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Lesson
Social development. The project has contributed to regional sustainable socioeconomic development, poverty reduction, and community development in the project area.

Project Number: 39652-023
Project Name: Gansu Heihe Rural Hydropower Development Investment Program: Erlongshan Hydropower Project
Report Date:
Lesson
Carbon revenue. The project was successfully registered as a clean development mechanism (CDM) project and was able to source significant amounts of revenue from the sale of carbon credits, thereby making it financially viable. This offers valuable lessons as a successful demonstration project for other clean energy developers in the region.

Project Number: 39652-023
Project Name: Gansu Heihe Rural Hydropower Development Investment Program: Erlongshan Hydropower Project
Report Date:
Lesson
Counterpart financing. The project funds comprised international funds and domestic funds. For smooth project implementation, the timely availability of counterpart funds is a key issue. For the project, the actual ADB financing was $22.0 million and the counterpart funds mobilized from stockholders and local banks was $35.9 million, all of which was provided in a timely manner that ensured smooth project implementation and early project commissioning.

Project Number: 39652-023
Project Name: Gansu Heihe Rural Hydropower Development Investment Program: Erlongshan Hydropower Project
Report Date:
Lesson
Procurement. Properly administered bidding processes were vital to obtaining cost- effective bid offers. Strict adherence to such processes, both in equipment procurement and onsite construction, facilitated savings on capital costs and ensured quality construction and equipment. The engagement of an experienced procurement agent proved to be a key factor in facilitating efficient procurement.

Project Number: 39652-023
Project Name: Gansu Heihe Rural Hydropower Development Investment Program: Erlongshan Hydropower Project
Report Date:
Lesson
The external supervising mechanism was also effective and played an important role in improving the quality of the project. The selection and hiring of competent international and national consultants ensured that the quality standards required for the project were observed.

Project Number: 39652-023
Project Name: Gansu Heihe Rural Hydropower Development Investment Program: Erlongshan Hydropower Project
Report Date:
Lesson
The successful construction of the project resulted from the strong government ownership and provides a valuable lesson on the importance of this factor in facilitating effective implementation and delivery of development results in ADB-financed projects. The Erlongshan Hydropower Company (EHC) always took the initiative in solving problems, including in the provision of design documents, timely delivery of equipment, approach to dealing with issues, and other areas. The owner's initiative guaranteed appropriate procedures and timely action on key tasks and when problems arose.

Project Number: 39652-023
Project Name: Gansu Heihe Rural Hydropower Development Investment Program: Erlongshan Hydropower Project
Report Date:
Lesson
There are underlying systemic challenges associated with project implementation on the outer islands of the Maldives that must be considered in project design, as these conditions are different from those of other South Asian developing member countries. First, direct project oversight is more difficult because of transport issues unique to the archipelago. (Many outer islands are remote, with transport by lengthy, infrequent, and irregularly scheduled boat trips.

Project Number: 32036-013
Project Name: Outer Islands Electrification (Sector) Project
Report Date:
Lesson
ADB must supervise an IA more effectively if it has not established a prior record of successfully managing ADB-funded projects. ADB review missions throughout the project noted early warning signs that the project faced difficulties. More proactive and decisive action by ADB might have effected more efficient implementation. For example, when it became apparent that legislation would be delayed, ADB could have engaged the government to discuss an acceptable alternative, rather than simply leave it to a review mission to urge the government to take unspecified corrective action.

Project Number: 32036-013
Project Name: Outer Islands Electrification (Sector) Project
Report Date:
Lesson
A notable feature of this project was the difference in the performance of the batch 1 and batch 2 contractors, though both contracts were undertaken by the same consortium. The main difference was in project management requirements.

Project Number: 32036-013
Project Name: Outer Islands Electrification (Sector) Project
Report Date:
Lesson
For future projects located on numerous outer islands, formalized feedback channels from local island development committees (IDCs) to the IA should be established as part of project design.

Project Number: 32036-013
Project Name: Outer Islands Electrification (Sector) Project
Report Date:
Lesson
Passing the Cooperative Societies Act, the necessary enabling legislation before subproject loan agreements were possible, was known at project approval to be the responsibility of Parliament and therefore something the government could guarantee. Yet project formulation as set out in the report and recommendation of the President (RRP) implicitly assumed that this legislation would be passed in a timely manner and offered no robust contingency plan should the legal entities to operate subprojects fail to materialize.

Project Number: 32036-013
Project Name: Outer Islands Electrification (Sector) Project
Report Date:
Lesson
In formulating similar loan projects, ADB should ensure to the extent possible that achieving outputs is within the grasp of the implementing agency (IA). Depending on the Ministry of Planning and National Development (MPND), an agency without a stake in the subprojects, to spearhead the benefit and poverty monitoring and evaluation (BPME) proved problematic, as its withdrawal from that commitment left the IA unable to complete that part of the project.

Project Number: 32036-013
Project Name: Outer Islands Electrification (Sector) Project
Report Date:
Lesson
Forming separate, miniature utility cooperatives on individual islands with an average population of only 1,511 people, each with a separate loan agreement and inspector, proved very difficult to implement. This suggests that one island is too small a unit to justify this approach. The availability of technical expertise on each island varies significantly, and the requisite financial-management and tariff-setting expertise is scarce.

Project Number: 32036-013
Project Name: Outer Islands Electrification (Sector) Project
Report Date:
Lesson
Island selection and subproject appraisal were inefficient, delaying the commencement of contract processing by over 2 years and suggesting a recommendation for altering the approach that is shown in the next section.

Project Number: 32036-013
Project Name: Outer Islands Electrification (Sector) Project
Report Date:
Lesson
Where a large capacity-building component precedes project preparation, reviews by ADB should be more frequent. The consultants should also produce verifiable and detailed reports on progress and staff training. This will allow a more timely response to problems by both ADB and the Borrower.

Project Number: 38458-013
Project Name: Infrastructure Development
Report Date: