ATTACHMENT_J.7_Energy_Links_Annual_Report_Y3.pdf

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 1

CENTRAL ASIAN REPUBLICS

CENTRAL ASIAN REPUBLICS

ENERGY LINKS PROJECT

CONTRACT NO. AID-176-C-14-00004

YEAR 3 ANNUAL REPORT

FOR THE PERIOD OCTOBER 1, 2016 – SEPTEMBER 30, 2017

OCTOBER 31, 2017

This document is made possible by the support of the American People through the United States

Agency for International Development (USAID). The contents of this document are the sole responsibility of ECODIT, LLC, and do not necessarily reflect the views of USAID or the United States

Government.

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT

CENTRAL ASIAN REPUBLICS ENERGY LINKS

PROJECT

CONTRACT NO. AID-176-C-14-00004

YEAR 3 ANNUAL REPORT

For the Period October 1, 2016 – September 30, 2017

October 31, 2017

DISCLAIMER

The authors’ views expressed in this publication do not necessarily reflect the views of the

United States Agency for International Development or the United States Government.

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT

Key Cover Photos for Reporting Period:

Energy Ministers from Afghanistan, Kyrgyz Republic, Pakistan, and Tajikistan sign theCASA-1000 Resolution at the IGC meeting in Dubai

USAID Tajikistan Country Office Director and Deputy Energy Minister of Tajikistan at the ceremony of IT equipment handover

Energy Links improved operational rules and procedures for the Toktogul Water Reservoir in the Kyrgyz Republic

Energy Links awarded the special recognition certificates for outstanding work in the Kyrgyz

Republic

Participants of the Transmission Line Route Survey for CASA-1000 at the Datka substation in the Kyrgyz Republic

Energy Links COP attends the Energy Charter Regional Forum on Transit of Energy Resources in

Ashgabat, Turkmenistan

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 4

TABLE OF CONTENTS

ABBREVIATIONS ················································································································ 5

BACKGROUND

A. SUMMARY OF MAJOR ACCOMPLISHMENTS ···························································· 8

B. DETAILED DESCRIPTION OF ACTIVITIES··································································· 17

B.1 Project Team: Staffing and Administrative Issues

B.2 Cross-Cutting: Coordination with Governments, Donor, Gender and Environmental Compliance

B.3 Detailed assessment and analysis of progress made on each task and milestone of the work plan

ACTIVITY 1.1 (CLIN 001): REGIONAL CASA-1000 SECRETARIAT

ACTIVITY 1.2 (CLIN 001): REGIONAL NON-CASA ASSISTANCE

ACTIVITY 2 (CLIN 002): KYRGYZ REPUBLIC BILATERAL ASSISTANCE

ACTIVITY 3 (CLIN 003): TAJKISTAN BILATERAL ASSISTANCE

ACTIVITY 4 (CLIN 004): TURKMENISTAN BILATERAL ASSISTANCE

C. PERFORMANCE INDICATORS AND PROGRESS AGAINST AMEP TARGETS

D. COSTS

E. PROJECT SCHEDULES AND IMPLEMENTATION CHALLENGES ······························· 57

F. PLANS FOR NEXT PROJECT YEAR ·············································································· 60

ATTACHMENT 1 – WORK PLAN GANTT CHARTS FOR YEAR 4 ·································· 63

ATTACHMENT 2 – SUCCESS STORIES ············································································ 68

ATTACHMENT 3 – LIST OF REPORTS AND DELIVERABLES ········································· 71

ATTACHMENT 4 – LIST OF SUBCONTRACTS ································································ 81

ATTACHMENT 5 – LIST OF PROCURED COMMODITIES AND INVENTORY ·············· 84

ATTACHMENT 6 – PROJECT PERSONNEL SUMMARY ················································· 86

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 5

ABBREVIATIONS

Although an effort was made to reduce the number of acronyms used in this document, many are commonly used and are included here – specifically those for donors, government institutions, and commonly used technical terms. Whenever the acronym or abbreviation appears for the first time, it is defined in the text.

ADB Asian Development Bank

AEE U.S. Association of Energy Engineers

AMEP Activity Monitoring and Evaluation Plan

BER Bid Evaluation Report

BOQ Bills of Quantities

CAPS Central Asia United Power System

CAR Central Asian Republics

CAREC Central Asia Regional Economic Cooperation

CASA-1000 Central Asia-South Asia 1000

CCN Cooperating country national

CDC “Energia” Coordinating Dispatch Center “Energia”

CO Contracting Officer

COP Chief of Party

COR Contracting Officer Representative

DABS Da Afghanistan Breshna Sherkat is an independent and autonomous energy company of the Islamic Republic of Afghanistan

DoE U.S. Department of Energy

DCOP Deputy Chief of Party

DSM Demand-side management

ED Executive Director of the CASA-1000 Secretariat

EBRD European Bank for Reconstruction and Development

EL Energy Links Project funded by USAID

EPC Engineering, procurement and construction

ESCC Energy Sector Coordinating Committee of CAREC

ESIA Environmental and Social Impact Assessment

GGPAS USAID Good Governance and Public Administration Strengthening Project

HICD Human and institutional capacity development

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HVAC High-voltage alternating current

