ATTACHMENT_J.8_Energy_Links_Annual_Report_Y4.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 4 ANNUAL REPORT

FOR THE PERIOD OCTOBER 1, 2017 – SEPTEMBER 30, 2018

OCTOBER 31, 2018

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 4 ANNUAL REPORT

For the Period October 1, 2017 – September 30, 2018

OCTOBER 31, 2018

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

REPRESENTATIVE PHOTOS FROM KEY ACTIVITIES DURING THE REPORTING PERIOD:

High-ranking energy officials of CASA-1000 project countries signed the IGC Resolution that ratified award for Converter Stations and declared construction start date, on September 21, 2018, in Almaty, Kazakhstan

Converter Station contract signing between JV ABB/Cobra and NTDC of Pakistan took place on September 21, 2018, in Almaty, Kazakhstan

CASA-1000 completed Transmission Line Route Surveys in Afghanistan with Secretariat support, September 2018.

Energy Links supported Energy Savings training for Tajik Energy Institute and provided modern laboratory equipment. December 2017, Kurgan- Tyube, Tajikistan

Energy Links supported power system planning and conducted four trainings for Barki Tojik on DigSILENT Power Factory software in Dushanbe during May-September 2018.

Energy Links co-organized the 14th Meeting of the Energy Charter Regional Task Force on Energy Cooperation in Central and South Asia, November 2017, Ashgabat, Turkmenistan

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

TABLE OF CONTENTS

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

BACKGROUND ···························································································· 7

A. SUMMARY OF CUMULATIVE PROJECT ACCOMPLISHMENTS ··················· 9

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

B.1 Project Team: Staffing and Administrative Issues

B.2 Cross-cutting: Coordination with Governments, DonorS, 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 3 (CLIN 003): TAJKISTAN BILATERAL ASSISTANCE

ACTIVITY 4 (CLIN 004): TURKMENISTAN BILATERAL ASSISTANCE

C. PERFORMANCE INDICATORS AND PROGRESS TOWARD AMEP

TARGETS ·························································································· 47

D. COSTS ··································································································· 61

E. PROJECT SCHEDULES AND IMPLEMENTATION CHALLENGES················ 62

F. PLANS FOR NEXT PROJECT YEAR ··························································· 64

ATTACHMENT 1 – WORK PLAN GANTT CHARTS FOR YEAR 5 ··················· 67

ATTACHMENT 2 – SUCCESS STORIES ························································ 71

ATTACHMENT 3 – LIST OF REPORTS AND DELIVERABLES ························· 75

ATTACHMENT 4 – LIST OF SUBCONTRACTS ············································· 87

ATTACHMENT 5 – LIST OF PROCURED COMMODITIES AND

INVENTORY ······················································································ 90

ATTACHMENT 6 – PROJECT PERSONNEL SUMMARY ·································· 93

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

AMEP Activity Monitoring and Evaluation Plan

BER Bid Evaluation Report

BOQ Bill of Quantities

CAPS Central Asia United Power System

CAR Central Asian Republics

CAREC Central Asia Regional Economic Cooperation

CAREM Central Asia Regional Electricity Market

CASA-1000 Central Asia-South Asia 1000

CCN Cooperating country national

CO Contracting Officer

COP Chief of Party

COR Contracting Officer Representative

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

DoE U.S. Department of Energy

DCOP Deputy Chief of Party

DFID UK Department for International Development

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

ESIA Environmental and Social Impact Assessment

GGPAS USAID Good Governance and Public Administration Strengthening Project

HICD Human and institutional capacity development

HVAC High-voltage alternating current

HVDC High-voltage direct current

IDA International Development Association

IFB Invitation for Bids

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 6

IFC International Finance Corporation

IFIs International Financial Institutions

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

LSC Legal subcommittee of CASA-1000 Joint Working Group

LTTA Long-term technical assistance

MDM Metered 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

NEGC National Energy Grid Company of the Kyrgyz Republic

O&M Operations and Maintenance

PGI Power Grid of India, IFC Technical Procurement Consultant

PPA Power purchase agreement

SCADA Supervisory control and data acquisition system

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 tender

TW02 Procurement package for HVDC/AC transmission lines in Pakistan tender

TW03 Procurement package for HVDC transmission lines in Afghanistan tender

TW04 Procurement package for HVDC/AC transmission lines in Tajikistan tender

TW05 Procurement package for HVAC in the Kyrgyz Republic tender

TW06 Procurement package for HVAC transmission lines and AC bay extensions in the Kyrgyz Republic and Tajikistan tenders

TCN Third-country national

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, LLC, 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 (AF) and Pakistan (PK) 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). KR and TJ can better utilize their hydropower generation, with TJ ranking eighth in the world for hydropower potential. The two countries have excess supply during the warm summer months, which cannot be utilized locally while PK has an increasing demand for electricity to support its growing economy.

