Translated Document
AFRICAN DEVELOPMENT BANK GROUP
MULTINATIONAL
RUZIZI III REGIONAL HYDROPOWER PLANT
APPRAISAL REPORT
ONEC DEPARTMENT December 2015
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TABLE OF CONTENTS
Currency Equivalents
Acronyms and Abbreviations
Project Information Sheet,
Executive Summa
Results-Based Logical Framework and Implementation Schedule i to v
1 STRATEGIC THRUST AND RATIONALE ............................................................... 1
1.1 Project Linkages with Countries' Strategies and Objectives ......................................... 1
1.2 Rationale for Bank's Involvement ................................................................................. 1
1.3 Aid Coordination ........................................................................................................... 2
2 PROJECT DESCRIPTION ............................................................................................ 3
2.1 Project Description and Components ............................................................................ 3
2.2 Technical Solutions Retained and Alternatives Explored ............................................. 3
2.3 Project Type ................................................................................................................... 4
2.4 Project Cost and Financing Arrangements .................................................................... 4
2.5 Project Target Areas and Beneficiaries ......................................................................... 7
2.6 Participatory Process...................................................................................................... 8
2.7 Bank's Experience and Lessons Reflected in Project Design ........................................ 8
2.8 Key Performance Indicators .......................................................................................... 8
3 PROJECT FEASIBILITY .............................................................................................. 9
3.1 Economic and Financial Performance ........................................................................... 9
3.2 Environmental and Social Impacts ................................................................................ 9
4 PROJECT IMPLEMENTATION ............................................................................... 12
4.1 Implementation Arrangements .................................................................................... 12
4.2 Project Monitoring ....................................................................................................... 14
4.3 Governance .................................................................................................................. 15
4.4 Sustainability ............................................................................................................... 15
4.5 Risk Management ........................................................................................................ 15
4.6 Knowledge Building .................................................................................................... 16
5 LEGAL FRAMEWORK ............................................................................................... 16
5.1 Legal Instrument .......................................................................................................... 16
5.2 Conditions for Bank's Involvement ............................................................................. 16
5.3 Compliance with Bank Policies ................................................................................... 18
6 RECOMMENDATION ................................................................................................. 18
ANNEX 1: Countries' Comparative Socioeconomic Indicators...I
ANNEX 2: Tables of AfDB Portfolio in the Countries....IV
ANNEX 3: Development Partners' Operations in the Electricity Sub-Sector in the Great Lakes
CountriesIX
ANNEX 4: Map of Project Area...X
ANNEX 5: On-lending of ADF Resources...XI
ANNEX 6: Factors of Fragility Addressed by the Project....XII
TABLES
No. Title Page No. Title Page
2.1 Project Components and Cost 3 2.5 Project Cost by Expenditure Category 6
2.2 Project Alternatives and Reasons for
their Rejection