HVDC High-voltage direct current

IFB Invitation for Bids

IFC International Finance Corporation

IEC International Electrotechnical Commission

IGC Inter-Governmental Council of CASA-1000

IsDB Islamic Development Bank

JWG Joint Working Group of CASA-1000

JSC Joint Stock Company

KOREM Kazakhstan Operator of Energy & Capacity Market

LSC Legal subcommittee of CASA-1000 Joint Working Group

LTTA Long-term technical assistance

NEHC National Energy Holding Company of KR

MDM Meter data management

MEWR Ministry of Energy and Water Resources of the Republic of Tajikistan

MoE Ministry of Economy of the Kyrgyz Republic

MOU Memorandum of Understanding

O&M Operations and Maintenance

PGI Power Grid of India, IFC Procurement Consultant

PPA Power purchase agreement

SOW Statement of work

SPMF State Property Management Fund of the Kyrgyz Republic

STTA Short-term technical assistance

TA Technical assistance

TW01-TW06 CASA-1000 codification of procurement packages

TW01 Procurement package for Converter Stations

TW02 Procurement package for HVDC/AC transmission lines in Pakistan

TW03 Procurement package for HVDC transmission lines in Afghanistan

TW04 Procurement package for HVDC/AC transmission lines in Tajikistan

TW05 Procurement package for HVAC in the Kyrgyz Republic

TW06 Procurement package for AC transmission lines and AC bay extensions in the

Kyrgyz Republic and Tajikistan

WB World Bank

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 7

BACKGROUND

On September 30, 2014, USAID signed a contract with ECODIT for the Central Asian Republics (CAR)

Energy Links Project (AID-176-C-14-00004). Through Energy Links, USAID/Central Asia (CA) is uniquely positioned to address various power sector and water management challenges, as described below, and seize existing opportunities to achieve increased national energy security for countries in Central Asia via four supporting outcomes:

1. Increased transparent intra- and inter-regional energy trade

2. Improved legal and regulatory framework and investment climate for the countries’ energy sectors

3. Improved corporate governance, operations, and commercialization of the energy companies

4. Improved energy efficiency (EE) and demand-side management (DSM).

Certain countries in Central Asia, including Kyrgyz Republic (KR), and Tajikistan (TJ), and Afghanistan and Pakistan in South Asia, experience regularly severe electricity shortages and poor electricity supply.

Uneven generation sources, combined with poor transmission infrastructure and a regionally fragmented grid, represent the most critical realities for the gap between demand and supply. A key driver of electricity market fragmentation is a political conflict and tension within and among the countries, including disagreements over equitable water resource management. Both KR and TJ heavily rely on hydropower to satisfy local demand in the winter, which reduces the volume of water available for irrigation in the downstream countries of Kazakhstan (KZ), Turkmenistan (TM), and Uzbekistan (UZ).

The regional grid in Central Asia was not designed with cross-regional export in mind, therefore, its infrastructure gaps exacerbate electricity shortages in parts of the region and end up squandering millions of dollars of potential export revenues to the wider regions, including Afghanistan and Pakistan, that could improve the financial bottom line of the electric companies and contribute to power sector investment and maintenance. Weak and underdeveloped regulatory environments augment revenue and infrastructure deficits. As a result of low electric tariffs, large losses and poor bill collection, electricity companies fail to generate revenue for upgrading or replacing degrading generation and transmission infrastructure. A massive institutional capacity and skills deficit within public and private institutions, along with widespread corruption and theft of service, prevent government regulators from effectively monitoring electricity flows and enforcing rules, reducing the ability of electricity companies to manage and disclose finances and operations in an effective way. Partly as a result of these challenges, inefficient energy use, especially by large industrial and government facilities, is also an issue.

The ECODIT Consortium embraces USAID’s vision for national energy sectors on a sustainable upward trajectory for the individual Energy Links’ countries and for the region as a whole. Our technical approach is designed to move these countries up the maturity curve of regional trade and investment, toward an integrated, competitive regional energy market. Currently, lack of reliable power infrastructure and the risks associated with cross-border electricity trade in the region discourage investments in a regional power market. To reduce these risks, we are supporting CASA-1000 power infrastructure project, and continue facilitating a robust framework of institutions that address key political and regulatory barriers to market development. The project also addresses underlying capacity deficits that prevent effective management of energy trade, regulatory bodies, and the energy companies.

This is the Third Annual Report for the Energy Links Project of USAID / Central Asian Republics (CAR), and covers the period from October 1, 2016 to September 30, 2017. Per Contract Number AID- 176-C-14-00004, the Annual Report presents details on major activities and achievements, progress toward achievement of milestones in accordance with the approved Annual Work Plan, success stories, and progress toward standard indicators for the Activity Monitoring and Evaluation Plan (AMEP).