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 AF and PK, 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 LLC 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 Fourth Annual Report for the Energy Links Project of USAID / Central Asian Republics (CAR), and covers the period from October 1, 2017 to September 30, 2018. Per Contract Number AID-

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

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 9

A. SUMMARY OF CUMULATIVE PROJECT

ACCOMPLISHMENTS

REGIONAL CASA-1000 SECRETARIAT

Energy Links project is supporting implementation of CASA-1000 electricity transmission and trade project that will supply summer surplus hydroelectricity from Central Asia to South Asia. Once implemented, the $1.2 billion 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. Energy Links supports operations of CASA-1000 Intergovernmental Council’s (IGC) Secretariat to ensure smooth CASA project implementation, by coordinating procurement, facilitating contractual negotiations, supporting legal and financial activities, and administering many other important project processes and business flows.

During project Year 4, the CASA-1000 project experienced the most active phase of the procurement process and it progressed toward the construction phase. This acceleration began following the signing of engineering, procurement and construction (EPC) contracts for the majority of the procurement packages, including the signing of the largest component of the CASA system - the contracts for the construction of the HVDC Converter Stations that are main pre-condition for the viability of the other CASA project contracts and components.

The project Year 4 ended symbolically by convening the IGC meeting on September 21, 2018. The key decision-makers reviewed the critical project points and milestones achieved by the focused and coordinated efforts of CASA-1000 participant countries, WB, and IFC, under the Secretariat’s dynamic facilitation. By its Resolution, the IGC has restored the validity of the Master Agreement with all Government Guarantees issued by and exchanged among the four countries. The IGC Resolution ratified award for Converter Stations, extended the deadline for engaging Account Bank services and waived certain conditions to enable declaration of beginning of project’s construction phase. The IGC Resolution also established an important project legal basis and necessary framework for effective project implementation, marking the beginning of CASA construction start date.

Throughout project Year 4, the Secretariat played a critical role in achieving the substantial progress and reaching the important milestones in procurement across almost all CASA-1000 project components. By the end of September 2018, seven of nine procurement packages have been awarded. The concerted efforts with the project country teams and international financial institutions (IFIs), supported by USAID guidance and supervision, allowed to overcome many barriers and impediments. Along the way, the Secretariat was able to aptly facilitate various political factors and uncertainty in decision-making in some member countries in Central and South Asia, turnovers of high-ranking government officials;

technical complexities associated with many procurement packages and necessity to make timely amendments and clarifications.

The Secretariat provided full-scale administrative and technical support to the CASA-1000 Joint Working Group (JWG) and Procurement Committee (PC) by organizing and facilitating technically-structured meetings, supported as necessary by STTAs Legal Advisor, Contract Advisor, and Finance Advisor. The Secretariat coordinated effectively the work of its procurement and technical consultants, managed the project documentation flow, facilitated communication with the procurement tenders’ participants, provided clarifications for ongoing contractual negotiations, coordinated bid evaluation processes, oversaw the overall timely implementation, and provided requisite support to Country Project Implementation Units (PIUs). In summary, the Secretariat organized and facilitated 68 meetings, including two IGC meetings, eight JWG meetings, four of them face-to face in Dubai and Almaty, 35 PC meetings, three of them face-to face in Dubai and Almaty, three Bids Opening events - for TW06, and

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 10

second-stage bids for HVDC Owners Engineer (OE) and TW01, 17 Negotiation Sessions with the contractors for the various packages and three Contractor Information Sessions in Dubai and Paris for TW02 and the DC Operator Strategy. Besides organizing the meetings, the Secretariat conducted two Document Management System (DMS) roll-out training sessions for KR PIU in Bishkek and for AF PIU in Almaty.

The meetings were actively supported and attended by representatives of all CASA-1000 countries, USAID, WB, IFC, DFID, IsDB, EIB, EBRD, and Energy Links. The efficient and closely coordinated efforts resulted in successful and timely launching, evaluation and awarding of the tenders for the main CASA-1000 project components of the total approximate value of USD 1.2 billion:

Procurement Packages Status

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

The EPC contracts for the Converter Stations were signed by the national transmission companies of TJ and PK with the successful bidder - JV of ABB Sweden and Cobra Instalaciones and Servicios S.A. Spain.

TW02: HVDC lines in Pakistan (IsDB funding)

Tender documents for TW02 HVDC lines in Pakistan were prepared for IsDB approval. Contractor Information Sessions in Dubai in July 2018 and in Paris in August 2018 were conducted to increase interest and number of potential bidders for this package.

TW03: HVDC lines in Afghanistan (WB funding)

Three EPC contracts were signed with two Indian companies, KEC and KPTL, in December 2017. Design and line routing activities began in January 2018. Reports for the three- Lot Route Survey were completed by KEC and KPTL in September 2018 and presented to AF DABS for review and approval.

TW04; TW05: HVDC

transmission lines in Tajikistan, and 125 km of HVAC transmission line in Kyrgyz Republic (IsDB funding)

The EPC contract for TW04 for the Tajik portion of the HVDC line between Barki Tojik (BT) and Indian company KPTL was signed in May 2018. The EPC contract between Turkish company MITAS and the National Electric Grid Company (NEGC) of Kyrgyz Republic was signed in September 2018.

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

The contract for the WB/EIB-funded HVAC transmission line procurement package for Tajikistan was signed between BT and KPTL of India in September 2018, at the conclusion of the IGC meeting in Almaty.

Signing of the contract for KR portion is envisioned in November 2018, after incorporating modifications agreed with MITAS in September’s negotiations in Bishkek due to currency (Turkish Lira) volatility in the Contractor’s home country.

HVDC Owner’s Engineer (WB funding)

Representatives of CESI company signed contracts with representatives of Pakistan and Tajikistan national transmission companies in September 2018, at the conclusion of the JWG meeting in Almaty. The signing of the Contract with CESI for HVDC OE Services by Afghanistan national transmission company DABS – is scheduled for October 2018.

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

HVAC Owner’s Engineer (WB funding)

The contract was awarded to Monenco Iran in 2016.

The Secretariat coordinated and facilitated review, comments and translation of voluminous procurement documentation (technical, commercial, administrative/procedural, and legal texts) that facilitated significant and timely progress with the development and evaluation of project procurement packages (TW01 through TW06 and HVDC OE).

Government Guarantees (GGs) and Request Letters for Financial Effectiveness and other CASA-1000 management issues: In September 2018, with active facilitation by the Secretariat, the CASA countries issued and exchanged their respective GGs. Fulfillment of this condition was reflected in the IGC Resolution signed by high-ranking government officials at the IGC Meeting in Almaty on September 21, 2018, declaring restoration of the Master Agreement’s effectiveness.

The Secretariat also facilitated resolution of other important topics such as signing by the GoKR of authorization on closing IGC’s dormant bank account in Kabul, finalization of Environmental and Social Impact Assessments (ESIAs), Resettlement Action Plans (RAPs), update of the project Technical Code, preparation of the Account Bank agreements, and several other pertinent matters.

The Secretariat coordinated the issues related to Financing Conditions and IFIs’ Guarantees to the CASA Governments. By the decision of the JWG reached on September 20, 2018, CASA Ministers of Finance committed to confirming the validity of their previously-issued requests for these Guarantees to the WB, and the WB will issue its response to the countries. The remaining actions to perform in the next period include clearance of EIB conditions for TJ and KR National Transmission Companies (NTCs) and signing of the Financial Agreement with EIB; execution of the Financial Agreement between PK NTC and IsDB; meeting the conditions to complete and present the country reports with ESIA and RAP to the WB for approval and initiation of construction works on the project sites.

CASA-1000 Document Management System (DMS): In order to ensure effective centralized document management for the growing volume of technical, commercial, administrative/procedural, and legal documents, the Secretariat developed and started implementation of the CASA-1000 DMS. The platform is accessible by the CASA-1000 countries and other authorized stakeholders through a customized application. This state-of-the-art document repository will provide stakeholders with a centrally designed and maintained web-based system where they can quickly find electronic copies of documents, search for the needed information, identify information gaps and track the progress on different components of the CASA-1000 process. The Secretariat developed an effective implementation plan for a full CASA DMS rollout to the project countries and conducted extensive preparations for the DMS first kick-off meeting, with the KR stakeholders in Bishkek.

