Investment Bank 12.0 0.0 0 (EIB) Total 83.5 94.7 113 Phase 2 IDA 45.0 45.2 100.4 GRIDCo 15.0 10.28 68.5 Total 60.0 55.48 92.5 23 Annex 2. Outputs by Component (a) Ghana Component APL 1 Phase 1 Cost Characteristics/Description (US$ million) Component 1 330kV Aboadze-Tema transmission line and terminal 71.95 substation Construction cost of 219 km, 330 kV single circuit twin bundle 11.80 transmission line Conductors and insulators 8.69 330 kV substations at Aboadze and Volta in Tema 15.06 161 kV switchgear and electromechanical equipment at the 161 4.52 kV Aboadze switchyard and Volta switching station Four 200 MVA 330/161 kV, three-phase autotransformers with 13.32 phase shifting capabilities for the Aboadze and Volta substations. Facilities for the extension and upgrade of SCADA and 5.84 communication system. EMP and RAP 12.71 Component 2 161kV Akosombo and Volta switchyards upgrade 13.55 161 kV electromechanical equipment including but not limited to 13.55 circuit breakers, disconnect switches, and protection and control facilities Component 3 Project implementation support 8.38 Project management, construction supervision, and engineering 0.80 for the construction of the Aboadze-Volta transmission line and associated 161 kV substation. Provision of project management, construction supervision, and 6.30 engineering for the supply and installation contracts for both CTB Phase 1 and Phase 2 projects PIU support: Provision of technical and institutional support, 1.28 capacity building, and logistics support for the PIU Component 4 Technical assistance 0.82 Engagement of an Expert Advisory Panel to review WAPP 0.12 ‘Operational Mitigation and Security Plan’ to provide expert advice on the efficient management and operation of the WAPP interconnection system. Generation Strategy Study for Akosombo and Kpong generating 0.68 stations to establish an operational strategy for the optimum operation of the hydro system within the context of the WAPP operation. The component covered the provision of appropriate consulting 0.028 services to assist the relevant stakeholders (Ministry of Energy, Public Utilities Regulatory Commission, and Energy Commission) to develop and implement a comprehensive action plan for an autonomous and commercially viable transmission system operator (TSO) within WAPP APL 1 Phase 2 Cost (US$, Characteristics/Description million) Component 1 Substation upgrades and equipment 33.84 Upgrade of 330 kV Volta Expansion of the 330 kV Volta substation and 161 kV Asiekpe 12.23 substation substation for the termination of the Volta-Tornu line and accommodate the reactor and the phase shifting transformer 24 APL 1 Phase 1 Cost Characteristics/Description (US$ million) Upgrade of 161 kV (PST) as well as relevant switchgear, protection, and control Akosombo substation facilities and associated civil works respectively Supply of PST and Design, manufacture, testing, and delivery of 161 kV PST and 4.33 reactor 330 kV reactor for installation at the 161 kV Asiekpe substation and 330 kV Volta substation respectively to ensure efficient and reliable operation of the 330 kV Volta-Tornu transmission line to meet the objectives of WAPP Upgrade of Kpong Replacement of old electromechanical switchgear including 5.94 generating station circuit breakers, disconnect switches, instrument transformers, switchyard protection, relaying and metering facilities to upgrade the Kpong generating station switchgear Third bulk supply point (a) Design, manufacture, testing, and delivery as well as the 11.34 installation of power and auxiliary transformers as well as relevant balance of plant and associated civil works at the Accra East and Achimota substations. (b) Design, manufacture, testing, and delivery of the following transformers for installation at the Accra East substation: (i) Two (2) 50/66 MVA, 161/34.5 kV PSTs (ii) Two (2) 250 kVA, 34.5/0.433 kV grounding/ auxiliary transformers. Component 2 SCADA/EMS upgrade for VRA network 10.20 (a) Supplementary works on SCADA involving the replacement 10.20 of obsolete remote terminal units (RTUs) and related optical fiber and power line carrier (PLC) communication systems (b) Accra Third Bulk Supply Point (A3BSP) telecommunication system Component 3 Generating station rehabilitation 9.51 Rehabilitation and Evaluation and assessment of dam safety, preparation of an 3.13 emergency preparedness Emergency Preparedness Plan and an EMP for the Akosombo plan and Kpong Dams. Crane rehabilitation and Rehabilitation of overaged penstocks and cranes at the 6.38 penstock rust treatment at Akosombo generating plant to ensure availability of essential Akosombo generating spares for the existing 85 ton intake crane, 65 ton spillway hoist, station and 450 ton power house gantry crane Component 4 Pre-investment activities and studies 1.93 Pre-investment activities for the proposed 330 kV Aboadze- 1.93 Prestea-Kumasi-Han and 161 kV Tumu-Han-Wa transmission systems VRA control center study - Not undertaken VRA training center - Not undertaken 25 (b) Benin Component Output Cost (US$ millions) • Transmission Infrastructure Development: engineering services- 1.2 supervision • Upgrade of transmission control and communications system and 12.2 CEB System Control Center • Emergency Preparedness Plan Nangbeto power station 0.9 • Project Implementation Support and Expert Advisory Panel for 0.3 WAPP implementation 26 Annex 3. Economic and Financial Analysis Background 1. The economic analysis at inception reflected the expected benefits from the interconnection, broken down into the main beneficiaries, namely Ghana, Togo/Benin, and Côte d’Ivoire. At ICR, the interconnection is not yet operating, but the transmission line from Aboadze to Tema is in service and is channeling energy from west to east. Benefits to Ghana consist of (a) increased transmission capacity for wheeling power from west to east, (b) increased power availability during years of drought, (c) reduced transmission losses, and (d) reduced CO2 emissions associated with lower transmission losses. 2. The project as designed in the Ghana component would have a maximum transfer capacity of 400 MW, which would be in addition to the capacity of the 161 kV line. The economic benefits associated with the 330 kV line can be quantified through the savings from generation in the Tema area that would be replaced by lesser-cost production in the Aboadze/Takoradi area. The project has been operating since mid-2013 and the historical transfers up to 2016 have been recorded. Table 3.1 Historical Transfers on Aboadze-Tema Line 2013 2014 2015 Average MW 19.97 59.80 51.58 Equivalent GWh 175 524 452 3. The original objective would have supplied Tema area’s load with natural gas-based production from power plants using the WAGP, which would have been the main offload point with 234 MMcfd; a fraction of this volume (around 40 MMcfd) could power combined cycle plants to provide power to be transferred through the 330 kV line at its designed capacity. Because gas supplies through the WAGP did not materialize, there is a limited production to be transferred through the 330 kV transmission line. 4. For the project to make economic sense, it would also be necessary to have the required demand at the Tema end of the line. At appraisal, one of the large sources of demand consisted of the Volta Aluminium Company Limited (VALCO) aluminum plant load, which has not materialized, thereby reducing the potential benefits of the project. Ex-post Economic Analysis 5. Given the uncertainty surrounding the future operation of the transmission assets, and the potential loading of the project within Ghana, the economic analysis simulates the effects of two main parameters on the project’s indicators: the load factor of the line, assuming a nominal capacity of 400 MW, and the cost margin involved in the optimization between the western and eastern areas of the network: • The load factor is calculated on the basis of the average line loading assuming a nominal capacity of 400 MW; on this basis, the load factor of 2014 and 2015 has been particularly low (13 percent and 15 percent, respectively); 27 • The cost margin would reflect the difference between generation technologies used in each region, for example, the benefits from replacing diesel-based production with natural gas generation. 