Public Disclosure Authorized

31-Oct-2023
______________

H. E. Ato Ahmed Shide

Minister
Ministry of Finance
Public Disclosure Authorized

Addis Ababa

Re: Preparation of Proposed Power Sector Reform Investment and Modernization

in Ethiopia (PRIME-1) No. IDA V502-ET
Additional Instructions: Disbursement and Financial Information Letter

I refer to the Advance Agreement (“Agreement”) between Federal Democratic Republic of Ethiopia
(“Recipient”) and the International Development Association (“Bank”) for financing activities
(“Activities”) facilitating activities (“Activities”) facilitating the preparation of the above-referenced First
Power Sector Reform Investment and Modernization in Ethiopia (PRIME-1) Project. The Standard
Conditions, as defined in the Agreement, provide that the Recipient may from time-to-time request
Public Disclosure Authorized

withdrawals of Advance amounts from the Advance Account in accordance with the Disbursement and
Financial Information Letter, and such additional instructions as the Bank may specify from time to time
by notice to the Recipient. The Standard Conditions also provide that the Disbursement and Financial
Information Letter may set out financial reporting requirements specific to the Activities. This letter
constitutes such Disbursement and Financial Information Letter (“DFIL”) and may be revised from time to
time.

I. Disbursement Arrangements, Withdrawal of funds from the Project Preparation Advance, and
Reporting on the uses of funds from the Project Preparation Advance.

(i) Disbursement Arrangements

The table in Schedule 1 of this DFIL sets out the disbursement methods – reimbursement, advance,
direct payment, and special commitment, which may be used by the Recipient, information on registration
Public Disclosure Authorized

of authorized signatories, processing of Withdrawal Applications (including the processing of advances

from the Advance), instructions on supporting documentation, and reporting of advances.

The Disbursement Guidelines for Investment Project Financing, dated February 2017
(“Disbursement Guidelines”), are available on the Bank’s secure website “Client Connection” at
https://clientconnection.worldbank.org and its public website at https://www.worldbank.org. The
Disbursement Guidelines are an integral part of the DFIL, and the manner in which the provisions in the
Disbursement Guidelines apply to the Project Preparation Advance is specified below.

(ii) Withdrawal Applications (Electronic Delivery)

The Recipient will deliver Withdrawal Applications (with supporting documents, “Applications”)
electronically through the Bank’s web-based portal “ClientConnection” at
https://clientconnection.worldbank.org. This option will be effective after the officials designated in writing
by the Recipient who are authorized to sign and deliver Applications have registered as users of “Client
Connection.” The designated officials shall deliver Applications electronically by completing Form 2380,
which is accessible through “Client Connection.” By signing the Authorized Signatory Letter, which can
be delivered manually or electronically, the Recipient confirms that it is authorizing such persons to accept
Secure Identification Credentials (SIDC) and to deliver the Applications and supporting documents to the
Bank by these means. The Recipient may exercise the option of preparing and delivering Applications in
paper form on exceptional cases (including those where the Recipient encounters legal limitations) and
which were previously agreed with the Bank. By designating officials to use SIDC and deliver the
Applications electronically, the Recipient confirms through the Authorized Signatory Letter its agreement
to (a) abide by the Terms and Conditions of Use of Secure Identification Credentials in connection with the
Use of Electronic Means to Process Applications and Supporting Documentation, available in the Bank's
public website at https://www.worldbank.org and “Client Connection” at
https://clientconnection.worldbank.org; and (b) to cause such officials to abide by those terms and
conditions.

II. Financial Reports and Audits

(i) For the Preparation Advance

 Financial Reports

The Recipient shall prepare and furnish to the Bank not later than forty-five (45) days after the end
of each semester, interim unaudited financial reports (“IFRs”) for the activities covering the semester.

 Audits

The audit of the Financial Statements shall cover the entire period of the PPA
implementation. The audited Financial Statements shall be furnished to the Bank by the Recipient not
later than six (6) months after the closing of the PPA.

(a) If, on or before the Refinancing Date, a Refinancing Agreement has been executed by all
of its parties, the Recipient shall have the Financial Statements included in the first audit of financial
statements required under the Refinancing Agreement.

(b) If, by the Refinancing Date, no Refinancing Agreement has been executed by all of its
parties, such audit of the Financial Statements shall cover the period of the Advance, commencing with the
financial year in which the first withdrawal under the Advance was made. The audited Financial Statements
for such period must be furnished to the Bank not later than six (6) months after the end of the Recipient’s
financial year in which the Refinancing Date occurs.

(c) Notwithstanding the provisions of paragraphs (a) and (b) of above, the Bank may request
an audit of the Financial Statements prior to the Refinancing Date, covering such period as is indicated in
its request. The audited Financial Statements for such period shall be furnished to the Bank not later than
six (6) months after the end of such period. Once the audit report is issued, the audit report findings should
be rectified within one-month from the receipt of the audit.
III. Other Important Information

For additional information on disbursement arrangements, please refer to the Loan Handbook
available on the Bank’s public website at https://www.worldbank.org and “Client Connection” at
https://clientconnection.worldbank.org the Bank recommends that you register as a user of “Client
Connection.” From this website, you will be able to prepare and deliver Authorized Signatory Letters and
Withdrawal Applications, monitor the near real-time status of the Advance and retrieve related policy,
financial, and procurement information. For more information about the website and registration
arrangements, or if you have any queries in relation to the above, please contact the Bank by email at
askloans@worldbank.org using the above reference.

Yours sincerely,

______________________________
Ousmane Dione
Country Director for Ethiopia, Eritrea Sudan, and South Sudan
Eastern and Southern Africa Region

Attachments
1. Form of Authorized Signatory Letter
2. Statement of Expenditure (SOE)
 Schedule 1 : Disbursement Provisions

Basic Information
Project Country Federal Democratic Republic of Ethiopia Refinancing
August 31, 2024
Preparation IDA V502- Recipient Ministry of Finance Date
Advance ET Name of the Project First Power Sector Reform Investment and Disbursement The disbursement deadline date is
number Preparation Advance Modernization in Ethiopia (PRIME-1) Deadline Date the same as the refinancing date.
Disbursement Methods and Supporting Documentation
Disbursement Methods Methods Supporting Documentation
Section 2 (**) Subsections 4.3 and 4.4 (**)
Direct Payment Yes Copy of records (e.g., invoices and receipts)
Reimbursement Yes Interim unaudited Financial Report (IFR) in the format provided in Attachment 2 of the DFIL
Advance (into a Designated Yes Interim unaudited Financial Report (IFR) in the format provided in Attachment 2 of the DFIL
Account)
Special Commitments No Copy of Letter of Credit
Designated Account (Sections 5 and 6 **)
Type Segregated Ceiling Variable
Financial Institution -
National Bank of Ethiopia (NBE) Currency USD
Name
Frequency of Reporting Based on up to 6 months cash forecast
Quarterly Amount
Subsection 6.3 (**)
Minimum Value of Applications (subsection 3.5)
The minimum value of applications for Reimbursement, and Direct Payment is USD 100,000
Authorized Signatures (Subsection 3.1 and 3.2 **) The form for Authorized Signatories Letter is provided in Attachment 1 of this letter
Withdrawal and Documentation Applications (Subsection 3.3 and 3.4 **)
The form for Authorized Signatory Letter is provided in Attachment 1 of this letter.
The ASL and all Withdrawal Applications corresponding to this Project Preparation Advance, with their supporting documentation, will be submitted
electronically via the Bank’s “Client Connection” system.
If the ASL and all Withdrawal Applications corresponding to this Project Preparation Advance, with their supporting documentation, will be submitted
manually to the following address:
Delta Center, 13th Floor
Upper Hill, Menengai Road
P.O. Box 30577 - 00100
Nairobi, Kenya
Tel: 254 20 2936 000
Attention: Loan Department
Additional Information

Other
 A local currency account denominated in Birr will also be opened to receive transfers from the Dollar Account. The details of both accounts opened (the
designated and local currency account) including the account signatories are to be submitted to the Bank
 Attachment 1 – Form of Authorized Signatory Letter]

[Letterhead]
Ministry of Finance
[Street address]
[City] [Country]

[DATE]

The World Bank

1818 H Street, N.W.
Washington, D.C. 20433
United States of America

Attention: [Country Director]

