The World Bank Report No: ISR14331 Implementation Status & Results Tanzania TZ First Power and Gas Sector DPO (P143645) Public Disclosure Copy Project Name: TZ First Power and Gas Sector DPO (P143645) Program Stage: Implementation Seq.No: 1 Status: ARCHIVED Archive Date: 16-Apr-2014 Country: Tanzania Approval FY: 2013 Product Line: IBRD/IDA Region: AFRICA Lending Instrument: Development Policy Lending Implementing Agency(ies): ENERGY AND WATER UTILITIES REGULATORY AUTHORITY(EWURA), TANESCO, Tanzania Petroleum Development Corporation Key Dates Board Approval Date 26-Mar-2013 Original Closing Date 30-Jun-2014 Planned Mid Term Review Date 07-Nov-2013 Last Archived ISR Date Effectiveness Date 12-Jun-2013 Revised Closing Date 30-Jun-2014 Actual Mid Term Review Date 07-Nov-2013 Program Development Objectives Program Development Objective (from Program Document) The objective of the proposed program is to: (i) strengthen the country’s ability to bridge the financial gap in its power sector; (ii) reduce the cost of power supply and promote private sector participation in the power sector; and (iii) strengthen the policy and institutional framework for the management of the country’s natural gas resources. Has the Program Development Objective been changed since Board Approval of the Program? Yes No Overall Ratings Previous Rating Current Rating Progress towards achievement of PDO Moderately Satisfactory Overall Implementation Progress (IP) Moderately Satisfactory Implementation Status Overview The series’ objective to place the Tanzanian power sector on a more sustainable path is on track. Improved efficiency of TANESCO led to a lower operational deficit, together with Public Disclosure Copy the stabilization of arrears, in 2013. Effective January 2014, the electricity tariffs increased on average by 39 percent to enhance TANESCO revenue on a more permanent basis. This also allows the Government to reduce the level of transfers to TANESCO, in line with prior commitments supported by the DPO series. By launching a set of capacity building programs for public-private partnerships (PPPs), the Government has implemented the initial phase of its policy to expand electricity generation while lowering its cost through diversifying the sources of electricity generation toward domestic natural gas. Such effort includes the increased participation of the private sector on a competitive basis. The sector review of the power sector for structural reforms is still underway and being prepared in the context of developing the Power Sector Roadmap under the BRN Initiative. The Government has also started the process of implementing an appropriate policy framework for the optimal use of future natural gas revenues by adopting the Natural Gas Policy and launching the Natural Resource Charter program. The submission of a Gas Bill to the Parliament has been delayed due to the longer-than-expected time required for the Gas Policy to be adopted due to broad local consultations. Results Page 1 of 3 The World Bank Report No: ISR14331 Results Indicators Indicator Name Core Unit of Measure Baseline Current End Target Amount (USD) of accumulated arrears to Amount(USD) Value 276000000.00 243000000.00 50000000.00 Public Disclosure Copy suppliers by TANESCO Date 31-Dec-2012 31-Dec-2013 30-Jun-2016 Comments TANESCO operating deficit (USD) Amount(USD) Value 244000000.00 293000000.00 50000000.00 Date 31-Dec-2012 31-Dec-2013 30-Jun-2016 Comments New generation capacity added to the system, Megawatt Value 105.00 165.00 600.00 cumulative (MW) Date 31-Dec-2012 31-Dec-2013 30-Jun-2016 Comments Average unit cost of power sales (USD/MWh) Amount(USD) Value 0.18 0.18 0.13 Date 31-Dec-2012 31-Dec-2013 30-Jun-2016 Comments Baseline updated from the original as reported in PD. Number of bids for gas power plant launched Number Value 0.00 0.00 1.00 on a competitive basis Date 31-Dec-2012 31-Dec-2013 30-Jun-2016 Comments GoT has identified location for the plant and start the hiring process of transaction advisor (s). Volume of gas produced (mscf/d) Number Value 78.00 92.00 290.00 Date 31-Dec-2012 31-Dec-2013 30-Jun-2016 Comments Amount of on-shore proven natural gas Number Value 1.00 1.40 3.50 reserves (Tcf) Date 31-Dec-2012 31-Dec-2013 30-Jun-2016 Comments Public Disclosure Copy Data on Financial Performance (as of 20-Jun-2013) Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date P143645 IDA-52150 Effective 26-Mar-2013 18-Apr-2013 12-Jun-2013 30-Jun-2014 30-Jun-2014 Disbursements (in Millions) Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P143645 IDA-52150 Effective XDR 64.90 64.90 0.00 64.90 0.00 100.00 Page 2 of 3 The World Bank Report No: ISR14331 Tranches Tranche 1 Public Disclosure Copy Amount (USD) Expected Release Date Actual Release Date Status 0 Pending Released Key Decisions Regarding Implementation Proceed to appraise the second operation of the series. Restructuring History There has been no restructuring to date. Related Operations P145254-TZ Second Power and Gas Sector DPO Public Disclosure Copy Page 3 of 3