THE WORLD BANK ASIA ALTERNATIVE ENERGY PROGRAM (ASTAE) Annual Status Report #12 July 1, 2003 - June 30, 2004 (FY2004) December 2004 Washington, D.C. I I ■ -- :I I 園 l I Contents Acronyms and Abbreviations ............................................................................................... i 1. BACKGROUND .......................................................................................................... 1 2. OVERVIEW OF FY04 PROGRESS ............................................................................... I Highlights ................................................................................................................ 1 Approval of Projects Supported by ASTAE ........................................................... 2 Funding M obilization .............................................................................................. 2 Outreach and Promotion .......................................................................................... 2 W orld Bank's Bonn Commitment ........................................................................... 3 IN 3. TARGETS OF ASTAE BUSINESS PLAN 2004-2006 .................................................... 3 4. IW LEMENTATION BUSINESsPLAN FY04 .................................................................. 5 Projects Approved in FY04 ..................................................................................... 6 Achievements under Projects Closed in FY04 ........................................................ 7 Project Added to the Pipeline in FY04 .................................................................... 9 Ongoing Nonlending Activities and Knowledge Management ............................ 10 5. ASTAE RESOURCE UTILIZATION ........................................................................... 14 6. STAFFING ............................................................................................................... 14 TABLES: Table 1: ASTAE Indicators for FY04 .......................................................................... 2 Table 2: ASTAE Targets and Contribution to M DG ................................................... 4 Table 3: Changes in FY04 and Status at the End of FY04 ........................................... 5 Table 4: Resource Utilization, World Bank and Donors, FY1992-2004 ................... 15 ANNEXES: Annex 1: Energy Lending Statistics FY02-03 ............................................................ 16 Annex 2: Portfolio of World Bank/GEF Loans, Credits, and Grants for Alternative Energy in Asia that received ASTAE Support .......................... 17 Annex 3: ASTAE Supported Investment Projects-East Asia and the Pacific ........... 33 Annex 4: ASTAE Supported Investment Projects-South Asia ................................. 34 Annex 5: Publications in FY04 .................................................................................... 35 Annex 6: Key ASTAE Funding Events ....................................................................... 36 6 L I ACRONYMS AND ABBREVIATIONS AIJ Activities Implemented Jointly (Mechanism) ASTAE Asia Sustainable & Alternative Energy Program BB Bank Budget BMZ Bundesministeriumflir wirtschaftliche Zusammenarbeit und Entwicklung (German Federal Ministry for Economic Cooperation and Development) BNPP Bank-Netherlands Partnership Program CEB Ceylon Electricity Board CFL Compact Fluorescent Lamp CG Consultative Group CIDA Canadian International Development Agency CRESP China Renewable Energy Scale-Up Program DANIDA Danish Agency for Development Assistance DfID (U.K.) Department for International Development DGIS (Netherlands) Directorate-General for International Cooperation DSM Demand-Side Management DSMO Demand Side Management Office EASEG East Asia Energy and Mining Sector Development Unit EASIN East Asia Infrastructure Department EC Electric Cooperative EdC Electricit6 du Cambodia EdL Electricit6 du Laos EE Energy Efficiency EGAT Electricity Generating Authority of Thailand EMC Energy Management Company EnPoGen Energy, Poverty, and Gender Project ESCO Energy Service Company ESD Energy Services Delivery ESMAP Energy Sector Management Assistance Programme EVN Electricity of Vietnam FTL Fluorescent Tube Lamp FY Fiscal Year GEF Global Environment Facility GOC Government of China GOI Government of Indonesia GRIDCO Grid Corporation of Orissa GTZ Deutsche Gesellschaftfiir Technische Zusammenarbeit (German Corporation for Technical Cooperation) GWh Gigawatt-hour IBRD International Bank for Reconstruction and Development ICR Implementation Completion Report IDA International Development Association IDF International Development Forum IEA International Energy Agency IMC Investment Management Contract IREDA Indian Renewable Energy Development Agency ISO International Organization for Standardization kW Kilo Watt kWp Kilowatts-peak MEA (Thai) Metropolitan Electricity Authority MFI Microfinance Institution MMS Mandated Market Share MNES (Indian) Ministry of Non-Conventional Energy Sources MW Megawatt MWp Megawatts-peak NGO Nongovernmental Organization PBS Palli Bidyut Samitis (Rural Electricity Cooperatives) PDF GEF-Project Development Facility or Power Development Fund of Nepal Power Development Project PHRD Japan Policy and Human Resources Development Fund PLN Perushaan Listrik Negara (Indonesian State Electricity Corporation) PV Photovoltaic PV GAP Global Approval Program for Photovoltaics QuaP-PV Quality Program for Photovoltaics RAPSS Remote Area Power Supply System REAP (Vietnam) Renewable Energy Action Plan RERED Renewable Energy for Rural Development Project SASEI South Asia Energy and Infrastructure Sector Unit SEIER (Vietnam) System Efficiency Improvement, Equitization and Renewables SHS Solar home system Sida Swedish International Development Cooperation Agency TA Technical Assistance tce Tons of coal equivalent U.K. United Kingdom UNDP United Nations Development Programme US/ECRE U.S. Export Council for Renewable Energy US/IFREE U.S. Internal Fund for Renewable Energy and Efficiency US/NRECA National Rural Electric Cooperation Association US/NREL National Renewable Energy Laboratory USAID U.S. Agency for International Development USDOE U.S. Department of Energy USTDA U.S. Trade and Development Agency WB World Bank WSSD World Summit on Sustainable Development r 1. BACKGROUND In 1992, the World Bank and donor partners established the Asia Alternative Energy Program (ASTAE) to support the transition to environmentally sustainable energy use in developing countries in Asia. ASTAE's strategic objective during the past decade has been to mainstream alternative energy in World Bank energy sector activities, with the aim of achieving a 10 percent share of renewable energy and energy efficiency components in World Bank energy sector projects in Asia. This strategic objective has been achieved; during the period FY98-2000, more than 12 percent of the Bank's power sector lending in Asia was for alternative energy components and projects, and renewable energy and energy efficiency are important components of country strategies. With this milestone achieved, ASTAE reviewed its program strategy in 2002-03 to ensure that its overall objectives and individual country strategies were in line with the larger business strategies of the East Asia Energy and Mining Sector Development Unit (EASEG), the new East Asia Infrastructure Unit (EASIN), and the Bank as a whole. Based on a management review of the program initiated in FY02 and finalized in FY03, and in response to the World Summit on Sustainable Development (WSSD), ASTAE prepared a new business plan covering the period 2004-2006. This business plan was presented at the meeting of the Consultative Group (CG) on Energy Trust Funded Programs, managed by the World Bank in March 2004. Based on the business plan, additional funding was mobilized. This document presents the progress achieved during FY04 towards the 2004- 2006 targets. 2. OVERVIEW OF FY04 PROGRESS HIGHLIGHTS Events that took place in FY04, important to ASTAE, were: (a) the World Bank Board approval of 3 projects which received ASTAE support; (b) commitment from the Netherlands to fund a Phase III support for ASTAE; (c) the launch of an outreach and promotion campaign in response of the 2004 CG meeting; and (d) the World Bank commitment made at the International Conference for Renewable Energies in Bonn in June 2004. ASTAE Status Report 1 APPROVAL OF PROJECTS SUPPORTED BY ASTAE FY04 was a productive year for ASTAE, with three projects approved by the World Bank Board of Directors, with a total alternative energy investment of US$121 million of which US$26 million in IBRD/IDA commitments and US$26.8 million in GEF grants. The projects supported by ASTAE constituted 16% of total energy lending in Asia and 27% of total energy investment, including both World Bank lending and GEF support (for details see Annex 1). The three projects will provide access to electricity for 125,000 households, and facilitate investments in an additional 11.8MW of renewable energy capacity. Details are provided in Table 1. TABLE 1: ASTAE INDICATORS FOR FY04 Households On and off grid Energy tCO2' Renewable Efficiency displaced Energy GWh over over 20 years MW 20 yrs Cambodia: Rural Electrification and 107,000 6.8 - 498,666 Transmission Project Philippines: Rural Power Project 18,000 5.9 - 366,666 Philippines: Electric Cooperative - - 1,867 838,777 System Loss Reduction Total FY2004 125,000 11.8 1,867 1,704,129 FUNDING MOBILIZATION The ASTAE funding requirement for calendar years 2004 to 2006 is estimated at $9.32 million, of which $3.27 was secured before FY04. In FY04, the Government of the Netherlands committed to fund a Phase III support for ASTAE of C3.3 million, which is equivalent to about $4.2 million. The remaining funding gap is $1.85 million. OUTREACH AND PROMOTION At the instance of donors at the 2004 CG meeting, ASTAE started with an inventory of lessons learnt from projects supported in the earlier years of its existence. Former task managers and donor agencies were interviewed and supported projects were - -visited. A document and video presenting these experiences were produced: the ASTAE "Atlas": Sustainable Energy, Less Poverty, More Profits. This initiative eventually led to the BBC World Earth Report Documentary "A Switch in Time", highlighting how the World Bank's projects, supported by ASTAE, have mainstreamed renewable technology and energy efficiency in a number of countries. This documentary was aired globally in February and March 2005, and received favorably. Based on the assumption that 1 MW installed capacity in renewable energy avoids 1,000 ton carbon (replacement of diesel oil) or 3,660 tCO2, these projects will displace over 11,800 ton carbon/year. Assuming that the lifetime of the installed capacity is 20 years, this would be a displacement of 236,000 ton of carbon, or 865,333 ton of CO. (Conversion factor used is I ton CO2 equals 12/44-ton carbon). ASTAE Status Report 2 WORLD BANK'S BONN COMMITMENT At the International Conference on Renewable Energies that took place in June 2004 in Bonn, the World Bank Group committed to an Action Plan to foster renewable energy and energy efficiency as part of the World Bank Group's portfolio. This action plan has major implications for ASTAE's work program. The World Bank made the following commitments: (1) The World Bank Group's strategy, through programs and policies, will aim to ensure that renewable energy and energy efficiency are seen as economically viable and essential ingredients in the energy choices of our member nations, not marginal considerations. (2) With the aim of ensuring an institutional focus on the transition toward cleaner energy sources, the World Bank Group commits with the concurrence of its Board of Directors to a target of at least 20 percent average growth annually in both our energy efficiency commitments and our renewable energy commitments over the next five years (FY05 - FY09).2 This is equivalent to doubling the World Bank Group's current annual commitment of about $200 million.3 Thereafter, this goal will be reassessed. The 20% per annum growth rate pledge made by the World Bank Group in Bonn, will apply to the World Bank Group as a whole, which includes World Bank (IBRD and IDA), IFC and MIGA together with GEF co- financed amounts in projects executed by the World Bank Group. 3. TARGETS OF ASTAE BUSINESS PLAN 2004-2006 In the ASTAE Business Plan 2004-2006 of January 2004 and revised March 2005, ASTAE promises its donors to achieve by 31 December 2006 the following targets: * Provide an additional 1 million households with improved energy services; * Installation of an additional 1 GW renewable electricity generating capacity equivalent; and * Avoid an additional 1 GW of conventional electricity generating capacity equivalents through efficiency improvement. 