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 8

A. SUMMARY OF MAJOR ACCOMPLISHMENTS

REGIONAL CASA-1000 SECRETARIAT

Energy Links project is supporting implementation of CASA-1000 electricity transmission project that will supply summer surplus hydroelectricity from Central Asia to South Asia. Once implemented, CASA- 1000 project will bring 1300 MW from Tajikistan and Kyrgyz Republic to Afghanistan and Pakistan. It will be a major new source of revenue in the regional electricity market, generating 4.6 billion kWh/year.

The four project countries had signed a Master Agreement and the Power Purchase Agreements, which, along with a Coordination Agreement constitute the core project agreements and mark the beginning of the procurement stage. During project year three, Energy Links continued to support operations of CASA-1000 Intergovernmental Council’s (IGC) Secretariat to ensure smooth CASA project implementation by coordinating procurement, facilitating contractual negotiations, legal and other project support activities.

The Secretariat and Tajikistan Country Coordinator supported the CASA-1000 Presidential Summit, held on July 6 in Dushanbe. Presidents of Afghanistan, Pakistan, Tajikistan, and Prime Minister of Kyrgyz Republic expressed respectively their strong political commitments in a joint Communique, and acknowledged the concerted efforts supporting the project progress.

The Secretariat played an important role in achieving the substantial progress and reaching the important milestones in procurement of critical CASA-1000 project components. During the year, Secretariat provided full-scale administrative resources and technical support, organized and facilitated the activities and meetings of the Procurement Committee (PC), supported the Joint Working Group (JWG) and its Legal Sub-Committee (LSC), and the IGC. The Secretariat managed the project documentation, facilitated communication with the bidders to provide clarifications for ongoing contractual negotiations, coordinated bids evaluation process, and oversaw the overall implementation. The Secretariat coordinated procurement activities and organized 39 meetings, including 30 PC and nine JWG meetings, three bids opening events and four bilateral meetings with CASA-1000 countries. The efficient and closely coordinated efforts resulted in successful and timely launching of the tenders with the approximate value of USD 1.2 billion for main CASA-1000 project components, with their current status shown in the table below:

Procurement Packages Status

TW01: Two Convertor Stations in Tajikistan and Pakistan (WB/IDA/DFID funding)

Bid evaluation report prepared for four technical and commercial proposals from reputable bidders.

Submission of financial proposals is due by December 15, 2017.

TW03: HVDC lines in Afghanistan (WB funding)

Three EPC contracts awarded and initialed by contractors. Design will start in October 2017.

TW02; TW04; TW05: HVDC transmission lines in Tajikistan and Pakistan, and 125 km of HVAC transmission line in Kyrgyz Republic (IsDB funding)

Bid evaluation report prepared for each procurement lot. Once agreed with the countries, bid evaluation report (BER) will be sent to IsDB for no objection and award. TW02 package might be re-bid due to high price of the proposal that significantly exceed the budget estimate.

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 9

TW06: HVAC transmission lines in Kyrgyz Republic and Tajikistan and re-enforcement of the grid in Tajikistan (EIB and WB funding)

Tender announced and 20+ bidders expressed interest to participate. Bid submission date was shifted to November 2017 due to amendments of technical specifications.

HVDC Owner’s Engineer (WB funding) Bid evaluation report for technical proposals prepared and submitted to the countries for approval. Once agreed with the countries, BER will be sent to WB for no objection and financial proposals will be opened.

The success of procurement process was recognized by the four Energy Ministers at the IGC meeting held in early October in Dubai who acknowledged the significant progress with preparation of signing three EPC contracts in Afghanistan. As the highest decisional authority for the CASA-1000 project, the IGC passed a Resolution that authorized the countries’ national transmission companies to execute the required amendment to the project’s Master Agreement, effectively marking the beginning of the implementation phase.

The Secretariat coordinated and facilitated review, comments and translation of 46 documents (procurement technical, commercial, and legal) that facilitated significant and timely progress with the development and evaluation of all project procurement packages (TW01 through TW06 and HVDC Owner’s Engineer) which, when completed, will comprise the following CASA-1000 facilities:

TW01 includes the two WB-funded HVDC converter stations to be located in Tajikistan and Pakistan and represents the largest single contract. The key achievement was to facilitate the finalization of all discussions between the PC, IFC and the World Bank Procurement Consultants from Power Grid of India (PGI) with prospective bidders on their technical submissions. These were completed in meetings with each bidder in September in Dubai. The meetings resulted in agreed clarifications and deviations that will enable the four qualified bidders (ABB, GE, Siemens and TBEA) to submit their financial bids by November 15, 2017, in conformance with the bidding rules and procedures.

TW02, TW04, and TW05 are IsDB-funded HVAC and HVDC power lines. The bid evaluation report covering all three packages was issued and reviewed at length by all project countries. The remaining issue related to ice loading in Tajikistan has delayed acceptance of the report, and hence the award process for all packages, but resolution of this issue is expected in October 2017 and will be reported on subsequently. Regarding the three specific packages:

TW02 (Pakistan) is now an 88 km HVDC line from the AF/PK border to Nowshera (plus an earth electrode line and short HVAC interconnection). Only one bid was received and exceeded by more than 50 per cent the budget; therefore, IsDB will be requested to support re-bidding the facility as soon as the BER can be sent for approval.