6. Three scenarios are visualized to evaluate the project’s performance: • Scenario 1: Load factor equivalent to 20 percent for the 2016–2033 period and cost differential of 0.01 US$ per kWh. Under this scenario, the project exhibits a poor performance with a B/C ratio of 0.4 and an EIRR of 0.3 percent, as shown in Table 3.2 Table 3.2 Economic Analysis for 20% Load Factor/US$0.01 per kWh cost differential on Aboadze-Tema Line • Scenario 2: Higher demand develops and the load factor increases to 75 percent, and the cost differential remains constant at 0.01US$ per kWh. Under this scenario, the economic performance becomes acceptable and the B/C ratio increases to 1.14. Table 3.3 Economic Analysis for 75% Load Factor/US$0.01 per kWh cost differential on Aboadze-Tema Line • Scenario 3: Increased but modest load factor (40 percent) and increased cost differential to 0.015 US$ per kWh. Under this scenario there is increased demand at the Tema side of the transmission line, together with benefits estimated according to a US$0.015/kWh price differential between Tema and Aboadze. Table 3.4 Economic Analysis for 40% Load Factor/US$0.015 per kWh cost differential on Aboadze-Tema 28 7. The economic performance becomes acceptable with reasonable economic parameters, particularly with higher utilization factors of the transmission line. As shown in Tables 3.3 and 3.4, the 12 percent threshold IRR becomes feasible with higher load factors and reasonable cost differentials between the Aboadze/Takoradi generation facilities and those in Tema. 29 Annex 4. Bank Lending and Implementation Support/Supervision Processes (a) Task Team Members Phase 1 and Phase 2 Responsibility/ Names Title Unit Specialty Lending Amarquaye Armar Lead Energy Specialist EWDEN Team Leader Fanny Missfeldt-Ringius Energy Economist AFTEG Economics Karen Hudes Sr. Counsel LEGAF Lawyer Aman Sachdeva Consultant-Financial Analyst AFTEG Financial Analysis Environmental John Boyle Sr. Environmental Specialist AFTS1 Safeguards Social Development Dan Aronson Consultant-Social Scientist AFTTR Safeguards R. Gopalkrishnan Consultant - Procurement Specialist EAPCO Procurement Said Mikhail Power Engineer, and Team member AFTEG Power Engineering Charles Di Leva Chief Counsel, International Law LEGEN Lawyer Natalie Munzberg Counsel LEGAF Lawyer Wolfgang Chadab Sr. Finance Officer LOAG2 Disbursement Monitoring and Mohammed Khatouri Sr. M&E Specialist AFTKL Evaluation Mangesh Hoskote Sr. Power Specialist AFTEG Power Fred Yankey Sr. Financial Management Specialist AFTFM Financial Management Kofi Awanyo Sr Procurement Specialist AFTPC Procurement Monitoring and Mohammed Khatouri Sr. M&E Specialist AFTKL Evaluation Rita Ahiboh Program Assistant AFTEG ACS Support Lily Wong Chun Sen Program Assistant AFTEG ACS Support Salli Cudjoe Program Assistant AFC10 ACS Support Supervision/ICR Amarquaye Armar Lead Energy Specialist N/A Team Leader Fanny Missfeldt-Ringius Lead Energy Specialist GEE06 Team Member Karen Hudes Sr. Counsel LEGAF Lawyer Aman Sachdeva Consultant-Financial Analyst AFTEG Financial Analysis Natalie Munzberg Counsel LEGAF Lawyer Wolfgang Chadab Sr. Finance Officer LOAG2 Disbursement Monitoring and Mohammed Khatouri Sr. M&E Specialist AFTKL Evaluation Fred Yankey Sr. Financial Management Specialist AFTFM Financial Management Kofi Awanyo Sr Procurement Specialist AFTPC Procurement Environmental John Boyle Sr. Environmental Specialist AFTS1 Safeguards Social Development Dan Aronson Consultant-Social Scientist AFTTR Safeguards R. Gopalkrishnan Consultant - Procurement Specialist EAPCO Procurement Said Mikhail Power Engineer, and Team member AFTEG Engineering Richard Senou Senior Energy Specialist AFTEG Team Member Sunil Mathrani Program Leader, and TTL AFCF2 Team Leader 30 Issa Diaw Program Leader AFCC1 Team Member Janine Speakman Operations Analyst AFTEG Operational Support Fabrice Bertholet Senior Energy Specialist GEE03 Team Member Team Member, ICR Franklin Gbedey Senior Energy Specialist GEE07 contributor Rita Ahiboh Senior Program Assistant GTPFS ACS support Lu Ha Portfolio Analyst GTPFS Operational Support Margaret A Wilson Consultant AFTEG Juliana Victor Senior Operations Officer GEE08 QA and M&E Natalie Tchoumba Program Assistant GEE07 ACS support Raima Oyeneyin Operations Analyst GEE01 Operational Support Ramon Lopez-Riviera Consultant AFT Procurement Fernando Lecaros Consultant GEE01 ICR Primary Author (b) Staff Time and Cost Phase 1 Staff Time and Cost (Bank Budget Only) US$ (including Stage of Project Cycle No. of Staff travel and Weeks consultant costs) Lending FY02 32.50 43,668.94 FY03 31.04 90,747.84 FY04 33.89 58,376.71 FY05 45.34 81,115.57 Total: 142.77 273,909.10 Supervision/ICR FY06 10.20 65,836.51 FY07 15.16 423,125.49 FY08 12.94 58,266.08 FY09 7.44 63,389.76 FY10 13.20 8,506.76 FY11 11.73 17,134.09 FY12 9.01 7,877.34 FY13 8.22 14,743.11 FY14 2.27 1,975.24 Total: 90.17 660,854.38 31 Phase 2 Staff Time and Cost (Bank Budget Only) US$ (including Stage of Project Cycle No. of Staff travel and Weeks consultant costs) Lending FY06 13.95 101,169.00 Total: 13.95 101,169.00 Supervision/ICR FY07 2.38 8,061.61 FY08 14.52 91,718.19 FY09 17.1 32,360.1 FY10 16.51 16,215.96 FY11 17.94 15,119.4 FY12 13.18 9,476.48 FY13 8.97 22,017.15 FY14 9.41 10,177.56 FY15 9.41 13,093.29 FY16 8.67 2,193.94 FY17 4.55 37,195.22 Total: 122.6 257,628.90 32 Annex 5. Beneficiary Survey Results Not Applicable 33 Annex 6. Stakeholder Workshop Report and Results Not Applicable 34 Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR Summary of CEB’s Completion Report 1. This project was implemented owing to financial contributions from IDA, AfDB, KfW, Bank for West Africa Development (Banque Ouest Africaine de Développement, BOAD), and CEB. IDA Loan No. 4214-BJ was used to fund WAPP project activities, which lasted eight years and helped to achieve the implementation of project objectives. This evaluation was initiated to highlight the strengths and weaknesses of the actions undertaken by the World Bank under this project and to draw the relevant lessons in view of establishing post-completion prospects. 2. Medium-sized countries in ECOWAS, such as Benin and Togo, used to face difficulties in terms of energy supply and had a production pool that could not meet the energy needs of their respective populations. As of February 2007, both countries imported a substantial portion of their energy from Ghana, and from time to time, severe droughts reduced power supply in Ghana, and also affected hydroelectric plants in Togo, Benin, and Nigeria, which further exacerbated energy supply difficulties in these countries. With the interconnection of Nigeria via the Transmission Company of Nigeria, most of the imports have now shifted to Nigeria. I. Project Description and Launching 3. The long-term vision of the WAPP project is to become the main intermediary in charge of addressing the region's energy supply needs, building on existing sources such as high-capacity hydroelectric dams (Kainji and Jebba, Akosombo, Manantali, and Nangbéto), located along the major rivers in the region (Niger, Volta, Senegal, and Mono), with a competitive production cost, and promoting the construction of new hydroelectric and thermal power plants. 