The World Bank Implementation Status & Results Report Energy Community of South East Europe APL Program - APL 5 for Albania DAM SAFETY (P110481) Energy Community of South East Europe APL Program - APL 5 for Albania DAM SAFETY (P110481) EUROPE AND CENTRAL ASIA | Albania | Energy & Extractives Global Practice | IBRD/IDA | Investment Project Financing | FY 2008 | Seq No: 16 | ARCHIVED on 21-Nov-2019 | ISR39470 | Implementing Agencies: Albanian Power Corporation (KESH), Albania Financial Supervisory Authority Key Dates Key Project Dates Bank Approval Date: 30-Jun-2008 Effectiveness Date: 16-Dec-2008 Planned Mid Term Review Date: 30-Nov-2015 Actual Mid-Term Review Date: 07-Apr-2016 Original Closing Date: 31-Dec-2013 Revised Closing Date: 31-Dec-2020 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) The objectives of the Project are to: (i) contribute to safeguarding the hydroelectric dams on the Drin and Mat river cascades in the territory of the Borrower; and (ii) improve the operational efficiency of said hydroelectric dams and enhance the stability of power supply in the regional market. Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Physical infrastructure investments:(Cost $54.81 M) Technical Assistance and Training:(Cost $10.98 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Satisfactory Overall Implementation Progress (IP) Satisfactory Satisfactory Overall Risk Rating Moderate Moderate Implementation Status and Key Decisions After commencement of works in April 2019, the contractor for rehabilitation of spillways, Ciltug from Turkey is progressing with spillway rehabilitation on both HPPs. On Komani HPP, the rehabilitation activities on the stoplog on spillway No.4 have been completed to a large extent, with preparatory works on the stoplog No.3 started as well. Initially, after a complete pull-out, the stoplog No.4 was found to be in a very bad condition. The follow up works included repairs, NDT tests, sandblasting and painting of arms and both sections of the stoplog, underwater steel sealing rail cleaning as well as repairs of the winch mechanism. The main outstanding activity is the underwater welding of stoplog sealing rails, the activity that will require a close coordination with KESh’s department for generation. In order to ensure safety of the power plant, to ensure sufficient operational spill capacity at any moment of the rehabilitation works, major works on stoplog No.3 will start once activities on the stoplog No.4 are completed. This will ensure that at least one spillway is fully operational during the rehabilitation works. On Fierza HPP, the works started in late August 2019, almost four months later than initially foreseen due to inability to work on the spillway as the reservoir water leave was above target 11/21/2019 Page 1 of 12 The World Bank Implementation Status & Results Report Energy Community of South East Europe APL Program - APL 5 for Albania DAM SAFETY (P110481) level. Currently, the works are focused on the stoplog on the spillway No.3, with dismantling of the gate completed, and repairs of the stoplog structure and winch mechanism in progress. The initial inspection of Fierza stoplogs indicates their much better condition than the ones on Komani HPP. Although the rehabilitation works on both HPPs are progressing well, it is very likely that, due to multiple delays the rehabilitation of the stoplogs and spillways cannot be complete by the end of December 2020. However, this is tentative proposed implementation schedule and would be readdressed again in April 2020. At that time the project implementation progress should be substantial, and the project status will provide more inputs for the decision. KESh, the Bank team emphasized that the extended schedule can only be met in case of an effective coordination between KESh’s various departments including the PMU, Department for Generation, Department for Maintenance and the Dam Safety Department. The coordination is required to maintain water level in the reservoir according to the agreed schedule. This will allow contractor to carry out rehabilitation works safely and according to the agreed schedule. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance -- Moderate Moderate Macroeconomic -- Low Low Sector Strategies and Policies -- Moderate Moderate Technical Design of Project or Program -- Moderate Moderate Institutional Capacity for Implementation and Sustainability -- Low Low Fiduciary -- Moderate Moderate Environment and Social -- Low Low Stakeholders -- Low Low Other -- -- Low Overall -- Moderate Moderate Results PDO Indicators by Objectives / Outcomes Regional Market Liberalization IN00771341 ►Regional Market Liberalization (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target On May 15, 2019, GoA The Albanian Power On May 15, 2019, the decided to establish Exchange to be Value 0% in most countries Albanian Government the Albanian Power Functional and decided to establish the Exchange (APEX) and Operational 11/21/2019 Page 2 of 12 The World Bank Implementation Status & Results Report Energy Community of South East Europe APL Program - APL 5 for Albania DAM SAFETY (P110481) Albanian Power Exchage on September 2019 (APEX). GoA approved the Twelve customers APEX shareholders’ connected in HV are structure and qualified as eligible; the procedures for selling annual consumption in the shares. 