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Papua New Guinea: Town Electrification Investment Program - Tranche 2

Sovereign (Public) Project | 41504-025 Status: Active

The Asian Development Bank is working with Papua New Guinea on a program to deliver reliable and affordable power supplies to provincial centers. The second tranche will rehabilitate two existing hydropower plants and build another run-of-river plant, allowing provincial centers to cut diesel use and power costs. Only about 12% of the population had access to grid-connected power as of end-2015.

 
Project Name Town Electrification Investment Program - Tranche 2
Project Number 41504-025
Country Papua New Guinea
Project Status Active
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan 3544-PNG: Town Electrification Investment Program - Tranche 2
Ordinary capital resources US$ 55.90 million
Loan 3545-PNG: Town Electrification Investment Program - Tranche 2
concessional ordinary capital resources lending / Asian Development Fund US$ 5.00 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Knowledge solutions
Partnerships
Private sector development
Sector / Subsector

Energy / Electricity transmission and distribution

Gender Equity and Mainstreaming Some gender elements
Description

The components proposed for financing under the requested PFR are:

Component 1: Rehabilitation of two hydropower plants: (i) Yonki Toe of Dam (YTOD) hydropower plant, and (ii) Warangoi hydropower plant, which are currently operating below their full capacities. After rehabilitation, these plants will be capable of operating at their rated capacity of 28.0 MW-18 MW YTOD, and the 10 MW Warangoi plant. Moreover, the proposed rehabilitation will extend the economic life of these plants by another 20 to 25 years and ensure that they are brought to current standards.

Component 2: Construction of Ramazon run-of-river small hydropower plant with a preliminary capacity of 3 MW. The project will include construction of a (i) concrete weir, (ii) 5 km pipeline, (iii) penstock, (iv) powerhouse, and (v) new access road from the existing road to the powerhouse and internal roads within the project area.

Project Rationale and Linkage to Country/Regional Strategy

In PNG, grid-connected power is still largely restricted to the main urban areas. By the end of 2015, approximately 12% of the overall population had access to electricity. The majority of provincial centers are supplied entirely through diesel generation, resulting in high generation costs but still with a low quality of power supply. Lack of access to affordable and reliable power is limiting economic growth in provincial centers.

PNG has significant underutilized indigenous renewable energy sources, particularly hydropower and solar, for which the generation costs of energy are considerably lower than that of diesel. The TEIP is assisting PNG to meet the MFF outcome of improved utilization of reliable and clean power in provincial urban centers by supporting the development of least-cost renewable energy sources to (i) improve the reliability and quality of power supply in order to stimulate economic growth; and (ii) replace diesel generation, thereby reducing power-generation costs and creating incentives to improve access rates. The TEIP also supports the extension of the distribution grid to increase access to electricity in the provinces.

Under tranche 2, the government seeks ADB financing for (i) refurbishment of two existing hydropower plants; and (ii) construction of the Ramazon hydropower plant, consisting of a 3 megawatt (MW) run-of-river hydropower plant.

Impact The economic condition of the population in the targeted provincial centers has improved
Project Outcome
Description of Outcome Improved utilization of reliable, clean power to two provincial urban centers
Progress Toward Outcome

2018 July: YTOD and Waronggoi contracts concluded and ready for signing.

2018 September: The implementation progress of the Project is slow. Since effectiveness of the Project, a construction supervision consultant contract, with a value of about $1.89 million has been signed. Moreover, two out of three small hydro power turnkey contracts under the Project, with a total value of $32.95 million are ready for signing. However, no disbursement has been made and the two award-ready contracts have not been able to be signed, because the SLA has not been signed, which is the condition for disbursement of loan proceeds.

Implementation Progress
Description of Project Outputs

PPL rehabilitates two aging hydropower plants to bring them back to their rated capacity of 28.0 MW

Capacity building undertaken for implementing agency and project beneficiaries

The PMU renders efficient project management services

Status of Implementation Progress (Outputs, Activities, and Issues)

YTOD and Waronggoi contracts concluded and ready for signing.

To be assessed later.

To be assessed later.

For the Romazaon contract, the JV issue has been resolved, but has delayed the signing.

Too early to determine.

Too early to determine.

Too early to determine.

Too early to determine.

Geographical Location
Safeguard Categories
Environment B
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design Broad stakeholder consultation was undertaken during project design, inlcluding Government officials (national, provincial, and local), landowners, development partners and NGOs.
During Project Implementation Stakeholder consultation will continue during project implementation.
Responsible ADB Officer Villareal, Maria Theresa J.
Responsible ADB Department Pacific Department
Responsible ADB Division Papua New Guinea Resident Mission
Executing Agencies
Energy Division of the Department of Petroleum and Energy
P.O. Box 494
Waigani, NCD
Papua New Guinea
Timetable
Concept Clearance -
Fact Finding -
MRM 28 Sep 2016
Approval 04 Jul 2017
Last Review Mission -
Last PDS Update 26 Sep 2018

