vietnam second transmission and distribution project (cr. 4107...

Aide Memoire – June 2013

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Vietnam

Second Transmission and Distribution Project

(Cr. 4107-VN, Ln. 8026-VN)

Implementation Support Mission

June 3-11,2013

Key Project Data

Project Number: P084871 Credit Number: Cr. 4107

Effectiveness Date: May 31, 2006 Closing Date June 30, 2014

Project Age: 84 months Current Credit Amount US$208 million (SDR 136.7M)

Credit Disbursement US$184m (88%)

Additional Financing: P114875 Loan Number: Ln.8026

Effectiveness Date: Aug 29, 2011 Closing Date June 30, 2014

Project Age: 19 months Current Loan Amount US$180 million

Loan Disbursement US$87m (48%)

Date of Last Mission: 14-Oct-2012 Date of Next Mission December 2013

AIDE-MEMOIRE

I. Introduction and Acknowledgements

1. A World Bank mission carried out an implementation support mission for the Second Transmission and Distribution Project (TD2, original credit Cr. 4107-VN and the additional financing Ln. 8026-VN) in Vietnam from June 3 to 11, 2013 and June 18, 2013. The mission objectives for the project include: (i) review overall project implementation including safeguards, financial management, procurement and disbursement; (ii) assess progress on the actions agreed during the last supervision mission; and (iii) collect project indicators for results monitoring and evaluation.

2. The mission visited and discussed project implementation progress with the Southern Power Project Management Board (SPMB) and the Ho Chi Minh City Power Corporation (HCMCPC) in Ho Chi Minh City; the Central Power Projects Management Board (CPMB) and the Central Power Corporation (CPC) in Da Nang; the National Power Transmission Corporation (NPT), and the National Load Dispatch Center (NLDC) in Hanoi. Field visits were made to the site of the 220kV Hiep Binh Phuoc substation in Ho Chi Minh City. The mission conducted a wrap-up meeting on June 11, 2013, in EVN’s office in Hanoi chaired by Mr. Dinh Quang Tri, Vice President of EVN. .

3. The mission wishes to thank the management and staff of EVN, NPT, CPC, HCMCPC, the SPMB, the CPMB and the NLDC for their courtesies and hospitalities and for the assistance extended to it in carrying out its tasks. The main findings and the key actions for follow up are detailed in this Aide Memoire. A list of people met and the Bank Task Team composition are attached in Annex 1.

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II. Project Development Objective (PDO) 4. The objective of TD2 Project is (i) Investment support to overcome bottlenecks in 500kV and 220kV transmission system and upgrades to selected 110kV distribution system; (ii) Replacement of the national and regional SCADA/EMS system; and (iii) Assistance in the reform and restructuring of EVN and its affiliates to manages and operate the transmission system efficiently in an unbundled and increasingly market-oriented power industry.

III. Implementation Status and Key Issues

5. Progress towards achievement of PDO: Overall progress towards achievement of PDO is assessed as moderately satisfactory. Most of outcome indicators and result indicators by each component have been achieved or are likely to be achieved by the end of the Project. One key indicator related to the establishment of a new supervision control and data acquisition system and energy management system SCADA/EMS, is likely not to be achieved by the project closing date; however EVN/NLDC have confirmed that the system will be completed by December 2014. The latest status of results monitoring indicators is attached in Annex 2.

6. Overall Implementation Progress: Overall progress of project implementation is moderately satisfactory. Subprojects of component 1 for transmission and distribution expansion and reinforcement have made significant progress since the last supervision mission in October 2012. 9 out of 16 subprojects under original financing (Cr.4107) and 3 out of 8 subprojects under additional financing (Ln. 8026) have been fully completed and have been put into operation. The remaining subprojects are also progressing well and expected to complete by the project closing date of June 30, 2014. The commitment value has significantly improved from 60% to 93%. However, the mission has been informed that the SCADA/EMS subproject

under component 2 most probably will not be completed by the project closing date because of delays in the bidding process: the SCADA/EMS system contract was concluded with the contractor only in December 2012 and as per contract’s schedule the contract would only be completed by December 2014 which is 6 months after the project closing date. According to the schedule, by the project closing date of June 30, 2013, only 75% of contract’s work could be completed and consequently only 75% of contract amount would be disbursed under the project’s fund. EVN/NLDC has confirmed payment of the remaining about $5 million of the contract amount out of its own funds. Another component that is lagging behind schedule is the technical assistance for building NPT’s capacity to enhance its financial performance for which an allocation of US$500,000 was made under the Additional Financing Loan. NPT will start implementing the activities with a view to completing them by June 30, 2014. The detailed implementation progress is described in Annex 3 and 4.

7. Disbursement Progress: Overall progress of disbursement is highly satisfactory. The disbursement value for FY2013 up to the time of the supervision is recorded at $83.6 million, which is equal to a disbursement ratio of 42% for FY2013. Of the original IDA Credit 88% has been disbursed after 85 months of implementation since effectiveness (corresponding to 88 % of the project duration) and all remaining contracts are signed so the disbursement is expected to reach 100% by project closure. For the IBRD AF the disbursement stands at 42% but contracts are signed and work ongoing corresponding to an accumulated value of 93% of the loan. Only two contracts remain unsigned, but bid evaluation has been completed and contract signing is expected by the end of July 2013. The detailed disbursement status is listed in Annex 5.


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Table 1: Project Cost and Disbursement

Financing source

Original (US$ m)

Current disbursement

(US$ m)

Percentage disbursed

Disbursement In FY2013 (US$ m)

Un-disbursement

(US$)

IDA Credit Cr.4107

207.0 182.3 88.0% 16.5 24.7

IBRD Loan Ln.8026

180.0 87.0 48.3% 67.1 103.0

Total 387.0 269.3 69.6% 83.6 127.7

IV. Next Steps

8. SCADA/EMS subproject: NPT/NLDC and the mission have agreed to monitor the progress of the SCADA/EMS subproject very carefully so that the best possible outcome is achieved by the end of the Project. NLDC has agreed to (i) work with the contractor to accelerate the implementation as much as possible and (ii) make sure that advance payment and other disbursement of funds to the contractor are made in a timely manner in accordance with the progress of services.

9. Reallocation of the Project Funds: NPT, HCMPC and NLDC informed that the allocation of funds under Cr.4107 does not match the contract values committed. (Details are presented in Table 2). EVN is therefore suggesting a restructuring of the project in order to re-allocate funds by categories so as to best use the remaining funds available. The mission supports this proposal and advises that the process of re-allocation shall be started as soon as possible. The mission has informed EVN that an official request for such restructuring/reallocation needs to be received from SBV.

Table 2: Shortage and Reallocation of the Project Funds

Reallocation of funds and categories:

Financing source Cr.4107

Original allocated (SDR m)

Total contracts committed (SDR m)

Shortage (SDR m)

NPT 14.5 18.4 -4.1

NLDC 12.3 10.7 1.6

HCMC 27.4 28.6 -0.8

CPC 5.0 4.8 0.2

10. Monitoring Implementation Progress: NPT has been requested to monitor the progress of each subproject to make sure that all the subprojects are completed by June 30, 2014. This mission has confirmed that the transmission and distribution expansion and reinforcement subprojects are showing good progress toward the completion by the closing of the Project, but notes that some remaining safeguard issues need to be resolved in a timely manner.


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Implementing Agencies including CPMB and SPMB are requested to provide detailed information concerning all remaining environmental and social safeguards issues.

11. Subproject Completion Reports (SCR): Each implementing agency is required to submit SCR for completed subprojects to the Bank in a timely manner. The mission has agreed to provide a standard report template to HCMC PC who plans to submit SCR reports for the first time.