TW04 (Tajikistan) is a 117 km HVDC line from Sangtuda to the AF border (plus a short HVAC line to interconnect to the existing TJ system, and an earth electrode line). The financial bids have been evaluated and contract award recommendation prepared, subject to resolution of the ice loading issue referenced above.

TW05 (Kyrgyz Republic) is a 125 km HVAC line to the KR/TJ border plus some facilities.

The financial bids have been evaluated and the contract award recommendation is ready.

TW03 is the WB-funded Afghan HVDC line for which the EPC Contracts were awarded in three lots to KEC and KPTL from India. As of September 30, 2017, the final version of contracts was initialed by the contractors and the process for initialing from the

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Afghanistan/DABS energy company side was being organized to submit them to the World Bank for final review and signature. The contracts have been modified to enable a $6 million in design and definitive routing work to occur prior to commitment to the full project scope.

TW06 includes WB- and EIB-funded HVAC lines in Tajikistan and Kyrgyz Republic plus some facilities. As of September 30, 2017, all amendments and extending the bid date to accommodate the timing of release of the final amendments were yet to be completed. (Note: Extension of the bid deadline to November 23, 2017 was agreed and communicated on October 16)

WB-funded HVDC Owner’s Engineer package. As of September 30, 2017, IFC representatives from the tender administration distributed HVDC OE BER, drafted by WB’s procurement consultants from PGI, to countries. The report recommended to open financial proposals of two out of four submitted bids. Other two bidders were recommended for disqualification due to low technical scores. The Secretariat received approvals of BER from PK, AF and KR. TJ provided their comments on evaluation scores to be agreed with other three countries, and requested that the wording and scores in BER be changed, which would not impact BER final evaluation results. As soon as PK, AF and KR confirm their agreement with TJ comments, financial bids of CESI and Manitoba Hydro will be opened and the tender’s winner will be selected.

In order to ensure proper document management for the growing volume of technical, commercial and legal documents, the Secretariat developed the Concept of CASA-1000 Document Management System (DMS), supported by USAID. The CASA-1000 DMS will provide stakeholders a centrally designed and maintained web-based system where they can quickly find electronic copies of documents, search for the needed information in these documents, identify information gaps and track the progress on different components of the CASA-1000 process. Energy Links engaged an experienced service provider “360Works” to begin the design process and implementation of the new DMS.

OTHER REGIONAL ACCOMPLISHMENTS

During the third project year, Energy Links identified committed stakeholders for regional power trade, conducted regional workshops and conferences for building consensus among regional stakeholders for organized power market in Central Asia, prepared analytical papers and conducted reviews on cross-border electricity trading in Central Asia and economic benefits for market participants. Energy Links continued cooperation with the Energy Charter Secretariat based on the Memorandum of Understanding signed in 2016 to conduct joint annual workshops on Central Asia regional energy cooperation. Within the framework of this cooperation, Energy Links co-organized two regional energy events for about 300 participants during Year 3. Energy Links assisted USAID in preparing and organizing Central Asia Regional Economic Cooperation (CAREC) Energy Subcommittee meetings and discussions with regional energy companies and host government stakeholders from Kyrgyz Republic, Tajikistan, Uzbekistan and Turkmenistan to identify counterparts committed to activities that will increase regional electricity trade. The three most significant efforts to increase regional energy cooperation during the reporting period included:

Conference on the Regional Energy Cooperation in Central Asia: This regional event, organized in November 2016 in Almaty, brought together representatives of the Ministries and energy companies from Afghanistan, Kazakhstan, Kyrgyz Republic and Tajikistan, as well as the representatives of regional organizations such as CDC “Energia”, Executive Committee of CIS Electric Power Council and CASA-1000 IGC Secretariat. The meeting addressed a wide range of issues related to challenges and opportunities of energy cooperation in Central and South Asia. The delegates discussed various perspectives in cross-border electricity trade, integration of energy markets, potential platforms for regional and inter-regional power trading, including possibilities for parallel operation of the Afghan power system with Central Asia. The participants welcomed the

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 11

work of the Energy Charter on a Multilateral Framework Agreement on Energy Transit. It was highlighted that the proposed Agreement could be useful to address existing issues in the United Power System of Central Asia such as transit tariffs and a third party access, as well as to facilitate construction of new infrastructure projects. The Energy Links project discussed the progress in implementation of CASA-1000 project that aims to interconnect power systems of Kyrgyz Republic, Tajikistan, Afghanistan, and Pakistan.

CAREC Energy Sector Coordinating Committee as a Discussion Platform on Regional Electricity Trade: Energy Links supported USAID in strengthening cooperation with the ADB-sponsored CAREC Program and its Energy Sector Coordinating Committee (ESCC). On May 11-12, 2017, Energy Links participated in the meeting of CAREC ESCC in Dushanbe where plans for enhancement of the cross-border trade were discussed among the attendees. Discussions delineated several possible directions for regional cooperation in the power sector and prospects for further development. The next ESCC meeting took place in Astana on July 17-19, 2017. Energy Links supported USAID in attending this event and developing several analytical documents on regional energy trade opportunities. About 200 participants representing government officials, energy companies, commercial and development banks, investment agencies and consultants from Central Asia region were in attendance. US Ambassador Mary Warlick delivered a speech outlining importance of regional energy cooperation in CAR and confirmed USG support to CASA-1000 project. Energy Links took active participation in sessions related to regional energy trading and integration of renewable energy sources into regional markets. Energy Links conducted a number of side meetings with WB, EBRD, ADB, KZ Ministry of Energy, NREL, USEA and GE to discuss better coordination on revitalization of regional energy markets and integration of RE in the regional markets.