2 This growth target for renewable energy includes solar energy for heat and power, wind energy for mechanical and electrical power generation, geothermal and biomass energy for power generation and heat, and hydropower plans less than 10 MW per facility. The growth target for energy efficiency will include both demand-side and supply-side options. While this target applies only to a subset of energy options that can be considered as renewable energy or energy efficiency, it will not restrict the World Bank Group in any way to support other renewable energy, energy efficiency or mainstream power projects in line with requests from our clients and their country assistance strategies. The baseline against which the performance of the target is to be measured represents US$200 million. This was the World Bank (IBRD and IDA) approximate average lending commitment in the 3 years, FY02, FY03 and FY04. This is also not much different from the average since 1990. The baseline includes exclusively solar energy for heat and power, wind energy for mechanical and electrical power generation, geothermal and biomass energy for power generation and heat, and hydropower of less than 10MW. ASTAE Status Report 3 Achieving the above targets would mitigate 156 million tons CO2 over a 20-year period. Table 2 summarizes how meeting the ASTAE targets contributes to meeting larger goals such as the Millennium Development Goals. TABLE 2: ASTAE TARGETS AND CONTRIBUTION TO MDG ASTAE target Millennium Development Goal An additional 1 million households provided with Increase Access to Modem Energy Services improved energy services. (MDG 1,2,3,4 indicators 1,la,8,14) Installation of an additional 1 GW renewable Increase Renewable Energy Capacity electricity generating capacity (MDG 7, indicators 27,28,29) Avoiding of an additional 1 GW conventional4 Invest in Efficient Use of Energy electricity generating capacity equivalent, through (MDG 7, indicators 27,28,29) efficiency improvements. Mitigate 156 million tCO2M Mitigation of GHG (MDG 7, indicators 28) For Asia the World Bank's Bonn commitment translates to $372 million investment in renewable energy and energy efficiency projects in the period 2004-2006. This is I based on an average annual investment of $85 million in FY02 to FY04 in Asia. ASTAE will contribute to achieving this target. I To achieve the established targets, ASTAE will support five strategic areas, as follows: oi Develop Sustainable Energy Programs in ASTAE Priority Countries in Asia Develop Sustainable Energy Projects in other Countries in Asia e Develop Sustainable Energy Components in Non-Energy Sectors Projects in Asia * Develop ASTAE "Flagship" Projects * Shanghai Green Electricity scheme (for details see Box 1) * Development and piloting of financing options for renewable energy investments and energy efficiency. e Documentation of successful public-private- partnerships. - * Operationalizing gender in ASTAE-supported activities. Outreach and Knowledge Sharing * Client country consultations; * Sharing experience/lessons learned; * Facilitating South-South partnerships and dialogues; * Coordination and collaboration with initiatives similar to ASTAE; 4 The indicator for this target is under discussion. ASTAE Status Report 4 L I * Establishment and maintenance of a dialogue with the NGO community; and * Facilitation of donor information exchange. Further details are provided in the ASTAE 2004-2006 business plan. Box 1: Green Electricity Scheme for Shanghai The Shanghai Municipal Government (with assistance from ASTAE and ESMAP) has developed a green electricity program, called Shanghai Jade Electricityc to pass through incremental cost of electricity generated by renewable energy sources to consumers who are willing to pay and actively participate in protecting the environment and developing more renewable based electricity capacity in the municipality. The program will initially support wind and PV electricity only. Green electricity will be available to households, industries and commercial customers, although initially the focus will be on large non-household consumers. Large non-household consumers must buy blocks of 6 MWh with a minimum number of blocks depending on the total electricity consumption of the consumer. Households must buy blocks of 12 kWh with a minimum of 10 blocks. At present the shanghai Municipality has 3.4 MW wind and 10 kWp PV capacity with another 21 MW wind under construction. With the support from ASTAE and ESMAP a Municipal Government Decree and Implementation Plan have been prepared. The Decree will provide the required legal basis to market green electricity in Shanghai. The Decree has passed two approval stages and is awaiting final approval by the Municipal Government. Shanghai Jade Electricity is expected to be available in 2005. Based on a consultation meeting with CEO's of large national and foreign companies located in the Shanghai Municipality it is expected that the available amount of green electricity will be sold very quickly. This would provide a strong signal for developing additional renewable electricity generating capacity in Shanghai. 4. IMPLEMENTATION BUSINESSPLAN FY04 Table 3 summarizes changes in ASTAE's portfolio in FY04 and the situation at years end. For a description of all projects, see Annex 2. The financial details for projects in East Asia are provided in Annex 3 and for projects in South Asia in Annex 4. TABLE 3: CHANGES IN FY04 AND STATUS AT THE END OF FY04 Changes in FY04 South Asia East Asia and the Pacific Total Closed 2 2 4 Approved 0 3 3 Added to pipeline 0 2 2 Dropped from pipeline 0 0 0 Status end FY04 South Asia East Asia and the Pacific Total Total Closed 4 6 10 Under implementation 6 13 19 Pipeline 0 8 8 Total 10 27 37 ASTAE Status Report 5 This section summarizes FY04 progress by presenting: (i) the three projects approved by the Board of Directors in FY04; (ii) the progress achieved under the four projects closed during FY04; (iii) the two projects added to the ASTAE pipeline; and (iv) the seven ongoing non-lending activities supported by ASTAE. PROJECTS APPROVED IN FY04 In FY04 the World Bank Board of Directors approved the projects Philippines Rural Power, Philippines Electric Cooperatives Power Loss Reduction and Cambodia Rural Electrification and Transmission. These projects are described in detail below. 1. Philippines Rural Power (PO663971PO72096) The Board approved the project on December 4, 2003. The objective of the Project is to support reforms and priority investments directed at improvements of the quality of life in rural areas through the provision of adequate, affordable and reliable energy services, in partnership with the private sector. Use of renewable energy will be promoted where cost effective. The main project components include: (a) rural electrification subprojects; (b) partial credit guarantee fund; and (c) capacity building, focusing on reduction of market barriers to the commercialization of renewable energy development. This Adjustable Program Loan (APL) will have four phases extending over a period of fourteen years. Total alternative energy investment for Phase 1 is $26.7 million. IBRD/IDA provides $10 million while the GEF provides a grant of $10 million, of which one million is executed through UNDP and $9 million through the World Bank. ASTAE provided major support to preparation of this project, including funding a solar home system (SHS) market assessment in the Philippines, co-financed with Solar Development Foundation, and supporting the economic analysis of the SHS project component. 2. Philippines Electric Cooperatives Power Loss Reduction (PO66532) The main objective of the Project is to achieve significant and sustained energy efficiency improvements in Electric Cooperatives (ECs), to provide current and prospective viable EC customers with reliable and least-cost power supply over the long term. - Towards this end; the project would: (i) develop and test financial-and contractual mechanisms to support private sector investment, management and operation, and risk sharing to support system loss reduction measures in selected ECs; and (ii) support commercial lending to qualified ECs for efficiency improvements. The project pilots the use of investment management contracts to attract private investors to manage and operate selected ECs under long-term, performance-based contracts, and to mobilize private finance without recourse to the government. For those ECs that are yet unable to attract private investors, access to affordable term loans would be facilitated. Both objectives will be supported by the establishment of the Partial Credit Guarantee Program for commercial loans under this Project. The total project size is $62.3 million, including ba a GEF grant of $12 million. ASTAE Status Report 6 3. Cambodia Rural Electrification and Transmission (PO64844) The Cambodia Rural Electrification and Transmission Project was approved on December 16, 2003. This project will support renewable energy activities as an integral part of the government's rural electrification program. It will help to strengthen the country's policy and legal framework and to build capacity of various stakeholders. The project has four main components: * A Transmission Line component, to be implemented by EdC and comprising a 220kV line connection to Vietnam, reinforcements of the 115kV grid around Phnom Penh, and a National Control Center to optimize load dispatch operations; * A Rural Electrification component, to be implemented by EdC and comprising MV and LV lines and electrification of about 50,000 households. The Project will make use of private sector providers (REEs) in the operation of rural distribution systems; * A pilot Rural Electrification Fund component that will provide assistance to private sector developers for: (a) about 45,000 new grid connections; (b) solar home system installations for about 12,000 households; and (c) addition of at least 6 MW of mini-hydro and 850kW of micro hydro capacity; and Institutional Development and Sector Reform TA component providing consulting and advisory services to renewable energy policy development, promotion of rural income generation options, renewable energy business development, private sector providers improvement and association building, and capacity building of financial institutions. Total project cost is $150 million with an estimated alternative energy investment of $32 million. IBRD/IDA will provide a loan of $40 million (of which an estimated $16 million is for the alternative energy part) and the GEF a grant of $5.8 million. ACHIEVEMENTS UNDER PROJECTS CLOSED IN FY04 Four projects closed during FY04: 1. Indonesia Solar Home Systems (SHSs), P035544/P003700; 2. Thailand Metropolitan Distribution Reinforcement, P037086; 3. India-Andhra Pradesh Power Sector Restructuring, P049537; and- 4. India Orissa State Power Sector Restructuring, P035170. 1. Indonesia Solar Home Systems (PO35544/P003700) The Indonesia Solar Home Systems project received a large amount of ASTAE support during the identification, preparation, and implementation phases of the planned $44 million project. ASTAE assisted in the design of this project, which supported solar home system investments funded and/or implemented by the private sector, NGOs, and cooperatives. Within the framework of a least-cost rural electrification strategy, the project supported investments in solar home systems to areas not expected to receive ASTAE Status Report 7 I grid-connected electrical services for at least three years. Components included TA for developing energy strategies and strengthening institutional capacities. Because of the Asia financial crisis, and attendant market collapse, the project scope was greatly reduced (from $44.3 million to just $5.3 million). Total direct alternative energy investment inclusive of IBRD, GOI, Participating Banks and sub- borrowers/end-users was $4.6 million, with another $4.3 million of TA and implementation and institutional support for $8.9 million in total support to alternative energy. Although only 8,054 solar homes systems were installed during the project, there were other benefits in terms of confirming the relatively low level of credit subsidy (20%) necessary to encourage uptake and testing innovative design features that found application in subsequent Bank/GEF projects elsewhere around the region. Furthermore, SHS sales have continued by the six dealers participating in the project. The lending component closed January 31 2001 and the GEF grant closed December 31, 2003. 