Table 3: Agreed Next Actions

Actions Responsibility Date

1 Review and necessary revision of implementation timeline for SCADA/EMS

NLDC July 31, 2013

2 Proposal of re-allocation of Project funds EVN July 30, 2013

3 Review of the fund re-allocation plan WB July 31, 2013

4 Report with detailed information concerning the remaining environmental and social safeguards issues.

CPMB/SPMB July 31, 2013

5 Submission of SCR reports SPMB, CPMB, CPC,

HCMPC ASAP

V. Financial Management

The financial management arrangements of the Project remain adequate. However, there are some areas with room for improvements that the Project Management should consider, as follows:

12. Inadequate management of project’s inventories:

The audit closing minute of Deloitte at SPMB commented that SPMB has conductors and earth wires valued at VND 41.2 billion being consigned at the warehouse of the contractor - Tan Cuong Thanh Ltd Co. However, the inventories have been collateralized to the commercial bank by Tan Cuong Thanh as at the time of the mission and therefore not available for project construction. SPMB is requested to report to the Bank in writing on the status of resolving this matter with Tan Cuong Thanh Co. and how it affects the progress of the Phu My – Song May transmission line by 31 July 2013. In case these materials and equipment are lost by the contractor, they will not be eligible for financing from the World Bank.

All project implementing agencies are strongly requested to closely monitor the inventory management practices on an on-going basis to avoid similar instances in the future.

13. 2012 Audited financial statements

NPT components:

a) Issue: The 2012 Auditor's report on Compliance and Internal Control Matters raised a number of critical issues, including the non-compliance with the requirements of Debt to Equity Ratio set forth in the Project Agreement No.8026-VN.


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Recommendation: The mission has requested that Project Management address these issues raised by the auditor and report to the Bank on the status of implementation before September 30, 2013.1

EVN components:

b) Issue: The 2011 audited financial statements and management letter (“the reports”) of the Second Transmission and Distribution Project were submitted to the Bank on July 6, 2012 which is later than 6 months after the financial year end as required by the financial covenants.

Recommendation: The mission strongly recommends that the Project Management works closely with the auditors during 2013 audit to ensure the Project’s financial statements for 2012 will be submitted on time and ith acceptable quality.

c) Issue: The 2012 Auditor's report on Compliance and Internal Control matters raised a number of critical matters, including the non-compliance with the financial covenants regarding the financial capacity of the Project executing entities

Recommendation: The mission has requested that Project Management address these issues raised by the auditor and report to the Bank the status of implementation before September 30, 20132.

The mission would like to remind NPT and EVN about the requirements to forward the Term of Reference of financial audit to the Bank for review and approval before signing the financial audit contract for future years/periods. Failure to do this may result in the Project audited financial statements being unacceptable to the Bank.

VI. Procurement

14. The procurement performance is satisfactory: During the period under prior review, about 10 sets of bidding documents and 10 bid evaluation reports (BERs) have been reviewed, with costs per package in the range of $300,000 to $25 million. Documentation and decisions have generally been of high quality, although often some minor changes have been required to BERs. There have been improvements in the recording of advertising of Invitations to Bid; notifications of bid opening; and publication of bid awards. During the period, one complaint regarding bidding for the SCADA/EMS subproject was recorded. The complaint was found to have no substance and the case has been resolved.

1 On 28 September 2012, NPT wrote to the Bank explained the reasons of the non-compliance. NPT also indicated

that the Corporation will be able to comply with the Covenants by 2015. These breaches of the financial covenants cannot be resolved at the project or company level and will need to be assessed more strategically and holistically - addressing the overall financial challenges of sector, EVN and its subsidiaries. Hence, EVN and the World Bank have agreed to conduct a study on developing "Strategic Options for Financial Recovery of the Vietnamese Power Sector" that will result in a detailed financial strategy and action and recovery plan for EVN and its subsidiaries. EVN has formed a Working Group with other relevant Government agencies to supervise the implementation of the Bank-executed study. With respect to the internal control matters, the Corporation is committed to resolve them successfully. 2 In October 2012, EVN wrote to the Bank explained the reasons for the non-compliance. EVN also indicated that

the Corporation will be able to comply with the Covenants by 2015. This is a situation similar to that of NPT and the mission is taking the same approach to deal with this matter. Please refer to previous footnote.


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VII. Safeguards

Environmental safeguards

15. Overall, the project is in compliance with the environmental safeguards policies, and its environmental performance can be rated as satisfactory. The mission reviewed some bidding and contractual documents of the project and found that environmental management requirements were incorporated. The mission also reviewed the independent environmental monitoring reports submitted on March 2013 by the Independent Monitoring Consultant and found them satisfactory. The project environmental safeguard documents have been disclosed as required by the Bank policy on access to information. The environmental management systems of the PMBs are functioning, and monitoring reports submitted by the construction supervision consultant and independent environmental monitoring consultant indicate that contractors complied with the EMP. As an example, CPMB maintains a very good safeguard monitoring system with rigorous monitoring by the construction supervision consultant and the independent monitoring consultant.

16. The mission visited 220kV Hiep Binh Phuoc substation and 220kV/110kV Hoc Mon – Hiep Binh Phuoc transmission line in Ho Chi Minh City. Construction of the substation was completed while the work on the transmission line is ongoing. The mission was pleased to see that the site restoration was well done and that fire preventive measures are in place at the substation. However, worker safety, workers camp conditions, and overall construction management need to be improved at the transmission line construction site. The workers at the tower foundation neither wore safety helmets nor protection boots and the workers camp is not up to the standard. In addition, construction waste was not well managed and left scattered around the site.

17. The SPMB reported that there may be some changes in the alignment of the 220kV Tan Dinh – Uyen Hung Transmission lines. If the changes would cause moderate impacts on the environment, the EMP of this subproject needs to be updated accordingly. The mission was informed that the technical design for the monastery relocated due to the 500kV Phu My – Song May transmission line was completed taking into account all requirements of the monastery owner. The owner will be compensated to an extent that will enable her to construct a new monastery by herself. This mission advises that SPMB consider offering compensation to allow observation of local religious tradition associated with the dismantlement and relocation of the monastery to a new place and that a detailed relocation plan acceptable to the Bank is prepared.

Social safeguards

18. The mission had meetings with all implementing agencies (CPC, CPMB, HCMPC, SPMB) to review the implementation and compliance with social safeguard policies.

19. CPC: The mission was informed that there has been no major difficulty in performing land acquisition and compensation for Quang Ngang 110kV substation and branch lines. The substation is located within the Quang Ngang industrial zone where land was previously acquired. CPC is now working with the steering committee of Quang Ngang industrial zone to reimburse the compensation budget that the latter paid to 6 affected households. The estimated budget is around 300 million VND. ToR for an independent monitoring consultant has been cleared on May 10, 2013. It is expected that this consultant will be mobilized by July 2013.


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20. CPMB: The mission acknowledged the great effort made by CPMB in performing the land acquisition for the Quang Ninh – Hiep Hoa 500kV T/L subproject. Of the total 316 tower positions, only 7 positions (in Chi Linh, Hai Duong) are not yet ready for civil works. CPMB committed that by July 2013 all payments will be made to affected households (especially for RoW3 compensation) in order to meet the commissioning date of the project previewed in September 2013. The mission re-emphasized that per Bank requirement and given the complicated nature of 500kV subproject, resettlement arrangement must be properly addressed before physical relocation. CPMB is requested to prepare a synthesis table capturing relocated households, type of resettlement, and potential resettlement arrangement. CPMB will send this table to the Bank by July 2013. Under this subproject, a second monitoring report of RP implementation was prepared in March 2013.