Dear [Country Director]:

Re: Project Preparation Advance No. ____-___ (____________)

I refer to the Advance Agreement (Agreement”) between the International Bank for Reconstruction
and Development (“Bank”) and [Recipient Name] (“Recipient”), providing for the above Project
Preparation Advance. For the purposes of Section 2.02 of the General Conditions as defined in the
Agreement, any 1 [one/two/three] of the persons whose authenticated specimen signatures appear below
is/are authorized on behalf of the Recipient to sign applications for withdrawal [and applications for a
special commitment] under this Preparation Advance:

For the purpose of delivering the Applications to the Bank, 2 [one/two/three] of the persons whose
authenticated specimen signatures appear below is/are authorized on behalf of the Recipient, acting
[individually3 / jointly4] to deliver the Applications and evidence in support thereof on the terms and
conditions specified by the Bank.

This Authorization also confirms that the Recipient is authorizing such persons to accept Secure
Identification Credentials (SIDC) and to deliver the Applications and supporting documents to the Bank

1
Instruction to the Recipient: Stipulate if more than one person needs to sign Applications, and how many or which
positions, and if any thresholds apply. Please delete this footnote in final letter that is sent to the Bank.
2
Instruction to the Recipient: Stipulate if more than one person needs to jointly sign Applications, if so, please indicate
the actual number. Please delete this footnote in final letter that is sent to the Bank.
3
Instruction to the Recipient: Use this bracket if any one of the authorized persons may sign; if this is not applicable,
please delete. Please delete this footnote in final letter that is sent to the Bank.
4
Instruction to the Recipient: Use this bracket only if several individuals must jointly sign each Application; if this
is not applicable, please delete. Please delete this footnote in final letter that is sent to the Bank.
including by electronic means. The Bank shall rely upon such representations and warranties, including
the representations and warranties contained in the Terms and Conditions of Use of Secure Identification
Credentials in connection with Use of Electronic Means to Process Applications and Supporting
Documentation (“Terms and Conditions of Use of SIDC”), the Recipient represents and warrants to the
Bank that it will cause such persons to abide by those terms and conditions.

This Authorization replaces and supersedes any Authorization currently in the Bank records with
respect to the Agreement(s) referred to in the subject line of this Authorization.

Signatory Details

Name Position Email ID

[Signatory Name] [Title] [Email]

Specimen Signatures

Signatory Name Signature 1 Signature 2 Signature 3

[User Name]

[User Name]

Yours truly,

/ signed /

______________
[Position]5

5
Instruction to Bank staff: please forward this letter to the Country Lawyer for further processing (Recipient: please
do not delete this note).
Attachment 2 – Interim unaudited Financial Statements

Ethiopian Electric Power (EEP)

Interim Unaudited Financial Report

P176731 - FIRST POWER SECTOR REFORM INVESTMENT AND MODERNIZATION IN ETHIOPIA (PRIME-1) PROJECT PPA

For the quarter ended……

Content

1 Notes to the IFR-Discussion of Financial performance, Notes & Explanations

2 Statement of Sources and Uses of Fund

3 Statements of Uses of Funds by activity

4 Statement of Accounts - Designated Account and Local Account

5 Designated Account (DA) Activity statement

6 DA Documentation Schedule

7 Expenditure Forecast and Cash requirement summary for the next six months

8 Payments Against Contracts subject to the World Bank's Prior Review

Supporting docuemnts and schedules such as account Receivable and Account Payable schedules with age analysis,
9 bank statement, reconciliations, etc.
10 Supporting schedules-e.g. Bank Reconciliation

11 Supporting Documents- Bank Statements, trial balance, etc.

Ethiopian Electric Power (EEP)
P176731 - FIRST POWER SECTOR REFORM INVESTMENT AND MODERNIZATION IN ETHIOPIA (PRIME-1)
PROJECT PPA
Notes to the IFR
For the quarter ended …….