2. Thailand Metropolitan Distribution Reinforcement, P037086 This Bank-assisted lending project, which closed June 30 2003, was intended to meet the anticipated growth in demand during 1997-2001 by improving system reliability, restructuring the Metropolitan Electricity Authority (MEA) in preparation for its commercialization, and introducing DSM to the organization. Total estimated project cost at appraisal was $331 million ($148 million IBRD); including $3 million for DSM program development. ASTAE assisted in the preparation and supported supervision of the DSM component, which was scheduled to include an appliance-testing laboratory, load research, load control and energy service company (ESCO) development. Implementation was seriously affected by the country's 1997-1999 financial/economic crisis. With MEA management understandably reluctant to commit resources to DSM in the midst of declining demands, ongoing dialogue culminated in a restructuring of the DSM component to emphasize development of commercial DSM (ESCO) capabilities within MEA. With the recent return of demand growth and increasing tariffs, and building on the capacity supported through this project, MEA as of 2003 has developed a new ESCO strategy comprising a strategic partnership with Bank Thai PLC to jointly pursue ESCO business objectives. Under _this partnership program, the commercial bank will extend credit directly to customers for energy efficiency investments whilst MEA provides its expertise to convert technical energy audits conducted by third parties, mostly equipment vendors, into a commercially-viable, investment -ready project package. A 15-person ESCO within the Electrical System Service Department is now responsible for project assessment and management; equipment installation control and auditing; and performing technical feasibility study on energy conservation, proposing energy conservation measures as well as providing measurement and verification. ASTAE Status Report 8 3. India Andhra Pradesh Power Sector Restructuring, P049537 This large ($281 million at appraisal) T&D investment project closed August 31, 2003. ASTAE contributed to this project by implementing a linked integrated agricultural DSM activity financed under the activities implemented jointly (AU) mechanism. This activity was scheduled to include improvements in distribution system efficiency, metering, and end-use efficiency improvements in irrigation systems. Unfortunately, there were significant delays in finalizing scope of work, engaging consultants, ultimately this component did not disburse, and the AIJ-funded component was cancelled. 4. India Orissa State Power Sector Restructuring, P035170 This large, reform-oriented project closed June 30, 2004. ASTAE staff assisted in the preparation of a Demand-Side Management (DSM) component in the state's power sector reform program and is now supervising implementation of this component. A DSM cell was set up within the Grid Corporation of Orissa (GRIDCO) to facilitate load research and DSM program development. DSM investments were scheduled to include municipal water pumping and storage systems, motor rewinding and motor efficiency programs, load research linked to a proposed metering program, and various DSM opportunities in the industrial, residential, commercial, and agricultural sectors. However, the DSM component was restructured during implementation, with the emphasis placed on metering, especially of agricultural accounts. Total scheduled Bank support for the DSM component was $10 million; actual support was considerably less. PROJECT ADDED TO THE PIPELINE IN FY04 Of the pipeline projects included in the FY03 ASTAE Status Report 11, three projects were approved (see above). Two new projects entered the preparation pipeline: PNG Teachers Solar Lighting Project and the Indonesia Rural Electrification Project. No *7 project was deleted from the pipeline. 1. PNG Teacher's Solar Lighting Project (P088940) Papua New Guinea has one of the lowest rural electricity access levels and highest poverty levels within the East Asia and Pacific Region. The main objective of- this project is to improve the life of rural health and education service providers by removing the barriers now preventing the use of solar photo-voltaics for house lighting and other purposes. This proposed GEF MSP will be a comprehensive and integrated pilot operation with the goal of promoting purchase of 2,500 solar lighting systems by government teachers and health workers posted to areas without electricity. In addition to financial remediation of initial cost hurdles via a Revolving Risk Equalization fund and a payroll deduction plan, TA will be provided to develop markets, build solar provider capacity, train end-users, and develop a national program for recycling of batteries. This small-scale pilot is intended to establish confidence in the PV technology and suppliers on the part of users and financiers that will lead to rapid scaling up of the ASTAE Status Report 9 I solar lighting industry throughout rural PNG.5 ASTAE has provided significant support to early sector work and subsequent preparation work to develop this project for submittal to the GEF. Total alternative energy investment will be $3.2 million, with $1 million provided by GEF. This project is expected to be approved in FY05. 2. Indonesia Rural Electrification Project (P091020) Indonesia's rate of electrification is about 57 %, among the lowest in the region, which means some 90 million people still do not have access to electricity. About two- thirds of the population without electricity lives in the rural areas and 65% of these is outside of Java-Bali. The Government of Indonesia (GOI) has made rural electricity access a major development objective, whereby a large part of the population can improve their standard of living and play a more productive role in the economy. Over the past three decades, GOI has allocated considerable resources to its rural electrification program mainly through the state owned power utility PLN. However, in a country with roughly 15,000 islands and a length and width of 5,000 and 1,800 kilometers, the task of rural electrification has never been easy and expanding power to rural areas should not rely entirely on conventional power generation technologies through PLN's grid connections. In response to the request of the GOI for support of increasing rural electricity access, the World Bank has indicated in the recent CAS that it will support rural electricity access and renewable energy development projects in the country. The current CAS appropriates a potential $200 million for the rural electrification part, anticipating that this World Bank commitment will leverage substantial additional funds from both public and private sources of funding. ONGOING NONLENDING ACTIVITIES AND KNOWLEDGE MANAGEMENT Main non-lending activities carried out in FY04 included: 1. Study tour for Chinese officials on renewable energy promotion laws to Europe (March/April 2004). For several years, the Government of China (GoC) had been preparing laws with which to shape a supportive policy environment for promoting the development of renewable energy. The GoC/ -World Bank/ GEF Renewable Energy Scale-Up Programme (CRESP) supported this process. At the start of its phased implementation, the development of a policy for a mandated market share (MMS) would be a high priority. It would specify pricing arrangements and tax incentives, and an obligation to connect and purchase renewable electricity. Other initial elements would include the development of market infrastructure, featuring training and establishment of standard contracts; a focus on technology, cost reduction and quality improvement through shared Papua New Guinea Teacher's Solar Lighting Project Medium Size Project Brief, September 2004. ASTAE Status Report 10 investments, and a GoC Partnership for Renewable Energy through which to mobilise international assistance. In August 2003, the National People's Congress assigned the task of legislative preparations to the National Development Reform Committee. In order to optimise the rafting process of these laws, study tours were organised for lawmakers to gain a better understanding of how other countries have introduced laws, which operate through an MMS. ASTAE gave financial and logistical support to a study tour of 12 Chinese lawmakers to Germany, Spain and the United Kingdom held at the end of 2003. Other tours were organised to the United States and Australia. In December 2004, the Renewable Energy Law was introduced to the NPC (and approved February 2005). 2. Support to the Government of Mongolia (GOM) in the update of their Energy Strategy. The Energy Strategy was presented to donors at the CG meeting. ASTAE supported both the development of a Concept Note on Rural Energy Supply, as well as its r dissemination. 3. Support to rural energy sector work in Papua New Guinea This includes the preparation of a Background Note entitled "Papua New Guinea Energy Sector and Rural Electrification" (1 March 2004), creation of a Rural r Electrification Advisory Committee, and supervision of an ESMAP-supported project entitled "Innovative Approaches to Provision of Rural Electricity Services in PNG". ASTAE supported the development of models for financing solar lighting for teachers in Papua New Guinea under the Teachers Solar Lighting Project (SLP) in Papua New Guinea, which has funding support from the Global Environment Facility. Funding will be made available for loans for teachers to acquire solar lighting kits, in the provinces of Milne Bay, Western Highlands, East Sepik and New Ireland. The project aims at making a direct contribution to improving the conditions and quality of education, and provides experience for the possible development of such a nation-wide service to teachers. The loans are to be provided through the Teachers Savings & Loan Society (TSL), which in mid-2003 has a membership of 35% of all teachers. In the four provinces covered by the SLP, 39% of the teacher population are members. Under TSL regulations, loans to members are normally for 1-3 years for personal loans, and 5 years for housing construction on State land. In the case of the solar lighting loans, which were to cover 100% of the indicated price of 3,000 PNG Kina (US$ 930), the TSL was willing to take the full credit risk for loans over only three years, given the shape of its unused loan capital. However, this would imply a fortnightly loan payment of K46, and this was considered unaffordable. ASTAE Status Report 11 In June 2004, ASTAE supported a mission to resolve this dilemma. It was proposed that the TSL should extend the loan period to a notional five years, with the SLP covering the credit risk for the fourth and fifth year through a 'risk equalisation payment' to the TSL. This would lead to an affordable repayment instalment to the TSL of K31 each fortnight, with the instalments in Years 4 and 5 being recovered by SLP from the TSL. 4. Watergy: Energy Efficiency in Chinese Water Supply Project Under the Hebei Urban Environment Project in China, which is supported by a World Bank loan, one key partner is the Tangshan Water Supply Company. The performance of this company has been hampered by the state of decay of the existing infrastructure. Early in 2004, a study was financed by ASTAE on how to address this issue. A World Bank Energy Efficiency mission, conducted in March 2003, had proposed an upgrade to the infrastructure. The enhancements to the Tangshan water infrastructure would comprise an upgrade of the water intake pumping station, through replacement of pumping sets with high efficiency pumps and variable frequency drives; an upgrade of water treatment plants, including more energy- and water-efficient filter backwashing systems, flocculation tanks and settlement clarifiers; an upgrade to the ground water treatment plant, including higher efficiency pumps, variable frequency drives and new switch cubicles; and replacement of 31 km of decayed pipes. In the Hebei project, a 'loans saving' had arisen of US$ 5.1 million. The report commissioned by ASTAE recommended in detail how these funds could be reallocated to proposed new contract packages for improving the water infrastructure. Those would cost US$8.3 in total. Under the disbursement ratios agreed in the Hebei Loan Agreement, the World Bank component would total US$ 5.09 million. 5. Maximizing Acceptability of Home Solar in the Philippines Most solar photovoltaic (PV) applications in the Philippines have been in the commercial and industrial sectors. The large potential for investment in rural household applications has gone under-utilized - 50% of the nation's population of 78.5 million people lives in rural areas, often in remote and dispersed mountain and island communities. In partnership with the Philippine Department of Energy, the World Bank intends to support a Solar Credit Line through national financing institutions for the purpose of refinancing loans to rural customers of PV Systems. The Government of the Philippines, with GEF funding, also intends to provide subsidy /grant support through PV companies to "buy down" the initial cost of PV systems. ASTAE Status Report 12 There have been relatively few insights in the perception of consumers regarding the value of PV systems, and their willingness to pay. A market research study, reported upon in 2004, was financed by ASTAE amongst the residents of underserved rural barangays (rural communities) of which 6,500 were unelectrified nationwide in 2003, and amongst local opinion leaders. The study gathered data on energy requirements and consumption patterns; availability and accessibility of financial services, awareness of and disposition towards PV products and a value for money rating. 