21. HCMPC: Regarding the Hoc Mon – Hiep Binh Phuoc 220/110 kV T/L, the mission is pleased to note that affected households accepted the new compensation rates. Subsequently, all tower positions in District 12 (6 positions) and in Thu Duc district (9 positions) were handover to contractors. However, Van Phuc Company and HCMPC have not yet reached an agreement on compensation for impacts in the RoW (Van Phuc Company expects to have full compensation for impacts in RoW whereas HCMPC proposes compensation only for impacts due to the upgrading from 110kV to 220kV). HCMPC and Van Phuc Company are currently working with Thu Duc District People’s Committee to reach a final decision on this issue.

22. SPMB: Land acquisition, resettlement and compensation activities are still ongoing in six 500 kV and two 220kV subprojects. Two outstanding issues require particular attention. Firstly, related to the relocation of Ngoc Trung monastery, the mission is pleased to note that land for the new monastery is identified. The design is developed based on the agreement with the owner who will build the new monastery by herself with compensation budget provided by SPMB. The mission emphasized that (i) the old monastery should be demolished only when the new one is ready for usage; (ii) the compensation package will include expenses for rituals associated with the relocation and (iii) SPMB should prepare a detailed report and submit to the Bank Team by July 2013. Secondly, the mission was informed that the alignment of Tan Dinh – Uyen Hung 220kV T/L will be changed to avoid the new urban area of Thu Dau Mot city (Binh Duong province). The change will impact 4.9 km T/L and 17 tower position. SPMB is requested to update the Resettlement Plan for this subproject incorporating the newly identified impacts due to the change of alignment.

VIII. Financial Performance

The mission reviewed NPT’s financial results for the year ended December 31, 2012 based on draft financial statements. FY2012 key financial indicators are positive and show NPT recording a profit for the first time since 2009, its first full year of operation and achieving all three targets covenanted under the Second Transmission and Distribution Project, i.e. the self-financing, debt service coverage and debt equity ratios. The table below shows the targets under the project and the actual indicators achieved during 2012. The key factors behind NPT’s financial results during 2012 are as follows:

3 Right of Way: this refers to the corridor in which the transmission line runs and where land use is restricted for

security reasons.


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a) Operating Revenues: A revenue increase of 25% driven by an increase in energy transfers

of about 15% and a lower increase in operating costs; there was no increase in transmission

charges for NPT in 2012. The mission understood that the increase in energy transfers

arose from the introduction of metering of embedded generation (less than 30MW) at

transfer points from distribution voltage (110kV) to high voltage lines (220kV).

Previously only small generation units directly connected to the NPT high voltage

transmission system were metered at the transfer points.

b) Assets Revaluation: A major asset revaluation (VND 15 trillion) was finally incorporated

onto NPT’s balance sheet which together with the operating results jerked up net equity by

a factor of about 5.5 times (from VND 3.6 trillion to VND 20.1 trillion).

c) Finance costs: These were slightly higher than in 2011 despite a substantial increase in

debt; this was due to the impact on foreign currency debt of the stabilization of the VND

d) Exchange rate changes: NPT had a net gain due to effects of foreign exchange rate changes

on its debt compared to a huge loss of about VND 1,791 billion in 2011. This affected both

its cash flows (realized exchange rate movements) and its debt and equity position.

e) ITEM/YEAR 2011 2012 2013 2014 2015

REQUIRED PER PROJ. AGREEMENT

Self- financing (%) 20 25 25 25

Debt service coverage ratio 1 1.3 1.5 1.5 1.5

Debt/Equity ratio 80/20 75/25 75/25 75/25 75/25

ACHIEVED

Self financing (%) 33 20 24 29 35

Debt service coverage ratio 0.93 1.53 1.47 1.65 1.84

Debt/Equity ratio 88/12 61/39 66/34 69/31 72/28

23. Since the analysis is based on unaudited financial statements the Bank will review the results based on audited financial statements which are expected to be received prior to the end of June 2013, 24. NPT’s financial projections for 2013-2015 indicate that NPT is unlikely to meet the self-financing and debt service coverage ratios in 2014. While the projections indicate marginal shortfalls (SFR of 24% against the targeted 25% and DSCR of 1.47 against the target of 1.5) the real gap will likely be larger. The main reason is that the revenue estimates are likely overstated given that they assume an average transmission charge yield of VND 91.47/kWh for 2013 whereas the current charge is VND 83.32. To achieve the projected yield would require an increase of about 19.5% effective from July 1, 2013. If there is a delay in approving the current proposal which NPT submitted to EVN the increase required to produce this revenue yield would be even larger. 25. The model has other assumptions that could be optimistic (those related to modest


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foreign exchange losses and high energy transfers of about 10% in 2013, 12% in 2014 and 13% in 2015. It is notable, however, that although the indicators after 2013 appear to be healthy based on these assumptions the debt equity ratio will be creeping upwards after the revaluation boost to reach 72/28 by 2015 and the year-end cash balances will remain very low suggesting possible liquidity constraints in the coming years. 26. Finally, the positive 2012 results do not necessary mean that NPT has achieved a financial turnaround. The risks are clear and emphasize the need to proceed with the TA provided under the project to help improve the management of financial performance. A key ingredient of the TA is the emphasis on improving the quality of the investment program and how it is financed, including optimizing revenues through engagement in the regulatory process. The ongoing EVN-wide financial study is also expected to contribute to NPT strategies for its financial turnaround.

IX. Next Mission

27. Next Mission. The next mission is tentatively scheduled for December 2013.

ANNEXES: Annex 1: List of People Met and Project Task Team

Annex 2: Result Monitoring Indicators

Annex 3: Implementation Progress by Component

Annex 4: List of Subprojects and Implementation Progress

Annex 5: Disbursement Progress


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Annex 1: List of People Met and Project Task Team

Vietnam Electricity (EVN) 1. Mr. Đinh Quang Tri, Vice President 2. Ms. Nguyễn Thị Lam Giang, Expert of International Corporation Department 3. Mr. Trần Đức Minh, Expert of International Corporation Department 4. Mr. Nguyễn Thị Thu Trà, Expert of Investment Dept. 5. Ms. Nguyễn Hoàng Diệu Hương, Expert of Finance & Accounting Department

National Load Dispatch Center (NLDC) 1. Mr. Nguyễn Đức Ninh, Manager of Power System Analysis Dept. 2. Mr. Đặng Thành Long, Manager of Planning & Materials Department 3. Mr. Nguyen Thanh Long, Planning & Materials Department

National Power Transmission Corporation (NPT)

1. Mr. Vũ Trần Nguyễn, Vice President 2. Ms. Lương Lan Dung, Director of International Corporation Department 3. Ms. Nguyễn Thị Hoài Anh, Chief Accountant 4. Mr. Lưu Văn Hùng, International Corporation Department 1. Mr. Nguyễn Ngọc Tân, Director of Planning Department 5. Mr. Nguyễn Thị Kim Anh, Expert of International Corporation Department 6. Ms. Hằng, Investement Management Department

Ho Chi Minh City Power Corporation (HCMC PC)

1. Mr. Nguyễn Ngọc Tuyến, Director of International Relation Department 2. Mr. Lê Văn Thu, Chief Accountant. 3. Ms. Huỳnh Tố Trinh, Expert of Accounting and Finance Deprtment. 4. Mr. Nguyễn Đăng Việt Cường, Deputy Director of Materials and Import-Export

Department 5. Mr. Trần Thanh Liêm, Procurement Department 6. Mr. Nguyễn Tuấn Dũng, Expert of Planning Department 7. Ms. Trúc, Expert of International Relation Department 8. Ms. Duyên, PECC2

Southern Power Project Management Board (SPMB)

