international bank for reconstruction and...
TRANSCRIPT
R E S T R I C T E D
R e p o r t N o. TO-272b
This report was prepared for use within the Bank. It may not be publishednor may it be quoted as representing the Bank's views. The Bank accepts noresponsibility for the accuracy or completeness of the contents of the report.
INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT
APPRAISAL OF THE SECOND STAGE OF
THE GUADALUPE HYDROELECTRIC PROJECT
EMPRESAS PUBLICAS DE MEDELLIN
COLOMBIA
April 27, 1961
Department of Technical Operations FILE COPY
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CURRENCY EQUIVALENTS
U.S. $1 = 7 Pesos1 Peso = U. S. $0. 1431 Million Pesos = U.S. $143,000
APPRAISAL OF TIE SECO-'3 STAGE OP THE
GUADALUPE HYDROELECTRIC FROJ.ECT
Empresas Publicas de Xedellin
Colombia
Page No.
SUMIARY i-
I INTRODUCTION 1
II THE BORROWER 1
Existing Power Facilities 3
III THE P01aER MARIET 3
Conditions in Recent Years 4
IV LOUG RAIGE POIWER PROGRAM 5
V THE PROJECT 5
Description 5
Miraflores Dam and Reservoir 6
Estimated Costs 7
VI F1I1-AE1CIAL ASPECTS 8
Tariffs 8
EPIM Financial Background 8
Present Financial Position of the Power Department 10
Recent Earnings Record 12
Financial Plan 12
Estimated Future Earnings 15
Debt Limitation 16
Rate Covenant 16
Auditors 17
VII CONCLUSIONS 17
,is' of Annexes
i. PEAK LOADS, CAPAMILITIES, AND INSTALLATION SCHEDULE
2, ANNTUAL ENFEGY REQUIREMEtNTS AT IED,ELLIN
30 CONSTRUCTION SCHEDULE
4. FACILITIES OF EPM's POWER DEPARTMNT
5. DETAIL DESCRIPTION OF THE PROPOSED PROJECT
6. TELEPHOVE, WATER SUPPLY AN SEIAGE DEPARTMNTS
7. INCOM5 STATEENTS FOR TELEPRONE, WATER SUPPLY AMD SEWIAGE DEPARTENTS
8. BALANCE SHEETS FOR TELEPHONE, WATER SUPPLY AND SEWAGE DEPIET o-TS
9. BALAMCE SHEETS - EMPRESA DE E];ERGIA
10. CONDENSED INCO1E STATEMENTS - EMFRESA DE ENERC-IA
11. FORECAST OF CASH FLOW 1960-68
12. FORECAST OF INCOME STATEMENTS 1960-68
13. FORECAST OF BALANCE SHEETS 1960-68
Map
LAYOUT OF THE PROJECT AND THE GUA4DALUPE SCHEM4E
APPRAISAL OF THE SECOND STAGE OFTHE GUADALUPIF HYDROELECTRIC PROJECT
COLOMBIA
SUT'IARY
The Bank in May 1959 made Loan 225 CO to the Empresas Publicas deMedellin (ERM) to finance the foreign exchange cost of the first stage ofthe Guadalupe hydroelectric project. The Bank has now been asked to con-sider a new loan to cover the foreign exchange cost of the second stageproject, The project is estimated to cost $29.63 million of which 422 mil-lion would be foreign exchange. This include .i 3. 8 million to cover addi-tional foreign exchange requirements under Loan 225 CO.
ii. The project would comprise the addition of an 18 NW hydro unit inthe Troneras plant, three hydro units of 40 NtW each at the Guadalupe IIIplant, the construction of an earth fill dam, the construction of trans-mission facilities, and the expansion of the Medellin distribution system.The cost of the development is equivalent to 5185 per kilowatt of installedcapacity. The low cost of the hydro installation makes it comparable incapital cost to a thermal installation of equivalent capacity.
iii. Empresas Publicas de Medellin, which would be the borrower is anautonomous agency established in 1955. In addition to operating powerfacilities it also provides the telephone, water supply, and sewage ser-vices to Kedellin. EREts operations have been satisfactory.
iv. EPMts management is conmpetent and its staff has been strengthenedby the addition of engineers in accordance with agreements reached duringnegotiations for Loan 225 CO. Consulting firms are participating in thepreparation of designs and supervision of construction of the first stageand the same consultants would participate in the deslgn and supervisionof the second stage.
v. The need for the power is urgent. Power is now being rationed byEPM. The capacity now under construction will be absorbed by 1963 and thepower of the proposed program should be absorbed by 1968.
vi. The financial position of EDN's four departments is sound. TheBank has obtained assurances that the assets of the Power Department wouldnot be used by other departments and that each of the departments wouldcontinue to be maintained in a sound financial position.
vii. EPM was allowed an increase in electricity tariffs of 33%, whichwent into effect on July 1, 1960, increasing the average revenue per kwhfrom 4.5 centavos (6.4 US mills) to 6 centavos (8.6 US mills). The tariffsappear adequate to cover all operating expenses, debt service and taxes,and provide sufficient funds for EPM to finance approximately 40% of newinvestment in power facilities. EPM has agreed to maintain tariffs atlevels which will maintain this amount of internal cash generation.
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viii. The financial prospects of Eal's Power Department during the nineyear period 1960-68 appear to be good. Currently, the return on the invest-ment and the debt service coverage are satisfactory. The debt/equity ratiois 46/54. The financial forecast, based on present conditions, shows thata satisfactory return on the investment would continue for the next fewyears but it also indicates a declining trend at the end of the period,Timely action in securing a rate adjustment will be necessary to prevent thedownward trend in the rate of return on the investment.
ix. The project is sound and is a logical step in the expansion ofEal's facilities. It is suitable for a Bank loan in an amount equivalentto 'iv22 million for a tenr of 25 years including a period of grace of fiveyears on amortization payments.
APPRAISAL OF THE SECO1ND STAGE OFmEf GUADALTUPE HYDROELECTRIC PROJECT
COLONBIh
I. INTRODUCTION
1, The Empresas Publicas de Medellin (EPM) has asked the Bank toconsider a loan to finance the foreign exchange cost of a power expansionprogram, which consists of the installation of three 40 MW hydro units atGuadalupe III power plant, the installation of the second 18 MW hydro unitat Troneras power plant, the construction of Miraflores dam and storagereservoir 3 and the transmission and distribution facilities for the in-creased power output.
2. In May 1959 a loan (225 CO) of $12 million was made to financethe development of 98 MW of electric power on the Guadalupe River. Thetotal original cost of that project at the time the loan was made wasestimated to be Ps 139 million, The project is now estimated to costPs 178.6 million or 28.5% more than the original estiimate 0 This increaseis substantially all in the civil works. The costs for such works werebased on prices prevailing in Colombia in late 1958 at which time localprices had not reflected the impact of the peso devaluation of Mlay 1957.Furthermore, the estimztes were based on the assumption that local con-tractors would be the successful bidders on the earth fill dam and otherrelated civil works. Foreign contractors, who required substantiallymore foreign exchange than Colombia contractors were, however, the success-ful bidders. This together with the increase in the estimated cost of theproject has resulted in a substantially greater foreign exchange require-ment. As a consequence EPMI is now requesting the Bank to include in theproposed loan an additional $3 million for higher costs plus $800 thousandfor interest during construction or a total of $3.8 million to aid infinancing the increased foreign exchange requirements of the first project,
3. The total cost of the proposed project is estimated to be theequivalent of $25.83 million which together with the additional require-ment of $3.8 million for Loan 225 CO totals $29.63 million. Of this amount$22.0 million would be required in foreign exchange and this is the amountof the requested loan,
4. This report covers an appraisal of the project. It is based oninformation supplied by EPM, a detailed report by their consulting engineers,and on field studies and discussions by a Bank mission which visited theproject during November and December 1960.
II. THE BORROWER
5. EPM was established by charter in 1955 through powers given thecity of IvIedellin by Federal law. Concurrently the existing municipally-operated utility was abolished and its assets and liabilities turned overto EPH. EPM's charter makes it an autonomous agency to provide power,telephone, water and sewage services in the MedelliU.. area. Upon itsestablishment EPM obligated itself to pay taxes and assumed 855% of the out-standing municipal dollar bonds on which the city had defaulted. The cityreceived no other consideration for the transfer of the utility assets.
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However, if EPM should at any time cease to exist its properties wouldrevert to the municipality.
60 EPMNs seven member Board of Directors includes the Mayor ofMedellin, who is president of the Board; two members selected by and fromthe City Council; three members appointed by the Mayor from names suggestedby the Bank of the Republic, the National Banks of Medellin, and the NationalAssociation of Industrialists; and one member appointed by the Mayor fromnames submitted by the l4edellin Chamber of Commerce and the NationalFederation of Merchants. Except for the Mayor, the terms of office are fortwo years and are staggered to provide continuity. The Board members maybe reelected indefinitely.
7. The Board controls broad policy. It does not establish powertariffs which are controlled as explained in paragraph 30. It employs ageneral manager who is responsible for administration and operation ofthe entity. The present general manager assumed office on August 1, 1959and has demonstrated his executive ability developed over many years ofexperience as manager of one of the large textile plants in Medellin. Thefour branches of power, telephone, water, and sewage are eached headed by asupervisor and are operated as independent sections, except for administrativedirection.
8. In the power branch the manager is assisted by a qualified tech-nical staff, which has been augmented in accordance with commitments madeto the Bank during negotiations of Loan 225 CO by the addition of qualifiedengineers to the planning and general engineering groups and by the employ-ment of a technical engineering advisor with wide experience in the planning,design and construction of hydroelectric developments.
9, During the discussions preceding the consideration of the firstBank loan for financing power development in I4edellin the Bank insistedupon reorganization of EPM to give it autonomous powers free from the controlsassociated with the Mqunicipal government, and with a board of directorsselected principally from outside the city council. The 1955 chartergranted EPM all the powers and organizational structure considered essentialby the Bank. Upon making the loan, assurances were given by EPM that theBank would be notified promptly of any amendments or changes in laws whichwould affect EPMIs status or operations. In view of the Bank's interestin the independent character of Empresas, assurances have been obtainedthat the Bank will be consulted before EPRAs Board of Directors introducechanges in EFp14s statutes.
10. Planning and the preparation of a report on the project forwhich a loan is requested was performed by Integral Ltda, of Medellin. Thisfirm is also general consultant on all expansion work which EPM now has
under construction. Jointly with Gannett, Fleming, Corddry and CarpenterInc., Harrisburg, Pa., Integral is responsible for the design andconstruction of the Troneras dam, Troneras powerplant, and the Tenchediversion works, and jointly with Italian Edison, MiUan, Italy, Integralis responsible for the design and construction of the Guadalupe IIIpowerplant and appurtenant works. The relationship between the EPv andits various consultants is good and the work of the consultants issatisfactory. EPM through its own staff is performing engineering workfor the substation and distribution facilities.
11. Past experience indicates that with the plarned assistance ofconsulting engineers EPM is fully capable of accomplishing constructionof the project.
Existing Power Facilities
12. At present the Power Department owns and operates four hydroplants with a total name plate capacity of 136 ¢MW as described in Annex 4.At sustained overload the plants are capable of an output of 146 pvil Inaddition EPM has under construction 98 WJ of capacity in two additionalhydro plants, described in detail in Annex 4, which the Bank is assistingto finance under Loan 225 CO. These are the Guadalupe III powerplantdesigned for six units of 40 M1J each, two of which are now being installed;and the Troneras powerplant designed for two units of 18 KT each, one ofwhich is being installed initially. The transmission system currentlytotals about 130 km of double circuit 115 Kv line. The construction ofapproximately 70 1km of additional double circuit 130 KY transmission linesis under way.
III. THE PCTER MARvKET
13. The EPM power system serves Nedellin and a nunber of smalladjacent corxaunities. In addition bulk supplies are to be provided to anew public organization, the Electrificadora de Antioquia, for distributionto small towns and rural customers in the Department of Antioquia.
14. From 1938 to 1960 the population of the service area of ELP hasincreased from 232,800 to 843,400 or at an average annual rate exceeding6 percent. This high rate has been mainly due to a high birth rate andimmigration into the area. This report assumes that this population growthrate will be maintained in the future and the service-area population,estimated to be 843,400 in 1960, should reach 1,120,000 in 1965 and1,480,000 in 1970.
15. EPM has kept reliable power statistics for more than 30 years.Since 1933 the system load has grown at a compound annual rate ofapproximately 11%, although the system has been subjected to intermittentperiods of power shortage caused by inadequate plant capacity and waterdeficiencies. The load growth for the Empresas system is illustratedin Annex 1 (Power) and Annex 2 (Energy).
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16. The plan to sell power to the Electrificadora de Antioquia willadd a substantial market area and load to the EPM system. In addition EPMis now starting studies to determine the advisability of connecting itssystem with other major power systems in Colombia. Interconnecting lineswould greatly enlarge the possibilities of sales and transfers of electricalenergy between population centers in Colombia and establish greaterdependability in the interconnected systems.
17. The Medellin area now enjoys low power rates averaging only 6centavos per kwh. Average consumption for domestic customers is high,exceeding 400 kwh per month for each customer. It is anticipated thishigh rate of use will continue, and the rapid load growth can be meteconomically because of the very favorable natural conditions for hydro-elec-tric development.
Conditions in Recent Years
18. In 1958 the generating equipment of the Rapresas system wascapable of meeting the peak demand with a very slight margin of excesscapacity, but without reserves. In 1959 with 136.0 Mi of capacity thepeak load of the system had reached 147.5 MW. By operating the generatingequipment at the maximum overload capacity it was possible to reach anoutput of only 146 WM, hence it was necessary to curtail consumptionl and topurchase power from industries equipped with generating plants. By early1960 the maximum peak on the system had reached 149 iW and on February 16,1960 it was necessary for EPM to put into effect load restrictions, Byrotation sections of the city are cut off from service for a half to fourhours per day depending on the availability of power. EPM tries to confinethis rationing to domestic consumers so as to maintain the industrial growthof the community. Several industrial circuits which serve the majorindustrial users are kept in service at all times. The problem of inadequategenerating capacity in the system is compounded by a shortage of waterduring the dry season which limits the energy capability of the system.
19. Two large textile plants adjacent to Medellin generate their ownpower, and have 35 VW of installed capacity. Practically all other largefactories are equipped with standby units to meet their load requirementsat times of power rationing. Such plants aggregate 13 MWI.
20. The industrial power installations result from the need for firmdependable power which Empresas has not always been capable of furnishing,and from the production of electric power as a subproduct of factory steamrequirements. There has consequently been a reduction of E 1M sales forindustrial use, In recent years industrial consumption amounted to slightlyover 24$ of total kwh sales as compared to more than 30/> prior to 1955.
21. Assuming a continuation of the 11%G rate of growth of past years theestimated figures for future years are given below and are compared withthe actual results for 1959:
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Forecast of Growth of Peak Loads ard Consumption
1959 l92i2 1969 1970
Peak Loads (in 41! at the plants) 147.5 285 440 488
Consumption (sales in million kwh)
Industrial 157.2 320 508 572
Other 487.0 840 1212 1338
The use of the 11% rate of growth for load projection is reasonable consideringthe population increase, the possibility of serving additional areas throughthe Electrificadora, and the probability that industrial consumption willexpand when a dependable source of power is again available. Other detailsof annual energy requirements are shown in Annex 2.
IV. LOING RANGE POWER PROGRAM
22. A long range program of expansion extending into 1968 is proposedby EPM to provide installed capacity of 472 MN by that date. It is nowenvisaged that this development will occur in several stages although thedetail plans for the future program (principally the Nare development) arenot yet ccmplete. It appears from the information available that thesedevelopments are feasible and the capital cost will be low.
V. TH PFROJECT
Description of the ProJect
23. The project which the Bank has been asked to assist in financingwould increase the generating capacity of the EP4 system by 138 14W, andincrease the energy production by approximately 690 million kilowatt hoursannually. The location of the project is shown on the map. It wouldconsist of:
a) The installation of the second 18 1MW unit of the Troneras powerplant,
b) The installation of the third, fourth and fifth 40 MW units of theGuadalupe III powerplant.
c) The construction of the Miraflores dam and reservoir on the Tencheriver, together with access road.
d) The construction of additional transmission, distribution and sub-station capacity.
Additional details of the project are given in Annex 5.
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214, In addition to the funds for the facilities of the proposedproject there is need for additional foreign exchange for the project beingconstructed under the first loan as exolained in paragraph 2. With interestduring construction this additional requirement amounts to $3.8 million.
25. Inasmuch as the project is an extension of the work underLoan 225 CO the proposed project will be facilitated by the work alreadycompleted or now being performed. Preliminary engineering plans for allfeatures of the project are complete. Preparation of final designs andspecifications can proceed without delay for the Guadalupe III plant inas-much as the units will be similar to the first two units which are now onorder with Brown-Boveri and Neyrpic. Designs have been started for theTroneras powerplant, both for the first unit financed under Loan 225 C0,as well as for the second unit. Bids for Troneras powerplant equipmenthave been requested. Preliminary plans for the Miraflores dam have beencompleted and preparation of final plans will be started as soon as fieldinvestigations are completed. In the past EPM has requested bids on aninternational basis for performance of all major construction and purchaseof principal equipment items and EPM proposes to continue this practice inthe future.
26. The three 40 IqW units of the Guadalupe III powerplant are scheduledfor completion in October 1964, April 1965 and December 1965, and the secondunit of the Troneras powerplant in October 1963. The Miraflores dam is tobe completed by the end of 1964 and the reservoir should be filled in 1965to provide seasonal storage. Prior to the filling of Nliraflores reservoir,the units could be operated from the normal river flows and from storageavailable in Troneras reservoir. The detail construction schedule is shoimin Annex 3.