6. Planning the Assessment of Renewable Energy Resources in Laos The Lao PDR Southern Provincial Rural Electrification II Project (SPRE II) is a underway, with the goal of gaining project approval by mid-2005. Its principal objective is to expand rural electricity service in the central and southern provinces of Lao PDR. It will do so by extending the grid to some 42,000 households and providing off-grid electricity services to a further 10,000 households during Phase 1 (July 2005 - December 2007) and, subsequently, further extending the grid to some 51,500 households and providing off-grid electricity services to a further 20,000 households during Phase 2 (January 2008 - June 2010). The overall preparation of SPRE II includes the assembly of a comprehensive rural electrification database, which will make possible a coordinated approach. It should therefore cover all villages whether on- or off-grid and including, at the village level, total number of households, local availability of raw energy resource (wind, biomass, hydro, solar insulation, etc), proximity of grid step-down transformers, number of households connected to the grid, existing electricity demand and potential load, number of diesel rice mills, number of electric rice mills, year in which the village was energized, and type of income-generating activities that could benefit from electricity. ASTAE supported a study, completed in mid-2004, to prepare the comprehensive Renewable Resource Assessment Plan to be undertaken under SPRE II. Its report notes that there is substantial inventory data available from previous studies supported by JICA, ASTAE, UNEP and ADB, but it is clearly incomplete. The support of ASTAE will therefore allow previous work to be capitalized upon, further developed and complemented. 7. Building a Tool Box on Small Power Purchase Agreements The emergence of small power producer (SPP) programs is proving to be a cornerstone in renewable energy programmes in many countries, not least in Asia. In Thailand and India, for example, almost 4% of national power supply is from these initiatives. Their operation depends upon the existing of clear, functioning Power Purchase Agreements between SPPs and electricity boards, regulating issues of standard tariffs, their indexation (or not) with foreign exchange and local inflation, and review procedures. ASTAE Status Report 13 r E In February 2004, the report was published of a study commissioned by ASTAE on 'Small Power Purchase Agreement Application for Renewable Energy Development: Lessons Learned from Five Asian Countries'. It describes compares and contrasts the PPA measures in place in Thailand, Indonesia, India (including state-based measures in Andhra Pradesh and Tamil Nadu), Sri Lanka and Vietnam taking into account their common elements and their specificities. Intended as an aid to those contemplating small power production programmes and independent power programs, the study emphasized both the innovative and perhaps replicable features of each country's instruments, and those elements, which have led to problems during rollout and implementation. r 5. ASTAE RESOURCE UTILIZATION ASTAE supports alternative energy initiatives at all stages of the project cycle: identification, preparation, implementation, and evaluation. At the identification stage, support can be provided for identification studies or missions, or by supporting energy sector work to assess issues and options with respect to alternative energy. At the project implementation stage, ASTAE can support troubleshooting of alternative energy components. ASTAE has also supported project evaluation to draw out lessons learned and best practices from completed alternative energy projects or project components. The major part of ASTAE support, however, is devoted to project preparation through capacity building and supporting studies. The use of donor funds by ASTAE in FY04 totaled $1.014 million (see Table 4). The use of World Bank resources for ASTAE supported projects, including GEF Bank Budget (BB), totaled in FY04 $3.014 million. Total donor funds, utilized by ASTAE since FY92 is $19.7 million. The Table shows a steep increase of the Bank's own budgets spent on renewable energy and energy efficiency activities in FY04 because a large number of projects approved in previous years have become effective. There is a clear rising trend of World Bank spending on renewable energy and energy efficiency: World Bank budget for alternative energy in the past 3 years (FYO2-04) is four times the volume of that of the first 3 years (FY92-94). 6. STAFFING Ms. Junhui Wu, Sector Manager, East Asia Energy and Mining Development Sector Unit, was the ASTAE Program Manager during FY2004. In March 2004, Antonie de Wilde was appointed as the ASTAE Coordinator. Grayson Heffner and Enno Heijndermans were the ASTAE Program Based consultants. ASTAE Status Report 14 TABLE 4: RESOURCE UTILIZATION, WORLD BANK AND DONORS, FY1992-2004 Donors' World Bank2 Total $ % $ % $ % FY92 108,000 32 226,400 68 334,400 100 FY93 827,087 66 419,100 34 1,246,187 100 FY94 1,399,635 67 688,100 33 2,087,735 100 FY95 1,309,063 56 1,046,000 44 2,355,063 100 FY96 2,057,058 56 1,618,924 44 3,675,982 100 FY97 1,705,817 59 1,197,128 41 2,902,945 100 FY98 1,617,777 59 1,126,683 41 2,744,460 100 FY99 1,782,576 61 1,156,346 39 2,938,922 100 FY00 2,627,480 63 1,524,004 37 4,151,484 100 FYO1 955,281 46 1,106,035 54 2,061,316 100 FY02 2,108,541 66 1,106,035 34 3,214,575 100 FY03 2,205,111 64 1,239,633 36 3,444,744 100 FY04 1,014,358 25 3,013,893 75 4,028,251 100 Total 19,717,784 56 15,468,280 44 37,055,126 100 Notes: 1. Includes the Netherlands, U.S. agencies, the New Zealand Ministry of Foreign Trade, the German Federal Ministry for Economic Cooperation and Development and the German Corporation for Technical Cooperation (BMZ/GTZ), the European Community, the International Energy Agency (IEA), the Danish Agency for Development Assistance (DANIDA), Sida, and Government of the Swiss Confederation and in-kind contributions. 2. Includes World Bank/GEF Annual Discretionary Budget, Office Occupancy, Consultant Trust Funds, PHRD, International Development Forum (IDF), and PDF grants. ASTAE Status Report 15 Annex 1: Energy Lending Statistics FYO2-03 Lending and GEF support (million $) FYO2 FY03 FY04 World Bank lending 19,519 18,513 20,100 East Asia and the Pacific 1,774 2,311 2,613 South Asia 3,508 2,919 3,417 Asia Total 5,282 5,230 6,030 Energy lending total 1,975 1,088 1,022 East Asia and the Pacific 315 254 50 South Asia 505 151 120 Asia Total 820 405 170 Lending for alternative energy (estimated) East Asia and the Pacific 17.2 0 26.0 South Asia 132.9 49.2 30.0 Asia 150.1 49.2 56.0 Lending for alternative energy (% of energy lending) East Asia and the Pacific 5.5% 0.0% 52.0% South Asia 26.3% 32.6% 25.0% Asia 18.3% 12.1% 32.9% GEF support for alternative energy East Asia and the Pacific 4.5 31.5 26.8 South Asia 16.0 0.0 0.0 Asia 20.5 31.5 26.8 Energy investment total (lending + GEF) East Asia and the Pacific 319.5 285.5 76.8 South Asia 521.0 151.0 120.0 Asia 840.5 436.5 196.8 Alternative energy investment (lending + GEF) East Asia and the Pacific 21.7 31.5 52.8 South Asia 148.9 49.2 30.0 Asia 170.6 80.7 82.8 Alternative energy investment (% of energy investment) East Asia and the Pacific 6.8% 11.0% 68.8% South Asia 28.6% 32.6% 25.0% Asia 20.3% 18.5% 42.1% ASTAE Status Report 16 Annex 2: Portfolio of World Bank/GEF Loans, Credits, and Grants for Alternative Energy in Asia That Received ASTAE Support6 Closed Loans, Credits and Grants 1. Lao PDR Provincial Grid Integration (PGI), P004197 This project included components for demand-side management (DSM) and institutional building. ASTAE coordinated a South-South twinning arrangement between Electricit6 du Laos (EdL) and Tenaga Nasional Berhad (the Malaysian electric utility) to provide comprehensive training in utility operations to EdL. ASTAE also a helped twin EdL with Tunisia's Agence pour la Matrise de l'Energie for training in commercial sector energy audits. Total alternative energy project cost was $0.9 million, which was for 100 percent provided by the World Bank loan to support the DSM component. Board approval date: October 6, 1992. Closing date: January 31, 2000. 2. India Renewable Resources Development, P010410/P009583 ASTAE assisted in the overall design, appraisal and supervision of this project, which included PV, wind, and minihydro components totaling $284 million in investment. The Indian Renewable Energy Development Agency (IREDA) has played a direct, as well as catalytic, role in successfully commercializing renewable energy. Renewable energy share of power generation capacity in India is now growing faster than ever before. It increased from about 0.1 percent of total generation capacity in 1992 to 3 percent in 2000. Nearly 3,000 MW of wind, small hydro, biomass, and solar photovoltaic power systems were in operation by March 2001 compared with about 100 MW in 1992. IREDA has supported additions about half this capacity, whereas the balance was financed through private sector equity, Ministry of Non-Conventional Energy Sources (MINES) support, and loans from other lenders. The project financed over 113 MW of small hydro capacity in 33 projects compared with a target of 100 MW. During this period, IREDA financed an additional 155 MW of small hydro using other resources. Wind farm capacity financed under the project was 87.2 MW in 27 projects compared with 85 MW envisaged at project appraisal. During this period, IREDA financed an additional 184 MW of wind power using locally mobilized resources.-The PV projects that were financed totaled 2.2 MWp in 78 projects, or slightly below the target of 2.5 MWp. The products financed ranged from solar lanterns, PV irrigation pumps, and village solar power schemes to a 200 kWp grid-tied system. In addition, IREDA financed an additional four MWp of PV irrigation pumps with MINES assistance. A $26 million GEF grant supported both the wind farm and PV market development components. Total Alternative Energy project cost was $284 million, of which $115 was provided from IBRD/IDA and $26 million from the GEF. Board approval date: December 17, 1992. Closing date: June 24, 2002. 6 Information from Project Portal. ASTAE Status Report 17 3. Thailand Distribution System and Energy Efficiency, P004796/P004647 This project provided support for the Electricity Generating Authority of Thailand's (EGAT's) implementation of a five-year DSM demonstration program. The project created considerable momentum in promoting efficient electricity consumption through utility-sponsored DSM programs and public education. EGAT's Demand-Side Management Office (DSMO) launched more than 17 efficiency programs for lighting, appliances, industrial-commercial buildings, and load management. The DSMO exceeded its savings target of 238 MW in load reduction by 238 percent, and achieved 566 MW in avoided capacity through improved efficiency gains. The energy savings from this program avoided an estimated 2.3 million tons of C02 emissions. Total alternative energy investment was $59 million, of which the GEF provided $9.5 million, although $1.5 million of this was later allocated to the Thailand Metropolitan Distribution Reinforcement Project. Board approval date: April 27, 1993. Closing date: June 19, 2000. 4. Indonesia Second Rural Electrification (REII), P003979 This project provided support for the Indonesian State Electricity Corporation's (PLN's) least-cost rural electrification program, which included renewable energy generation components. Among the objectives of the project was the establishment of incentives for private sector and local cooperatives to take an increasingly larger share of rural energy distribution and renewable energy development within the framework of a least-cost rural energy master plan. ASTAE supervised the preparation, appraisal, and supervision of the small geothermal and grid-connected minihydro components. The issuance of regulations and letters of awards, announcement of purchase tariffs, and supported private participation in small power generation but the financial crisis in 1997 prevented further progress. The minihydro projects (7.8 MW) were commissioned at about 14 percent below estimated cost. PLN prepared additional minihydro and mini- geothermal projects with an aggregate capacity of about 30 MW for future assistance, but no follow-up investment was made on account of the negative impact of the financial crisis. Total alternative energy investment was $19 million, of which IBRD/IDA provided $13 million. Board approval date: February 28, 1995. Closing date: September 11, 2000. 