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Lesson
Continuity and stability in project officers are essential elements for successful implementation, especially during the early implementation phases. Delegation of implementation responsibility to the resident mission at an early stage of the project cycle is also good practice, provided locally recruited staff have sufficient familiarity with ADB operational and procurement procedures.

Project Number: 34476-016
Project Name: Gansu Clean Energy Development Project
Report Date:
Lesson
Sponsors can identify qualified local maintenance providers. CPTL’s international maintenance provider departed with the majority shareholders and was successfully replaced with a local provider. If the project sponsors or project management teams are able to find suitably qualified local operation and maintenance solutions, costs to the project are likely to be lower and an important opportunity to create skilled jobs is created from the outset.

Project Number: 40914-018
Project Name: (Cambodia) Power Transmission Lines Co., Ltd., Power Transmission Project
Report Date:
Lesson
For Asian developing countries with a well developed local capacity in electric power or other infrastructure sectors, partnership with an international consulting firm in the implementation arrangements can be an effective mechanism to enable the transfer of state-of-the-art management and operational practices to national companies and agencies.

Project Number: 34476-015
Project Name: Gansu Clean Energy Development Project
Report Date:
Lesson
Controls over project cash flows and bank accounts protect project interests. The loan structure included strict controls over the project bank accounts. Bank accounts specifically dedicated to the CPTL project needed to be opened and maintained both outside the host country (the offshore account) and within it (the onshore account). All amounts payable to the project are required to be paid into the offshore account and may only be withdrawn according to the payment priorities and amount limits specified in the loan document.

Project Number: 40914-017
Project Name: (Cambodia) Power Transmission Lines Co., Ltd., Power Transmission Project
Report Date:
Lesson
Addressing adequately the social and environmental impact of hydropower development projects during preparation and making sure the local communities affected by the development participate in the benefits of the investment is an important lesson to ensure longer term project sustainability. To achieve this goal, funding needs to be committed before loan approval to ensure that such issues will be addressed during implementation, and independent monitoring mechanisms put in place to measure the impact on local communities.

Project Number: 34476-014
Project Name: Gansu Clean Energy Development Project
Report Date:
Lesson
Additional resident mission resources could aid in due diligence. Whether this dispute and its potential to disrupt the business could have been prevented through a change in due diligence procedures requires consideration, although the causes of the dispute itself are not clear. All existing due diligence requirements appear to have been completed, including checklists, and PSOD used an external consultant and included the resident mission in its due diligence process, even without a formal due diligence requirement to do so.

Project Number: 40914-016
Project Name: (Cambodia) Power Transmission Lines Co., Ltd., Power Transmission Project
Report Date:
Lesson
For short periods these conditions are tolerable, but for a major outage such as that witnessed during the evaluation mission, these plans are inadequate. Losses to businesses due to outages included cancelled bookings at smaller hotels without backup generators, food spoilage due to no refrigeration, less customer traffic due to discomfort for patrons in the high temperatures, and inability to manage booking changes or take credit card payments due to inoperable electronic ticketing and payment systems.

Project Number: 40914-021
Project Name: (Cambodia) Power Transmission Lines Co., Ltd., Power Transmission Project
Report Date:
Lesson
Strong project ownership is essential for successful implementation. In evaluating project ownership, attention must be given during appraisal not only to investment planning priorities but also to whether counterpart funding has been committed, key staff are in place, coordination mechanisms across and within different government levels are working effectively, and an institutional capacity exists to address social and environmental issues affecting the project’s long-term sustainability.

Project Number: 34476-013
Project Name: Gansu Clean Energy Development Project
Report Date:
Lesson
Delays occurred frequently in meeting conditions of loan effectiveness, recruiting consultants, and awarding contracts.

Project Number: XXXXX
Project Name: Kali Gandaki “A” Hydroelectric Project
Report Date:
Lesson
There is no doubt that selecting hydro versus thermal power in Nepal provided a least-cost intervention given the country’s topography and relatively high costs of alternative energy such as diesel and oil. At feasibility study time, alternatives to the adopted design were investigated but ultimately rejected and it now appears when factoring in energy production (actual versus planned), down time due to mechanical problems in the turbines, that including considerations of operational costs into decision making process may have changed the design of the plant.

Project Number: XXXXX
Project Name: Kali Gandaki “A” Hydroelectric Project
Report Date:
Lesson
Experienced foreign investors in power generation have access to private sector technical insurance that sovereign entities may not otherwise have. This is important when technical problems arise that cause major shutdown of operations, as was the case of AKL due to a 2004 fire. Private sector insurance enables unforeseen technical problems to be fixed along with compensation to the insured for revenue loss due to the incident. Foreign investors can leverage important insurance that is often difficult for sovereign entities to acquire.

Project Number: 34912-014
Project Name: AES Kelanitissa Power Project in Sri Lanka
Report Date:
Lesson
ADB should consider promoting complementary rural development initiatives in project-impacted areas with indicators of outcome derived from the impact assessment process. Agencies to be involved in implementing these initiatives should be preferably located at the district or village level. ADB should not rely on the “polluter pays” principle or on compliance mechanisms to implement its safeguards.

Project Number: XXXXX
Project Name: Kali Gandaki “A” Hydroelectric Project
Report Date:
Lesson
Close examination and assessment of real capacity is necessary in analyzing economic and financial benefits for private sector power plant projects supported by ADB. Nameplate capacity needs to be considered in the context of a plant’s capacity factor. No power plant runs 100% of the time, and power plants, like that of AKL, that run on auto diesel fuel will need to shut down routinely for scheduled maintenance. Routine maintenance combined with unscheduled shutdowns lower actual net capacity.

Project Number: 34912-014
Project Name: AES Kelanitissa Power Project in Sri Lanka
Report Date:
Lesson
Consider projects with sufficient storage capacity to better address load shedding, which continues to affect economic growth and living standards. To consider such projects, greater knowledge of technical aspects, including geology, hydrology (including extreme events), and sedimentation, should be developed by financing agencies and/or developers.

Project Number: XXXXX
Project Name: Kali Gandaki “A” Hydroelectric Project
Report Date:
Lesson
Risk of lost revenues due to delayed commissioning and unplanned shutdown associated with mechanical failures can be mitigated by requiring expert power plant developers sponsored by ADB to provide more oversight and guidance to construction contractors.

Project Number: 34912-014
Project Name: AES Kelanitissa Power Project in Sri Lanka
Report Date: