Annex 4: Implementation Support Plan

Annex 4: Implementation Support Plan

1. 
   The Implementation Support Plan describes the support Argentina will require to implement key mitigation measures identified in the PAD. The Plan will seek to ensure that major risks are addressed and the Project can be implemented in a swift manner. The project design already takes these issues into account and provides mitigation options to be backed by the Bank. The Plan will be implemented by the Bank team involved in the operation taking into account country level risks, legal framework, and local context. The Implementation Support Plan is indicative and flexible, relies on experiences and lessons learned from Argentina and elsewhere, and will be revisited during project implementation based on progress made on the ground.
   

2. 
   The Bank strategy to support implementation will rely on continuous monitoring and constant interaction and advice to MEM. Even though MEM will count with proven, capable, and experienced staff, hands-on and constant collaboration and advice will be necessary to overcome the challenges associated to an increase in project scope and boundaries.
   
3. 
   Satisfactory implementation from start will require the preparation of critical tasks in the following areas:
   

1. 
   Legal:
   

1. 
   The Bank team will work closely with MEM to help expedite the effectiveness due diligence; and the signing of all agreements between all relevant stakeholders.
   

2. 
   Technical:
   

2. 
   The team will support the training and enlargement of the MEM team as well as support knowledge transfer between relevant stakeholders (mainly sub-projects’ sponsors).
   

3. 
   Financial:
   

1. 
   The analysis of relevant sub-projects fulfilment of eligibility criteria and other financial aspects.
   

4. 
   Financial management:
   

1. 
   Provide training to MEM and BICE and review processes.
   

5. 
   Safeguards
   

1. 
   Provide training to MEM’s environmental and social teams and to sponsors (as needed); and
   
2. 
   Supervise the implementation of safeguards instruments by MEM.
   

6. 
   M&E
   

1. 
   Support the drafting of terms of reference to prepare activities needed for a successful M&E framework and systems.
   

4. 
   Particular key issues to be addressed also include:
   

1. 
   Implementation capacity
   

1. 
   Argentina’s renewable energy goals may prove too ambitious: The magnitude of the renewable energy generation scale-up required to comply with Law 27191 may over-extend supply chain and implementation capacities, create technical hurdles for the dispatcher, CAMMESA, and overall, prove technically challenging for existing institutions. To mitigate these risks, the proposed operation would support technical assistance activities with GoA and relevant stakeholders. The team will also provide advice to MEM as needed, supervise the implementation of safeguards instruments by MEM, and prepare specific technical and safeguard guidelines and training activities with MEM through knowledge exchanges and sharing lessons learned elsewhere.
   
2. 
   FODER performance risk: There is a risk that BICE, as trustee of FODER, does not perform the actions it is contractually obliged to, for instance not making a payment even though funds are available. However, BICE is a publically owned bank with an established track record. The team has reviewed contractual relationship between GoA and BICE to ensure adequate checks and balances, and will receive notices in certain events of non-compliance with contractual obligations.
   

2. 
   Implementation arrangements
   

1. 
   Inadequate funding to FODER: There is a risk that FODER does not have the required funding to backstop PPA ongoing payment requirements, which could lead to a Put Option amount being due. If FODER does not have the required funds and the GoA does not replenish FODER adequately, this would lead to a call on the IBRD guarantee. The team will continue evaluating the electricity sector to quantify the risk associated with non-payment or late payment by CAMMESA, and the risk that FODER does not receive sufficient funds to backstop ongoing payments.
   

3. 
   Stakeholder involvement
   

1. 
   Lack of projects and facility not being used: Facilities are often designed but rarely meet success. The main reason is that the pipeline of projects is often weak and that key risks are not mitigated. In Argentina, the potential and appetite for renewable projects is a positive indication. During preparation, the team worked with GoA to identify the pipeline and review experiences from other facility support and the Round 1 results proved that there are projects.
   
2. 
   Dissemination of information for sponsors, beneficiaries and relevant stakeholders. Improved dissemination and incorporation of new stakeholders during implementation will be sought.
   
3. 
   Supporting sub-projects in all provinces and utilizing different technologies may be problematic due to lower capacity or lack of experience. The team will support MEM, provinces and sponsors.
   

5. 
   The Bank team will undertake field visits when needed and have discussions with MEM other stakeholders as well as IPPs. During project implementation, it will also maintain a constant presence in the field with at least two supervision missions per year (and even more during the first year of implementation). The team will also support the strengthening of MEM and will develop capacity-building activities and support training workshops for other stakeholders.
   
6. 
   As needed, the team will work together with the implementing agency to maintain a viable delivery model, allocate adequate human resources—in quantity and quality—for and throughout the implementation period and continuously provide valuable guidance through local staff.
   
7. 
   Implementation support will be carried out at the following levels:
   

1. 
   Technical: Technical staff will be located in the Buenos Aires and Washington offices. Additional technical experts will also be used, especially for the development of technical specifications for new technologies deployment.
   
2. 
   Financial and Guarantees: As usual for guarantee operations, specialized guarantee specialists and guarantee lawyers, respectively from the Financial Solutions (GEEFS) and from the Legal Structured Finance & Guarantees (LEGSG) units, will provide advice and support from Washington D.C.
   
3. 
   Safeguards: The Bank will support MEM with Buenos Aires senior staff as well as local experts and consultants.
   

Table 4.2: Skills Mix Required