1. Mr. Đoàn Tấn Phong, Deputy Director 2. Mr. Lý Ngọc Khánh, Deputy Director 3. Mr. Nguyễn Công Toản, Deputy Director 4. Mr. Nguyễn Thế Mỹ, Manager of Procurement Department 5. Ms. Yến, Manager of Planning Department 6. Ms. Ngọc Anh, Chief Financial and Acountant 7. Mr. Lê Phú Hải, Manager of Material Supply Department 8. Mr. Nguyễn Văn Châu, Manager of Appraisal Department

Central Power Corporation (CPC)

1. Mr. Thái Văn Thắng, Deputy General Director


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2. Mr. Lê Lương Dung, Director of Central Energy Rural Management Board 3. Mr. Lê Nam Hải, Director of Central Power Network Project Management Board 4. Mr. Thái Văn Cường, Director of Investment Management Department 5. Ms. Phan Thị Diệu Liên, Director of International Relations Dept. 6. Mr. Trương Vĩnh Hưng, Deputy Director - International Relations Dept. 7. Ms. Phạm Thị Thanh Phương, Expert - International Relations Dept 8. Mr. Lê Văn Tín, Expert of Technical Department 9. Mr. Ngô Xuân Thủy, Manager of Technical Dept-Central Energy Rural Mngt. Board 10. Mr. Phan Công Tiến, Manager of Planning Dept-Central Energy Rural Mngt. Board 11. Mr. Lê T. Phương Cẩm, Material Department - Central Energy Rural Management Board 12. Mr. Võ Khắc Hoàng, Manager of Central High Voltage Power Network Company

Central Power Project Management Board (CPMB)

1. Mr. Lê Nam Thắng, Deputy Director 2. Mr. Trương Tiến Hưng, Manager of Materials & International Relations Department 3. Ms. Ngô Thị Anh Vinh, Expert of Materials & International Relations Department 4. Mr. Lê Văn Sỹ, Manager of Procurement Department 5. Mr. Nguyễn Văn Chiến, Appraisal Department 6. Mr. Hiếu, Compensation Department

Task Team Composition

Bank Staff

Name Title

Tran Tan Hung Power Engineer, Task Team Leader

Peter Johansen Senior Energy Specialist, Co-Task Team Leader

Franz Gerner Lead Energy Specialist

Joel Maweni Lead Energy Specialist/Operations Adviser

Nguyen Quy Nghi Social Specialist

Nguyen Van Son Environmental Specialist

Daisuke Miura Energy Specialist

Nguyen Thi Huu Hanh Financial Management Specialist

Le Kim Dung Program Assistant

Nguyen Thi Bich Lien Program Assistant


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Annex 2 – Result Monitoring Indicators

No PDO indicator(s)

Baseline Value

Previous mission

Progress To Date

End-of-Project Target Value

(June 30, 2006)

(June 30, 2012)

(May 30, 2013)

(June 30, 2014)

Outcome Indicators

1 New generation capacity connected via 500kV transmission system links financed by the project

0 2,250 2,250 1,200

2

Number and duration of interruptions in 500kV transmission system per 100 circuit km:

Number: 0.34 0.07 0.23 0.30

Duration: 17.50 10.08 11.50 13.50

3

Number and duration of interruptions in 220kV transmission system per 100 circuit km

Number 0.625 0.440 0.470 0.450

Duration 25.20 14.36 17.18 23.80

4

Number and duration of interruptions in 110kV transmission system per 100 circuit km

Number 3.32 1.51 0.103 3.166

Duration 28.80 19.60 8.164 28.22

5

Actual peak hour minimum voltage measured at known system weak points:

220kV Substation Bac Lieu 205 222 222 225

220kV Substation Quy Nhon 210 218 218 225

110kV Substation Soc Trang 108 - - 115

110kV Substation Trang Bang 107 - - 115

110kV Substation Quang Ngai 109 115 115 115

110kV Substation Mong Cai 108 - - 115

Results Indicators for Each Component

6

Component 1: transmission and distribution expansion and reinforcement Additional transmission asset created:

Circuit km of transmission line:

500kV 0 225 225 502

220kV 0 0 152 180

110kV 0 0 2,676 0

Transformer capacity (MVA):

500/220kV 0 1,050 1,500 2,550

220/110kV 0 1,250 875 2,500


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110/22kV 0 126 216 400

7

Component 2: Electricity Market and System Operations Modernization

Commissioning of new market and transmission system information and control systems SCADA/EMS

Not in place Not in place Not in place In place

Vietpool Interim Market system Replacement Telecommunications backbone

Not in place Not in place Not in place In place

8

Component 3: Market Transition Support

Development of a single transmission subsidiary within EVN

Not in place In place In place In place

Development of a functioning internal power market

Not in place Not in place In place In place


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Annex 3 – Implementation Progress by Component

I. ORIGINAL PROJECT (Cr. 4107)

1. Brief Description of Component Activities; The original project (Cr. 4107) consists of the following three components: (i) Transmission and Distribution System Expansion and Reinforcement which comprises subprojects for 500kV and 220 kV transmission lines and related substations and for selected 110kV distribution systems (US$176.6 million), (ii) Electricity Market and System Operations Modernization which supports the replacement of national and regional dispatch and control systems (US$21.8 million); and (iii) Market Transition Support which provides technical assistance for reform and restructuring of EVN and its subsidiaries as part of the transition support towards an electricity generation market (US$1.65 million).

2. Overall progress of project implementation is assessed as moderately satisfactory due to delay of the implementation of Component 2 – SCADA/EMS subproject.

3. The implementation of Component 1 is satisfactory. All the 82 contracts for subprojects under Component 1 (Transmission and Distribution Expansion and Reinforcement) have been signed, representing a total commitment of US$197 million or 110% of the allocated IDA funding for this component. A re-allocation of funds is needed to avoid overdraft of the allocated categories (see Annex 5 for more detail).

4. Component 2 (Electricity Market and System Operations Modernization) with an estimated cost of US$12.9 million has been delayed due an extended bid evaluation and contract award process. The contract was signed in December 2012 with a schedule of completion in 24 months, which is 6 months after the Credit’s closing date of June 30, 2014.

5. Component 3, Market Transition Support, comprised technical assistance for transmission system planning for an amount of about US$0.74 million. However, the contract expired and was not extended. Since the Vietnam Power Master Plan No. 7 (PDP7) has been approved by Government recently, this proposed study is no longer required.

6. The disbursement during FY 2013 was about $16.5 million, and the total disbursement rate reached 88%. Component 1: Transmission and Distribution System Expansion and Reinforcement 7. A list of the 16 subprojects under this component is provided in Table A3-1. The list comprises 9 subprojects by SPMB, 3 by HCMCPC and 4 by CPC. 9 out of 16 subprojects have been completed. The detailed list of contracts and progress is presented in the Annex 4.