Section 1: Background information about the project

1.1 General information about the project (PDO, Components/sub-components/actvities,
implementing entity, etc.)
1.2 Financial Management (Accounting center, basis of accounting, major accounting policies,
currencies, etc.)
Section 2: Project implementation
2.1Overview of sources of funds
2.2 Overview of expenditures
2.3 Status of budget utilization by project components/sub components
2.4 Variance analysis with summary of actions taken and/or planned to be taken

2.5 Overview of closing balances including analysis of major outstanding advances and payables
2.6 Exchange rates used
2.7 Adjustments to the previous reports
2.8 FM challenges and actions taken and/or planned to be taken
Section 3: Status of action plans
3.1 FM assessment/ supervision action plans implementation status
3.2 Status of action plan to address issues raised in the project/entity audit reports
3.3 Status of action plan to address issues raised in the internal auditors reports
Section 4: Other issues
Implementing Entity: Ethiopian Electric Power (EEP)
P176731 - FIRST POWER SECTOR REFORM INVESTMENT AND
Project: MODERNIZATION IN ETHIOPIA (PRIME-1) PROJECT PPA
Description: Statement of Sources and Uses of Funds
IFR for the Quarter ending:
Reporting Currency: In USD and In Ethiopian Birr
Actual

Description Current Quarter Year -To Date Cumulative to Date

OPENING BALANCES
Cash on hand - -
Cash at bank- Designated Account - -
Cash at bank - Local Account - -
Account receivable - -
Less: Account payable - -
Total Opening Balance (A) - -
SOURCES OF FUNDS
DA Receipts/Replenishment - - -
Direct Payments - - -
Special Commitments Payments - - -
Reimbursements - - -
Refunds - - -
Adjustments (if any) - - -
Contribution by the government - - -
Others (Please specify) - - -
Total Sources of Funds (B) - - -
Total (A+B) - - -
USES OF FUNDS
RAP studies - - -
ESIA Studies - - -
Procurement related support - - -
Institutional capacity building related
- - -
consultancies
Sub-Total Uses of Funds ( C ) - - -
Adjustments (if any) - - -
Others (Please specify) - - -
Total Uses of Funds (D) - - -
Total Available Funds Less Total uses (A+B-D) - - -
Add: Foreign Exchange difference
CLOSING BALANCES - - -
Cash on hand - total - - -
Cash at bank- Designated Account - - -
Cash at bank - Local Account - - -
Account receivable - - -
Less: Account payable - - -
Total Closing Balance ( E ) - - -
Prepared By__________________________ Approved By________________________
Signature_____________________________ Signature __________________________
Date_________________________________ Date ______________________________
Implementing Entity: Ethiopian Electric Power (EEP)
Project: P176731 - FIRST POWER SECTOR REFORM INVESTMENT AND MODERNIZATION IN ETHIOPIA (PRIME-1) PROJECT PPA
Description: Statement of Uses of Funds by activity
IFR for the Quarter ending:
Reporting Currency: In USD and In Ethiopian Birr
ACTUAL AMOUNT PLANNED AMOUNT VARIANCE PPA
Life of Revised Life
Current
Current Cumulative Current Cumulative Cumulative project of Project *
Quarter
Quarter Year to Date to date Quarter Year to Date to date Year to Date to date (Amt) (Amt)
RAP studies
RAP Study for Haromaya, Chelenko and Arsi Robe
Projects

RAP Study for Daye, Shashemene and Durame Projects

RAP Study for Debark and Injibara Projects
RAP study for Kamashi, Limu Genet and Woliso
Projects

RAP study for Fiche, Mehal Meda and Wereilu Projects

Sub total - - - - - - - - - - -
ESIA Studies
ESIA study for Debark and Bensa Daye Projects
ESIA study for Kamashi and Limu Genet Projects
ESIA study for Fiche, Mehal Meda and Werilu Projects
Sub total - - - - - - - - - - -

Procurement related support

Technical and procurement support consultancy for
Component-2 projects
Consultancy service to prepare bidding document and
support the procurement system defense and system
digital twin project
Consultancy service to prepare bidding document and
support the procurement system instrumentation
improvement project
Sub total - - - - - - - - - - -
Institutional capacity building related consultancies
Consultancy services for design institutional capacity
building program on technical design, procurement
and contract management aspects
ESRM and Gender Program Design Consultancy
HR Development Strategy and Roadmap