2018 was above GWh Twelve customers 900 which is 15% of total connected in HV are demand in Albania. At qualified as eligible the the beginning of 2018 the annual consumption in other 85 MV customers 2019 is estimated connected in 35 kV were GWh 900 which is qualified but only few of 15% of total demand in them are suppled on Albania. At the deregulated market. beginning of 2018 the . other 96 MV customers connected in 35 kV, with annual consumption around GWh 80, were qualified and supplied with “market base price” by qualified suppliers and OSHEE supplier. The other group of customers potential to be deregulated are the customers connected in MV (20, 10, 6 kV); there are 4000 customers and the annual consumption is estimated at GWh 780 Date 10-Mar-2011 07-Jun-2019 15-Nov-2019 31-Dec-2020 Comments: Improve the dams’ operation efficiency IN00771343 ►Improve the dams’ operation efficiency (Gigawatt-hour (GWh), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 15.00 15.00 31.00 Date 19-May-2008 07-Jun-2019 15-Nov-2019 31-Dec-2020 The electromechanical rehabilitation works for Komani HPP (the largest hydro power plant in Albania) is fully completed on March 2019; The refurbishment and rehabilitation of all four units have increased the power plant: (i) reliability (the availability of units is high and the benefit from the cascade operation during Comments: good hydrology is significant) and (ii) efficiency (water leakages are eliminated and the estimated GWh 11 lost during a year is reduced to zero). Safeguarded dams and generation capacities IN00771342 11/21/2019 Page 3 of 12 The World Bank Implementation Status & Results Report Energy Community of South East Europe APL Program - APL 5 for Albania DAM SAFETY (P110481) ►Safeguarded dams and generation capacities (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The main hydropower capacities in Albania are affected by safeguards measures (Drin and Mat Rivers The main hydropower Cascades). capacities in Albania are The dam geological, affected by safeguards seismic and geodetic measures (Drin and Mat monitoring systems Rivers Cascades). are functional (both The dam geological, Cascades). seismic and geodetic COMPLETED. monitoring systems are The Rockfall danger functional (both protection works in all Cascades). three Drin River Dams COMPLETED. are COMPLETED The Rockfall danger The Komani dam toe protection works in all rehabilitation works three Drin River Dams are COMPLETED on are COMPLETED July 2016 The Komani dam toe KESh and Albanian rehabilitation works are institution are adopting COMPLETED on July Safeguard remedies the recommendations Safeguard measures are 2016 are implemented at Value of “Strengthening of not functional KESh and Albanian Drin and Mat Rivers the Institution set-up of institution are adopting Cascades Dam Safety and the recommendations of Emergency “Strengthening of the Preparedness” study. Institution set-up of Dam Rehabilitation works in Safety and Emergency Komani HPP are Preparedness” study. completed and four Rehabilitation works in generation units are in Komani HPP are operation. completed and four COMPLETED on generation units are in March 2019. operation. COMPLETED The contract for Fierza on March 2019.. and Komani’s The contract for Fierza Spillways Gates and and Komani’s Spillways Stop-logs Gates and Stop-logs Rehabilitation works, is Rehabilitation works, is in in implementation implementation phase phase since January since January 2019. 2019. The implementation progress is satisfactory. Date 19-May-2008 07-Jun-2019 15-Nov-2019 31-Dec-2020 Overall Comments PDO Albanian government adopted has adopted a decision (15 May 2019) to establish APEX (with day-ahead and intraday markets) and on September 2019 approved the APEX shareholders’ structure and procedures for selling the shares. The power exchange will be established in accordance with EU directives and as a step-in power sector reform. The power exchange will speed up the electricity market liberalization and deregulation. OST, Albania’s state-owned transmission system operator (TSO), will be in charge of setting up a company to operate the power exchange. The operator will be a joint stock company, and the Albanian government will select its shareholders. 