5. Vietnam Power Development, P042236 This project supported the development of new gas-fired generator at Phu My and augmentation of transforming capacity to meet the electricity needs of Vietnam. ASTAE assisted in the preparation of Terms of Reference for a Rural Electrification Master Plan that included renewable energy technologies and assisted in the supervision of the Master Plan's preparation. Total alternative energy investment was $1.6 million, of which IBRD/IDA support was $0.5 million. Board approval date: February 20, 1996. Closing date: June 30, 2000. ASTAE Status Report 18 6. Sri Lanka Energy Services Delivery (ESD), P010498/PO39965 An ASTAE staff member task managed this project on a cross-support basis during the first years of effectiveness. The project encouraged the provision of grid and off-grid energy services using renewable energy and DSM investments. The project included an ESD Credit Program Component to help finance investments by the private sector, NGOs, and cooperatives in off-grid photovoltaics and village hydro schemes, of grid-connected minihydro sites and other renewable energy applications. The other components were: (a) a grid-connected Pilot Wind Farm executed by the Ceylon Electricity Board (CEB); and (b) TA to the CEB to strengthen its capacity to help ESD Credit Program subproject developers and to undertake DSM activities, including DSM program design and implementation, load research, and an energy-efficient building code. Total alternative energy investment (actual) was $45 million, of which $22 million came from IBRD/IDA, while $5.7 million was provided by the GEF. Board approval date: March 18, 1997. Closing date: May 6, 2003. 7. India Orissa State Power Sector Restructuring, P035170 ASTAE staff assisted in the preparation of a DSM component in the state's power sector reform program and is now supervising implementation of this component. A DSM cell has been set up within the Grid Corporation of Orissa (GRIDCO) to facilitate load research and DSM program development. DSM investments include municipal water pumping and storage systems, motor rewinding and motor efficiency programs, load research linked to a proposed metering program, and various DSM opportunities in the industrial, residential, commercial, and agricultural sectors. The DSM component was restructured during implementation, and total Bank support for the DSM component is $10 million.7 Board approval date: May 14, 1996; closing date: January 31 2004 8. Indonesia Solar Home Systems (SHSs), P035544/P003700 ASTAE assisted in the design of this project, which supported solar home system investments funded and/or implemented by the private sector, NGOs, and cooperatives. Within the framework of a least-cost rural electrification strategy, the project supported investments in solar home systems to areas not expected to receive grid-connected electrical services for at least three years. Components included TA for developing energy strategies and strengthening institutional capacities. Because of the Asia financial crisis, the scope of the project was substantially reduced. Total alternative energy investment (actual) is expected to be $3.4 million, of which $0.1 million came from IBRD/IDA and $2.3 million from the GEF. Board approval date: January 28, 1997. Closing date loan: July 24, 2001. GEF grant will be closed in FY04. In December 2002 the DSM component was further restructured to focus solely on metering. ASTAE Status Report 19 9. Thailand Metropolitan Distribution Reinforcement, P037086 This Bank-assisted project sought to meet the anticipated growth in demand during 1997-2001 by improving system reliability and restructuring the Metropolitan Electricity Authority (MEA) in preparation for its commercialization and corporatization. ASTAE assisted in the preparation and is supervising the DSM component, which includes the creation of an appliance-testing laboratory, load research, load control and energy service company (ESCO) development. Total alternative energy project cost is $4.0 million of which $1.5 million is a grant from EGAT's Project allocated to MEA to support this program. Board approval date: June 24, 1997. Expected closing date: December 31, 2003. 10. India Andhra Pradesh Power Sector Restructuring, P049537 ASTAE contributed to this project by implementing a linked integrated agricultural DSM activity financed under the activities implemented jointly (AIJ) mechanism. This activity includes improvements in distribution system efficiency, metering, and end-use efficiency improvements in irrigation systems. Total cost of the alternative energy component was $4.6 million, which came from the Government of Norway. Board approval date: February 18, 1999. Expected closing date: December 31, 2002. Loans, Credits and Grants under Implementation during FY04 11. Vietnam Transmission, Distribution, and Disaster Reconstruction, P045628 The project financed the expansion of transmission systems in south and central Vietnam, and rural electrification in selected areas. The Swedish Sida-supported DSM component consisted of TA to prepare a DSM policy and regulatory framework, load management program, and energy efficiency standards and codes. The total alternative energy project cost is $3.3 million, of which Sida committed $2.8 million. Board approval date: January 20, 1998. Expected closing date: December 31, 2003. 12. Lao PDR Southern Provinces Rural Electrification, P044973 The project focuses on the expansion of rural electrification in seven southern and central Laos's provinces. ASTAE assisted in the supervision of a renewable energy component, which includes investments for off-grid electrification in solar homes systems and village hydro. Lending for this project is $38 million from IDA, with an alternative energy component of $2 million, of which IDA provides $1.3 million and the GEF provides $0.7 million. Current projections are for this off-grid electrification component to provide power to 5,200 off-grid households by the closing date of SPRE I, which is about 10% of the total 55,000 households that will be provided access under this ASTAE Status Report 20 project. With GEF support, the unit cost per household for the solar home systems has been systematically reduced and now stands at approximately $200 per household for an average 30W system, inclusive of planning and community mobilization. Financial remediation has consisted of a hire-purchase arrangement with individual households that provides for an up-front payment, which covers the cost of batteries, house wiring and lamps and fixtures, plus a monthly repayment charge, based on the size of the system purchased (customers may choose between a 20, 30, 40, or 50 W system, which accommodates the different electricity needs and purchasing power of individual households) and the term of repayment (5 or 10 years). The concessionary IDA credit terms are basically passed along, but the customer repays the full system purchase cost, out of which is drawn a contribution to a service arrangement with the Village Electricity Manager (VEM), who looks after the individual systems and collects the monthly repayments. Board approval date: March 17, 1998. Revised expected closing date: December 31, 2004. 13. China Energy Conservation, P003606/PO37859 This project is designed to introduce, demonstrate, and disseminate new project financing concepts and market-oriented institutions to promote and implement energy efficient measures in China. ASTAE is assisting in the supervision of this project. Under this project Energy Management Companies (EMCs) have been established to implement largely industrial efficiency projects through performance contracts. The project also supports the national energy conservation dissemination center. The three EMCs founded and supported under the project (Beijing, Liaoning and Shandong EMCs) had engaged in 339 investment projects using energy performance contracting by the end of April 2004, with aggregate investment of about US$94 million (see table below). These investments provide aggregate energy savings of at least 2.1 million tons of coal equivalent and associated carbon dioxide emission reductions of at least 1.4 million tons of carbon. The three EMCs experienced their strongest year to date, with an increase in aggregate profits of 126%. The model developed by the three companies continues to lead the development of a rapidly increasing EMC industry in China.8 Total alternative energy project cost is $151 million, of which IBRD/IDA and $22 million by the GEF provide $63 million. Board approval date: March 26, 1998. Expected closing date: June 30, 2006. EMC No.of EC CEF IBRD Self Total Projects M Bejin Contracts signed 86 1.13 5.01 11.88 8.79 26.81 Uonin Contracts sipned 175 1 1.04 3.97 9.16 18.77 32.94 Shandong Contracits signed 78 1.12 4.81 19.60 8.58 34.10 Total Contracts signed 339 3.29 13.79 40.64 36.14 93.85 Note 1: As of April30, 2004. 2: includes projects. anounted to the equivileat of USS7.3 million for 42 contracts. which were financed and implemented through alliance companics. IBRD/GEF China Energy Conservation Project May 2004 Supervision Mission Aide Memoire, June 25 2004. ASTAE Status Report 21 14. China Renewable Energy Development, P046829/PO38121 This stand-alone renewable energy project is supporting the accelerated development of renewable energy resources. The project objectives include financing, installation, and technical support for 20 MW of wind farms and 10MW of solar home systems. Quite different financing approaches are taken for the distinct solar home and wind farms components. A market development approach to the solar home systems has encouraged the entry and expansion into the rural consumer market of a growing number of companies: their number increased from 16 at the project commencement to 25 at mid-term, with six additional companies in the process of qualifying. Most are small and medium size enterprises. Market competition by qualified PV companies has been introduced by the setting and enforcing of product standards, including standards for labeling and service (this activity has been supported by ASTAE). PV companies are rewarded according to their performance; with the PV sub-grants being paid only after competitive market based sales have been confirmed. As of mid-FY 2004, the participating PV companies in the project areas, have sold 410,000 systems, amounting to 8.2 MWp of capacity. A sustainable market is emerging. Measured by households served, the REDP remains the largest program to support PV in China but other government programs and, most importantly, purely private transactions are larger. The richness of the product offering and the non-REDP sales by the participating PV companies are evidence of a strong and growing market.9 The 20MW wind farm capacity will be installed at two coastal sites, Chongming and Nanhui, in Shanghai and will rely on IBRD lending as well as the GEF-financed TA program of $1.5 million. This component is the result of restructuring of REDP following delays in getting other wind farms approved (at Huitingxile in Inner Mongolia, Pingtan in Fujian and Zhangbei in Hebei) and their eventual cancellation from the project. The first delivery of wind turbines will take place in September 2004 and installation will be complete in March 2005. Warranted energy yield will be 48.397 GWh/year, higher than the forecast at appraisal. Unit costs of plant and equipment are $822/kW compared with $804/kW at feasibility and total wind farm costs are $1,196/kW compared with $1,141/kW at feasibility.10 Total alternative energy investment (after restructuring) is $205 million, of which IBRD will provide $13 million and the GEF $27 million. Board approval date: June 8, 1999. Expected closing date: June 30, 2007. 15. Vietnam Rural Energy I, P056452 This project provides energy to about 500,000 households and 900 communes in 32 provinces in rural Vietnam. The project includes TA components to develop institutional capacity and policy frameworks to encourage the use of renewable energy to supplement grid supply or serve isolated communities where renewables are the least- cost option. The Renewable Energy Action Plan for Vietnam as well as other reports 9 China Renewable Energy Development Project: Photovoltaic Market Development and Technology Improvement Components - Mid-Term Review Mission, April 12-24, 2004, Aide Memoire 1 China Renewable Energy Development Project: Wind Component Mid-Term Review and Supervision Mission, April 2 and 26-27, 2004 ASTAE Status Report 22 related to power purchase agreements, rural electrification tariffs, and off grid small hydro institutional arrangements were prepared, and ASTAE funds were used to support review and supervision of these studies. Total support for alternative energy is $2.5 million, through ASTAE, the IFC, PHRD, ESMAP, the Swiss consultant trust fund, and Government of New Zealand. Board approval date: May 30, 2000. Revised expected closing date: June 30, 2005. 