1.1 Organizational Framework of the Energy Sector in Benin/Togo 4. In 2006, the energy sector in Benin was jointly managed by the Ministry of Mines, Energy, and Water Resources (MMEE), the Ministry of Trade and Industry, and the Ministry of Agriculture, Livestock and Fisheries. The Directorate General of Energy of the MMEE prepared and implemented policies governing the energy sector. This department was also in charge of supervising the electricity subsector, with distribution functions devolved to the Benin Power Utility. 5. In Togo, the MMEE governs the power sector. The Directorate General of Energy of the MMEE is in charge of supervising the biomass and electricity subsectors. Togo allows private sector companies to provide electricity services. The country also set up a Regulation Authority to regulate their activities. 6. Beyond these organizations of national significance, Togo and Benin jointly set up, as early as 1968, CEB, which is a body in charge of importing, producing, and transmitting electric power to distribution companies and major consumers in both countries. 35 1.2 Project Description and Objective 7. The WAPP CTB Project, is subdivided into four (4) components as follows: (a) Engineering consulting for the supervision of construction works along a 330 kV transmission line, about 208 km long between the Sakété transformer substation in Benin and the Togo/Ghana boundary through Lomé in Togo, with an expansion of the Sakété 330/161/20 kV station and the construction of the 330/161/20 kV station in Lomé; (b) Modernizing and expanding CEB's ‘dispatch systems’; (c) Studies for the rehabilitation of the Nangbéto hydroelectric dam and the drawing up of an emergency plan for the plant; and (d) Recruitment of a panel of experts by WAPP to review the CTB operations manual. 8. The overall project objective is to substantially alleviate poverty in the ECOWAS region by extending access to modern energy services. More specifically, the project aims to build capacities in energy transmission between Nigeria, Benin, Togo, and Ghana in view of the commercialization of electricity, so as to improve reliability in energy supply, reduce production costs, and alleviate production deficits of the hydroelectric dams during droughts. Table 7.1. Project Components Objectives Expected Outcomes (i) Engineering consulting for the Build the capacities for electricity (i) Supervise the construction of a supervision of construction works transmission between Nigeria, 208 km long 330 kV transmission along a 330 kV transmission line Benin, Togo, and Ghana to line in Benin and Togo between the Sakété substation in facilitate energy pooling (ii) Supervise the expansion of the Benin and the Togo/Ghana border Sakété substation in Benin (iii) Supervise the construction of the Davié and Lègbassito substations in Togo (ii) Modernization and Equip CEB with a new dispatch (i) Enhance performance in terms of expansion of CEB's dispatch systems system which covers all current data transmission speed, storage and future substations of its capacities, and data processing interconnected network (ii) Ensure the visibility in due course of all operating source substations interconnected through WAPP (iii) Study for the rehabilitation of Have a consultant prepare a (i) Come up with a feasibility study the Nangbéto hydroelectric dam and report on the feasibility of on the rehabilitation of structures the drawing up of an emergency plan the rehabilitation of the Nangbéto (ii) Prepare an emergency plan in for the plant dam for resources mobilization case of the accidental collapse of the from financial donors dyke (iv) Recruitment by WAPP of a Draft, with technical assistance Have an operations manual for the panel of experts to review the from a consultant, an operations WAPP interconnected network operations manual of the CTB manual of the WAPP interconnected network 36 1.3 Project Set Up and Implementation within CEB 9. The coordination of project implementation was entrusted to the Benin Power Utility (CEB) insofar as the Benin-Togo components of the project. The day-to-day management of the project was entrusted to the PIU set up to handle contract award processes and FM and monitor the physical performance of contracts. The PIU was headed by a Project Lead and placed under the supervisory authority of the Director of Studies and Development of CEB. The Project Lead was assisted by technical, financial, environmental, and administrative staff. 10. A joint CEB-VRA project implementation committee was equally set up to coordinate activities and solve possible problems related to the implementation of the project in the three countries. The committee had the following main members: the Project Manager and Project Lead of VRA, as well as the Director of Studies and Development and the CEB Project Lead. 11. M&E. To better support project M&E, it was agreed that CEB would transmit progress reports every six months. These reports dealt with progress achieved in the physical implementation of works, carefully identifying problems, whether already encountered or foreseeable, suggesting possible solutions, and clearly indicating the forms of assistance and measures expected from the World Bank and other institutions and bodies. 12. Project implementation was also monitored by way of regular supervision missions dispatched to the field. The supervision and review process also entailed a systematic evaluation of project achievements in light of targets set in the project implementation schedule and contracts. 13. Based on aide memoires from the various missions, the World Bank also ensured the coordination of its field supervision missions together with the AfDB and KfW, which allowed for the evaluation of progress made on project implementation and the adoption of appropriate measures to solve possible problems. II. Project Design, Implementation, Achievements, And Impacts 2.1 Evaluation of Project Design 14. On the whole, the project design was satisfactory, as it allowed for: • The modernization and expansion of the CEB dispatching center and the construction of a backup dispatching center at the Cotonou Vèdoko substation; • The design of an operations manual for the WAPP interconnected network; • Feasibility studies for the rehabilitation and development of an emergency plan in case of accidental collapse of the dyke for the Nangbéto hydroelectric dam; and • The partial supervision of construction works along the 330 kV Ghana-Togo-Benin transmission line. 37 2.2. Main Outcomes Obtained from Each Project Component 2.2.1 Activities Earmarked and Activities Effectively Carried Out Table 7.2 Project Activities and Components Level Evidence of the Implementation Component 1: Development of the 330 kV 1 activity Ghana-Togo-Benin Power Transmission Line 1-1 Supervision of construction works Carried out Resources initially identified helped to along the 330 kV line finance the basic contract. However, delays in the execution of works led to the adoption of addenda to the basic contract. Since the World Bank no longer had available resources and taking into consideration the closing date of the loan agreement on June 30, 2016. the World Bank closed the financing of this activity. Component 2: Modernization and 2 activities Expansion of CEB's Dispatching Center 2-1 Consultancy services for the drafting of Carried out Evidence: Tenders and supervision reports technical specifications, preparation of tender by Electricité de France (EDF), the files, and supervision of modernization and engineering