Cooperation with the Energy Charter Secretariat to Organize International Forums and Discussions: In late May, Energy Links project team participated in the Forum “Towards a Multilateral Framework Agreement on Transit of Energy Resources,” jointly organized by the Energy Charter Secretariat and the Government of Turkmenistan, in Ashgabat. Energy Links project experts delivered presentations on regional energy cooperation as a stimulus for diversifying electricity transportation routes, and participated in the panel discussion on cross-border electricity trading issues. Such high-level regional gatherings facilitate important discussions on the latest developments and opportunities in improving prospects for greater regional energy security and cross-border trade.

BILATERAL KYRGYZ REPUBLIC ACCOMPLISHMENTS

During the third project year, the Energy Links project finalized the implementation of activities in Kyrgyz Republic, based on USAID decision to phase out bilateral assistance in KR. The project technical activities were completed in March 2017 and project administrative close-out was completed in July 2017. KR government awarded the special recognition certificates for outstanding work in Kyrgyz Republic to USAID KR Mission Director and USAID Energy Links Project. The Kyrgyz Republic project accomplishments from the beginning of the project until the end of the bilateral assistance were presented in the Final Report for Energy Links project in Kyrgyz Republic submitted to USAID on July 30, 2017. While this report discusses details about the main Energy Links KR project accomplishments, the following examples highlight several strengthened capacities of the KR energy sector stakeholders:

National Energy Holding Company (NEHC) Structure and Capacity Strengthened At the request of USAID/Kyrgyz Republic, Energy Links conducted an assessment of the NEHC organization and developed a comparative discussion note about the international experience.

Energy Links provided ad hoc assistance and advice to the NEHC in developing its plans, presentations and justifications for Government / Parliamentary discussions of NEHC

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establishment. Energy Links strengthened local capacity of NEHC staff and conducted trainings on implementation of Enterprise Resource Planning (ERP) for all its operating companies, including JSC EPP, JSC Severelectro, JSC NESK, JSC Bishkekteploset, JSC Chakan GES, JSC Oshelectro, JSC Jalalabadelectro, and JSC Vostokelectro. The participants emphasized importance of the provided training events and requested the follow-up assistance to apply the knowledge received.

Key Performance Indicators for the Power Sector Approved by Energy Regulator By its Decision #150, the Kyrgyz Energy Regulator approved the Regulation that improved key performance indicators (KPIs) for the power sector, developed with comprehensive assistance of Energy Links’ consultants. The revised regulation includes reporting forms for utilities to improve monitoring, methodology for determining KPIs for transmission and distribution losses, as well as internationally applicable SAIDI, SAIFI and CAIDI indicators to report customer outages. The Regulation is based on the best international experience in implementation of KPIs and takes into account the local regulatory experience that had been accumulated during the initial year of using the KPIs. The Regulation will help further improve the system of KPIs and increase efficiency of the monitoring system administered by the Kyrgyz Energy Regulator. In 2017, the Energy Regulator started receiving utility reports for quarterly evaluations of their KPIs. Energy Links assessed the Regulator’s staff needs in conducting quantitative and qualitative analyses and made recommendations on further trainings for staff for performing the analytical works. Energy Links assisted the Regulator with upgrading its website to enable proper publication of the KPI reports, thus increasing transparency of its activities and building better communication with the general public.

Energy Sector Regulations for Investment Coordination Improved By its Decision #144, the Energy Regulator approved the Regulations on Investment Coordination Procedures for the Power Sector, on 1 November 2016. These new Regulations which were developed with Energy Links’ assistance include reporting forms for further monitoring and incorporate the recommendations to provide for establishing a transparent and predictable regulatory framework for coordination and further monitoring of investment programs, as currently there are no established procedures/regulations in the Kyrgyz Republic in this regard.

The International Electrotechnical Standards (IEC) on Data Exchange Adopted The NEHC approved a mandatory application of several IEC standards, developed with Energy Links’ assistance. In November 2016, the NEHC issued Order #32 on adoption of standard KMC IEC 61968-9:2016 and standard KMC IEC 61968-100:2016 for their mandatory application by all its power companies in newly introduced systems and elements of automated information and measuring systems of commercial energy metering. Several CIS countries adopted IEC standards following Kyrgyz Republic’s experience. Moldova informed Kyrgyzstandard that all data exchange standards adopted in Kyrgyz Republic had been also adopted in Moldova. Belarus recommended that the standards be adopted on a regional level.