In June 2018, the Secretariat facilitated a working session with the National Energy Grid Company (NEGC) PIU and Document Control staff to facilitate their seamless connection to the CASA-1000 electronic DMS that will allow them to meet their contractual obligations regarding project data handling and, in particular, change order requests from contractors as required under their EPC Contracts. In September 2018, the Secretariat organized second training on DMS to AF PIU team at DABS and the Secretariat AF Country Coordinator. The PIUs of other two countries Tajikistan and Pakistan will be trained on DMS by the end of the calendar year. The Secretariat finalized the DMS Document Control Manual and distributed to the countries for their review. Following the acceptance of this procedural document, the DMS will be codified and regularly monitored for upgrades and changes, as appropriate, so that it remains responsive to the countries’ project information needs.

Development of HVDC Operator Strategy: The Secretariat was instrumental in initiating the development of HVDC Operator Strategy. Following the focused marketing efforts, the Secretariat issued a Request for Proposals (RFP) on July 10, 2018, published on ECODIT, Energy Links and CASA-1000 web sites, and forwarded to 19 organizations that had expressed interest in this tender. The

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 12

biennial CIGRE Technical Exhibition and Convention, on August 25 – 31, 2018, in Paris, was selected strategically to expand potential bidders’ interest in this procurement. In accordance with the JWG recommendations from May 2018, the Secretariat held information sessions with potential service providers for the development of HVDC Operator Strategy. Six qualified companies from North America, Europe, and Asia submitted their technical proposals by the bids submission deadline of August 24, 2018. It is expected that the contract for engaging the DC Operator Consultancy will be awarded following the Secretariat’s own preliminary and countries’ reviews, projected to be completed in the November-December 2018 timeframe.

Communication, Visibility and Public Outreach for CASA-1000 Project: The CASA-1000 administrative and technical progress has been duly recognized by the CASA countries, USAID, WB and other IFIs, the global donor community, industry, and the media who all highlighted major milestones and achievements in steady progress toward establishing a viable energy corridor between the countries of Central and South Asia. Specifically, the press release on award of the HVDC converter station contracts to ABB/Cobra Consrotium had a wide distribution through the webs-sites of WB, ABB, CASA-1000 Secretariat, Energy Links, and EIN Presswire, an industry press release distribution service.

Energy Links and the Secretariat organized a dedicated CASA-1000 project booth to market future opportunities to HVDC and HVAC technology manufacturers, distributing targeted information and marketing products at CIGRE. The CIGRE Technical Exhibition and Convention is the preeminent international energy industry event that regularly attracts more than 3,000 delegates, 6,000 visitors, and 300-350 international companies every two years. During the convention, 114 delegates visited the CASA-1000 exhibition booth to solicit information on project progress and upcoming opportunities such as re-tendering of PK HVDC transmission line and development of HVDC Operation Strategy.

Energy Links/CASA team distributed more than 200 informational booklets and leaflets to the booth visitors.

OTHER REGIONAL ACCOMPLISHMENTS

The cross-border energy trade represents an opportunity for increased Central Asian intra- and inter-regional cooperation that has been a focal theme at various technical and policy forums, and promoted at different political and industry levels. Creating open markets, diversifying energy resources and ensuring sustainable development are commonly accepted and supported USAID policy objectives. During the reporting period, Energy Links was instrumental in enhancing the regional power trade efforts by organizing regional workshops and conferences with aim at developing a cross-border regional electricity trading framework that will provide economic benefits to all participating countries in Central Asia.

Conference on the Regional Energy Cooperation in Central Asia: In November 2017, under the framework of the Memorandum of Understanding (MOU) between the International Energy Charter and the Energy Links Project, the project organized a meeting of the Energy Charter Task Force on Regional Energy Cooperation in Asia (RECA) in Ashgabat, Turkmenistan. Delegates from Afghanistan, Kazakhstan, Kyrgyz Republic, Tajikistan, Turkmenistan, and Uzbekistan attended this event to exchange views and information on current developments in order to promote regional energy cooperation. The meeting served as a platform for the policy dialogue on energy cooperation in integrating energy markets, diversification of sources of supply and achieving sustainable development. Representatives of regional organizations such as CDC “Energia” and the Executive Committee of the CIS Electric Power Council, as well as international donors including USAID, the WB, EBRD, and the EU Delegation attended the conference.

Energy Links experts discussed enhancing regional cross-border electricity trading and cooperation emphasizing the role of Coordinating Dispatch Center (CDC) Energia; sharing relevant experiences of electricity cross-border trading among Armenia, Georgia, and Turkey; and potential of utilizing

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 13

Kazakhstan’s centralized electricity trading platform (KOREM) for the regional electricity trading in the Central Asia region.