Table A3-1: Component 1: Transmission & Distribution Expansion & Reinforcement

Subproject Value

(US$m)

Progress

SPMB

1 500kV Tan Dinh s/s 12.42 Completed, August 2010

2 500 kV Nha Be-O Mon T/L & O Mon 500kV S/S 31.68 Completed, May 2011


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3 220kV Xuan Loc s/s 7.88 Completed, December 2011

4 220kV Thuan An s/s 8.12 Completed, June 2012

5 500kV Phu Lam- O Mon T/L 17.67 Expected completion Q4/2013

6 500 kV Phu My-Song May T/L 20.87 Expected completion Q3/2013

7 500KV Song May-Tan Dinh T/L 10.48 Expected completion Q3/2013

8 500kV Song May s/s 31.19 Expected completion Q3/ 2013

9 500kV Phu My -Song May-Tan Dinh (2nd circuit) 8.21 Expected completion Q3/2013

Subtotal 148.52

HCMCPC

10 Binh Tan 220kV GIS S/S 19.80 Completed, June 2012

11 Hiep Binh Phuoc 220kV GIS S/S. 17.69 Completed, May 2013

12 Hoc Mon - Hiep Binh Phuoc TL 5.31 Expected completion Q4/2012

Subtotal 42.80

CPC

13 Hoa Thuan 110kV S/S 2.96 Completed, January 2011

14 North Dong Hoi 110kV S/S 1.0 Completed, January 2011

15 Upgrading My Thanh 110kV S/S. 0.13 Completed, August 2012

16 Quan Ngang 110kV S/S. 1.62 Expected completion Q4/2013

Subtotal 5.71

TOTAL 197.03

Implementation by SPMB

8. SPMB is implementing 9 out of the 15 subprojects under this component. 5 subprojects have been completed and the mission has requested SPMB to prepare an Implementation Completion Report (ICR)

for these subprojects. The 4 subprojects are as follows:

• 500kV Tan Dinh S/S: The subproject comprises the addition of a second 500/220kV 450 MVA transformer, plus upgrading of the communication system, and connection to the Song May-Tan Dinh 500kV T/L. The substation installation has been completed and was energized in August 2010.

• 500 kV Nha Be-O Mon T/L & O Mon 500kV S/S: This is the largest subproject comprising nine contracts all of which have been signed for a total cost of US$31 million in IDA financing. The 500kV O Mon SS was energized in April 2010. The T/L has two sections: O Mon – Cai Lay and Cai Lay – Nha Be. The section O Mon - Cai Lay has been in operation since 2009 at 220kV and the section Cai Lay – Nha Be had been delayed for a while. The entire section O Mon-Nha Be has been put into operation at the 500kV voltage level in May 2011. This subproject is using financing from TD2 only for goods contracts (not works) and 100% of committed funds have already been disbursed. There was one contract (Package No.6) which has been withdrawn from financing by IDA for financing by NPT SPMB. The mission reminded SPMB to refund to WB the 10% of the advance payment which has been paid for this contract.

• 220kV Thuan An SS & Xuan Loc SS: Both subprojects comprise building new 220kV substations which consists of 220-250MVA and 110V-63 MVA power transformers; outgoing 220kV and


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110kV feeders and associated controls, protection and SCADA systems. Construction works have been completed for both substations. Thuan An SS was energized in December 2011 and Xuan Loc SS in June 2012.

9. The remaining 5 subprojects under SPMB are expected to be completed by Q4/2013. In order to ensure the completion of those by the end of the project, the mission has requested SPMB to provide

detailed information concerning the remaining issues on environmental and social safeguards. The status of the individual subprojects is as follows:

• 500kV Phu Lam- O Mon T/L: The subproject finances a single circuit in the Long An to Phu Lam section of the O Mon - Phu Lam 500 kV T/L. All eight contract packages have been signed. The site clearance was delayed for tower foundations no. 6 and 7 which are crossing the Sai Gon – My Tho Railway. During the previous mission in November 2011, SPMB had expected to complete the subproject by November 2012, but there has been a long discussion about the railway crossing issue with the Ministry of Transport (MOT) since then. The issue has been solved and the completion date is now revised to the third quarter of 2013.

• 500 kV Phu My-Song May and 500KV Song May-Tan Dinh T/L and 500kV Song May SS: These subprojects consist of a 64 km T/L from Phu My to Song May with extension of 500kV bays at Phu My SS and Song May SS (450MVA) and a 36 km T/L from Song May to Tan Dinh SS. These subprojects aim to supply power to the northern areas of the Ho Chi Minh City metropolitan area. These subprojects were much delayed due to difficulties in the site clearance in the area of Dong Nai and Ba Ria – Vung Tau provinces; however after the joint Bank and NPT/SPMB special mission in April 2012 to the provinces authorities, the site clearance has progressed significantly.

• Transmission line subprojects: Compensation, site clearance, civil work and tower installation have been completed for 118 out of 138 foundations in Dong Nai province and 8 out of 21 foundations in Ba Ria – Vung Tau province. SPMB expected to complete works contracts by June 2013 for the line subprojects and September 2013 for the Song May substation.

• 500KV Phu My-Song May-Tan Dinh T/L second circuit: (This subproject was added to TD2 at a late stage.) The 5 contract packages have been signed. The installation of this second circuit is now being implemented in parallel with the first circuit and is expected to be completed by the third quarter of 2013.

10. Fund allocation and disbursement: the total credit funding allocated to NPT/SPMB is about $142 million while the total value of the contracts for 9 subprojects is about $148.5 million. Taking into account that most of those contracts were signed with price adjustment clauses, the value of the contracts is now estimated about $152 million. NPT will discuss with EVN possible solutions to the $10 million shortage of funds including (i) restructuring of the FA for reallocation of funds between the three components; and (ii) if after reallocation there is still shortage of fund, NPT will use its own funds for that payment. SPMB reported that the disbursement for all 9 subprojects is about $138 million, i.e. about 93% of the funds presently allocated.

Implementation by HCMC PC

11. The status of implementation of the HCMC PC projects is as follows:

• Binh Tan 220 kV GIS substation: The subproject is located in Binh Hung Hoa B Ward of Binh Tan District (Ho Chi Minh City) and consists of 2x250 MVA transformers at 220/110kV and 2x63


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MVA transformers at 110/22kV. The substation has been completed and was energized in June 2012.

• Hiep Binh Phuoc 220 kV GIS substation: This subproject is located in Hiep Binh Phuoc ward of Thu Duc district (Ho Chi Minh City) and it is technically similar to the Binh Tan S/S. Compensation and site clearance are completed. All four contract packages have been signed and the civil works started in May 2010. The substation was energized in May 2013.

• Hoc Mon – Hiep Binh Phuoc 220kV TL: this subproject consists of 550 km of 220kV and 110 kV outgoing feeders from the 220kV Hiep Binh Phuoc substation. All three contract packages have been signed and the civil works started in May 2012. Construction works are progressing well and the lines are expected to be energized in November 2013. Cut-off of electricity is planned in July 2013 in order to accelerate the whole construction of the project. Impact on local residents will be mitigated by providing rerouting of distribution.

12. HCMC PC requested the Bank for additional capital to cover the shortfall on signed contract of approximately 1.5 million USD. The total contract value of 4,379,054 USD exceeds the amount available of 2,895,301USD. The mission requested HCMC PC to check carefully the remaining balance of capital for disbursement and consult with NPT as to possible reallocation of funds.

13. The mission has requested HCMC PC to submit SCR reports to the Bank. This is the first experience for HCMC PC to prepare for the SCR, therefore the mission has agreed to provide a template.

Implementation by CPC

14. The status of implementation of CPC’s three subprojects is as follows:

• Bac Dong Hoi and Hoa Thuan 110 kV substations: Installation of these two substations was completed. The Hoa Thuan substation was energized in April 2010 and the Bac Dong Hoi substation was completed and energized in September 2010. The Subproject Completion Report (SCR) has been prepared and submitted to the Bank.

• My Thanh 110kV substation: The upgrading of this substation included installation of new power transformer and primary equipment. Part of the equipment procured for Nam Chu Lai has been used for upgrading the My Thanh substation subproject. The cost of the remaining equipment and installation works has been covered from CPC’s own funds. The substation has been energized on November 2011.

• Nam Chu Lai 110kV substation and upgrading of 110kV My Thanh substation: The Nam Chu Lai 110kV substation subproject was proposed for financing under TD2 Project. All 3 goods contracts have been signed and goods have been delivered. Two works contract have been signed. Payment has been made for 100% of the goods and advance payment (10%) has been made for works contracts. However, due to the restructuring of Vinashin Corporation, the need for power in this area is no longer urgent; therefore EVN/CPC has sent an official request to the WB proposing to use the procured equipment for Nam Chu Lai for upgrading the My Thanh 110kV substation and Quang Ngang 110kV substation. The transfer of equipment has been agreed by the Bank; however CPC should determine the balance of funds paid for the Nam Chu Lai subproject for immediate return to the Bank including the money paid for the two works contracts.