consultant available at CEB expansion works for the dispatching center 2-2- Modernization and expansion of the CEB Carried out Evidence: The new dispatching center at dispatching center the CEB headquarters and the backup dispatching center of Cotonou have been accepted and are currently operational. Component 3: Rehabilitation Studies for the 1 activity Nangbéto Plant and Drafting of the Emergency Plan 3-1 Consultant services for the feasibility Carried out Evidence: Rehabilitation study and studies, technical audit, assessment of security, emergency plan available at the detailed preliminary studies, and the Directorate of Studies and Development of preparation of the emergency action plan for CEB the hydroelectric development of Nangbéto Component 4: Drafting of the Operations 1 activity Manual for WAPP 4-1- Drafting of the operations manual for the Carried out Evidence: Procedures manual drafted WAPP network 2.2.2 Level of Achievement of Outcomes for each Component and Gap Analysis 15. Apart from the component pertaining to drafting an operations manual for the WAPP network, the three other components, namely (a) modernizing the dispatching system, (b) rehabilitation studies and the emergency plan, and (c) supervision of construction works along the Ghana-Togo-Benin 330 kV line were delayed, and their implementation went well beyond contract deadlines. 38 2.2.2.1 Modernization of Dispatching Centers 16. The contract for the construction of the structure was signed in January 2012, for an initial execution period of 22 months. Provisional acceptance, pending the structure, occurred in May 2017, that is, 42 months after the initial completion date. 17. At the operational level, the dispatching center was commissioned in May 2017. However, considering its initial configuration, it can be noted that: (a) Substations located in the northern areas of Benin and Togo could not be connected to the control center due to the unavailability of optic fiber linking between these substations. The optic fiber cable is actually damaged along the Atakpamé Kara segment. (b) The Sakété substation, which is the access route of energy from Nigeria, is not entirely visible in the dispatching center—due to poor drafting of the tender file according to the contracting company—and as a result of the obsolescence of communications equipment in the substation's design; and (c) The groups of the Nangbéto hydroelectric plant do not operate remotely from the dispatching center due to misunderstandings between CEB and the contractor related to an outstanding amount under another contract. 2.2.2.2 Works along the 330 kV Ghana-Togo-Benin Transmission Line 18. This activity encountered difficulties regarding the finalization of financial arrangements. The financing plan was finalized in June 2010 following the signing of a financing agreement between the Government of Togo and KfW, but access to resources was only made possible in May 2011, after the formalization and signing of separate agreements between CEB and KfW. These included two separate financing agreements, one amounting to EUR 12 million for the financing of substations and the second, for an amount of EUR 13 million, for the financing of transmission lines and substations in Togo. 19. To take into account the re-dimensioning of the Togolese component of the 330 kV line following a request from Togolese authorities to relate the 330 kV substation to Davié rather than Momé-Hagou and the construction of a new 161 kV substation in Lègbassito, CEB had to turn to BOAD to raise the necessary resources to integrate this new option. The loan agreement between BOAD and CEB was signed on December 28, 2012 for a total amount of CFAF 8.5 billion. 20. As a result, these initiatives to raise the project's additional funding led to a slowdown in the process of selecting the engineering consultant in charge of supervising construction works. The engineering consultant contract with Cabira/Societé Générale de Surveillance was signed in July 2013, five years after the effectiveness of the World Bank's financing agreement, following the award of various contracts for the construction of the Ghana-Togo-Benin 330 kV line. 21. Construction of the Ghana-Togo-Benin 330 kV line, initially slated to last 18 months would have permitted supervision to run until 2015. Although the closure of the World Bank's financing agreement only occurred on June 30, 2016, construction works along the 330 kV line witnessed 39 delays at all levels of the contract. This persistent delay in carrying out works on the various project sites did not allow the World Bank to continue supervision work until completion, as a further extension of the financing agreement after the June 30, 2016 deadline was not feasible. Other donors subsequently financed this activity. 2.2.3. Implementation Difficulties and Constraints for each Component 22. Difficulties that slowed down the timely implementation of the WAPP APL 1 project and thus negatively affected efficiency in achieving project objectives can be summarized as follows: • Delays observed in the finalization of the financing plan of the project component not covered by the World Bank and pertaining to the construction of structures of the Ghana-Togo-Benin 330 kV line and associated substations; • The belated start of construction works along the Ghana-Togo-Benin 330 kV line; • Administrative bottlenecks in managing the various procurement processes; • Recurrent cash flow difficulties at CEB which negatively affected the timely disbursement of resources allocated for compensation for property and persons affected by the Ghana-Togo-Benin 330 kV line; and • The resulting delay (42 months later than the initial project completion date) incurred by the Alstom/INEO consortium in the design and deployment of the dispatching center on the project site. 2.2.4. Lessons Learned and Prospects 23. The review of actions undertaken shows that project implementation gained in efficiency with respect to procurement and financial and accounting management due to the opening of a special account specifically for the project and the steering by CEB of the entire procurement process. 24. Delays observed in the construction of the project's dispatching center call for more vigilance in evaluating companies formed into groups, so as to better integrate their level of individual and collective liability in light of the risks resulting from insufficient coordination of their individual intervention and the complementarity of their experience in view of compliance with their contractual obligations. 25. Regarding the funding of multinational projects, there is also the necessity to enhance the coordination of actions of the various financial donors so as to optimize risks related to delays in financing finalization for activities not covered by one donor or another. 40 III. Critical Analysis of the Actions of the World Bank, Governments, and Technical Assistance 3.1 Appraisal of World Bank Actions throughout Project Implementation 3.1.1 Main Decisions that Eased Project Implementation 26. The various extensions of the loan agreement closing date helped to improve physical implementation levels, with better disbursements of the funds allocated by the World Bank. 3.1.2 Main Decisions that Hampered Project Implementation 27. The closing following several extensions of the loan agreement closing date negatively affected the continuation of the services of the consulting engineer. Indeed, upon the closure of World Bank financing, the works supervision contract remained the responsibility of CEB. 3.1.3 Project Monitoring by the World Bank 28. The monitoring mechanism set up by the World Bank helped to enhance its presence and facilitate its decision-making responsiveness in view of better achieving project goals. 