Electricity Sector Reform Roadmap (ESRR) Consultancy

Consultancy for preparation of an institutional
capacity building program for Petroleum and Energy
Authority (PEA) on electricity sector aspects
Certification Program
Sub total - - - - - - - - - - -

TOTAL PPA EXPENDITURE - - - - - - - - - - -

Prepared By__________________________ Approved By________________________
Signature_____________________________ Siganture __________________________
Date_________________________________ Date ______________________________
 Ethiopian Electric Power (EEP)
P176731 - FIRST POWER SECTOR REFORM INVESTMENT AND MODERNIZATION IN ETHIOPIA (PRIME-1) PROJECT PPA
Statement of Designated Account, Bank a/c ______________
For the quarter ended ……………………

USD Birr
Opening Bank Balance - -

Add: Receipts
Fund received from IDA on… - -
Fund received from IDA on… - -
Fund received from IDA on…
Others (specify) - -
Sub total - -
Fund available for use - -
Less: Transfers and Expenditure/payment
Transfer to Birr accounts - -
Expenditure/payments - -
Others (specify) - -
Sub total - -
Closing Bank Balance - -
Exchange rate at quarter end -
Closing Bank Balance at the rate of quarter end -
Add: Gain or (Loss) on foreign exchange -
Closing Bank Balance after gain/ (loss) of foreign exchange -

Prepared By___________________________ Approved By __________________________

Signature ___________________________ Signature ___________________________
Date ________________________________ Date ______________________________
 Ethiopian Electric Power (EEP)
P176731 - FIRST POWER SECTOR REFORM INVESTMENT AND MODERNIZATION IN ETHIOPIA (PRIME-1) PROJECT PPA
Statement of Local Account, Bank a/c ______________
For the quarter ended ……………………

Birr USD
Opening Bank Balance - -

Add: Receipts
Cash transfer from USD account - -
Others (specify) - -
Sub total - -
Less: Less: Advances and Expenditure/payment
Advances - -
Expenditure/payments - -
Others (specify) - -
Sub total - -
Closing Bank Balance - -
Exchange rate/s/ -
Clsoing Bank Balance in USD -

Prepared By___________________________ Approved By __________________________

Signature ___________________________ Signature ___________________________
Date ________________________________ Date ______________________________
Ethiopian Electric Power (EEP)
P176731 - FIRST POWER SECTOR REFORM INVESTMENT AND MODERNIZATION IN ETHIOPIA (PRIME-1) PROJECT PPA
Designated Account Activity Statement
For the quarter ended….
In USD
Particulars DA-A
PART I (Advances - As per Client records)
1 Cumulative Advances up to end of last reporting quarter/period (less refunds) 0.00
2 Less: Cumulative expenditures paid up to end of last reporting period 0.00
3 Outstanding Advances (book) to be accounted for at the end of last reporting quarter (1 minus 2) 0.00

PART II (Advances - As per Bank Client Connection)

4 Cumulative Advances up to end of current reporting quarter/period (less refunds) 0.00
5 Less: Cumulative expenditures documented with WB up to end of current reporting period 0.00
6 Outstanding Advances (ClientConnection) to be accounted for at the end of current reporting quarter (4 minus 5) 0.00

PART III (DA reconciliation)

7 Opening Advance (book) balance at beginning of current reporting quarter/period (same as item 3) 0.00
8 Add: Advances received during reporting period 0.00
9 Outstanding Advances to be accounted for at the end of the current reporting quarter (7 plus 8 ) 0.00
10 Less: Expenditures for current reporting quarter/period (paid from DA) 0.00
11 Add: Adjustments, if any 0.00
12 Less: Adjustments, if any 0.00
13 Closing Advance (as per project books of records) balance at end of current reporting quarter/period (9 minus 10 plus 11 minus 12 ) 0.00

PART IV (Bank reconciliation)

14 Closing DA balance (as per bank statement) at end of current reporting period, as of xxxx 0.00
15 Add/subtract: cumulative adjustments, if any 0.00
16 Minus: Expenditures for the current reporting period that have not been debited to the DA 0.00
17 Closing DA balance (as per project books of record) balance (14 plus/minus 15 minus 16) 0.00

PART V (Funds requested)