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• My Thanh 110kV substation: The upgrading of this substation included installation of new power transformer and primary equipment. Part of the equipment procured for Nam Chu Lai has been used for upgrading the My Thanh substation subproject. The cost of the remaining equipment and installation works has been covered from CPC’s own funds. The substation has been energized on November 2011.

• Quang Ngang 110kV substation: The subproject comprises of two 110kV 25 MVA transformers, plus completed electrical and communication system. The mission agreed to CPC’s proposal to use the remaining equipment procured for Nam Chu Lai and not used for upgrading the My Thanh 110kV substation for this substation. The subproject has been appraised by the Bank in August 2012. CPC will start the procurement process from November 2012 and started construction in May 2013. The subproject is expected to be energized by the end of 2013.

Component 2: Electricity Market and System Modernization

15. This component comprises design, procurement and installation/commissioning of the new SCADA/EMS system for a National Load Dispatching Center (A0) in Hanoi and three regional Load Dispatching Centers in the North, Central and South of Vietnam (A1, A2 and A3). Due to the difficulties encountered in the consultant selection, bid preparation and approval, the project is delayed. The bid was processed in 2 stages. The first stage has been completed in January 2012. During the previous mission in November 2011, NLDC had expected to complete the 2nd stage bid in June 2012 and to sign the contract early July 2012; however the bid evaluation of the 2nd stage was prolonged with many rounds of clarifications. The final bid evaluation report (BER) was submitted to the Bank on September 24, 2012 and the Bank has provided the no objection to the BER on September 28, 2012. The contract was finally signed on December 19, 2012 in the amount of approximately $12.9 million. The services will be completed within 24 months, i.e. by December 2014 or 6 months after the Credit’s closing date of June 30, 2014.

16. By June 30, 2014, only 75% of the work (equivalent to $10 million) will be completed, indicating that (i) NPT/NLDC will need to finance the remaining 25% of the service by utilizing other funds including their own sources, and (ii) approximately $1.6 million for component 2 will remain undisbursed and it should therefore be considered to reallocate this amount for other purposes.

Component 3: Market Transition Support

17. This component includes technical assistance on transmission system planning (calculating of the Vietnam power transmission system) in the period between 2008 and 2015 with perspectives to 2025. SNC Lavalin (Canada) was selected to carry out the service. The consultant started work in August 2009, submitted the Inception Report by the end of September 2009 and first Interim Report in March 2010. The second interim report was expected to be submitted in September, 2010 and final report in January 2011, but both are still outstanding because of a disagreement between EVN and NPT on the consultant’s performance against the Terms of Reference. As a result the contract expired November 2010. In July 2011, NPT had proposed retroactively to extend the contract for another 16 months, which the Bank would not agree to. Therefore, NPT needs to finalize all the pending payments in accordance with the contract conditions. The mission asked NPT to expedite this matter and to send the output to the Bank. EVN/NPT also informed the WB that in connection with the new Vietnam Power Master Plan No.7, which was recently approved by Government, the output of this study is no longer needed by NPT.


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II. ADDITIONAL FINANCING PROJECT (Ln. 8026)

18. The Additional Financing Loan for TD2 was approved by the Bank’s Board of Executive Directors on March 29, 2011 for an amount of US$180 million. The agreements were signed by all the relevant Vietnamese parties and the Bank on May 31, 2011, and the Loan was declared effective by the Bank on August 29, 2011. The purpose of the additional financing is to scale up the impact of transmission system expansion and reinforcement (Component 1 of the original project).

19. The mission has reviewed the implementation progress of the subprojects proposed under the AF Project. A list of the 8 subprojects under this component is provided in Table A3-2. Of these, three subprojects have been completed. 39 of 40 packages have been signed, and the remaining one package will be signed right immediately after the mission. Until now, US$87 million (48% of the total AF fund) have been disbursed.

Table A3-2: Subprojects Proposed under the Additional Financing

Name PMB Value

(US $m) Progress

1 500 kV Quang Ninh-Hiep Hoa T/L CPMB 73.21 Expected completion Q4/2013

2 220kV Tra Vinh SS SPMB 3.64 Completed, April 2013

3 220kV Vinh Long-Tra Vinh TL SPMB 15.22 Completed, April 2013

4 220kV Uyen Hung SS SPMB 6.25 Expected completion Q2/2014

5 220kV Tan Dinh-Uyen Hung TL SPMB 5.18 Expected completion Q2/2014

6 500 kV O Mon (2nd transf.) SS SPMB 8.08 Completed, April 2013

7 500 kV Song May (2nd transf.) SS SPMB 20.39 Expected completion Q2/2014

8 500 kV Cau Bong SS SPMB 55.09 Expected completion Q2/2014

Total 187.06

Implementation by CPMB

20. The status of the three subprojects (one from the base list and two from the reserve list) being implemented by the CPMB is as follows:

• 500 kV Quang Ninh – Hiep Hoa TL: This subproject consists of supply of equipment and construction of a 139 km 500kV transmission line from 500kV Quang Ninh to Hiep Hoa and extension of a 500kV bay at Quang Ninh SS. All the 6 contracts have been signed. During the mission CPMB informed the Bank that package No. 7 for secondary equipment of the extension of the 500kV Quang Ninh substation, originally proposed for IBRD funding, should be financed from CPMB own funds due to change of the substation design. The Mission advised that, regardless of the source of funds, CPMB should ensure completion of that package within the committed schedule for the entire subproject. The construction work started in March 2012 and is expected to be completed within 18 months, i.e. by December 2013. The construction works of the extension of 500kV Quang Ninh substation are expected to be completed by March 2014. The transmission line crosses three provinces: Quang Ninh, Bac Giang and Hai Duong. While the site clearance and compensation almost have been completed in Quang Ninh and Bac Giang provinces, the site


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clearance process in Hai Duong has been delayed because the provincial authorities have still to approve the compensation plan. The mission expressed that given that this subproject alone

accounts for almost 50% of TD2 AF and given the difficulties with land acquisition,

compensation, and site clearance in Vietnam, CPMB and NPT need to prepare a realistic

implementation plan including resolving safeguard issues so that the project is energized by the

end of June 2014 (The safeguard section of this AM provides more detailed issues). The Bank

and CPMB/NPT has agreed to conduct a joint site visit during the next mission.

Implementation by SPMB

21. SPMB is implementing 7 out of the 8 subprojects under this component. 3 subprojects have been completed and the mission has requested SPMB to prepare an Implementation Completion Report (ICR)

for these subprojects. The 3 subprojects are as follows:

• 220kV Tra Vinh substation and Vinh Long - Tra Vinh transmission line: The subproject comprises addition of a second 500/220kV 450 MVA transformer, plus upgrading of the communication system, and connection to the Song May-Tan Dinh 500kV T/L. The substation installation has been completed and it was energized in August 2010. All 4 contracts for 220kV Tra Vinh substation and 6 contracts for the transmission line have been signed. During the previous mission in November 2011, SPMB had expected to complete the subproject by November 2012, but due to delays in the bidding process for two packages (conductor and insulators). The project was completed in April 2013.

• 500kV O Mon substation (2nd transformer): The construction of the substation started in September 2011 and was completed in April 2013.

