Afghanistan: MFF - Energy Sector Development Investment Program (Facility Concept)

Sovereign Project | 42094-012

Summary

The multitranche financing facility (Facility) is intended to finance projects, subprojects or components in the Program, complying with the criteria set out in the Framework Financing Agreement (FFA).

The components include:

(i) feasibility studies and designs;

(ii) infrastructure improvements;

(iii) infrastructure maintenance; and

(iv) human resource development and institutional reforms.

Latest Project Documents

Consulting Notices

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Procurement Notices

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Procurement Documents

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Project Name MFF - Energy Sector Development Investment Program (Facility Concept)
Project Number 42094-012
Country Afghanistan
Project Status Approved
Project Type / Modality of Assistance Grant
Source of Funding / Amount
Grant 0026-AFG: MFF - Energy Sector Development Investment Program (Facility Concept)
Asian Development Fund US$ 570.00 million
MFF Facility Concept: MFF - Energy Sector Development Investment Program (Facility Concept)
United Kingdom (w/ LoA) US$ 20.00 million
Denmark - DANIDA (w/ LoA) US$ 12.40 million
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Governance and capacity development
Sector / Subsector Health - Health insurance and subsidized health programs
Gender Equity and Mainstreaming Some gender elements
Description

The multitranche financing facility (Facility) is intended to finance projects, subprojects or components in the Program, complying with the criteria set out in the Framework Financing Agreement (FFA).

The components include:

(i) feasibility studies and designs;

(ii) infrastructure improvements;

(iii) infrastructure maintenance; and

(iv) human resource development and institutional reforms.

Infrastructure improvements will include construction, rehabilitation, upgrading, and repair of energy infrastructure programmed in the country partnership strategy (CPS 2009-13), Afghan National Development Strategy (ANDS) and Government of Afghanistan's National Priority Programs (NPPs). The main objective of the maintenance component is to increase the sustainability of the investment program. The human resource development, capacity support and institutional reform component is included to increase implementation efficiency and sustainability of the physical investments, and help strengthen Da Afghanistan Breshna Sherkat (DABS), the newly established Afghan Power Utility which is the Executing Agency of the Facility.

Afghanistan has requested ADB to help finance part of the Program through the Facility in the amount of up to the equivalent of $570 million.

The Executing Agency for the power component of the Facility is DABS (of the Islamic Republic of Afghanistan). The Executing Agency for the Gas Wells Rehabilitation component is the Ministry of Mines and Petroleum (MOMP).

DABS will be responsible for the overall implementation of the Investment Program as well as of all projects to be financed under the Investment Program except for the Sheberghan gas fields rehabilitation project for which MOM will be the EA. A Project Management Office (PMO) will be established within DABS to manage the implementation of the projects and to perform due diligence for projects to be implemented in subsequent tranches. MOM will second staff to support the PMO in regards to management implementation of the Sheberghan gas fields rehabilitation project.

The Investment Program is scheduled for 8 years inclusive of procurement and construction activities and is expected for completion by 31 December 2016. Current period of MFF utilization is until 30 June 2017. The physical implementation of Tranche 1 and Tranche 2 is expected to be completed by 30 June 2016. The implementation schedule for the projects under the subsequent tranches will be prepared during implementation of Tranche 1.

ADB will provide financing, as and when necessary between 2008 and 2013, for physical and non-physical components of projects (Projects). The proposed allocation of funds is shown below.

1) NEPS 220 kV Transmission Line: Kunduz - Taloqan;

2) NEPS Distribution Network: Kunduz;

3) NEPS Distribution Network: Baghlan;

4) NEPS 220 kV System Operation and Maintenance;

5) Sheberghan Gas Fields Rehabilitation;

6) NEPS 220 kV Transmission Line Replication: Pul-e-Khumri - Chimtala;

7) NEPS 220 kV Chimtala 160 MVA Substation Replication;

8) NEPS 220 kV Transmission Line: Kabul - Gardez;

9) DABS Institutional Capacity Development (MIS/Metering/Billing/Collection);

10) Kabul Distribution Network;

11) Kabul 220 kV Substation;

12) Chimtala to Arghundy 220 kV Transmission Line;

13) Gereshk Hydropower Rehabilitation and supply of transmission and distribution equipment;

14) 500 kV Transmission line from Andkhoy to Sheberghan to Mazar;

15) Substations at Andkhoy, Sheberghan and Mazar; and

16) 500 kV Substation in Arghundy

Each Project will include one or more of the following components of the energy sector, which are described below: (i) feasibility studies and designs; (ii) infrastructure improvements; (iii) infrastructure maintenance; and (iv) human resource development and institutional reform.

Project Rationale and Linkage to Country/Regional Strategy

The Energy Sector Development Investment Program aims for improved energy security and sustainable power supply to stimulate economic development and would reduce cost of doing business and cut poverty. It aims to provide sustainable cost effective power supply in North East Afghanistan (including Kabul) through (i) Improvements in generation, transmission and distribution systems, and (ii) Strengthened institutional capacity of power utility's (DABS) commercial, technical and managerial functions (MIS, financial/revenue management, O&M capabilities, system planning, and project management).

The outputs include the following: (i) increase in customers in North-East Power System (NEPS) area through (a) Kunduz Taloqan transmission line, (b) Kunduz and Baghlan distribution, (b) replication of Pul-e-Khumri Chimtala transmission line, (c) replication of Chimtala Substation, and (d) Kabul South extension; (e) rehabilitated Sheberghan gas wells; (f) institutional support for DABS: (i) MIS, (ii) metering and billing, (iii) O&M of 220 kV NEPS, and (iv) project management; and (v) due diligence for future tranches and projects

Impact Secure and stable energy supplies for Afghanistan
Project Outcome
Description of Outcome Sustainable and reliable grid connected power supply in north, east and south Afghanistan
Progress Toward Outcome All targets are achievable. Substantial progress has been made with all projects getting commissioned by 30 June 2017.
Implementation Progress
Description of Project Outputs

Generation capacity from hydro sources and gas wells increased

Transmission network upgraded in project areas through rehabilitation, augmentation and expansion of NEPS

Development of power distribution systems at load centers supplied from NEPS

Technical, managerial, financial and institutional functions of DABS achieves requisite autonomy and corporatization

Project Management:

Projects designed, implemented and monitored within cost, time and quality parameters

Status of Implementation Progress (Outputs, Activities, and Issues) Projects are under implementation. Outputs will be achieved as planned. All projects will be commissioned before completion date of 30 June 2017.
Geographical Location Afghanistan
Safeguard Categories
Environment B
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects The EAs are ensuring that (i) the projects are designed, constructed, and operated in accordance with national and local environmental procedures and guidelines and with the Environment Policy (ii) the projects are designed, constructed, and operated in accordance with the EMPs as reflected in the IEEs and EARF; (iii) the EMMPs will be incorporated in bidding documents and civil work contracts and implemented; and (iv) environmental performance reports will be submitted to ADB twice annually during the construction period, including progress made on the mitigation measures, monitoring data, problems encountered, enforcement plan, and any violations.
Involuntary Resettlement The EAs are ensuring that the design, implementation and operation of the Program are carried out in accordance with the IR Policy, applicable Government's law and regulations, and the agreed LARF. In the preparation and implementation of projects or subprojects under Tranche 1 and following tranches the EAs ensures that: (i) all land and rights of way required by the relevant projects or subprojects are made available in a timely manner; (ii) traditional (non-turnkey) construction contract awards are signed only at the condition that LARP approved by ADB is disclosed to the affected people (AP) and implemented; (iii) for all subprojects, independently from contract type, civil works initiation will be allowed only at the condition that ADB provides no objection and that the relevant LARPs are prepared, approved by ADB, disclosed to the APs and implemented; (iv) contractors' activities are in compliance with requirements of the LARPs; and (v) an independent monitor acceptable to ADB is engaged to carry out monitoring and evaluation and report to ADB based on the requirements of the LARPs.
Indigenous Peoples

The frameworks cover the Facility-specific information and requirements in accordance with ADB's safeguard policies: (i) the general anticipated impacts of the components or projects likely to be financed under the MFF on the environment, involuntary resettlement, and indigenous peoples; (ii) the safeguard criteria that are to be used in selecting components, projects; (iii) the requirements and procedure that will be followed for screening and categorization, impact assessments, development of management plans, public consultation and information disclosure (including the 120-day disclosure rule, if required), and monitoring and reporting; and (iv) the institutional arrangements (including budget and capacity requirements) and the client's and ADB's responsibilities and authorities for the preparation, review and clearance of safeguard documents.

Prior to the preparation of each PFR, the applicability and relevance of each safeguard framework for environmental assessment, involuntary resettlement, and indigenous people will be reviewed by DABS and/or MOM and updated to ensure relevance and consistency with applicable country legal frameworks and ADB's safeguard policies, as amended from time to time.

Stakeholder Communication, Participation, and Consultation
During Project Design Project funds may be used for studying the feasibility or preparing the designs of projects to be financed from the Facility. During design, stage an extensive process of dialogue will be conducrted with local communities apprising them of the new investments and its potential benefits.
During Project Implementation The Investment Program is scheduled for 8 years inclusive of procurement and construction activities and is expected for completion at the latest by 31 December 2016. Period of utilization is until 30 June 2017. The physical implementation of Tranche 1 is expected to be completed by 31 December 2013. The implementation schedule for the projects under the subsequent tranches will be prepared during implementation of Tranche 1.
Business Opportunities
Consulting Services Consulting services will be required for, among others, (i) preparation of subprojects, (ii) detailed design, and (iii) construction supervision and management. Consultants will be selected and engaged in accordance with ADB's Guidelines on the Use of Consultants (2007, as amended from time to time). Consulting firms will be selected through international competition using quality- and cost-based selection method. Individual consultants may be recruited for specific assignments in accordance with the ADB's procedure. It is envisioned that, because of the continuation of a number of tasks during implementation, single-source selection may be used for certain assignments with the prior approval of ADB.
Procurement Procurement to be financed under the Investment Program will be done in accordance with ADB's Procurement Guidelines (2007, as amended from time to time). International competitive bidding (ICB) will be used for goods and works funded under the Investment Program. ICB will be used for supply contracts estimated to cost the equivalent of or more than $1 million. ICB will be used for works contracts estimated to cost the equivalent of or more than $5 million.
Responsible ADB Officer Asad Aleem
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Energy Division, CWRD
Executing Agencies
Da Afghanistan Breshna SherkatDr. Jalil P. Shamsinfo.dabs@gmail.comNear Kabul Nandari, Kabul, Afghanistan
Timetable
Concept Clearance 09 Jun 2008
Fact Finding 23 May 2008 to 06 Jun 2008
MRM 23 Jul 2008
Approval 28 Nov 2008
Last Review Mission -
PDS Creation Date 10 Jul 2008
Last PDS Update 17 Mar 2015

MFF Facility Concept

Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 32.40 Cumulative Contract Awards
ADB 0.00 - 0.00 0.00 %
Counterpart 0.00 Cumulative Disbursements
Cofinancing 32.40 - 0.00 0.00 %

Grant 0026-AFG

Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 570.00 Cumulative Contract Awards
ADB 570.00 - 0.00 0.00 %
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 - 0.00 0.00 %

Evaluation Documents

See also: Independent Evaluation

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