18 Total forecasted expenditures from the DA in next 6 months 0.00
19 Less: Closing Bank balance at the end of current reporting period (item 14 above) 0.00
20 Less: Withdrawal applications in process with the Bank 0.00
21 Fund request from WB for next 6 months (18 minus 19 minus 20) 0.00

Prepared By__________________________ Approved By________________________

Signature_____________________________ Siganture __________________________
Date_________________________________ Date ______________________________
Ethiopian Electric Power (EEP)
P176731 - FIRST POWER SECTOR REFORM INVESTMENT AND MODERNIZATION IN ETHIOPIA (PRIME-1) PROJECT PPA
Schedule of Designated Account (DA) Documentation
For the Quarter ended ……………..
Total Current quarter
documented expenditure to be Amount remaining to be
Advanced amount to date to date documented documented Total in USD
-
-
-

Prepared By___________________________ Approved By ______________________

Signature ___________________________ Signature _________________________
Date ________________________________ Date ____________________________
Ethiopian Electric Power (EEP)
P176731 - FIRST POWER SECTOR REFORM INVESTMENT AND MODERNIZATION IN ETHIOPIA (PRIME-1) PROJECT PPA
Expenditure Forecast
For the next Six months ending………..
Forecast for the 6 months
In Birr In USD
Project components and activities PPA Budget Quarter 1 Quarter 2 Total (Q1 + Q2) Total (Q1 + Q2)
RAP studies
Haromaya, Chelenko and Arsi Robe Projects
Daye, Shashemene and Durame Projects
Debark and Injibara Projects
Kamashi, Limu Genet and Woliso Projects
Fiche, Mehal Meda and Wereilu Projects
Sub total - - - - -
ESIA Studies
Debark and Bensa Daye Projects
Kamashi and Limu Genet Projects
Fiche, Mehal Meda and Werilu Projects
Sub total - - - - -
Procurement related support
Technical and procurement support consultancy
for Component-2 projects
Consultancy service to prepare bidding document
and support the procurement system defense and
system digital twin project
Consultancy service to prepare bidding document
and support the procurement system
instrumentation improvement project
Sub total - - - - -
Institutional capacity building related consultancies
Consultancy services for design institutional
capacity building program on technical design,
procurement and contract management aspects
ESRM and Gender Program Design Consultancy
HR Development Strategy and Roadmap
Electricity Sector Reform Roadmap (ESRR)
Consultancy
Consultancy for preparation of an institutional
capacity building program for Petroleum and
Energy Authority (PEA) on electricity sector aspects
Certification Program
Sub total - - - - -
GRAND TOTAL - - - - -
Prepared By___________________________ Approved By ______________________
Signature ___________________________ Signature _________________________
Date ________________________________ Date ____________________________
Ethiopian Electric Power (EEP)
P176731 - FIRST POWER SECTOR REFORM INVESTMENT AND MODERNIZATION IN ETHIOPIA (PRIME-1) PROJECT PPA
Cash Flow Forecast
For the next Six months ending………..
In Birr In USD
For the next six For the next six
Activities months months
RAP studies - -
ESIA Studies - -
Procurement related support
Institutional capacity building related consultancies - -
GRAND TOTAL - -
Less: Amount to be paid through direct payment/ special commitment - -
Less: DA balance end of the quarter - -
Less: Account receivable balance end of the quarter - -
Add: Account payable balance end of the quarter - -
Net Cash Requirement for the next six months - -

Prepared By___________________________ Approved By ______________________

Signature ___________________________ Signature _________________________
Date ________________________________ Date ____________________________
Ethiopian Electric Power (EEP)
P176731 - FIRST POWER SECTOR REFORM INVESTMENT AND MODERNIZATION IN ETHIOPIA (PRIME-1) PROJECT PPA
Payment Made during Reporting Period
Against Contracts subject to the World Bank's Prior Review
For the Quarter ended ……………..

Date of WB's No WB's Share of Special

Objection to Amount Paid to Amount Paid to Amount Paid in the Commitment/ Direct
Contract Number Supplier Contract Date Contract Amount Contract Supplier to date Supplier to date current quarter Payment No.

Prepared By___________________________ Approved By ______________________

Signature ___________________________ Signature _________________________

Date ________________________________ Date ____________________________