11/21/2019 Page 4 of 12 The World Bank Implementation Status & Results Report Energy Community of South East Europe APL Program - APL 5 for Albania DAM SAFETY (P110481) The EnC Secretariat pointed out the positive developments in the establishment of day-ahead markets in Albania. However, the pace of reforms in the WB6 region overall must be accelerated if market coupling is to take place within the time horizon foreseen. The establishment of a legal framework harmonized with the Third Energy Package and a power exchange, the key prerequisites, are yet to be completed by all WB6 Contracting Parties. The EnC Sekretaria is urging the GoA to speed up the distribution unbundling and limiting the market power of OSHEE. The significant contribution of the project is focused on safeguarding the hydropower dams on the Drin River Cascade in the territory of Albania. The main hydro power capacities are directly affected by safeguards remedial measures including those with very high priority, high priority and medium priority: (i) the dam geological, seismic and geodetic monitoring systems are functional; (ii) KESh and Albanian institution are implementing the strengthening of the Institution set-up of Dam Safety and Emergency Preparedness based on risk analysis; (iii) the Komani dam toe is fully reinstated; (iv) the Rockfall danger protection is implemented in three hydro power plants; (v) four units in Komani HPP are renovated and re-commissioned; (vi) the rehabilitation of Spillways gates and Stop-logs in three power plants are in implementation phase; and (vii) the recommendation for the hydrology risk management and new additional spillway capacities in Komani and Fierza HPPs are provided. Drin River Cascade operational efficiency is significantly improved. The generation is increased, and the Bank provided the recommendations and tool for the simulation of the Albanian system in order to optimize the utilization of hydro resources. The Drin River SCADA system (including the alarm system) is in implementation phase. The electromechanical rehabilitation works for Komani HPP (the largest hydro power plant in Albania) is fully completed on March 2019 and the refurbishment and rehabilitation of all four units have increased the power plant: (i) reliability (the availability of units is high and the benefit from the cascade operation during good hydrology is significant) and (ii) efficiency (water leakages are eliminated and the estimated GWh 11 lost during a year is reduced to zero. Intermediate Results Indicators by Components Physical Infrastructure Investments IN00771344 ►The rehabilitated spillways are tested and functional for very high priority investments (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The main hydropower The main hydropower capacity in Albania are capacity in Albania are affected by safeguards affected by safeguards measures (Drin and Mat measures (Drin and Rivers Cascades). Mat Rivers Cascades). The contract for Fierza The contract for Fierza and Komani’s Spillways and Komani’s gates and Stop-logs Spillways gates and Rehabilitation works is in Stop-logs implementation phase Rehabilitation works is and will be completed by in implementation the end of December phase and will be 2020. completed by June Feasibility Study (FS) KESh and the Panel of 2021. Rehabilitation tested Value completed Experts would provide and completed their views on the KESh would provide updated time schedule their actions on the and strategic plan to updated time schedule mitigate the risks related and strategic plan to to operation of both dams mitigate the risks during rehabilitation related to operation of works. both dams during rehabilitation works. kfW is financing the Spillway Gates kfW is financing the Rehabilitation and new Spillway Gates Stop-logs in Vau Deja Rehabilitation and new Dams; the owners Stop-logs in Vau Deja 11/21/2019 Page 5 of 12 The World Bank Implementation Status & Results Report Energy Community of South East Europe APL Program - APL 5 for Albania DAM SAFETY (P110481) engineer is appointed; Dams; the owners the bidder is selected, engineer is appointed; and contract will be the rehabilitation works signed contract is awarded and signed. Date 10-Mar-2011 07-Jun-2019 15-Nov-2019 31-Dec-2020 IN00771345 ►High priority remedial measures completed (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The Intermediate Indicator is COMPLETED The Intermediate (i) The Electro- Indicator is COMPLETED Mechanical (i) The Electro- Rehabilitation works in Mechanical Komani HPP are Rehabilitation works in co0mpleted. Four Komani HPP are generation units are co0mpleted. Four re-commissioned and generation units are re- in operation since commissioned and in March 2019. operation since March (ii) The Dam's 2019. Instrumentation and (ii) The Dam's Monitoring Systems Instrumentation and are COMPLETED. The Monitoring Systems are additional instruments COMPLETED. The and other facilities are additional instruments be provided by SECO; and other facilities are be the underwater provided by SECO; the inspection to verify the underwater inspection to Rehabilitation Value FS completed water leakages in verify the water leakages completed Komani Dam, is in Komani Dam, is COMPLETED. COMPLETED. (iii) The Komani Dam (iii) The Komani Dam toe toe rehabilitation