22. The remaining 4 subprojects under SPMB are expected to be completed by the project end. In order to ensure the completion of those by the end of the project, the mission has requested SPMB to provide

detailed information concerning the remaining issue on environmental and social safeguards. The status of the individual subprojects is as:

• 220kV Uyen Hung substation and Tan Dinh – Uyen Hung transmission line: all the contracts for 220kV Uyen Hung substation and transmission line have been signed. During the previous mission in November 2011, SPMB had expected to complete the subproject by June 2013, but due to delays in the bidding process for two packages (primary and secondary equipment for extension of Tan Dinh substation) the completion date is now revised to December 2013.

• 500kV Song May substation (2nd transformer): This subproject is the second phase of the 500kV Song May substation, the first phase of which is financed by the Original TD2 Project. Due to the delay of the first phase of the substation, the construction of the second phase was also delayed. SPMB informed that the 1st stage of this substation shall be completed by June 2013, so the construction work of the 2nd stage can only start after June 2013. The mission requested SPMB to monitor the progress carefully to ensure completion before the June 2014.

• 500kV Cau Bong substation: This subproject comprises of three single phase 500kV 200 MVA autotransformers, two three-phase 220kV 250 MVA autotransformers, five 500kV bays, thirteen 220kV bays, eleven 110kV bays and associated control, protection and SCADA systems. The subproject is located at a 16ha site in Cu Chi district, HCMC. It aims to increase the stability, connectivity and reliability of power supply in HCMC and the Southern area, and (ii) receiving and


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transmitting power to nearby load centers planned to be constructed in the near future; In the original Project Appraisal Document (PAD), this subproject is proposed in the reserve list; however upon request of NPT/SPMB this subproject has now been included in the official list of financing under the AF Project. However the cost estimate of this subproject is US$55 million, which is more than the remaining fund for the AF. NPT/SPMB confirmed that in the case of shortage of WB fund, NPT shall use its own funds for covering the shortfall. Contracts for 4 out of 5 packages of this project have been signed. The transformer component is still under final negotiation, but SPMMB expects to sign the contract very soon due to the importance of this substation in the HCMC area. The construction work is expected to start on November 2012 and is scheduled to be completed by June 2014.

23. TA component under Additional Financing:

The project includes technical assistance to support NPT in building up its capacity for financial performance management. The TA comprises support to improve its: (a) planning and financing of transmission investments with a view to improving investment selection and financing strategies; (b) management of liabilities to minimize the impact of currency depreciation and high interest rates; and (c) determination of tariff adjustment requirements and management of the regulatory process in order to enhance revenues from transmission fees. An allocation of US$500,000 was provided under the project to support implementation of these activities.

The mission reviewed the status of these activities with NPT and noted that none have been implemented yet with about one remaining before the project closes on June 30, 2014. Agreement was reached on a process and schedule for implementation of the activity on building capacity for planning and financing transmission investments. With respect to the management of liabilities NPT requested the mission to help with preparation of a brief scope of works from which NPT will prepare full terms of reference. This will be provided to NPT by July 31, 2013. On transmission tariffs and the associated regulatory process NPT informed the mission that after the appraisal of TD2 AF, the Government had issued Circular #14 4which details the methodology for determination of transmission tariffs and, therefore, this activity is no longer required. The mission advised NPT to reconsider its views given that Circular 14 has not been consistently applied to date and that the specified methodology may benefit from expert reviews to assess its conformity with the financial objectives of NPT (for example the recovery of foreign exchange losses through tariffs, the requirement if any for the shareholder to earn a rate of return on equity).

The mission assisted NPT to prepare a draft TOR for this activity. A consultant will be engaged to review existing regulations and processes for investment planning, the methodologies for economic and financial analysis, the existing financing strategies, including choice of currencies, and to recommend measures for addressing identified issues and optimizing outcomes. The consultant will document the agreed recommendations in a manual and provide training to NPT staff. The selection of the consultant will follow the selection based on cost and qualifications (SBCQ).

4 the Circular No.14/2010/TT-BCT of April 15, 2010 stipulating the methodology, sequence and procedure of setting up, promulgating and managing of transmission charges and amendment thereto dated January 19, 2012.


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The following key processing milestones were agreed. Based on this schedule the TA would be delivered by May 31, 2014 prior to the closing date of the project on June 30, 2014.

Action By Whom Date Submit draft TOR to WB NPT Jul. 8, 2013

Submit cost estimates and procurement plan NPT Jul. 15, 2013

Issue NOL to cost estimates, procurement Plan and TOR WB Jul. 20, 2013

Publish Request for Expressions of interest NPT Jul. 30, 2013

Submit short list and draft RFP to WB NPT Aug. 30, 2013

Issue NOL for NPT to seek proposals from the selected firm WB Sep 5, 2013

Issue RFP to the recommended firm NPT Sep 10, 2013

Recommended firm submission proposal to NPT NPT Oct 10, 2013

Proposal Evaluation Report submission to WB NPT Oct 20, 2013

Issue NOL to Proposal Evaluation Report WB Oct 25, 2013

Invitation firm for negotiation the contract NPT Nov 1, 2013

Draft contract sent to WB NPT Nov 10, 2013

Issue NOL to draft contract WB Nov 15, 2013

Contract sign NPT Nov 20, 2013

Completion of Assignment NPT May 31, 2014


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ANNEX 4: LIST OF SUBPROJECTS AND IMPLEMENTATION PROGRESS

Original Credit Cr.4107

1. Component 1: Transmission and Distribution System Expansion and Reinforcement: a) Subcomponent 1.1: 500 and 220kV Transmission System Expansion and Reinforcement:

Packages No. Contract

Value5 (US$m)

Progress

SPMB

1 500kV Tan Dinh substation

Package No.1: transformer 6.81

Completed

Substation has been energized

in August 2010

Package No.2: equipment 2.78

Package No.3: control & protection 1.41

Package No.4: construction 1.41

Total 12.42

2 500 kV Nha Be-O Mon T/L & O Mon 500kV substation

Package No.1: conductors 7.76

Completed

Transmission line has been energized

in May 2011

Package No.2: insulators 2.63

Package No.3: OPGW 0.35

Package No.4: Steel towers 5.75

Package No.5: transformer for OM 7.74

Package No.6.1: equipment for OM 5.74

Package No.6.2: control for OM 1.69

Total 31.68

3 220kV Xuan Loc substation

Package G01: transformer 2.43

Completed


in December 2011

Package G02: equipment 1.71

Package G03: control 1.09

Package G04: steel towers 0.34

Package W01: construction 2.31

Total 8.05

4 220kV Thuan An substation


Completed


in June 2012





Total 8.60

5 Equivalent to USD based on the exchange rate of the signing date


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5 500kV Phu Lam- O Mon transmission line

Package No.1: steel towers 4.24 Completed

Package No.2: conductors 1.64 Completed

Package No.3: OPGW 0.20 Completed

Package No.4: insulators 0.62 Completed

Package No.5.1: reactors 1.05 Completed

Package No.5.2: equipment 1.75 Completed

Package No.6: construction SS-G5 3.87 Completion of 70%

Package No.7: construction G5-G9 4.23 Completion of 70%

Total 17.67

6 500 kV Phu My-Song May transmission line

Package 1: steel towers PM-G6A 1.61 Completed

Package 2: steel towers G6A-SM 1.54 Completed

Package 1A: steel towers additional 2.72 Completed

Package 3: conductors 2.76 Completed

Package 4: OPGW 0.31 Completed

Package 5: insulators 1.08 Completed

Package 6: construction PM-G6A 5.26 Completion of 80%

Package 7: construction G6A-SM 4.32 Completion of 85%

Package 8: equipment for Phu My 1.01 Completed

Package 9: control for Phu My SS 0.32 Completed

Total 20.87

7 500KV Song May-Tan Dinh transmission line

Package 1: steel towers 2.14 Completed

Package 1A: steel towers additional 1.29 Completed




Package 5: construction 4.29 Completion of 85%

Total 10.48

8 500kV Song May substation

Package 1: transformer 7.63 Completed

Package 2: equipment 5.79 Completed

Package 3: control 2.23 Completed

Package 4.1: steel tower for SS 0.80 Completed

Package 4.2: steel tower for TL 2.24 Completed




Package 8: construction SS 5.31 Completion of 90%


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Package 9: construction TL 5.40 Completion of 30%