16. China Hebei Urban Environment Project, P045910 The Hebei Urban Environment Project aims to provide a safe environment and to sustain the long-term economic growth of urban areas in Hebei Province. It supports Hebei Province in implementing a long-term urban environmental services improvement program to recover from environmental degradation of its water and land resources, provide an adequate supply of safe water, and ensure sustainability of delivery through institutional and financial reforms of the service utilities. To pioneer linkages between energy/water conservation and urban services, ASTAE was involved in developing an energy efficiency component relating to wastewater utilities as part of this project. The total alternative energy project value is $8.3 million, of which $5.0 million comes from IBRD/IDA. Board approval date: June 27, 2000. Expected closing date: June 30, 2007. 17. India Renewable Energy II/Energy Efficiency, P049770/P055906 This project is a follow-up to the first Renewable Resources Development Project and expands support for the small hydro program beyond the southern region to include other states in India. The development objectives of this project are to: (i) augment power supply through environmentally sustainable small hydro investments; (ii) mobilize private sector investments in renewable energy projects; and (iii) promote energy efficiency and demand side investments. The project also provides support for IREDA to promote and finance energy efficiency investments and foster the development and operation of energy service companies. As of mid-FY 04 there were 47 completed ongoing and prepared small hydro sub-projects comprising 182 MW of capacity 3 and $97 million in blended IDA and IBRD lending. As regards the Energy Efficiency component, as of mid-FY 04 there were 14 energy efficiency projects approved to be financed under the WB LOC totaling $26 million, a figure expected to increase as specific TA-funded activities for EE pipeline development are completed. Another six energy efficiency projects representing potential loan applications of over $40 million are under preparation, focusing on the cement, hotel, textile, and paper sectors." Expected total alternative energy project cost is $300 million, of which IBRD/IDA will provide $130 million ($80 million IBRD Loan, $50 million in IDA assistance), and a GEF grant will provide $5.0 million of TA and preparation support. Board approval date: June 27, 2000. Expected closing date: March 31, 2006. " India Second Renewable Energy Project Implementation Review Mission (April 19 May-4, 2004) Aide Memoire, May 10, 2004. ASTAE Status Report 23 18. India Rajasthan Power Sector Restructuring, P038334 This project is directly supporting the implementation of the power sector reform program in the state of Rajasthan in order to improve the efficiency of electricity service and enable the sector to gain access to capital markets and commercial financing. ASTAE is assisting in the design of the DSM component comprising TA for DSM and load research. Total alternative energy project cost is $2.0 million provided by USAID to co-finance a DSM TA component. Board approval date: January 18, 2001. Expected closing date: June 2005. 19. China Passive Solar Heating for Rural Health Clinics, P070161 This GEF project strengthened the capacity of architectural and engineering design institutes in China to design and build energy-efficient passive solar buildings. The project funded the incremental cost of constructing passive solar heating in 29 township health centers that were built or renovated under the ongoing Basic Health (Health XIII) project (P003566). Energy savings and service improvements in these demonstration clinics have been evaluated, and this experience will be disseminated within the health sector and to other sectors. This project was designed based on a pilot project implemented by ASTAE in 1999-2001 under the ASTAE Renewable Energy and Energy Efficiency Application Program (REAP-TF021717), funded by the Government of the Netherlands from the BNPP program. GEF support for this project is $0.8 million. Board approval date: June 21, 2001. Revised expected closing date: December 31, 2004. 20. India Uttar Pradesh Water Sector Restructuring, P050647 The project aims to set up an enabling institutional and policy framework for water sector reform, as well as to increase and sustain water and agricultural productivity. This project is expected to include canal-based hydro components. Total alternative energy project cost is $40 million, of which $35 million is provided by IBRD/IDA. Board approval date: February 19, 2002. Expected closing date: October 31, 2007. 21. Bangladesh Rural Electrification and Renewable Energy Development (RERED), P071794/PO74040 The Bangladesh RERED Project ($298 million total; $191 million IDA & $8 million GEF) will provide access to 700,000 on-grid and 64,000 off-grid households. This project will enable electricity to more rapidly reach rural households by supplementing grid with renewable technologies provided by both public & private providers, strengthening the rural distribution sector through rationalizing and rehabilitating distribution area, and creating new entities - Infrastructure Development Company Ltd (IDCOL) & the Infrastructure Investment Facilitation Center (IIFC) - to mobilize technologies, investment, planning, capacity-building necessary to accelerate pace of rural electrification. The grid component of the project supports: (a) line ASTAE Status Report 24 0 expansion and intensification in areas currently under the Palli Bidyut Samitis (PBSs) (Rural Electricity Cooperatives); (b) distribution area rationalization and rehabilitation of networks in new areas taken over by the PBSs; (c) TA for Rural Electrification Board/PBS institutional development, financial restructuring, socioeconomic program and poverty reduction aspects of electricity provision; and (d) development of the small power generation program. The off-grid component supports: (a) financing and subsidy mechanisms for solar home systems through the Rural Electrification Board (REB), PBSs, NGOs, and new microfinance institutions such as IDCOL; (b) financing of remote distributed generation schemes using renewables; and (c) GEF-financed TA for promotion of solar home systems and development of pilot wind and micro-hydro projects. As of end FY04 the rural electricity cooperatives had taken together installed 870 SHS systems, while the REB was finalizing bid documents for the purchase of 6,000 systems that will enable REB to commence a SHS program by early 2005. The IDCOL managed SHS program has made exceptional progress, with 19,700 systems installed by eight private operators (POs) in just 18 months after Credit effectiveness. At present, the POs are installing about 1,600 systems per month and in some cases compete in supplying systems within the same area. Collection of installments from solar households exceeds 98% for all but one PO. Total project cost includes $30 million is for alternative energy and GEF $8.5 million. Board approval date: June 25, 2002. Expected closing date: June 30 2008. 22. Vietnam System Efficiency Improvement, Equitization and Renewables (SEIER), P066396/PO73778 This project includes renewable energy and energy efficiency components. The project supports Phase 1 of the Renewable Energy Action Plan (REAP) developed jointly by Electricity of Vietnam (EVN) and the Bank, and adopted by the Ministry of Industry. ASTAE supported preparation of the action plan as well as preparation of the renewable component. SEIER supports renewable energy policy development, rehabilitation of small hydro facilities owned by EVN, a wind diesel hybrid island mini-grid, piloting of off-grid community-scale micro hydro, and development of grid-connected small power producers. The mini hydropower rehabilitation work is progressing as planned. Procurement of equipment and installation is fully completed, construction is ongoing, and commissioning is expected in March 2005. Wind measurement equipment for the Phu Quoc Island hybrid project was underway at the close of FY04.12 Consultant studies in support of a restructuring of the off-grid community-scale micro hydro have been commissioned, and the grid-connected small power program plan is under preparation. Total alternative energy investment is $25 million, of which IDA provides $17 million and the GEF $4.5 million. Board approval date: June 25, 2002. Expected closing date: December 31, 2007. 12 IDA Supervision Mission - System Energy Efficiency Improvement, Equitization and Renewable Project (SEIERP), Aide Memoire, May 37, 2004. ASTAE Status Report 25 23. Sri Lanka Renewable Energy for Rural Economic Development, P076702/PO77761 The objectives of the Renewable Energy for Rural Development Project (RERED), which succeeded the now-closed Sri Lanka Energy Services Delivery Project (P010498/PO39965), are to expand commercial provision and utilization of renewable energy and pursue economic development and improvement in quality of life through more productive and efficient use of rural energy resources. It adopts the successful concept of the predecessor ESD project while pursuing broader goals, namely, increasing access of the poor to rural electricity, utilizing electricity as a means to further income generation and social objectives, and expanding the scope to include other rural energy resources and objectives. The strengths of the ESD concept-community ownership and operation of village hydro assets, private sector- and microfinance-based model for solar energy, and private sector model for grid connected mini-hydro schemes-are retained. The RERED project has several components including Mini-Hydro, Biomass, Solar, Community Electrification, Sector Reform, and others. As of close FY04, some 17 grid-connected mini-hydro projects with an installed capacity of 48 MW and project financing of Rs 1.4 bn (US$14.5m) had been approved. This places the RERED project on track to meet its performance indicator of 85 MW installed capacity. As regards Biomass, seven developers are pursuing some ten projects with a total installed capacity of 26 MW. The project fuels include bagasse cogeneration, rice husks and dendro. The wind industry is lagging behind, as it has faced market entry difficulties following the cancellation of the CEB tender for 20MW of wind power in the Putallam area. The Solar Homes component is performing in line with expectations, with sustained sales of 1400+ systems per month. The cumulative number of SHS installed under the RERED project is 23,977 at March 31, 2004 with 50,000 total installed systems projected for the end of FY04. The Community Electrification component has yielded a total of 48 village hydro schemes designed to provide services to 2360 households). 13 Total project cost is $134 million, of which IDA is $75 million and GEF is $8.0 million. Board approval date: June 20, 2002. Expected closing date: June 30, 2008. 24. China Energy Conservation II, P067337 This project is a follow-up to the China Energy Conservation I Project (P003606/P037859). This predecessor project (described above) was successful in introducing and adapting energy performance contracting to Chinese conditions, developing a viable business model in the three EMCs (ESCOs), and developing an initial market among client enterprises. The objective of the China Energy Conservation II project is to expand the EMC market in China by establishing a loan guarantee facility and a national EMC association. Key participants in China EC II include a new EMC loan guarantee facility, the China National Investment and Guaranty Co. Ltd. (I&G), and the new EMC industry association, the China EMCA. 3 Aide Memoire, Sri Lanka - Renewable Energy for Rural Economic Development Project Supervision Mission, 6 June 2004. tl ASTAE Status Report 26 ASTAE and DFID played a vital role in supporting technical assistance and preparation and early implementation of China Energy Conservation II. In particular, ASTAE supports the EMC Financial Technical Assistance, which assists EMCs in overcoming financing barriers and obtaining financing for energy conservation projects through customized loan structuring financial engineering TA to I&G and commercial banks; advice to EMCs on EMC business and financing of EPC projects; and outreach activities including workshops to increase awareness of commercial banks in the EMC business. The Chinese EMC industry is rapidly growing, with several dozen new EMCs having begun operation during FY04. The new industry association, the EMCA, was legally registered under the China Energy Conservation Association (CECA) and by end FY04 had received 70 membership applications. The GEF-provided Special Account that funds the Guarantee Program was in place and ready to provide sufficient investment income to counterbalance payment of I&G's management fees and subrogation losses.14 Total project cost is $243 million, of which the GEF support is $26 million. Board approval date: October 24, 2002. Expected closing date: December 31, 2009. 