(Exchange Rate Effective as of December 31, 2016) Currency Unit = Pakistan Rupee (PKR) US$1.00 = PKR 104.375 SDR 1.00 = US $1.34433 FISCAL YEAR July 1 – June 30 ABBREVIATIONS AND ACRONYMS ADB Asian Development Bank BISP Benazir Income Support Programme CPPA-G Central Power Purchasing Agency (Guarantee) Limited CPS Country Partnership Strategy DPC Development Policy Credit Disco Distribution Company, (WAPDA successor company) ECC Economic Coordination Committee (of the Pakistan Cabinet) EFF Extended Fund Facility (of IMF) FBR Federal Board of Revenue FDI Foreign Direct Investment FGD Flue Gas Desulfurization GDP Gross Domestic Product Genco Generation Company (WAPDA Successor Company) GHG Greenhouse Gas GWh Gigawatt Hour HESCO Hyderabad Electric Supply Company HFO Heavy Fuel Oil Hydel Hydroelectric IDA International Development Association IFC International Finance Corporation IPP Independent Power Producer JICA Japan International Cooperation Agency KESC Karachi Electric Supply Company Limited (now K-Electric) kWh Kilowatt Hour MEPCO Multan Electric Power Company MoF Ministry of Finance MPNR Ministry of Petroleum and Natural Resources MW Megawatt MWP Ministry of Water and Power MTB Market Treasury Bill MYT Multiyear tariff NDT NEPRA-determined Tariff NEPRA National Electric Power Regulatory Authority NPL Non-Performing Loan NTDC National Transmission and Dispatch Company OGRA Oil and Gas Regulatory Authority PEFA Public Expenditure and Financial Accountability PESCO Peshawar Electric Supply Company PFM Public Financial Management PMT Proxy Means Test PSIA Poverty and Social Impact Assessment SBP State Bank of Pakistan SDR Special Drawing Rights SEPCO Sukkur Electric Power Company SOE State owned Enterprise USAID United States Agency for International Development WAPDA Water and Power Development Authority Senior Global Practice Director: Practice Manager: Task Team Leader: ICR Team Leader: Riccardo Puliti Demetrios Papathanasiou Richard J. Spencer Fanny Missfeldt-Ringius ISLAMIC REPUBLIC OF PAKISTAN DEVELOPMENT POLICY CREDITS I & II
IMPLEMENTATION COMPLETION REPORT CONTENTS Data Sheet Program 1 Country Pakistan Program Name Power Sector Reform Development Policy Credit Program ID P128258 L/C/TF Number(s) IDA-54360 ICR Date 12/07/2017 ICR Type Core ICR Lending Instrument DPL Borrower Islamic Republic of Pakistan Original Total Commitment SDR 387.80M Disbursed Amount SDR 387.80M Implementing Agency: Ministry of Finance
Quality at Entry Highly Satisfactory Government: Satisfactory Quality of Supervision: Highly Satisfactory Implementing Agencies Satisfactory Overall Bank Performance Highly Satisfactory Overall Borrower Performance Satisfactory C.3 Quality at Entry and Implementation Performance Indicators Power Sector Reform: Development Policy Credit - P128258 Implementation Performance Indicators QAG Assessments Rating Potential Problem Program at any time No Quality at Entry None Problem Program at any Time No Quality of Supervision None DO rating before Closing Satisfactory Power Sector Reform: Second Development Policy Credit - P152021 Implementation Performance Indicators QAG Assessments Rating Potential Problem Program at any time No Quality at Entry None Problem Program at any time (Yes/No): No Quality of Supervision None DO rating before Closing/Inactive status Moderately Satisfactory D. Sector and Theme Codes Power Sector Reform: Development Policy Credit - P128258 Original Actual Major Sector Energy and Extractives Other Energy and Extractives 100 100 Major Theme/Theme/Sub Theme Public Administration 33 33 Public Finance Management 6 6 Business Enabling Environment 56 56 Fiscal Policy 6 6 Power Sector Reform: Second Development Policy Credit - P152021 Original Actual Major Sector Energy and Extractives Other Energy and Extractives 75 75 Oil and Gas 25 25 Major Theme/Theme/Sub Theme
Indicator Baseline Value DPC1 Target (end FY15/16) DPC2 Target (end FY15/16) Actual Achieved at Completion or Target Years Policy Area A: Reducing Subsidies and Improving Tariff Policy A.1. Subsidies allocated in Federal budget (as % of budget) 1.80% 0.40% 0.80% 0.70% Date achieved 30 June 2013 30 June 2016 30 June 2016 30 June 2016 Comments (incl. % achievement) DPC2 target overachieved. Original target changed from 0.4% to 0.8% of GDP (see table 2). Policy Area B: Improving Sector Performance and Opening the Market to Private Participation B1. Increased bill collection in DISCOs (% of total billing) 86% 90% 94% 94.60% Date achieved 30 June 2013 30 June 2016 30 June 2016 30 June 2016 Comments (incl. % achievement) Targets overachieved. B2. Increased gas supply 3.8 billion SCFD 5 billion SCFD 3.9 billion SCFD Date achieved 30 June 2013 30 June 2016 30 June 2016 Comments (incl. % achievement) Target not achieved. B3. Separation of market operations and transmission system operations Market and system operations in single entity (NTDC/ CPPA-G) All contracted power generated by IPPs, GENCOs and WAPDA Hydel traded through an independent CPPA-G All contracted power generated by IPPs, GENCOs and WAPDA Hydel traded through an independent CPPA-G Date achieved 30 June 2013 30 June 2016 30 June 2016 Comments (incl. % achievement) Achieved. Policy Area C: Ensuring Accountability and Transparency C1. Disco performance reports and NEPRA review published None Yes Yes Date achieved 30 June 2013 30 June 2016 30 June 2016 Comments (incl. % achievement) Achieved. G. Ratings of Program Performance in ISRs Power Sector Reform: First Development Policy Credit - P128258 No. Date ISR Archived DO IP Actual Disbursements (USD millions) 1 05/20/2015 Satisfactory Satisfactory 603.79 Power Sector Reform: Second Development Policy Credit - P152021 No. Date ISR Archived DO IP Actual Disbursements (USD millions) 1 12/13/2016 Moderately Satisfactory Satisfactory 489.39
8. Each Disco (i) includes subsidy amount in customer’s bills; and (ii) publishes on its website monthly billing and collection data aggregated by consumer category. 8. MWP implements public web-based access to monthly results of performance contracts signed with Discos, NTDC and Gencos. 9. NEPRA publishes at least monthly on its website, information provided by all licensees on selected performance standards results and indicators. 8. NEPRA has disclosed the annual Discos’ performance and evaluation report, and has initiated outreach action to consumers on the content thereof; and Discos have disclosed on their respective websites their annual performance reports, including their plans to improve service delivery. Combined the two triggers and focused on monitoring of performance of licensees through regulator rather than management by MWP. Was also aimed at building consumer awareness of comparative Disco performance. Measured through result indicator C1, Disco performance reports and NEPRA review published from a baseline of no publication in FY12/13 to a target of the reports and review published (not dated in original program document). 9. ECC approves establishment of monitoring units within both MWP and MPNR with responsibilities for monitoring the energy sector, reporting on a quarterly basis; and MWP and MPNR formulate the scope of work for advisors who will review the quarterly monitoring reports and make those reviews public.