rehabilitation works, the works, the consolidation of scour consolidation of scour area and dredging to the area and dredging to tailrace channel are the tailrace channel COMPLETED. are COMPLETED. (iv) The Prefeasibility and (iv) The Prefeasibility Feasibility studies are and Feasibility studies both COMPLETED. The are both recommendations for COMPLETED. The new additional spillways recommendations for in Fierza and Komani new additional Dams are provided. spillways in Fierza and Komani Dams are provided. Date 10-Mar-2011 07-Jun-2019 15-Nov-2019 31-Dec-2020 IN00771346 ►Remedial measures of medium priority and operational improvements completed (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target 11/21/2019 Page 6 of 12 The World Bank Implementation Status & Results Report Energy Community of South East Europe APL Program - APL 5 for Albania DAM SAFETY (P110481) The intermediate Indicator is partially COMPLETED (i). The Risk Analysis The intermediate and preparation of Indicator is partially Emergency COMPLETED Preparedness Plan (i). The Risk Analysis and (EPP) is preparation of COMPLETED; the Emergency Albanian responsible Preparedness Plan institutions are (EPP) is COMPLETED; adopting the the Albanian responsible recommendations institutions are adopting provided in EPP. the recommendations (ii) The internal provided in EPP. organization is (ii) The internal COMPLETED; the organization is new dam safety COMPLETED; the new department is dam safety department is established. The established. The operational operational improvements are improvements are ongoing, and the ongoing, and the Internal Internal Operation Operation improvements improvements are are partially Completed. partially Completed. KESH is adopting the KESH is adopting the “Strengthening of the “Strengthening of the Institution set-up of Dam Institution set-up of Safety and Emergency Dam Safety and Remedial measures Preparedness” study Emergency and operational Value FS completed recommendations. Preparedness” study improvements (iii) The Rock-fall recommendations. completed protection in Fierza HPP, (iii) The Rock-fall Komani HPP and Vau protection in Fierza Deja HPP are HPP, Komani HPP COMPLETED and Vau Deja HPP are The rockfall danger COMPLETED protection and rockfall The rockfall danger stochastic modeling are protection and rockfall completed in all Drin stochastic modeling Cascade Dam are completed in all (iv) The Drin River Drin Cascade Dam SCADA system (iv) The Drin River (including the alarm SCADA system system) is in (including the alarm implementation phase; system) is in that is financed by KfW implementation phase; (v).Drin river operation that is financed by KfW optimization (WBG (v).Drin river operation finances) - optimization (WBG COMPLETED. The study finances) - (finalized in 2012) COMPLETED. The presents the results of study (finalized in the simulation of the 2012) presents the Albanian system in order results of the to optimize the utilization simulation of the of hydro resources. Albanian system in order to optimize the utilization of hydro resources. Date 10-Mar-2011 07-Jun-2019 15-Nov-2019 31-Dec-2020 11/21/2019 Page 7 of 12 The World Bank Implementation Status & Results Report Energy Community of South East Europe APL Program - APL 5 for Albania DAM SAFETY (P110481) IN00771347 ►Safety of Dams Expert Panel (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The Panel of Experts The Expert Panel is fully is fully operative; the Terms of reference operative; the individual Value individual contracts are Panel in full operation. drafted contracts are extended extended until until December 2020. December 2020. Date 10-Mar-2011 07-Jun-2019 15-Nov-2019 31-Dec-2020 IN00771348 ►Hydrology analysis and water management (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The intermediate The intermediate Indicator is Indicator is COMPLETED COMPLETED The Prefeasibility and The Prefeasibility and Feasibility studies are Feasibility studies are The system is both COMPLETED. The both COMPLETED. Value Planning stag completed and recommendations for The recommendations functional new additional spillways for new additional in Fierza and Komani spillways in Fierza and Dams are provided Komani Dams are provided Date 10-Mar-2011 07-Jun-2019 15-Nov-2019 30-Jun-2019 IN00771349 ►Emergency preparedness plan (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The intermediate The intermediate indicator is indicator is COMPELTED COMPELTED The Risk Analysis and The Risk Analysis and preparation of preparation of Emergency Emergency Preparedness Plan Preparedness Plan Value Planning stage Continuation (EPP) is COMPLETED (EPP) is COMPLETED the Albanian responsible the Albanian institutions are adopting responsible institutions the recommendations are adopting the provided in EPP recommendations provided in EPP Date 10-Mar-2011 07-Jun-2019 15-Nov-2019 31-Dec-2019 IN00771350 ►Strengthen the capacities of KESH’s dam safety department and AlbCOLD (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value Planning stage The intermediate The intermediate Completion Indicator is COMPLETED Indicator is The internal organization COMPLETED is COMPLETED; the new The internal dam safety department is organization is established. The internal COMPLETED; the operational new dam safety 11/21/2019 Page 8 of 12 The World Bank Implementation Status & Results Report Energy Community of South East Europe APL Program - APL 5 for Albania DAM SAFETY (P110481) improvements are department is ongoing. KESH is established. The adopting the internal operational “Strengthening of the improvements are Institution set-up of Dam ongoing. KESH is Safety and Emergency adopting the Preparedness” study “Strengthening of the recommendations Institution set-up of Dam Safety and Emergency Preparedness” study recommendations Date 10-Mar-2011 07-Jun-2019 15-Nov-2019 30-Jun-2019 IN00771351 ►Prepare a new structure and organization for KESH Generation (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The internal organization is COMPLETED; the new dam safety department is The intermediate established. The indicator is COMPLETED internal operational The internal organization improvements are is COMPLETED; the new ongoing. KESH is dam safety department is adopting the established. The internal “Strengthening of the operational Institution set-up of improvements are Value Planning stage Dam Safety and Completion ongoing. KESH is Emergency adopting the Preparedness” study “Strengthening of the recommendations. Institution set-up of Dam Actually, KESH made Safety and Emergency an internal Preparedness” study reorganization and recommendations listed the PMU under the KESH Generation Department. PMU has been always an independent unit under KESH CEO. Date 10-Mar-2011 07-Jun-2019 15-Nov-2019 30-Jun-2019 IN00771352 ►Financial management capacity building (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value Planning stage The KESH financial The KESH financial KESH’s annual management contract is management contract financial statements signed, and it is in is signed, and it is in are prepared in full implementation phase. implementation phase. compliance with IFRS The audited Financial The contracted Statements and auditor consulting firm has Management Letter for worked on accounting 2018 are expected to be adjustment report submitted by the end of relevant for the June 2019. preparation of the entity financial statements for the year 11/21/2019 Page 9 of 12 The World Bank Implementation Status & Results Report Energy Community of South East Europe APL Program - APL 5 for Albania DAM SAFETY (P110481) ended December 31, 2018 and 2017 and supporting KESh in dealing with auditors on proposed adjustments, as well as with other deliverables according to the schedule plan. The audited KESh consolidated financial statements (FS) for the same year are not yet finalized, due to ongoing discussions between KESh management, the auditor and the FM TA consulting firm on the disagreements on the application of IFRS requirements in the measurement of the property plant and equipment and borrowings. The Bank team has been informed that the KESh management has taken a decision and will soon recommend the FS for approval to the board of directors. Approval of the FS and issuance of the auditor’s report are expected within December 2019. There are no pending financial management issues with respect to the project activities. Date 10-Mar-2011 07-Jun-2019 15-Nov-2019 31-Dec-2020 IN00771353 ►Percentage of grievance received and addresses within agreed timeframe (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 95.00 Date 31-Jan-2018 07-Jun-2019 15-Nov-2019 31-Dec-2020 Data on Financial Performance Disbursements (by loan) 11/21/2019 Page 10 of 12 The World Bank Implementation Status & Results Report Energy Community of South East Europe APL Program - APL 5 for Albania DAM SAFETY (P110481) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P110481 IBRD-81110 Effective USD 21.60 21.60 0.00 17.76 0.00 100% P110481 IBRD-88620 Effective USD 14.90 14.90 0.00 2.45 12.22 17% P110481 IDA-44800 Effective USD 35.30 35.30 0.00 31.77 0.33 99% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P110481 IBRD-81110 Effective 20-Dec-2011 17-Feb-2012 31-May-2012 30-Dec-2016 31-Dec-2020 P110481 IBRD-88620 Effective 25-May-2018 21-Jun-2018 29-Nov-2018 31-Dec-2020 31-Dec-2020 P110481 IDA-44800 Effective 30-Jun-2008 02-Jul-2008 16-Dec-2008 31-Dec-2013 31-Dec-2020 Cumulative Disbursements Restructuring History Level 2 Approved on 15-Dec-2015 ,Level 2 Approved on 27-Dec-2016 Related Project(s) 11/21/2019 Page 11 of 12 The World Bank Implementation Status & Results Report Energy Community of South East Europe APL Program - APL 5 for Albania DAM SAFETY (P110481) P125856-DAM SAFETY - ADDITIONAL FINANCING ,P166469-Second Additional Financing for Energy Community of South East Europe APL Program APL 5 for Albania Dam Safety 11/21/2019 Page 12 of 12