29. The monitoring mechanism revolved around the following points: • Organization by the World Bank, with support from the other donors (AfDB and KfW) and based on their availability, of joint six-monthly project supervision missions; • Organization of video/audio conferences with the PIU; and • Regular discussions via e-mail and telephone between the World Bank’s TTL, the Director of Studies, and the Project Lead at CEB. 3.1.4 Key Lessons to be Learned 30. Achieving the outcomes of the 330 kV Ghana-Togo-Benin power transmission line remains an uphill task, owing to delays observed in the execution of works at the various project sites. Although the World Bank’s Financing Agreement did not cover this component, the component received indirect support from the World Bank, under the works supervision component. The withdrawal of the World Bank at the end of its funding was a hindrance to the fulfillment of this activity. 31. This further highlights the necessity to have a greater leeway during project design and development phases to better address implementation-related constraints. 32. Furthermore, in light of specificities (terms for effectiveness, variance of dates, and end of loan period) in loan agreements of the various financial donors, it is important that in the future, for multinational projects, all relevant financing agreements should have the same clauses so that 41 disbursements can be done simultaneously with all donors on board to avoid the withdrawal of one or more donors during critical stages of the project. 3.2 Appraisal of the Actions of the Governments of Benin and Togo during Project Implementation 3.2.1 Main Decisions that Eased Project Implementation 33. The decision that eased project implementation was the finalization in 2010 of the project's financing, after the launching of activities identified under the World Bank Financing Agreement, with the financial contribution of KfW through its support to the Government of Togo. 3.2.2 Main Decisions (or Absence thereof) that Hampered Project Implementation 34. The revision of the option initially adopted for the Ghana-Togo-Benin 330 kV line hampered project implementation. This revision of the basic study led to additional studies, which in turn delayed the start of construction works along the Ghana-Togo-Benin 330 kV line after the financing scheme for all activities was finalized. 3.2.3. Project Monitoring by Line Ministries of Benin and Togo 35. Monitoring of project activities by the supervisory authority was performed via: • Putting in place quarterly reviews within the Ministry of Energy; • Organization of the joint Government-World Bank annual review of the World Bank's portfolio; • Organization every two months since December 2011, under the chairmanship of the Ministry in charge of Development and in the presence of the World Bank Country Director, of a review of World Bank-funded projects in Benin; and • The quarterly review of projects, organized by Caisse Autonome d’Amortissement. 3.2.4 Key Lessons Learned 36. Enhancing project monitoring at the level of each stakeholder was instrumental in achieving the project’s objectives. A regular presence, the periodic review of the project portfolio at the national level was a key lever, which should be sustained in view of the achievement of the project's assigned objectives. 3.3 Evaluation of the Efficiency and Quality of Relations between the World Bank and the Government of Benin during Project Implementation 37. The World Bank and the Government of Benin kept excellent relations throughout the project's life cycle. The World Bank regularly positively responded to calls for funds to supply the project's special account. Six-monthly supervision missions were also organized at regular 42 intervals and the World Bank and Government of Benin regularly monitored the implementation recommendations taken at such meetings. 3.4 Evaluation of the Performances of the Various Institutions, Firms, and Consultants that Participated in the Project 38. CEB. The PIU, headed by the Director of Studies and Development, ensured the end-to- end management of all project components. Initiatives undertaken led to the design and development of CEB's dispatch system which is currently operational and allows for the remote control of 200 MW power from Nigeria, 60 MW of energy from Ghana, and productions from TAG in Cotonou, Lomé port, and Nangbéto Dam. Significant delays were recorded during project implementation, which led to the loan agreement being extended on several occasions. This was mostly due to the weaknesses of the Alstom/INEO consortium regarding the execution of works in accordance with their contractual schedules. 3.5. Prospects for the Sustainability of Project Achievements 39. The WAPP Project is a regional project that seeks to enhance electrical infrastructure within ECOWAS in view of guaranteeing power pooling and the development of a common regional power market. In this context, CEB should ensure the implementation of all its actions under the WAPP master plan to ensure the sustainability of the achievements of all components implemented under the 4214-BJ loan agreement. 40. Appropriate actions must be taken by CEB to: (a) Ensure the execution of structures provided for under the Ghana-Togo-Benin 330 kV transmission line; (b) Rehabilitate the Nangbéto hydroelectric dam; and (c) Raise funds for the Benin component of the 330 kV transmission line (Nigeria, Niger, Benin/Togo, Burkina Faso (northern backbone of the WAPP Project) 43 Appendix: Table of Performance and Results Indicators of the Project Indicators Objectives and Values Description of Indicators Ensure more stability and reliability of trade in energy between Development objectives of the WAPP “Zone A” Coastal States (Côte d'Ivoire, Ghana, Benin, project Togo, and Nigeria) CEB’s electricity imports from Nigeria usually oscillate the Baseline value Indicator 1 contractual threshold, at 700.8 GWh. Electricity imports from Nigeria in the last few years: 20121,188 GWh; 20131,383 GWh; Value achieved 20141,489 GWh; 20151,536 GWh; 20161,275 GWh Target value 2400 GWh Development objectives of Alleviate power supply deficits and reduce the vulnerability of project coastal states to drought-induced power supply disruptions Significant reduction of drought-induced power supply Baseline value disruptions. Minimum load in 2008 without 209.17 MW Minimum load in the last few years without Nangbéto: Target value Indicator 2 2012319.92 MW; 2013341.71 MW; 2014370.60 MW; 2015390.32 MW Maximum load in the last few years without Nangbéto: Target value 2012323.12 MW; 2013345.42 MW; 2014370.86 MW; 2015395.75 MW 2016389.90 MW Development objectives of Come up with a unified operations manual for the WAPP network project Indicator 3 Baseline value No Value Available Value achieved Manual drafted and adopted by the WAPP Task Force Target value Manual available 44 VOLTA RIVER AUTHORITY COMPLETION REPORT WAPP COASTAL TRANSMISSION BACKBONE PROJECT PHASE 1 (CR 4092-GH) AND PHASE 2 (4213-GH) I. Introduction 1. The member states of ECOWAS, within the framework of regional integration, have established a cooperative power pooling mechanism for West Africa known as WAPP. WAPP is envisaged as a means to provide the citizenry of the community, increased access to stable and reliable electricity at affordable costs. In this regard, various transmission/power system infrastructure are to be developed to establish WAPP. 2. The Ghana component of the WAPP transmission infrastructure includes the CTB Project. 