Energy Facilities Improve their Operations Rules Energy Links developed the Toktogul Reservoir and the Naryn Cascade Operational Model that was presented to the experts of these critical hydrological facilities during a technical workshop conducted on November 16-18, 2016 for personnel of JSC Electric Power Plants (JSC EPP) and the National Energy Grid Company (NESK). This model can be used to assist them in making more optimized operational decisions. Along with the model, Energy Links presented a User’s Manual to the trainees. Energy Links team completed the draft Resolution of the Government of Kyrgyz Republic “On Approval of Rules for Operation of Toktogul Reservoir”, and prepared an accompanying administrative note to adopt the resolution. Once approved, the Rules will be used by NEHC to improve operations of the Toktogul Reservoir and increase overall reliability of the Kyrgyz power system.

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BILATERAL TAJIKISTAN ACCOMPLISHMENTS

During the third project year, the Energy Links project advanced implementation of the Action Plan and the Memorandum of Understanding (MOU) signed between USAID and the Ministry of Energy and Water Resources (MEWR). The major project efforts in Tajikistan bilateral activities focused on:

providing assistance to improve coordinated energy project management, IT capabilities and data exchange among MEWR, Barki Tojik (BT), and the State Investment Committee;

assessing the energy efficiency potential in the country and providing the relevant recommendations to MEWR to consider implementing select energy efficiency measures;

developing and transferring educational curricula for Master’s courses with technical energy fields of study to Tajikistan higher education institutions, for enhancing the local energy sector capacity;

securing the commitment of TJ stakeholders to conduct a corporate management workshop for energy sector professionals from MEWR and BT;

organizing the study tour to the U.S. for the group of energy professionals working in Tajikistan power sector;

initiating Association of Energy Engineers Chapter in Tajikistan;

supporting training courses in the English language and Financial Management to improve skills of MEWR and BT personnel.

Coordinated Energy Project Management and IT Capabilities in the MEWR, BT, and the State Investment Committee Improved

Within the framework of the MOU signed between the MEWR and USAID, and the Action Plan on implementation of MOU’s provisions, Energy Links provided support for developing an integrated energy project management information system for the MEWR to oversee a centralized energy project database. Energy Links engaged a local provider Sistemavtomatika to coordinate the installation and wiring of the necessary IT elements. The project management and data exchange needs of the MEWR and BT were assessed; the specific hardware and software tools were defined, procured and delivered to the MEWR and BT; the installation of the equipment was completed and the training for the use of equipment and special software was provided to MEWR technical staff. In February 2017, MEWR and USAID Tajikistan Country Office held the official handover ceremony of the project management systems IT equipment and software. USAID Energy Links assistance was instrumental in increasing capacity of the key project counterparts to utilize modern project management IT tools to manage more efficiently the energy projects, including CASA-1000. The Ministry expressed appreciation to USAID for its support of modernizing the energy sector capacities and institutions in Tajikistan, including

A new fully equipped IT data center at the MEWR;

Wired and wireless network connectivity via LAN wires connecting the new Wi-Fi router/access points;

A network attached storage (NAS) system and an uninterruptible power system (UPS) were installed and configured to provide secure storage for personal and shared files; and

A network router/firewall and switches were installed to provide secure local and Internet connectivity.

It needs to be noted that the project experienced an unexpected delay in installation of the equipment as Energy Links contractor Sistemavtomatika was precluded from accessing the equipment installation sites due to administrative hurdles. Joint efforts of the Energy Links, MEWR and the contractor subsequently enabled to resolve effectively the access issue with the respective TJ government agencies.

With the new state-of-the-art project management IT infrastructure in place, this project provided the end users with all needed equipment to interface with the Automated Management Information System.

As the next step, the Energy Links supported setting up a fully functioning and integrated data exchange

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optical network between the MEWR, BT’s Project Implementation Unit and the State Enterprise (Energy Projects Management Unit), the State Committee on Investments and State Property Management. By the end of September 2017, Sistemavtomatika completed the installation and cabling works at the four pre-defined locations in MEWR, BT, PIU and the State Investment Committee, and the procedures to ensure acceptance of the performed works were initiated. Modern IT infrastructure tools and data exchange communication system enabled Tajik stakeholders to improve their ability to manage large power projects, including CASA-1000.

Technical Analysis and Recommendations on Energy Efficiency Potential Prepared Energy Links conducted a comprehensive technical assessment of the energy efficiency potential in Tajikistan, supporting the Outcome: Improved Energy Efficiency/Demand Side Management. Energy Links EE expert Astghine Pasoyan conducted a comprehensive technical analysis, reviewed the data, and prepared the EE Recommendations Report that took into consideration the perspectives of the MEWR, BT, donors and IFIs, and private sector stakeholders. Energy Links finalized the EE Recommendations Report and submitted it to MEWR and USAID for acceptance: The recommendations raised the following key issues analyzing the economics and benefits of expanding the district heating service in the City of Dushanbe;

assessing the potential for energy savings in the pump-fed irrigation systems;

analyzing the features of the proposed Energy Efficiency Fund for potential cross-sectoral financing and promotion of energy efficiency investments;

preparing policy and regulatory tools for promotion of labeling of energy consuming appliances and analyzing their potential to promote energy savings and energy efficiency;

raising public awareness about the benefits of energy efficiency while promoting behavioral changes and catalyzing private sector investments in energy conservation.