Assistance to CDC Energia on Improving Its Capacities to Plan and Coordinate Electricity Cross-border Power Flows: During the reporting period, the Energy Links project assessed the needs of CDC Energia, located in Tashkent, Uzbekistan, in improving its capacity to coordinate and monitor cross-border power flows as mandated by the Central Asian United Power System’s (CAPS) Coordinating Council. Energy Links prepared and submitted to USAID a comprehensive proposal of coordinated technical assistance to CDC Energia in the following areas: power system planning, capacity building for CDC dispatch technical personnel, supervisory control and data acquisition (SCADA) system, and transit price methodology for cross-border electricity trade. In December 2017, at the donor coordination meeting, the WB informed about its plans to assist CDC Energia with capacity building under a grant facility. USAID confirmed that in coordination with the WB, Energy Links will provide technical assistance to CDC Energia on improving power system planning and upgrading training infrastructure for its facilities. This approach was presented and concurred with the Uzbek Government authorities from the Ministry of Economy and the power utility Uzbekenergo in March 2018 and was officially included in the Uzbek government plan of action for USAID energy projects in June 2018.

Uzbek stakeholders expressed interest in regional electricity trade cooperation and supported Energy Links’ plans to assist the CDC Energia. Energy Links selected a professional service provider for assistance on regional power system planning and is in the process of implementing the targeted assistance on regional power system planning.

BILATERAL TAJIKISTAN ACCOMPLISHMENTS

During the reporting period, Energy Links provided targeted assistance in Tajikistan to promote greater energy security and more efficient energy resource planning and operations under the framework of the MOU between USAID and the Ministry of Energy and Water Resources (MEWR) of the Republic of Tajikistan. Significant progress was made in the areas described below:

Assistance to BT on Power System Planning: Energy Links provided technical assistance to Barki Tojik by enhancing its power system planning and operational capabilities through structured technical workshops featuring BT power system modules utilizing DigSILENT Power Factory software tool.

Energy Links experts from DMCC of Ukraine conducted an initial needs assessment with BT through interviews and administering the questionnaire for data collection. During a kick-off meeting in April 2018, the DMCC expert team presented several options of software modules configuration to simulate the BT system. Energy Links procured and delivered to BT the needed hardware equipment for power system planning, including three computers equipped with the MS Suite and a color plotter, as well as four Power Factory software licenses.

From May to September 2018, DMCC conducted four in-country technical training sessions for BT engineering team to enhance their skills in power system planning. In addition, DMCC experts provided the remote support and guidance to BT specialists for developing the Tajik power system model. As a result, BT has been equipped with the modern professional power system planning tool DigSILENT Power Factory with modules allowing steady and dynamic states stability analyses along with basic functions of transmission system planning and operation, including calculation of technical losses in transmission and distribution networks.

Nine BT engineers, including three females, have strengthened their capacity and obtained skills for operating DigSILENT Power Factory application for power system modelling. The prospective model of BT power system that reflected all future system components that are planned to be installed in Tajikistan by 2030, has been developed and submitted to BT for testing and fine-tuning. Energy Links enhanced the capacity, practical knowledge and simulation skills of BT engineering team and established

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

professional credentials for their future work on power system planning, including for CASA-1000 project.

Assistance to BT to Enhance the Emergency Automated Protection System (EAPS) for Tajikistan’s Power System: To support a planned re-connection of the Tajik and Uzbek power systems, MEWR requested Energy Links assistance to review and improve the EAPS in Tajikistan’s power system. Energy Links experts from Deloitte Consulting conducted a number of technical meetings with BT management and technical specialists to collect information and data needed for development of the EAPS Assessment Report and the ToR for a Feasibility Study for EAPS technical enhancement. The key objective of the feasibility study was to prepare and review various options for technical re-enforcement of EAPS to ensure the required reliability and stability levels of the TJ power system for internal and external developments. Due to data limitations, the preparation of the Assessment Report and the ToR required more time and efforts then initially expected.

To ensure the qualitative production of the Assessment Report and the ToR, Energy Links pro-actively engaged the Energy System Researchers (ESR), a Kazakhstan-based, regionally operating technical firm specializing in analyzing Central Asian power systems. ESR assisted with collecting the requisite technical information and provided a critical peer review of the work delivered by Deloitte consultants. In May 2018, Energy Links team completed the Assessment Report of the current state of EAPS in Tajikistan’s power system, and developed the ToR to conduct the feasibility study for design and implementation of the enhanced EAPS architecture. Both documents were accepted by the MEWR and BT management.