3. The VRA was the executing agency responsible for the implementation of the Ghana component of the project which commenced in 2005. Operational control of the project was however given to GRIDCo in February 2010, following the operationalization of GRIDCo in 2008 upon the Power Sector Reform in Ghana. However, the VRA was still responsible for the performance of relevant obligations under the project since the Loan and Project Agreements were yet to be amended or the amendments were yet to become effective. II. WAPP CTB Project 4. The 330 kV CTB Project for WAPP “Zone A” consisting of Ghana, Côte d’Ivoire, Togo/Benin, and Nigeria is a priority project in the ECOWAS WAPP Master Plan. The project seeks to significantly expand the power transfer capacity from Côte D’Ivoire through Aboadze in Western Ghana, to Lome in Togo, through Sakete in Benin and to Ikeja West in Lagos, Nigeria. The 330 kV CTB Project consists of the following transmission lines and power projects: • 330 kV line from Sakete (Benin) to Ikeja West (Nigeria) • 330 kV line from Aboadze to Volta (Ghana) • 330 kV line Volta (Ghana)-Tornu (Togo)-Sakete (Benin) • Upgrade of strategic power generation and/or transmission assets including the CEB System Control Center (Lome, Togo). • Upgrade of the SCADA and communication systems at the Volta substation in Ghana into a WAPP Area Co-ordination Center. • The replacement of obsolete equipment including circuit breakers, relays, and disconnects at the Akosombo and Kpong generating stations switchyards and the Volta switching station in Ghana. 45 III. Objectives of the WAPP CTB Project 5. The overall objective of the WAPP CTB Project is to increase the access of WAPP “Zone A” Coastal States to more stable and reliable electricity as a means to alleviate power supply deficits and reduce their collective vulnerability to drought-induced power supply disruptions. 6. The expected outcomes for the WAPP “Zone A” Coastal States from the CTB projects based on the USAID-funded WAPP Transmission Stability studies undertaken by the Consulting firm NEXANT, USA were as indicated below: • Increased capacity to supply demand and reductions in power transfer losses • Cost efficient coverage of peak power demand through economic power exchanges • Alleviation in the overloading of the existing lines Akosombo-Lome-Cotonou-Sakete and Akosombo-Kumasi • Enhancement of the reliability of the Transmission system in compliance with N-1 planning criteria • Improvements in the dynamic response of the power system in reaction to faults and outages • Increasing Cross-border electricity trade IV. Ghana Components of WAPP CTB Project 7. The Ghana components of the CTB Project were packaged as: • 330 kV Aboadze-Volta (Tema) transmission line and associated substation works • 330 kV Volta-Tornu (Ghana-Togo border) segment of the Ghana-Togo-Benin interconnection including substation termination works at the Volta switchyard in Tema and a Third Bulk Supply Point for Accra and Tema load centers. • Upgrade and extension of SCADA/EMS and communication systems, including the replacement of the hardware and software at the Volta System Control Center and associated terminations and upgrades or replacements of RTUs at remote substations. • Replacement of existing overage and obsolete equipment including circuit breakers, relays, and disconnects at the Akosombo and Kpong generating station switchyards and the Volta switching station as well as the rehabilitation of cranes and penstocks at the Akosombo generating station. • VRA training school upgrade for WAPP operations • Technical assistance for various power system studies, institutional support, and for implementing and regulatory bodies as well as engineering and project 46 implementation support, including pre-investment studies for additional WAPP transmission lines. • Assessment of dam safety and preparation of emergency preparedness plans and emergency management plans for the Akosombo and Kpong Dams which were to be implemented in two phases. • Pre-investment studies for the 330 kV Aboadze-Kumasi-Prestea-Han and 161 kV Tumu-Han-Wa transmission system V. Funding for 330 kV WAPP CTB Project 8. The project was implemented in two phases with funding from the Kuwait Fund, World Bank/IDA, AfDB, and EIB. The funding from the EIB was however cancelled due to various reasons and the relevant contract packages were therefore funded by the VRA. The details of the funding support were as follows: Funding for Phase 1 of the 330 kV WAPP CTB Project 9. Phase 1 of the 330 kV WAPP CTB Project, which involved the construction of the 330 kV Aboadze-Volta line and associated substations was implemented with funding support from the Kuwait Fund, the EIB, and the World Bank/IDA. The details of the expected funding support were as follows: (a) The Kuwait Fund for Arab Economic Development provided Kuwaiti Dinars 5.0 million (approximately, US$17 million) for the construction of the 215 km 330 kV Aboadze-Volta transmission line and associated 161 kV substation works for interconnection of the existing 161 kV facilities with the new 330 kV substation facilities as well as institutional support and project management services for the relevant contract packages financed by the fund. (b) The EIB were to provide EUR 10.5 million to fund the supply of 330/161 kV autotransformer with phase shifting capability for installation in the 330 kV substations in Aboadze and Tema and the construction of 330 kV Aboadze and Tema substations. (c) The disbursement of the financing was not made due to unresolved issues on the Onlending Agreement and the amendment of the legal documents. The EIB therefore advised that the financing has been cancelled in accordance with the provisions of the financing. (d) The VRA therefore made all payments for the two contracts for the construction of the 330 kV substations and supply of autotransformer with phase shifting capability, which have since been completed, and the VRA had initiated the process for the reimbursement for the eligible payments made to the limit of the EIB loan amount of EUR 10.5 million. 47 (e) The World Bank/IDA provided SDR 26.5 (approximately US$40.0 million) for the supply of conductors and insulators for the 330 kV transmission line, the extension/upgrade of SCADA/EMS and communication facilities, the upgrade of the Volta System Control Center, the replacement of overage and obsolete equipment at the Akosombo generating station switchyard and the Volta switching station, Tema, and the provision of various consulting services and technical assistance including project management and engineering consultancy services. 10. The financing plan for the funding of the 330 kV CTB Project for Phase 1 is attached as Appendix A. VI. 330 kV Coastal Transmission Backbone Project (Phase 1) - Components/Packages 11. The various components under Phase 1 of the project were packaged and funded as indicated below: Component 1: Infrastructure Development a) Package 1-A: Supply of Conductors and Insulators 12. This component was in two (2) lots and funded by the World Bank/IDA. It involved the design, manufacture, testing and delivery to site of ‘TERN’ conductors, alumoweld shield wires, and optical ground wires (OPGW), as well as fog type U120 BP and U160 BSP glass insulators for the construction of transmission lines. b) Package 1-B: Construction of 330 kV Aboadze-Volta Transmission Line 13. This package co-funded by the Kuwait Fund involved the construction of approximately 219 km of 330 kV single circuit twin bundle ‘TERN’ conductor transmission lines on self- supporting steel towers. It covered the design, manufacture, testing, and supply of the steel towers and other associated accessories, storage of ‘TERN’ conductors and alumoweld shield wires, and fog type U120 BP and U160 BSP glass insulators from others, transportation and distribution of materials to the various tower locations, and all relevant civil works, tower erection, and stringing activities. c) Package 1-C: 161 kV Substation Works 14. This package co-funded by the Kuwait Fund involved the design, manufacture, testing, and the supply, installation, and commissioning of 161 kV switchgear and electromechanical equipment at the Aboadze switchyard and Volta switching station for the termination/interface of the 161 kV facilities with the 330 kV ones. d) Package 1-D and 2: Extension and Upgrade of SCADA/EMS and Communication Systems 15. This package co-funded by the World Bank/IDA involved the design, manufacture, testing, delivery to site, and installation of the facilities for the provision of SCADA and upgrade of the PLC communication system including the following: 48 • Provision of tele-protection of the transmission line, the remote control and telemetering of the substation facilities through optic fiber and PLC communication facilities on the 330 kV transmission line project • The provision of a new System Control Center and communication facilities at the Volta switchyard to serve as a regional system control center, comprising the provision of new hardware and software capable of monitoring the Ghana power network and communicating with other WAPP System Control Centers in the region as well as the provision of ancillary facilities • The replacement of old obsolete RTUs and defective Capacitor Voltage Transformers (CVTs) • Related optic fiber and PLC communication enhancement works in the national power system to ensure a reliable SCADA system for WAPP 16. This package was supplemented by an allocation in Phase 2 of the CTB Project funded by the World Bank/IDA to ensure full achievement of the project objectives. e) Package 1-E: Construction of 330 kV Substations 17. The package was to be co-funded by the EIB and involved the design, manufacture, testing, and erection of substation equipment such as circuit breakers and disconnect switches as well as protection, control, and metering facilities and the construction of 330 kV substations at Aboadze and Volta. f) Package 1-F: Supply of Transformers with Phase Shifting Capability 18. The package was to be co-funded by the EIB and entailed the design, manufacture, testing, and delivery to the project site of four 200 MVA 330/161 kV, three phase autotransformers with phase shifting capabilities. 19. However, there were no disbursements from the financing for the above packages 1-E and 1-F due to the contract issues on the Onlending Agreement as well as the amendment of the legal documents following the power sector reforms and the operationalization of GRIDCo. The VRA therefore solely funded these packages. g) Package P3 and P4: Upgrade of Electromechanical Equipment at Akosombo Generating Station Switchyard and Volta Switching Station 20. This package co-funded by the World Bank/IDA, involved the design, manufacture, testing, erection, and commissioning of 161 kV electromechanical equipment, including but not limited to circuit breakers, disconnect switches, and protection and control facilities to replace existing overage and obsolete ones to upgrade the facilities at the Volta switching station and the Akosombo generating station switchyard to ensure the reliability of power supply into WAPP. 21. An additional allocation was made from the World Bank Credit 4213-GH to facilitate payments for the project. 49 Component 2: WAPP APL 1 Project Implementation a) Project Management, Construction Supervision, and Engineering Services 22. Two separate consultants were engaged for the projects funded by the Kuwait Fund, AfDB, and the World Bank/IDA to provide project management and construction supervision services as outlined in the contracts below. 23. C1-1: The contract for the project management, construction supervision, and engineering for the construction of the Aboadze-Volta transmission line and associated 161 kV substation which was funded by the Kuwait Fund was undertaken by SMEC International. 24. C1-2: This contract involved the provision of project management, construction supervision, and engineering for the supply and installation for both CTB Phase 1 and Phase 2 projects funded by the World Bank as well as the construction of the 330 kV Volta-Tornu transmission line for the Ghana-Togo Interconnection Project funded by the AfDB. b) Institutional Support and Logistics 25. This component was to support institutional capacity building and provide technical and logistics support for the PIU. Activities undertaken included: • Review of procurement processes. An individual consultant was engaged to review the existing procurements processes for WAPP’s priority projects and to make recommendations to streamline them and expedite project implementation. • Review of PIM. An individual consultant was engaged to review the effectiveness of the PIM and make recommendations. This study was to establish the institutional causes of delays, if any, which were causing the poor drawdown of the IDA Credits. • Procurement of vehicles for project supervision and administration by the PIU • Procurement of office supplies. Office consumables and personal protection equipment for staff of the PIU, through shopping, for project implementation. • Procurement of IT equipment. Computers, printers, and projectors as well as cameras, photocopiers, and scanners for the PIU. • Skills training and capacity building. An individual consultant was engaged for a study to identify the staffing requirements for the capacity building of GRIDCo staff in the areas of operating and maintenance, protection and control, system operations, finance, legal, procurement, and inventory management as well as to prepare and carry out a program of training for staff as, may be necessary. The training program is to strengthen and develop personnel capability to meet the skills demands of the ever- expanding power grid. 50 Component 3: Technical Assistance for WAPP Action Plan a) C-2: Generation Study for the Optimization of the Operation of the Akosombo and Kpong Hydroelectric Power Generating Stations 26. A Generation Strategy Study for Akosombo and Kpong generating stations was undertaken to establish an operational strategy for the optimum operation of the hydro system within the context of the WAPP operation. The strategy was to ensure secure and reliable delivery of power and energy to the West Africa subregion at least cost without compromising electricity supply security in Ghana. b) C-3: Expert Advisory Panel 27. An Expert Advisory Panel was to be engaged to review the WAPP Operational Mitigation and Security Plan to provide expert advice on the efficient management and operation of the WAPP interconnection system. In this regard, a Synchronization Study was undertaken under this component to study the power systems of Nigeria, Benin, and Togo through Ghana to Côte d’Ivoire to ensure the effective interconnection of the power systems of these countries. c) Assistance to Ministry of Energy, Energy Commission, Public Utilities, and Regulatory Commission 28. The component covered the provision of appropriate consulting services to assist the relevant stakeholders to develop and implement a comprehensive action plan for an autonomous and commercially viable TSO within WAPP. 29. In this regard, two individual consultants were engaged to make presentations and share their knowledge and experience in the development of the Wholesale Power Market in connection with a Wholesale Power Market Workshop. Presentations were made to help stakeholders of the power industry in Ghana and understand the complexities in the process of creating a wholesale market and challenges associated with the process. VII. 330 kV Coastal Transmission Backbone Project (Phase 2) - Components/Packages 30. Phase 2 of the 330 kV WAPP CTB Project was implemented with financial support from the AfDB and the World Bank/ IDA. 31. The World Bank/IDA provided SDR 30.8 million (approximately US$45.0 million) and the AfDB, approximately UA 14.87 million (approximately US$23 million) to support the financing of the various components of the project. The various components under Phase 2 of CTB were packaged as follows. Component 1: Transmission Infrastructure Development a) Package P5-1: Supply of PSTs & Reactor 32. This package funded by the World Bank/IDA covered the design, manufacture, testing, and delivery of a 161 kV PST and 330 kV reactor for installation at the 161 kV Asiekpe substation 51 and 330 kV Volta substation, respectively, to ensure efficient and reliable operation of the 330 kV Volta-Tornu transmission line to meet the objectives of WAPP. b) Package P5-2: Construction of Volta-Tornu Transmission Line 33. This package involved the construction of the approximately 140 km single circuit 330 kV transmission line from the 330 kV Volta substation in Tema (Ghana) to Tornu on the Ghana-Togo border to increase the power transfer between Ghana, Togo, Benin, and Nigeria in the West African subregion and is funded by the AfDB. c) Package P5-3: Expansion of 330 kV Volta and Akosombo Switchyards 34. This package involved the expansion of the 330 kV Volta substation and 161 kV Asiekpe substation for the termination of the Volta-Tornu line and the accommodation of the reactor and the PST as well as relevant switchgear, protection and control facilities, and associated civil works. 35. During the implementation of the project, the PST which was originally to be located at the 161 kV Akosombo switchyard was relocated to the 161 kV Asiekpe substation due to space and technical constraints. d) Package P5-4: Third Bulk Supply Point for Accra/Tema 36. The package was in two lots and involved the construction (supply and installation) of a third bulk supply point for Accra/Tema, terminating at Achimota: (i) Package P-5-4-1: Substation Works. This involved the design, manufacture, testing, and delivery as well as the installation of power and auxiliary transformers including circuit breakers, disconnect switches, protection, control and metering facilities, and associated civil works, including the construction of control building, and so on, at the Accra East and Achimota substations and installation of power and auxiliary transformers. (ii) Package P-5-4-2: Transmission Line Works. This was to involve the design and supply of five double circuit and ten single circuit dead-end angle towers, AAC (LILAC) conductors, ADSS fiber, fog type U100BP glass insulators, line hardware and fittings, rehabilitation of existing towers, conductors, shield wires, and accessories before stringing, and improving upon existing tower access routes. The decommissioning of one set of existing line terminal equipment on the Akosombo- Volta line and protection system and one double circuit suspension type tower near the Volta substation as well as stringing of the unstrung arm of the double circuit tower from Volta substation to Achimota substation and breaking into one existing OPGW and Volta-Achimota line for termination in the new substation. 15 15 The original contract with Montreal Montajes Y Realizaciones S.A, was reassigned to AEE Power due to the firm’s inability to pre-finance the contract as a result of some financial constraints. GRIDCo funded the project. 52 e) Package P-5-4-3: Supply of Power Transformers 37. The scope of the supply involved the design, manufacture, testing, and delivery of the following transformers for installation at the Accra East substation: • Two 50/66 MVA, 161/34.5 kV power transformers • Two 250 kVA, 34.5/0.433 kV grounding/auxiliary transformers f) Package P-6: Upgrade of Kpong Generating Station Switchgear 38. This package involved the replacement of the old electro-mechanical switchgear including circuit breakers, disconnect switches, instrument transformers, and protection, relaying, and metering facilities to upgrade the Kpong generating station switchgear. Component 2: Upgrade of System Control Centers a) Package 1D and 2: Extension and Upgrade of SCADA/EMS and Communication Systems 39. This project package was to complement the one under Phase 1 of the 330 kV WAPP CTB Project of the Infrastructure Development Component to provide other supplementary works needed to achieve the WAPP objective of improved monitoring and control of power exchanges between “Zone A” Coastal States. The supplementary works included the replacement of obsolete RTUs and related optical fiber and PLC communication systems. Component 3: Upgrade of Strategic Power Generation Facilities a) C-6: Emergency Preparedness Plan 40. An engineering consulting firm was engaged for the evaluation/assessment of dam safety and preparation of an Emergency Preparedness Plan and an EMP for the Akosombo and Kpong Dams. b) Package P-7: Rehabilitation of Cranes and Rust Treatment of Cranes and Penstocks 41. The penstocks and cranes at the Akosombo generating plant were overage and beyond the end of their useful asset life while essential spares for the existing 85 ton intake crane, 65 ton spillway hoist, and 450 ton power house gantry crane were also not readily available. The rehabilitation of the cranes and rust treatment of the cranes and penstocks was to maintain and/or increase the reliability of the facilities. 53 Component 4: Implementation of WAPP Action Plan a) Package P-8: Supply of Equipment for the VRA Training Center 42. The VRA training school was to be equipped and upgraded to provide training in maintenance and operating skills to support the WAPP organization. The scope of the upgrade involved the provision of: • Modular power plant simulator (generation, transformation, distribution, and so on) • 330 kV transmission line training field • Staff technical capability • Development of training modules (hydro and thermal generation, dispatcher training, and so on) b) Transmission System Studies 43. Engineering firms were to be engaged to undertake the following pre-investment activities for the transmission systems: • C4R: Feasibility study, engineering, line route survey including the preparation of bidding documents for the proposed 330 kV Aboadze-Prestea-Kumasi-Han and 161 kV Tumu-Han-Wa transmission systems • C5R: Preparation of Environmental and Social Impact Assessment, EMP, and RAP for the proposed 330 kV Aboadze-Prestea-Kumasi-Han and 161 kV Tumu-Han-Wa transmission systems. 54 Comments from GRIDCo on the draft ICR Report 55 56 57 58 59 60 Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders No comments were received. 61 Annex 9. List of Supporting Documents 1. Eighth Quality at Entry Assessment (QEA8) FY 2006–2007 2. Project Appraisal Document for West African Gas Pipeline Project, November 2, 2004 3. Implementation Completion and Results Report for West African Gas Pipeline Project June 30, 2014 4. Project Appraisal Document for WAPP CTB Project (APL 1, First Phase) – June 1, 2005 5. Project Appraisal Document for WAPP CTB Project (APL1, Second Phase - June 2, 2006 6. Financing Agreements 7. Project Agreements 8. Aide-memoires on file 9. ISRs 10. Restructuring Papers 11. GRIDCo Annual Report, 2015 12. Volta River Authority (VRA) Fifty Fourth Annual Report and Accounts 2015 13. CABIRA/Societé Générale de Surveillance (Project Supervisors) July 2015 and November 2016 Project Reports 62 MAP 63