The report outlined detailed plans to integrate energy efficiency solutions into the business as usual operations, quantifying benefits, establishing illustrative energy efficiency experiences for wider replication, and gradually adapting the regulatory framework. As a next step for implementing the proposed energy efficiency measures, Energy Links is planning to initiate select energy efficiency and demand-side management pilot projects following discussion and final selection by the MEWR.

New Educational Curriculum on Energy Savings Prepared for the Tajik Energy Institute To assist the Tajik Energy Institute with adaption of more advanced educational energy programs in Tajikistan, Energy Links engaged the Municipal Development Institute from Ukraine to prepare a comprehensive curriculum, a textbook and training materials for the Master’s course students studying at technical departments of universities. While based on the best international practices, the curriculum was adapted to reflect Tajik local requirements stipulated in national laws and in relevant normative documents. It covered the principles of thermal physics of buildings, parameters of ventilation, heating, and air conditioning in buildings, feasibility studies on energy efficient measures, energy audit procedures, energy balance and other topics. The preparatory drafting work culminated in a four-day training workshop in July, in the city of Kurgan-Tyube, where Energy Links COP Andriy Mitskan and Chancellor of the Tajik Energy Institute Khayrullo Nazarov facilitated the discussions and review of the curriculum that will modernize the technical subject-matter knowledge of the Tajik power sector professionals so they are better prepared to understand the challenges of improving the energy sector performance. At the end of the training week, 33 faculty members of the Energy Institute received diplomas of attendance and assessed the training components as useful to their professional careers and opportunities. Chancellor Nazarov committed to launching a new Master’s program on Energy Savings in Buildings at the Energy Institute, starting from the 2018-19 academic year. The training course materials, which were translated into the Tajik language, will also be used for advanced training of post-graduate students and for expanded professional training of technical specialists.

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Capacity on Corporate Management for Energy Sector Professionals Improved During the reporting period, MEWR and BT requested Energy Links’ assistance to organize a Corporate Management Workshop with focus on modern commercial management practices and energy sector restructuring, aiming to improve local capacity of the energy professionals. The workshop was organized in August 2017 and targeted primarily the management staff of Barki Tojik. Corporate energy experts from Deloitte prepared and delivered several technical presentations about best practices in corporate management topics, including strategies to improve operational and financial performance of corporatized power utilities, management approaches to utility technical performance, enhancing power utility operational business models, principles of corporate governance and managing the changes, and ample practical examples to get better understanding of the changing corporate structures. The training participants (54% male and 46% female) included leading specialists, managers, and department heads of Barki Tojik, and assessed the workshop content and the informational value to be useful for future work, noting that the knowledge about developing forecast indicators, improving work with the clients, applying information received for the restructuring/ transitional phases could be shared with experts and utilized effectively in future planning activities. After completion of the workshop, all participants were awarded certificates of participation.

Local Capacity on Financial Management and English Language Training Strengthened Throughout Project Year Three, Energy Links provided support for building capacity of MEWR and BT personnel in English language training and Financial Management, facilitated by the University of Central Asia (UCA) and the Public Institute of Professional Accountants and Auditors of the Republic of Tajikistan (PIPAA RT), respectively. The English classes instruction for MEWR and BT staff continued in its second year according to the previously approved schedule. Improvement of technical English skills is particularly important in light of the envisioned transfer of modern software tools for power system planning and operations to BT, as well as for other functional tasks of professionals working in the energy sector, increasing their ability for communicating with international experts, reading and applying best international practices in their day-to-day work. In June 2017, all six groups of trainees studying English at different levels completed their coursework and took the final examination.

Out of 51 participants who completed the entire course, 76% demonstrated good and satisfactory results in the examinations, with the passing scores that allow them to continue their studies at the higher level.

The gender composition includes 67% males and 33% females. The remaining three language groups started in September and will complete the coursework and take examinations by end of December 2017.

Energy Links subcontractor PIPAA RT delivered the Financial Management-1 courses for BT employees. The first group started courses in December 2016, and the additional two groups were established and started classes in April 2017. The course adds critically needed capacity, allowing BT personnel to improve financial accounting and analytical skills when evaluating various projects and financial requests. PIPAA RT’s certified instructors provided the training in compliance with the curriculum of Certified International Professional Accountants’ network (CIPA) courses. As a result of the USAID/Energy Links-sponsored financial management training, the Tajik energy sector professionals significantly improved their skills and knowledge in financial accounting according to international standards, and the majority of participants expressed desire to further study these subjects.

The target audience for these training sessions are accountants and economists. Successful completion of this course qualifies the trainees to progress to the next course in Managerial Accounting-1. 79 trainees in the three groups took the final examination in March and June 2017 and were qualified to study at the next level of CIPA Managerial Accounting-1 course. Three participants passed the international CIPA examination. Based on the results of internal examination, 30 participants formed the group for studying at the next level - Managerial Accounting-1 course. The gender composition of these training groups demonstrates Energy Links’ commitment to gender equity, totaling 57% males and 43% females.