Total 31.19

9 500KV Phu My -Song May-Tan Dinh (2nd circuit) transmission line

Package 1: equipment for PM, TD 1.13 Completed



Package W06: construction PM-SM 1.27 Completion of 80%

Package W07: construction SM-TD 0.87 Completion of 80%

Total 8.21

TOTAL Subcomponent 1.1 149.22

b) Subcomponent 1.2: 220/110kV GIS Substations:

Ho Chi Minh City PC

10 Binh Tan 220kV GIS substation

Package 1: transformers 6.16

Completed


in June 2012

Package 2: SS equipment 11.02

Package 3: MV equipment 0.53

Package 4: control 1.93

Package 5: consultant 0.15

Total 19.80

11 Hiep Binh Phuoc 220kV GIS substation

Package 1: transformers 6.16 Completed


in May 2013 Package 2: SS equipment 8.89

Package 3: MV equipment 0.60

Package 4: control 2.04

Total 17.69

12 Hoc Mon - Hiep Binh Phuoc 220kV/110kV transmission line

Package 1: cable 1.85 Completed

Package 3A: towers, insulators 0.92 Completed

Package 3B: construction 2.55 Completion of 30%

Total 5.31


c) Subcomponent 1.3: Regional Distribution System Expansion and Reinforcement:

Central Power Corporation (CPC)

13 Hoa Thuan & North Dong Hoi 110kV substation

Package G01: transformer 1.03 Completed


in January 2011


Package G03: insulators, conductors 0.09


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Package G04: cables 0.20

Package W01: construction BDH 0.57

Package W02: construction HT 0.76

Total 3.96

14 Upgrading My Thanh 110kV substation

Equipment transferred from N.C.Lai 0.13 Completed

15 Quan Ngang 110kV substation

Package G01: transformer 0.61 Contract Signed

Package G02: equipment 0.59 Contract Signed

Package W01: construction 0.69 Contract Signed

Total 5.31

Subtotal 1.89


2. Component 2: Electricity Market and System Operations Modernization

Packages No. Contracts

Value (US$m)

Progress

National Load Dispatching Centre (NLDC)

Package 1: consultant 0.85 Completion of 50%

Package 2: SCADA/EMS 12.9 Completion of 20%

Total 13.75

3. Component 3: Market Transition Suport


Value (US$m)

Progress

National Transmission Corporation (NPT)

Package 1: consultant 0.74 Completion of 50%

Total 0.74

Additional Financing – Loan Ln.8026

4. Component 1: Transmission and Distribution System Expansion and Reinforcement:


Value (US$m)

Progress

CPMB

1 500kV Quang Ninh – Hiep Hoa transmission line

Package G01: steel towers 20.38 Under implementation: 90%


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Package G02: conductors 13.59 Completed

Package G03: insulators 3.71 Completed

Package G04: OPGW 0.47 Completed

Package G05: equipment for QN 2.19 Under implementation: 30%

Package W08: construction 32.88 Under implementation: 50%

Subtotal 73.21

SPMB

2 220kVTra Vinh substation

Package G02: equipment 1.08 Completed


in April 2013 Package G03: control 0.93


Subtotal 3.64

3 220kVVinh Long - Tra Vinh transmission line


Completed


in April 2013

Package G02: conductors 3.11

Package G03: insulators 0.65

Package G04: OPGW 0.17

Package W5.1: construction in VL 4.54

Package W5.2: construction in TV 4.13

Subtotal 3.64

4 220kV Uyen Hung substation

Package G01: transformer 1.25 Contract Signed


Package G03: control 1.86 Contract Signed

Package W04: construction 1.92 Under implementation: 44%

Subtotal 6.25

5 220kV Tan Dinh – Uyen Hung transmission line

Package G01: equipment for TD 0.33 Contract signed

Package G02: control for TD 0.19 Contract signed

Package G03: steel towers 1.43 Contract signed

Package G04: conductors 0.68 Contract signed

Package G05: OPGW 0.07 Contract signed

Package G06: insulators 0.32 Contract signed

Package W7: construction in 2.22 Under implementation: 26%

Subtotal 5.23

6 500kV O Mon (2nd

transformer) substation


Completed


in April 2013





of 29

Subtotal 8.08

7 500kV Song May (2nd

transformer) substation

Package G01.1: transformer 4.08 Contract signed

Package G01.2: reactor 3.31 Contract signed

Package G02: equipment 6.52 Contract signed

Package G03: control 3.45 Contract Signed

Package W04: construction 3.00 Contract Signed

Subtotal 20.39

8 500kV Cau Bong substation

Package G01: transformer 18.44 Contract is finalizing


Package G03: control 5.36 Contract is finalizing

Package W04: construction SS 13.95 Contract Signed

Package W05: construction TL 4.24 Contract Signed

Subtotal 55.09



of 29

Annex 5 – Disbursement Progress

(As of June 11, 2013)

1. Original Credit Cr.4107

a) Expenditure incurred prior to May 30, 2011 (before signing of FA amendment)

Cat Category Allocated amount6

(US$) Disbursed amount

(US$)

Undisbursed amount/overdraft

(US$)

1(a) Works for Component 1.1 206,995,241.00 182,298,801.59 24,696,439.41

1(b) Works for Component 1.3 21,247,675.36 18,165,254.14 3,082,421.22

2(a) Goods for Component 1.1; 2 and 3 1,204,094.50 1,204,093.71 0.79

2(b) Goods for Component 1.2 95,884,072.06 94,850,350.50 1,033,721.56

2(c) Goods for Component 1.3 19,571,422.75 31,399,866.24 -11,828,443.49

3(a) Consultants for Component 1.1; 2 & 3 3,238,097.57 3,698,989.07 -460,891.50

3(b) Consultants for Component 1.2 189,371.12 450,119.89 -260,748.77

b) Expenditure on and after May 30, 2011 (after signing of FA amendment)

Cat Category Allocated amount


(US$) Undisbursed

amount (US$)

4(a) Goods for Component 1.1 and 3 1,974,555.92 6,646,312.24 -4,671,756.32

4(b) Goods for Component 1.2 20,782,806.75 6,417,905.53 14,364,901.22

4(c) Goods for Component 1.3 1,159,294.49 235,152.56 924,141.93

4(d) Goods for Component 2 17,169,853.97 1,204,562.92 15,965,291.05

5(a) Works for Component 1.1 16,314,314.02 15,826,147.22 488,166.80

5(b) Works for Component 1.3 1,976,070.15 128,473.84 1,847,596.31

6(a) Consultants for Component 1.1 and 3 3,746,205.02 211,644.31 3,534,560.71

6(b) Consultants for Component 1.2 717,290.75 0.00 717,290.75

6(c) Consultants for Component 2 1,401,419.87 0.00 1,401,419.87

TOTAL 206,995,241.00 182,298,801.59 24,696,439.41

2. Additional Financing Ln.8026

Cat Category Allocated amount


(US$) Undisbursed

amount (US$)

1 Goods, Works and Consultants 180,000,000.00 87,073,366.49 92,926,633.51

6 Equivalent to USD based on the exchange rate of SDR/US$ = 1.514230 as of June 11, 2013

vietnam second transmission and distribution project (cr. 4107...

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