As a result of the EAPS Assessment Report and the ToR prepared by Energy Links, MEWR engaged Mercados AF from Spain, under funding by the Asian Development Bank (ADB), to prepare the feasibility study for the EAPS enhancement.

Capacity Building of Local Energy Professionals from MEWR, BT and TEI: Throughout the Project Year 4, Energy Links actively built capacity of MEWR and BT personnel in Financial and Corporate Management, English language courses, Energy Efficiency and Energy Management. The courses were prepared and delivered by the Public Institute of Professional Accountants and Auditors of the Republic of Tajikistan (PIPAA RT), the University of Central Asia (UCA), the Municipal Development Institute (MDI), and the US Association of Energy Engineers (US AEE), respectively.

Improving Technical and Professional Capacity in Financial and Corporate Management, and English Language: Energy Links supported training courses in the Financial and Corporate Management and English language to improve skills of MEWR and BT personnel. 39 participants (44%) from the MEWR and 50 participants (56%) from BT participated in the English language program. The gender composition of the groups was 66% males and 34% females. For the UCA language courses, the participants noted that their knowledge of and skills in written and conversational English have increased, they gained more confidence in the labor market and in the workplace, received new perspectives for professional growth and advancement, and started participating in conferences abroad, or are planning such participation. The series of PIPAA RT-administered Financial Management courses, including Managerial accounting, Corporate Law, short-term courses in planning, budgeting and reporting have significantly enhanced specialized knowledge and skills of BT financial staff to work analytically with complex financial information. Four BT specialists have passed international exams for CIPA (Certified International Professional Accountant) certification.

Tajik Chapter for Certification on Energy Management. Energy Links continued engaging with the MEWR and the US Association of Energy Engineers (AEE) to support the creation of the Tajik Chapter of the AEE. Such professional energy associations are critical for Tajikistan to ensure the continued development and specialized training of technical cadres during the dynamic developments in the country’s energy sector. Energy Links supported establishment of the AEE Chapter in Tajikistan and assisted with its initial business activities. The group of

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 15

trainees selected from the qualified specialists of MEWR, Tajik energy companies, academia and research institutions were trained in energy management and energy audits. Eight Tajik energy professionals received the Energy Manager certification from the US AEE. The Tajik Chapter of AEE was successfully established and the professional and networking development plans agreed by all stakeholders. It is expected that the Chapter will become a leading platform for local and international energy industry networking, professional development, and information dissemination, linking its members to the broader network of other AEE professionals around the world. The Tajik Chapter of AEE has submitted the application for its registration as Non- Gpvernmental Organization (NGO) in Tajikistan to the host government authorities. The government authorities declined the application for registering a new NGO and recommended to partner with the exisiting NGOs for conducting AEE Chapter activities in Tajikistan. AEE agreed to consider partnership with the NGO “Association of Energy Efficiency and Renewable Energy Sources in Tajikistan”. The MoU between the AEE and NGO “Association of Energy Efficiency and Renewable Energy Sources in Tajikistan” is under preparation.

Enhancing TEI’s Master’s Courses in Energy Fields: Energy Links developed and transferred educational curricula and laboratory equipment to enhance Master’s courses in the energy fields of study to the Tajikistan Energy Institute (TEI) to increase the local energy sector capacity. Energy Links procured and transferred to the TEI modern energy efficiency laboratory equipment that allows users to conduct inspections and analyze energy flows in buildings and facilities. 30 textbooks, entitled “Energy Savings in Buildings and University Campuses”, developed with the assistance of the Energy Links subcontractor MDI and translated into the Tajik language, have been delivered to the MEWR and the TEI. In December 2017, in Kurgan- Tyube, the MDI conducted a four-day energy audits training course entitled “Energy Savings in Buildings” for the TEI faculty and students, which built upon the theoretical knowledge obtained in the July 2017 workshop. TEI Management acknowledged that as a result of the effective assistance provided by Energy Links Project, the Ministry of Education of the Republic of Tajikistan had issued a license to the TEI to introduce a new academic track curriculum entitled “Thermal and Power Engineering”. Five new specialties for Master’s studies – 4 specialties in the energy field, and one specialty in the economics of energy management – were established, and the teaching faculty and students’ pool at the TEI were expanded accordingly.