25. Nepal Power Development, P043311 The objectives of the Nepal Power Development Project ($133m - $75m IDA, $38 M sub-borrowers) are to develop Nepal's hydro potential, scale-up rural electricity access, improve the transmission and distribution facilities of the Nepal Electricity Authority, and promote private participation in the power sector, both to improve efficiency & mobilize investment. The NPDP will provide access to 50,000 households via grid extension & mini-grids, will deliver 12 new private hydropower projects on stream by 2008 by way of a Power Development Fund (PDF), and support community- based electrification efforts. ASTAE supported this project in the early development stage by preparing a report on rural energy, by funding preparation of a report on the feasibility of small hydro, and by establishing contacts with GTZ, one of the project collaborators. Total project cost is $133 million, of which $50 is an IDA credit and $25 million is an IDA grant. The alternative energy component is $87 million. Board approval date: May 22, 2003. Expected closing date: June 30, 2009. 26. Vietnam Demand-Side Management, P071019 This GEF project, associated with the SEIER project describe above, would contribute to overall energy sector development by introducing load management and energy efficiency options to complement supply side investments in order to meet the country's fast-growing electric power requirements in a more balanced way. There are two major components which together comprise Phase 2 of a ten-year DSM/EE effort: (i) a DSM component, implemented by EVN, with 5.2 million from IDA and 2.55 million from GEF for four subprograms - Installation of Time of Use Meters, Promotion of 1 million CFL and Promotion efficient thin-tube FTLs, and Direct Load Control, and load 14 China Second Energy Conservation Project, May - June 2004 Supervision Mission Aide Memoire, June 25, 2004. ASTAE Status Report 27 research & M&E; and (ii) A pilot commercial energy efficiency program, supported by $3.25 million of GEF-financed TA, which is implemented by Ministry of Industry. The project will lead to more than 120 MW in peak load reduction and total energy savings of 798 GWh over the implementation period and help mitigate the effects of ongoing electricity tariff reforms. ASTAE was used for preparation of the Business Plan for the Energy Efficiency component implemented by Mol as well as part of the preparation and supervision costs. Total project cost is $19 million with a GEF cost of $5.5 million. Board approval date: June 24, 2003. Expected closing date: June 30, 2007. 27. Philippines Rural Power, P066397/PO72096 The Board approved the project on December 4, 2003. The objective of the Project is to support reforms and priority investments directed at improvements of the quality of life in rural areas through the provision of adequate, affordable and reliable energy services, in partnership with the private sector. Use of renewable energy will be promoted where cost effective. The main project components include: (a) rural electrification subprojects; (b) partial credit guarantee fund; and (c) capacity building, focusing on reduction of market barriers to the commercialization of renewable energy development. This Adjustable Program Loan (APL) will have four phases extending over a period of fourteen years. Total alternative energy investment for Phase 1 is $26.7 million. IBRD/IDA provides $10 million while the GEF provides a grant of $10 million, of which one million is executed through UNDP and $9 million through the World Bank. ASTAE provided major support to preparation of this project, including funding a solar home system (SHS) market assessment in the Philippines, co-financed with Solar Development Foundation, and supporting the economic analysis of the SHS project component. 28. Cambodia Rural Electrification and Transmission, P064844 The Cambodia Rural Electrification and Transmission Project were approved on December 16, 2003. This project will support renewable energy activities as an integral part of the government's rural electrification program. It will help to strengthen the country's policy and legal framework and to build capacity of various stakeholders. The project has four main components: * A Transmission Line (TL) component, to be implemented by EdC and comprising a 220kV line connection to Vietnam, reinforcements of the 115kV grid around Phnom Penh, and a National Control Center to optimize load dispatch operations; * A Rural Electrification (RE) component, to be implemented by EdC and comprising MV and LV lines and electrification of about 50,000 households. The Project will make use of private sector providers (REEs) in the operation of rural distribution systems; 16 * A pilot Rural Electrification Fund (REF) component that will provide assistance to private sector developers for: (a) about 45,000 new grid connections; (b) solar ASTAE Status Report 28 home system installations for about 12,000 households; and (c) addition of at least 6 MW of mini-hydro and 850kW of micro hydro capacity; and * Institutional Development and Sector Reform TA component providing consulting and advisory services to renewable energy policy development, promotion of rural income generation options, renewable energy business development, REE improvement and association building, and capacity building of financial institutions. Total project cost is $150 million with an estimated alternative energy investment of $32 million. IBRD/IDA will provide a loan of $40 million and the GEF a grant of $5.8 million. 29. Philippines Power System Loss Reduction, P066532 The main objective of the Project is to achieve significant and sustained energy efficiency improvements in Electric Cooperatives (ECs), to provide current and prospective viable EC customers with reliable and least-cost power supply over the long term. Towards this end, the project would: (i) develop and test financial and contractual mechanisms to support private sector investment, management and operation, and risk sharing to support system loss reduction measures in selected ECs; and (ii) support commercial lending to qualified ECs for efficiency improvements. The project pilots the use of investment management contracts (IMCs) to attract private investors to manage and operate selected ECs under long-term, performance-based contracts, and to mobilize private finance without recourse to the government. For those ECs that are yet unable to attract private investors, access to affordable term loans would be facilitated. Both 36 objectives will be supported by the establishment of the Partial Credit Guarantee Program for commercial loans under this Project. The total project size is $62.3 million, including a GEF grant of $12 million. Loans, Credits and Grants in the Pipeline in F04 A. Vietnam Rural Energy II, P074688/P080074 The objective of the proposed project is to improve access to high quality, affordable electricity services to rural communities. The project will improve access to electricity for about 2 million new households in Vietnam, including many living in some of the poorest communes, which represents more than 50% of the households currently without access. Repairing and maintaining existing rural power networks in about 1,000 communes and by connecting about 200 new communes or 100,000 households to the grid will achieve this. Financing is provided by an IDA credit of $220 million, supported by a GEF grant of $5.25 million focused on TA in support of rural power providers in their efforts to keep network losses at a minimum. The project will also enable supply of large increases in electric power for expanding productive uses in rural areas, alleviating a major constraint to local economic growth. ASTAE Status Report 29 B. Thailand ESCO Development, P065972 This project will seek to overcome barriers to expanded commercial financing of energy efficiency projects in Thailand. The project would develop financial schemes, using a blend of GEF, Thai Energy Conservation Fund, and commercial bank funds to provide affordable project financing for energy efficiency projects. It would also promote the development of ESCOs to bridge the gap between banks and energy end users. Estimated GEF support for this stand-alone project will be about $15 million. Estimated Board date: FY05. C. Lao Southern Provinces Rural Electrification II, P075531/P080054 This successor project will help the government to achieve its electrification goals 6 of 60 percent by 2005 and 70 percent by building on the achievements of the SPRE project, now nearing completion. The project will connect an additional 50,000 to 75,000 households to the grid and provide access to an additional 18,000 off-grid households through distributed power sources including solar, village hydro, biomass, and diesel gensets. The proposed credit to implement the project is $19 million for on-grid electrification, $2.5 million for off-grid electrification, $1.5 million for DSM, and $2.0 million for sector reform. GEF support is expected to be $5.0 million. Total project cost is estimated at $35 million. Estimated Board date: FY05. 6 D. China Heat Reform and Building Efficiency, P072721 r This proposed GEF project seeks to achieve substantial and sustainable improvements in the energy efficiency of large residential building heating systems in China's cold regions. The project will collaborate with the GOC to reduce energy waste in buildings through: (i) improvements in the buildings themselves; (ii) reform of heat pricing and billing systems, including heat metering, cost based pricing and consumption- based billing; and (iii) improvements in the heat supply systems to enable consumer control, demand-based dispatch and more commercial operation. The integration of these three elements has not yet been implemented in China, but is considered critical to removing the technical, institutional and organizational barriers to the implementation of the Government's dual policy agenda in heat reform and building energy efficiency regulation. The estimated energy savings from the 57 participating cities are about 270,000 GWh, while the total estimated energy savings of the entire national effort are about 3.6 million GWh. GEF support of $18 million is requested. Estimated Board date: FY05. E. Mongolia Delivery of Infrastructure Services, P085265 This project entered the preparation pipeline late in FY02. This project will support the Government of Mongolia's efforts to develop private-public partnerships that will result in rural infrastructure investment, especially in renewable energy applications, M ASTAE Status Report 30 improved energy efficiency and provision of ICT services in the rural areas. Estimated level of IEBRD/GEF support is $20 million. Estimated Board date: FY05/06. F. China Renewable Energy Scale-Up Program (CRESP), P067625/PO67828 This is the first 100% Renewable Energy Project by the Bank. The project provides support to the Government of China (GOC) Renewable Energy Program in the 10th and 11th Five-Year Plans. The objective would be to reduce environmental emissions from coal-fired power generation by developing sustainable commercial markets for electricity from renewable energy. Implementing a policy to create a mandated large-scale market and programs aiming to reduce costs for mature technologies, such as wind farms, small hydroelectricity, and biomass, would do this. Estimated Bank/GEF support for Phase 1 of this Adjustable Program Loan (APL) will be $222 million, with further support to be defined in future years. The GEF Project Brief was approved in May 2001. Estimated Board date: FY05. Estimated Bank/GEF support for this long-term program will be IBRD US$222 and GEF $40 million. G. PNG Teacher's Solar Lighting Project (P088940) The main objective of this project is to improve the life of rural health and education service providers by removing the barriers now preventing the use of solar photo-voltaics for house lighting and other purposes. This proposed GEF MSP will be a comprehensive and integrated pilot operation with the goal of promoting purchase of 2,500 solar lighting systems by government teachers and health workers posted to areas without electricity. In addition to financial remediation of initial cost hurdles via a Revolving Risk Equalization fund and a payroll deduction plan, TA will be provided to develop markets, build solar provider capacity, train end-users, and develop a national program for recycling of batteries. This small-scale pilot is intended to establish confidence in the PV technology and suppliers on the part of