4 2.6 Expenditure Schedule by Component 6
2.3 Estimated Cost by Component 5 3.1 Key Financial and Economic Indicators 9
2.4 Project Sources of Financing 5 4.1 Main Project Implementation Stages 15
2.4bis Project Sources of Financing by
Component
6 6
Currency Equivalents
October 2015 1 Unit of Account (UA) = USD 1.41
1 Unit of Account = EUR 1.25
1 Unit of Account = BIF 2,222.38
1 Unit of Account = CDF 1,300.59
1 Unit of Account = RWF 1,019.60
Fiscal Year
1 January - 31 December
Weights, Units and Measures T Tonne = 1000 kg kW kilowatt = 1000 Watt
GW Gigawatt = 1 000 000 kW or 1 000
MW kWh kilowatt-hour = 1000 Wh
GWh Gigawatt-hour = 1 000 MWh MVA Megawatt-ampere = 1 000 kVA or 1 000 000
VA
Toe Tonne of oil equivalent MW Megawatt = 1 000 000 W or 1 000 kW
kV kilovolt = 1 000 Volt MWh Megawatt-hour = 1 000 kWh
kVA Kilovolt-ampere = 1 000 VA tCO2 Tonne CO2 = 1000 kg of carbon gas
i
Acronyms and Abbreviations
ABAKIR Lake Kivu and Ruzizi River Basin Authority
PC Project Company
ADF African Development Fund PCR Project Completion Report AfDB African Development Bank PCU Project Coordination Unit
AFD French Development Agency PIB Gross Domestic Product
CPIA Country Policy and Institutional Assessment
PIDA Programme for Infrastructure Development in Africa
CSP Country Strategy Paper PIU Project Implementation Unit
DRC Democratic Republic of Congo PPP Public-Private Partnership
ECCAS Economic Community of Central African States
PRSP
II Poverty Reduction Strategy Paper
RE Regional Envelop
ECGLC Economic Community of the Great Lakes Countries
RMC Regional Member Countries
EGL Great Lakes Electricity Utility RIPS Regional Integration Policy and Strategy (RIPS)
EIB European Investment Bank RISP East Africa Regional Integration Strategy Paper
EPC Engineering, Procurement and
Construction
EU European Union RO Regional Operation GPRSP Growth and Poverty Reduction
Strategy Paper SME Small-and-Medium-Sized Enterprises
KfW Kreditanstalt fr Wiederaufbau tCO2 Tonne of carbon dioxide
NELSAP
Nile Equatorial Lakes Subsidiary
Action Programme - Project to
Strengthen Power Grid Inter-
connection of Nile Equatorial Lakes
Countries
TFP Technical and Financial Partners TSF Transition Support Facility (formerly Fragile
States Facility-FSF) UA Unit of Account
PBA Performance-Based Allocation WB World Bank
ii
PROJECT INFORMATION SHEET
CLIENT INFORMATION
Donees:
Borrowers:
Burundi and Democratic Republic of Congo
Democratic Republic of Congo and Rwanda
Executing Agency Electricit des Grands Lacs (EGL)
FINANCING PLAN
SOURCES Amount (UA million) INSTRUMENT
BURUNDI DRC RWANDA TOTAL
COUNTRY TOTAL 21 60 17.5 98.5
ADF (PBA) 7 7 Grant
7 7 Loan
ADF (RE) 14 30 44 Grant
10 10.5 20.5 Loan
TSF (Pillar I) 15 15 Grant
5 5 Loan
AfDB (private sector) 35.62 Loan
Other Donors (AFD, EIB, WB,
KfW, EU) 238.05
Private Partnership 71.24
TOTAL PROJECT COST 443.40
BURUNDI DRC RWANDA
Type of Financing ADF Grant ADF/TSF
Grant ADF/TAF Loan ADF Loan
Currency UA UA UA UA
Interest Rate Type NA(*) NA NA NA
Interest Rate Spread NA NA NA NA
Service Charge NA NA 0.75% / yr. 0.75% /yr.
Commitment Fee NA NA 0.50% / an 0.50% / yr.
Other Charges NA NA NA NA
Maturity NA NA
10-year grace period
and 30 years of
reimbursement
10-year grace period
and 30 years of
reimbursement
(*)NA: Not applicable
iii
FIRR 7.84%
FNPV USD 63.13 million
EIRR 13.35%
ENPV USD 36.13 million
TIMEFRAME AND MAIN MILESTONES
Concept Note Approval 3 September 2015
Project Approval 16 December 2015
Effectiveness 30 April 2016
Closing Date 31 December 2022
Completion 31 December 2023
Last Reimbursement 31 December 2056
iv
EXECUTIVE SUMMARY
1. Project overview: The Ruzizi III Hydropower Plant Project which is part of the Programme for the Development of Infrastructure in Africa (PIDA) concerns Burundi, the Democratic Republic of
Congo (DRC) and Rwanda. It entails the construction of a run-of-river dam (on the Ruzizi River
between DRC and Rwanda downstream from the Ruzizi II hydropower dam), a 147 MW power plant
and a distribution station. Burundis current total capacity will double, while Rwandas will increase by
half. DRCs share will contribute to raising supply in the Eastern region currently not connected to the
interconnected network, while also significantly reducing the percentage of energy o