The first group of graduate students will be enrolled and begin their studies at the Energy Institute in the 2019-2020 academic year.

Assistance on Improving Project Management Capacity of MEWR, BT and Project Implementation Unit (PIU) by installing the Data Exchange Communication Channels: In October 2017, Energy Links subcontractor Systemavtomatika completed all installation and cabling works at the four pre-defined locations in the MEWR, BT, PIU and the State Investment Committee.

The four institutions accepted the executed works, enabling a mutual operation of a fully functioning and integrated information network for energy project management. This assistance was provided for developing an integrated energy project management information system for the MEWR to oversee a centralized energy project database. The modern system provided by Energy Links was instrumental in increasing the capacity of MEWR and BT to manage more effectively the domestic and international energy projects, including CASA-1000, with modern IT and project management tools, establishing one national project management umbrella under the Automated Management Information System (AIMS).

Implementation of EE Pilot Project in the Tanobchi Orphanage: To support its recommendations on improved water supply delivery analyzed in the Energy Efficiency Recommendation Report, prepared in 2017, Energy Links conducted an assessment and prepared technical specifications for an Energy Efficiency Pilot Project in the Tanobchi Orphanage. The study identified measures to reduce energy and water consumption, improve quality and reliability of water supply, and reduce the consumption of electricity by the water supply company pumping station. The proposed measures were divided into two

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 16

groups, namely water saving measures and energy saving measures. Implementation of the proposed measures will result in a more efficient use of energy and water resources, and improved social and health conditions of the orphanage faculty and residents. The pilot project was strongly endorsed by the MEWR and the Energy Links subcontractor Systemavtomatika started the energy efficiency project implementation activities at the pilot site on September 11, 2018. Once completed, the Tanobchi pilot project will improve water and energy efficiency service delivery, benefiting 134 resident children and 64 faculty and service staff of the orphanage. It will serve as a model for replication in at least 70 social and public institutions in Tajikistan with similar inefficient conditions in water and energy consumption and delivery.

BILATERAL TURKMENISTAN ACCOMPLISHMENTS

During the reporting period, Energy Links provided assistance in Turkmenistan to support regional energy trading and advise on maximizing the country’s power export opportunities. In order to better identify the assistance needs of local stakeholders, the Energy Links TM Coordinator Dovlet Hangeldiyev from Deloitte Consulting maintained regular contacts with counterparts in the Ministry of Energy and Turkmenenergo. Regular meetings were held with the energy sector entities to receive updates and information on the latest developments in Turkmenistan’s energy sector to identify opportunities for cooperation. Energy Links experts conducted capacity building workshop and advanced the preparation of a White Paper on new regional trade opportunities for Turkmenistan.

Capacity Building on using Electricity Trading Platform for Turkmenistan and CAR Countries:

For 2017, the Chairmanship of the Energy Charter Conference was assumed by Mr Maksat

Mammetsaparovich Babayev, Deputy Chairman of the Cabinet of Ministers of Turkmenistan. In close cooperation with the Energy Charter Secretariat, Energy Links used this opportunity to organize a regional workshop on electricity trading in Ashgabat for Turkmen and other energy specialists from

Cenral Asia region. On November 8, 2017, the Energy Links Project experts and the representatives of

KOREM, Kazakhstan’s operator of the energy and capacity markets, presented the functional aspects of the electricity trading platform using innovate and interactive methods. Yedil Kopenov, Chairman of the

Board of KOREM, delivered the presentation entitled "A Centralized Electricity Trading Platform of

Kazakhstan and Its Potential Use for Regional Electricity Trading". The workshop discussion covered different aspects on organization of electricity trading using the electronic platform, including eligibility of trading participants, methods of trading, clearing and settlement, minimum volumes of trade, and others. Turkmenenergo specialists and representatives from KR, TJ and UZ participated in the workshop.

Development of TM White Paper on Regional Trade Opportunities: Energy Links team of international and local experts advanced preparation of the TM White Paper on New Trade Opportunities for Turkmenistan through expanded Central Asia and South Asia trading activities, recent developments in CAPS due to re-connection of Tajikistan and Uzbekistan, and the new USAID initiative, Central Asia Regional Energy Market (CAREM). In December 2017, the Energy Links Project developed a USAID-endorsed outline for the White Paper, including the following aspects:

Recent developments in the energy sectors of Central Asia, particularly in Turkmenistan and

CAPS countries;

Possible future scenarios for Turkmenistan’s power system developments;

Management, operational and commercial performance of Turkmenistan’s energy sector;

Supportive policy and regulatory environment; and

Possible donor support for Turkmenistan’s power sector developments and restructuring.