users and financiers that will lead to rapid scaling up of the solar lighting industry throughout rural PNG.'5 ASTAE has provided significant support to early sector work and subsequent preparation work to develop this project for submittal to the GEF. Total alternative energy investment will be $3.2 million, with $1 million provided by GEF. This project is expected to be approved in FY05. H. Indonesia Rural Electrification Project (P091020) Indonesia's rate of electrification is about 57 %, among the lowest in the region, which means some 90 million people still do not have access to electricity. About two- thirds of the population without electricity lives in the rural areas and 65% of these is outside of Java-Bali. The Government of Indonesia (GOI) has made rural electrification access a major development objective. Over the past three decades, GOI has allocated considerable resources to its rural electrification program mainly through the state owned power utility PLN. However, in a country with roughly 15,000 islands and a length and is Papua New Guinea Teacher's Solar Lighting Project Medium Size Project Brief, September 2004. h ASTAE Status Report 31 width of 5,000 and 1,800 kilometers, the task of rural electrification has never become easy and expanding power to rural areas should not rely entirely on conventional power generation technologies through PLN's grid connections. In response to the request of the GOI for support of increasing rural electricity access, the World Bank has indicated in the recent CAS that it will support rural electricity access and renewable energy development projects in the country. The current CAS appropriates a potential $200 million for the rural electrification part, anticipating that this World Bank commitment will leverage substantial additional funds from both public and private sources of funding. ASTAE Status Report 32 Annex 3: ASTAE Supported Investment Projects-East Asia and the Pacific Cost in million of dollars Approval- Total Source offinancing Projects (estimated) alternative IDPrimary project component Country end date energy project ID GEF Govt. Private Other cost Closed projects I Lao Provincial Grid Integration 10/92-1/00 0.9 0.9 DSM, institution building 2 Thailand Distribution System and Energy Efficiency 4/93-6/00 59.3 8 20.3 31 DSM, capacity building 3 Indonesia Second Rural Electrification 2/95-9/00 19.3 13.3 6 Minihydro, geothermal resource assessment and TA 4 Vietnam Power Development 2/96-6/00 1.6 0.5 1.1 Renewable energy capacity building 5 Indonesia Solar Home Systems 1/97-YFO4 3.4 0.1 2.3 1 - Solar home systems and TA 6 Thailand Metropolitan Distribution Reinforcement 6/97-FYO4 4 2.5 1.5 DSM management capacity building Total Closed Projects 88.5 14.8 10.3 28.8 1 33.6 Projects Under Implementation 7 Vietnam Transmission, Distribution and Disaster Reconstruction 1/98-FYO4 3.3 0.5 2.8 DSM capacity building, equipment standards 8 Lao Southern Provinces Rural Electrification 3/88-FYO4 2.2 1 0.7 0.5 Solar battery charging and microhydro projects 9 China Energy Conservation 3/98-FYO6 150.8 63 22 7 54.3 4.5 Energy efficiency, TA 10 China Renewable Energy Development 6/99-FYO7 205.4 13 27 165.4 Wind farms, PV, PV technology improvement II Vietnam Rural Energy I 5/00-FYO4 2.5 1 1.5 Renewable energy TA & pilot minihydro 12 China Hebei Urban Environment 6/00-FYO7 5 4 I Energy efficiency in water utilities 13 China Passive Solar Heating for Rural Health Clinics 6/01-FYO4 1.5 0.75 0.75 Energy efficient building design 14 Vietnam System Efficiency Improvement, Equitization and Renewables 6/02-FYO8 24.5 17.2 4.5 2.8 Renewable energy and DSM 15 China Energy Conservation II 10/02-FYIO 242.5 26 ' 216.5 ESCO market development 16 Vietnam Demand Side Management 6/03-FYO7 18.6 5.5 1.2 6.7 5.2 DSM support 17 Philippines Rural Power 12/03-FY1O 26.7 10 9 0.2 7.5 Renewable energy for rural applications 18 Cambodia Rural Electrification and Transmission 12/03-FYO9 32 16 5.8 10.2 Renewable energy for rural applications 19 Philippines Power System Loss Reduction 6/04-FYI2 62.3 12 0.3 50 Rural Electrification Total Projects Under Implementation 777.3 125.2 113.25 14.25 442.9 81.7 Expected Estimated Estimated Projects Under Preparation Board Alternative WB/GEF/PCF Primary Project Component approval Energy Project financing 20 Vietnam Rural Energy II FY05 70 40 Renewable energy for remote communities 21 Thailand ESCO Development FY05 100 15 ESCO market development and financing 22 Lao Southern Provinces Rural Electrification FY05 35 8 Renewable energy for rural application 23 China Heat Reform and Building Efficiency FY05 18 18 Energy efficiency 24 Mongolia Delivery of Infrastructure Services I FY05 30 20 Renewable energy and energy efficiency 25 China Renewable Energy Scale-Up Program FY05 137 40 Implementation of Mandated Market Share 26 PNG Teachers Solar Lighting Project FY05 3.2 1 Renewable energy (PV) for teachers in rural areas 27 Indonesia Rural Electrification Project FY06 400 200 Rural electrification Total Projects Under Preparation 793.2 342 Total projects completed, under implementation and under preparation 1,659 605.55 33 -I Annex 4: ASTAE Supported Investment Projects-South Asia Cost in million ofdollars Approval- Total Source offinancing Country Projects (estimated) alternative 1Primary project component end date energy project D GEF Govt. Private Other Cost Closed projects 1 India Renewable Resources Development 12/92-6/02 284 115 26 17 72 54 Small hydro, wind farms, photovoltaics, and TA 2 Sri Lanka Energy Services Delivery 3/97-5/03 44.6 22.1 5.7 1.9 14.9 SHS, village and microhydro, pilot wind farms, DSM 3 India Orissa State Power Sector Restructuring 5/96-YFO4 10 10 DSM, metering 4 India Andra Pradesh Power Sector Restructuring 2/99-FY04 4.6 4.6 Energy efficiency agricultural pump sets Projects under implementation 2/92-FY04 343 147 31.7 18.9 86.9 58.6 Energy efficiency agricultural pump sets 5 India Renewable Energy II/Energy Efficiency 6/00-FYO6 300 130 5 25 140 Energy efficiency, minihydro and TA 6 India Rajasthan Power Sector Restructuring 1/01-FYO5 2 2 TA for DSM/EE for privatized distribution companies 7 India Uttar Pradesh Water Sector Restructuring 2/02-FYO8 40 25 15 Canal based small hydro 8 Bangladesh Rural Electrification and Renewable Energy Development 6/02-FYO8 30.2 16.4 8 5.8 Off-grid renewables 9 Sri Lanka Renewable Energy for Rural Economic Development 6/02-FYO8 133.7 75 8 0.8 49.9 Renewable energy in rural areas 10 Nepal Power Development 5/03-FYO9 86.8 49.2 9.8 24.7 3.1 Mini- and microhydro Total projects completed or under implementation 592.7 295.6 21 41.4 214.6 20.1 34 Annex 5: Publications in FY04 Papers and Reports Published by ASTAE or through ASTAE-funded Initiatives During FY04 Papua New Guinea: Energy Sector and Rural Electrification Background Note, 1 March 2004. The World Bank East Asia Energy and Mining Unit. Small Power Purchase Agreement Application for Renewable Energy Development: Lessons from Five Asian Countries. Prepared by Steven Ferrey, February 2004. Inception Report: "Innovative Approaches to Provision of Rural Electricity Services in PNG". Intermediate Technology Corporation, January 2004. PSRC International Philippines: Market Assessment Study on PV System, 2004. ASTAE Status Report 35 Annex 6: Key ASTAE Funding Events Year Month Agency Event Amount Source 1992 January WB Creates ASTAE with 2 WB staff and I seconded USDOE renewable energy consultant $327,000' WB/USDOE March ASTAE Donors Meeting #1 (WB/ASTAE funding proposal to donors) May ASTAE Submits funding proposal (revised) to Netherlands Directorate-General for International Cooperation (DGIS) ($4,798,500) July USAID Approves ASTAE funding through USAID/WB Trust Fund $200,000 USAID July UNDP Submits funding proposal to Netherlands DGIS for ASTAE support ($607,392) September USDOE Funds to USTDA Trust Fund for ASTAE support $200,000 USDOE/USTDA November WB Creates Interim Fund for ASTAE while awaiting donor funding $500,0002 WB 1993 March ASTAE Submits funding proposal for ASTAE to USDOE ($3,500,000) May ASTAE Donors Meeting # 2 May Neth. DGIS Netherlands Trust Fund Arrangement signed ($4,401,180)3 Neth. DGIS June Neth. DGIS Netherlands Funding Tranche # 1 $1,558,290 Neth. DGIS September UNDP Netherlands DGIS/UNDP Funding Agreement signed ($479,520)4 NethJNDP October USDOE Funds to USTDA Trust Fund for ASTAE support $250,000 USDOE/USTDA November UNDP UNDP Trust Fund Tranche # 1 $29,250 Neth./UNDP December Neth. DGIS Netherlands Trust Fund Tranche #2 $821,140 Neth. DGIS 1994 April ASTAE Donors Meeting# 3 May UNDP UNDP Trust Fund Tranche #2 $69,500 Neth./NDP September Neth. DGIS Netherlands Trust Fund Tranche # 3 $914,020 Neth. DGIS September USDOE USDOE Funding Agreement signed ($3,000,000)5 USDOE October USDOE USDOE Trust Fund Tranche # 1 (for ASTAE) $715,837 USDOE IOctober WB PHRD Grant approved for use for India DSM $700,000 WB/PHRD November Neth. DGIS Netherlands Trust Fund Tranche # 4 $583,220 Neth. DGIS $1995 April WB Approval IDF Grant for Philippines DSM capacity building $245,000 WB/IDF May ASTAB Donors mee6i4c May LNDP UNDP Trust Fund Tranche #3 $35,000 Neth.UNDP ISeptember WB Approval Project Preparation Facility (PPF) Advance for Sri Lanka ESD project $340,000 WB/GEF September UNDP UNDP Trust Fund Tranche #4 $377,100 Neth./UNDP October WB Approval GEF-Project Development Facility (PDF) Grant for Sri Lanka ESD project $200,000 WB/GEF October WB Approval GEF PDF Grant for China Renewable Energy Development Project $140,000 WG/GEF October U-SDOE _USD(E Trust Fund$Tranche # 2 (for ASTAE) $339,000 USDOE 1996 May "AsTAE Donors MeetingS 5 August WB PHRD Grant approved for use for India DSM $800,000 WB/PHRD October USDOE USDOE Trust Fund Tranche #3 (for ASTAE) $180,000 USDOE 1997 January UNDP UNDP Trust Fund Tranche #5 $347,763 Neth/UNDP April ASTAE Donors Meeting # 6 April Neth. DGIS Netherlands Trust Fund Tranche # 5 $530,525 Neth. DGIS October Neth. DGIS Netherlands Trust Fund Tranche # 6a $215,000 Neth./UNDP October UNDP UNDP Trust Fund Tranche # b $287,728 Neth. DGIS A ASTAE Status Report 36 Year Month Agency Event Amount Source December Swiss Gov. Swiss Trust Fund Agreement signed ($470,000) Swiss Gov. December Swiss Gov. Swiss Trust Fund Tranche # 1 $309,447 Swiss Gov. 1998 April ASTAE Donors Meeting # 7 June Netherlands BNPP Agreement signed ($3,250,000) BNPP August Netherlands Dutch Partnership Trust Fund ($2,250,000) Neth. Partnership August Netherlands Dutch Partnership Trust Fund Tranche # 1 $750,000 Neth. Partnership 1999 January Swiss Gov. Swiss Trust Fund Tranche # 2 $154,723 Swiss Gov. March Netherlands BNPP Tranche # 1 $2,250,000 Neth. Partnership March ESMAP ESMAP Agreement Signed ($223,000) ESMAP April ASTAE Donors Meeting#8 April ESMAP ESMAP Transfer $223,000 ESMAP May Netherlands Dutch Partnership Trust Fund Tranche # 2 $970,000 Neth. Partnership July WB PHRD Grant approved for use for Vietnam REAP $100,000 WB/PHRD August Finland Finnish Trust Fund Agreement signed ($569,000)6 Finland October Finland Finnish Trust Fund Tranche # 1 $173,570 Finland 2000 January Netherlands Dutch Partnership Trust Fund Tranche # 3 $530,000 Neth. Partnership April ASTAE Donors Meeting #9 May U.K. DFID Tranche # 1 $633,368 U.K. May Netherlands BNPP Tranche # 2 $1,000,000 BINPP July Finland Finnish Trust Fund Tranche # 2 $179,583 Finland October UNDP UNDP Trust Fund Tranche # 6 $848,806 Neth./UNDP November Finland Finnish Trust Fund Tranche # 3 $179,583 Finland 2001 April ASTAEDonors Meeting 10 April Netherlands Dutch Partnership Trust Fund ($1,250,000) Neth. Partnership August Netherlands Dutch Partnership Trust Fund Tranche # 4 $1,250,000 Neth. Partnership August U.K. DFID Tranche # 2 $745,193 U.K. 2002 April ASTAE Donors Meeting #11 April U.K. DFID Tranche # 3 $469,014 U.K. 2003 January U.K. DFID Tranche # 4 $117,014 U.K. March Canada CIDA Climate Change Development Fund Commitment ($2,780,000) 7/ Canada April Canada CIDA Tranche # 1 $1.675,141 Canada April ASTAE Donors Meeting #12 May U.K. DFID Tranche # 5 $378,578 U.K. 2004 March ASTARDonors Meeting# 13 March U.K. DFID Tranche #6 $363,351 U.K. March - -- Canada-- CIDA Tranche #2 $563,562 Canada May Netherlands Commitment for ASTAE Funding 2004-2007 $4,000,000 Netherlands Note: Does not include annual World Bank support. Footnotes: 11 Includes $227,000 committed by WB plus secondment of USDOE of Anil Cabraal and other consultants to ASTAE during FY92 (January-June 1992). 2/ Reimbursed to WB in June 1993, following receipt of Netherlands funding. 3/ To be disbursed in five tranches over three-year period. Retroactive to July 1992. 4/ To be disbursed in tranches over three-year period. 5/ To be disbursed in tranches of $1,000,000 per year over three-year period, of which ASTAE receives $700,000 per year. Retroactive to July 1994. 6/To be disbursed in equal tranches over three-year period. 7/ To be disbursed in 4 tranches over three-year period. ASTAE Status Report 37 sl s.f .s - .• . s