Association of Energy Engineers (AEE) Chapter in Tajikistan to be Established

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Energy Links facilitated and organized the visit of two experts from the US Association of Energy Engineers to Tajikistan, in accordance with the plans to organize a certification program on energy management for professionals working in Tajikistan’s power sector, in close cooperation with the Tajik Energy Institute and other key local stakeholders. The purpose of AEE’s first visit was to assist on selection of qualified training participants for the program of Certification of Energy Managers (CEM) and to initiate the establishment of AEE Chapter in Tajikistan. The new AEE Tajikistan Chapter will support further training activities for and professional development of the Tajik stakeholders working in the energy sector. The Chapter will also develop into a trusted local platform for industry networking, professional development, and information dissemination. Furthermore, it will link its members to the greater network of other AEE professionals around the world. During their first visit, AEE experts held a series of meetings with the stakeholders, including the Tajik energy companies, MEWR, USAID and UNDP representatives, academia and research institutions, consulting firms, and discussed the prospects for cooperation. In September, the AEE conducted its second visit to Tajikistan and facilitated the first class of Certified Energy Manager training and examination, with a purpose to select the qualified candidate pool for the next “Train-the Trainer” program which is planned to be conducted during the third AEE visit to Tajikistan. Out of previously screened 20 candidates, 15 participants attended the CEM training on September 11 - 15, 2017, in Kurgan-Tube, and 5 of them successfully passed the examination to advance to the next level (Train-the-Trainer Program), which is planned for December 2017. To ensure sustainability of CEM in Tajikistan, Energy Links supported the establishment of the Tajikistan Chapter of US Association of Energy Engineers to continue the strong professional development. It is envisioned that the group of trainees, selected from the qualified specialists of the MEWR, Tajik energy companies, academia and research institutions, and consulting firms, will serve as the leaders and champions in the process of developing the AEE Chapter in Tajikistan.

US Study Tour Improves Knowledge of Global Energy Trends and Technology Energy Links sponsored participation of a Tajikistan delegation to the World Energy Engineering Congress (WEEC) on September 26 – 29, 2017 in Atlanta, USA. The delegation included three leading specialists and managers from the MEWR, Barki Tojik, and senior teaching faculty and research staff from the Tajik Energy Institute. A Colibri Law (ECODIT subcontractor) representative accompanied the delegation to ensure proper information transfer. The participants attended a Chapter Leadership Meeting at the Georgia World Congress Center and found this event instrumental for resolving practical issues related to organizing the AEE Chapter in Tajikistan. The Energy Congress featured participants from more than 90 countries. 14 parallel panel sessions were organized every day of the conference, and the TJ participants selected the sessions of most interest, including fundamentals of energy efficiency, renewable energy, and solar energy technologies and applications, and interacted with the key experts in the field. In their assessment, the Tajik participants gave the highest ranking to the exhibition of energy equipment manufacturers which featured more than 200 companies presenting their latest technologies, products, and newest innovations in improving energy performance. The participants also benefited from forming new contacts with energy equipment manufacturers, particularly in renewable energy technologies given Tajikistan’s current focus on renewable energy development, more sustainable energy management and energy efficiency. The Tajik experts established professional ties with the organizations from the U.S. and abroad and plan to maintain these ties and connections in the future for knowledge and sharing of expertise. As the next immediate step, the participants are committed to preparing more detailed trip reports and present their findings in their organizations and at the interim meeting of the AEE Chapter in Tajikistan.

BILATERAL TURKMENISTAN ACCOMPLISHMENTS

During the reporting period, Energy Links conducted a needs assessment with different energy sector stakeholders in Turkmenistan in close coordination with USAID. Based on the discussions, Energy Links prepared a detailed proposal for technical assistance in the energy sector of Turkmenistan and

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submitted it to USAID for approval. USAID conveyed the assistance proposal to the Ministry of Energy and the Ministry of Foreign Affairs of Turkmenistan. The proposal contained the following activities:

Improve local capacity of Turkmenenergo on operations & maintenance of power system;

Support organization of Energy Charter events in Turkmenistan on regional energy cooperation;

Support Turkmenenergo on power system planning;

Support Turkmenenergo Project Management Unit on project management of power projects.

International Energy Forum “Towards a Multilateral Framework Agreement on Transit of Energy Resources” Organized in Ashgabat Energy Links discussed and agreed with the Energy Charter Secretariat on a joint organization of the Energy Forum “Towards a Multilateral Framework Agreement on Transit of Energy Resources,” on 30- 31 May 2017 in Ashgabat, Turkmenistan. Over 100 participants including Ministers, high-level officials and leading experts from the International Energy Charter member and observer countries, including the delegations from Kazakhstan, Kyrgyz Republic, Tajikistan and Uzbekistan, international organizations, energy companies and research institutions participated in the Forum. Deloitte regional energy expert Matthew Addison delivered a presentation on regional energy cooperation as a stimulus to diversify electricity transportation routes.