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 17

Based on the approved outline, the Energy Links experts collected publicly available data and conducted various analyses to propose different internal and external scenarios for development of Turkmenistan’s power system and increased opportunities for cross-border electricity trade. Energy Links engaged a cross-border energy trade expert to review all collected material and develop a final draft of the White Paper. In July 2018, Energy Links submitted the draft document to USAID CA for review and approval.

USAID CA provided comments that will be addressed by the Energy Links experts as part of project regional activities. The TM White Paper is expected to be finalized by end of November 2018.

Close-out of TM Bilateral Activities: On June 8, 2018, the Energy Links Project received a formal notification from USAID to close formally the Energy Links bilateral activities in Turkmenistan, and prompted the project to initiate planning and preparation for the closeout. On June 27, Energy Links drafted a Demobilization and Property Disposition Plan for the Energy Links Bilateral Activities in Turkmenistan and submitted it to USAID for approval. In accordance with the approved Demobilization Plan, Energy Links completed all bilateral technical activities in Turkmenistan by July 31, 2018. This has allowed the project to focus on a smooth administrative closeout that was completed by the end of the reporting period.

B. DETAILED DESCRIPTION OF ACTIVITIES

B.1 PROJECT TEAM: STAFFING AND ADMINISTRATIVE ISSUES

ECODIT implements the Energy Links project in the Consortium with several subcontractors, including Deloitte Consulting, Energy Law International (ELI), University of Central Asia (UCA), Colibri Law, and others. The complete list of subcontractors, fixed price orders and individual consulting agreements are listed in Attachment 4. As work on the project progresses, Energy Links may attract additional local and international partners to respond to emerging technical needs.

The current Energy Links project field and home office management team includes:

• Andriy Mitskan, Chief of Party (COP);

• Michael Bekker, Deputy Chief of Party (DCOP);

• Gregory Osadetz, CASA-1000 Secretariat Executive Director; and

• Martina Schwartz, Home Office Sr. Energy Project Manager, ECODIT LLC.

CASA-1000 IGC Secretariat Executive Director (ED) Hiring Process: During the reporting period, Energy Links continued a comprehensive selection process for the permanent CASA-1000 Secretariat ED. ECODIT conducted interviews with eight pre-finalist candidates with strongest qualifications.

ECODIT collected their references, technical writing samples, assignment availability, rates and other relevant information, further narrowing the candidate pool to three finalists, and communicated those results to CASA countries and WB. On August 13, 2018, the Technical Evaluation Committee (TEC) consisting of CASA-1000 countries’, an ECODIT representative, and a WB representative (in an observer capacity), interviewed three short-listed candidates for the position of CASA-1000 Secretariat ED. Upon conducting interviews, TEC unanimously approved Mr. Gregory Osadetz, incumbent CASA- 1000 Secretariat Acting ED, to be recommended to IGC for the permanent appointment. ECODIT’s contract with Mr. Osadetz was signed on September 28, 2018.

Status of the CASA-1000 Secretariat Country Coordinators: As of the end of the FY 2018, CASA-1000 Secretariat employed three CASA Country Coordinators: Amin Lashkari (AF), Kairat Djumaliev (KR), and Furugzod Usmonov (TJ). The Secretariat continued coordinating with the CASA-1000 PK Working Group for the selection of its Country Coordinator. In March 2018, the CASA ED has prepared and submitted the selection memo with recommendation to engage Mr. Rahman as PK Country Coordinator to the PK JWG for concurrence. The concurrence was not received and the CASA ED held additional

CAR ENERGY LINKS – CONTRACT AID-176-C-14-00004 – ANNUAL PERFORMANCE REPORT 18

discussions with the members of the PK JWG regarding this recruitment. The revised ToR for the PK Country Coordinator was sent to PK JWG members for review and approval in May 2018. Based on the approved ToR, ECODIT advertised the position at the ECODIT, Energy Links and CASA-1000 web-portals. As a result, 50+ resumes were received and are under screening by ECODIT.

Starting from 2018, the CASA-1000 project shifted its focus to coordinate the timely completion of procurement and implementation of construction activities which are anticipated for a period of 42 months, and surpassing the life of the Energy Links project. During this period, the IGC Secretariat’s role will be to assist the Implementation Sub-committee (ISC) that will be established by the JWG as a natural successor to the Procurement Committee (PC).