Loan 3544-PNG

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
04 Jul 2017 19 Jul 2017 12 Oct 2017 30 Jun 2020 24 Nov 2020 -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 55.90 Cumulative Contract Awards
ADB 55.90 04 Jul 2017 36.40 0.00 89%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 04 Jul 2017 27.65 0.00 68%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory Satisfactory Satisfactory Satisfactory - Satisfactory

Loan 3545-PNG

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
04 Jul 2017 19 Jul 2017 12 Oct 2017 30 Jun 2020 24 Nov 2020 -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 20.70 Cumulative Contract Awards
ADB 5.00 04 Jul 2017 2.41 0.00 46%
Counterpart 15.70 Cumulative Disbursements
Cofinancing 0.00 04 Jul 2017 1.66 0.00 32%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory Satisfactory Satisfactory Satisfactory - Satisfactory

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.

In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

Title Document Type Document Date
Town Electrification Investment Program - Tranche 2: Audited Project Financial Statements (January-December 2019) Audited Project Financial Statements Dec 2020
Amendment to the Loan Agreement (Ordinary Operations [Concessional]) for Loan No. 3545-PNG: Town Electrification Investment Program - Tranche 2 Loan Agreement (Ordinary Resources) Sep 2019
Amendment to the Loan Agreement for Loan 3544-PNG: Town Electrification Investment Program - Tranche 2 Loan Agreement (Ordinary Resources) Sep 2019
Town Electrification Investment Program - Tranche 2: Audited Project Financial Statements (Year Ended 31 December 2018) Audited Project Financial Statements Jun 2019
Town Electrification Investment Program - Tranche 2: Procurement Plan Procurement Plans Jun 2019
Amendment to the Loan Agreement for Loan 3544-PNG: Town Electrification Investment Program - Tranche 2 Loan Agreement (Ordinary Resources) Dec 2017
Loan Agreement for Loan 3544-PNG: Town Electrification Investment Program - Tranche 2 Loan Agreement (Ordinary Resources) Jul 2017
Project Agreement for Loans 3544 and 3545-PNG: Town Electrification Investment Program - Tranche 2 Project/Program Agreements Jul 2017
Loan Agreement (Ordinary Operations [Concessional]) for Loan 3545-PNG:Town Electrification Investment Program - Tranche 2 Loan Agreement (Ordinary Resources) Jul 2017
Town Electrification Investment Program - Tranche 2: Periodic Financing Request Report Periodic Financing Request Reports Jun 2017
Taun Ilektrifikesen Invesmen Program – Trens 2: Projek Rekot Pepa Translated PDS Mar 2017

Safeguard Documents See also: Safeguards

Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

Evaluation Documents See also: Independent Evaluation

None currently available.

Related Publications

None currently available.


The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

Requests for information may also be directed to the InfoUnit.

Tenders

Tender Title Type Status Posting Date Deadline
PMU Consultant Individual - Consulting Closed 18 Dec 2019 24 Dec 2019
L3544/3545 (COL) – PNG: Town Electrification Investment Program – Tranche 2 [WHRP-ICBV1-02/17-TEIP2-W02] Invitation for Bids Closed 25 Aug 2017 16 Feb 2018
41504-PNG: Town Electrification Investment Program – Tranche 2 [YTOD-ICBV1-01/17-TEIP2-W01] Invitation for Bids Closed 14 Jul 2017 13 Oct 2017

Contracts Awarded

Contract Title Approval Number Contract Date Contractor Contractor Address Executing Agency Contract Description Total Contract Amount (US$) Contract Amount Financed by ADB (US$)
TEIP PMU STAFF SALARIES AND RELATED EXPENSES Loan 3545 18 Jan 2021 PNG POWER LTD P.O BOX 1105, BOROKO, NCD PAPUA NEW GUINEA Energy Division of the Dept of Petroleum & Energy CONSULTANCY 513,673.41 513,673.41
ENGINEERING, PROCUREMENT AND CONSTRUCTION OF WARANGOI HYDRO REFURBISHMENT PROJECT Loan 3544 27 Nov 2018 JV AG INVESTMENT LTD. & DONGFANG ELECTRIC INT PO BOX 11, GORDONS, NCD PAPUA NEW GUINEA Energy Division of the Dept of Petroleum & Energy TURNKEY 19,976,251.00 18,955,505.00
ENGINEERING, PROCUREMENT AND CONSTRUCTION OF YONKI TOE OF DAM DAM (YTOD) SURGE TANK AND OTHER REMEDIAL WORKS Loan 3544 27 Nov 2018 JV AG INVESTMENT LTD. & DONGFANG ELECTRIC INT PO BOX 11, GORDONS, NCD PAPUA NEW GUINEA Energy Division of the Dept of Petroleum & Energy TURNKEY 10,715,578.00 10,338,009.00
PROJECT SUPERVISION CONSULTANT Loan 3545 08 Jan 2018 MULTICONSULT ASA NEDRE SKOYEN VEI 2, 0276 OSLO NORWAY Energy Division of the Dept of Petroleum & Energy CONSULTANCY 1,894,974.00 1,983,582.00

Procurement Plan