Miraflores Dam and Reservoir
27. The M-Iiraflores reservoir would provide 80 million cubic metersof active storage for use during dry periods to supplement the normal riverflows. Availability of these stored waters in the system permits theinstallation of the proposed additional units. Hydrologic records andstatistics which are available indicate that there is sufficient run-offto operate the system as planned. W hile only limited river discharge recordshave been obtained at the darn site, they have been complemented by correlatingrecords obtained elsewhere on the Tenche river, and on adjacent rivers. Thespillway would be of the morning-glory type discharging into the diversiontunnel required for the construction of tne dam. Geological features of boththe dam site and reservoir are typical of the region. Quebredona dan hassuccessfully been built, and Troneras dam is being built on foundationssimilar to and from earth materials comparable to those found at theMiraflores site. Investigations show that sedimentation in the Mirafloresreservoir can be adequately cared for by providing 20 million cubic meters ofsilt storage in the reservoir, which should assure 80 million cubic metersof active storage in the reservoir for 150 years. Detailed investigationsand studies are now being made to confirm the preliminary hydrological,structural, and geological aspects of the dam.
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Estimated Cost
28. The estimates of cost are based on unit prices prevailing in theproject area in late 1960 and take into consideration the bids received byEPM for similar types of work and thus they are appreciably more reliablethan estimating data used for Loan 225 CO. Physical contingencies for allwork have been computed at the rate of 20% for the peso costs and 15% forthe dollar costs which is reasonable considering the current status ofinvestigation of the project. The estimates of cost of the principal featuresof the project and the total estimated cost including the $3.8 millionrequired to supplement Loan 225 CO are as follows:
In millions of Pesos and Dollars
Foreign Local Total CostCurrency CurrencyCosts Costsin P i n in $ in Ps
Troneras Powerplant (secondunit only) 0.94 0.12 1.06 7.42
Units 3, 4 and 5 - Civil workand equipment for expansionGuadalupe III 8.12 1.74 9.86 69.02
Miraflores Dam 1.14 1.50 2.64 18.48
Distribution System expansion 2.75 2.61 5.36 37.52
Engineering, Administration,and Corsultants 0.69 0.47 1.16 8.12
Contingencies 2.06 1.19 3.25 22.75
Additional Foreign Exchangefor Loan 225 CO 3.C0 - 3.00 21.00
Interest and other charges 1)during Construction 3.30 - 3.30 23.10
Totals in dollars 22.00 7.63 29.63
Equivalent in Pesos 154.C0 53.41 207.11
Rate of exchange: 7.0 Ps = JS% 1.00
1) Includes $8co thousand interest during construction on the additionalforeign exchange for Loan 225 CO.
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29. The total cost of the project ($25.83 million, including trans-mission and distribution costs) amounts to about l185 per kilowatt. With theproject added to the system the cost of system energy including transmissionand distribution costs is estimated to be 4.l centavos (about 5,86 US millsper kwh). The low cost of the hydro installation makes it comparable incapital cost to a thermal installation of equivalent capacity. Under theseconditions annual costs for a thermal plant would obviously be higher.
VI, FINANCIAL ASPECTS
Tariffs
30. The tariffs of electric public utilities in Colombia, bothprivately and publicly owned, are subject to the approval of theSuperintendencia de Regulacion Economica, a recently created Governmentagency.
310 The retail rates at which energy is currently sold in Medellinwere increased by 33% on July 1, 1960, by authorization of the Ministerio deFomento. Current rates result in an average revenue of about 6 centavbs(8.6 US mills) per kwh, having been increased from 4.5 centavos (6.4 US mills).
320 The rate structure now in effect penalizes the large residentialconsumer by an ascending rate. A demand charge plus a uniform rate forenergy is used for the commercial and industrial consumer. Up to the preseiht,there has been little incentive for EPIM to promote the sale of energy by adecreasing rate for greater consumption, because of shortages in production.If an adequate energy supply were available, it would be logical to adopta rate structure which would promote greater energy consumption by individualcustomers.
33. On the basis of the foregoing, EPM has assumed average revenuesof 52 centalros (7e4 US mills) per kwh during 1960, or the average of ratesbefore and after July 1, 1960. After 1960, the average price of 6 centavos(8e6 US mills) per kwh has been assumed. These average rates have been usedin the preparation of the financial forecasts. St present these rates areadequate to cover all operating expenses, debt service and taxes, and providesufficient funds for EFM to finance a reasonable portion of new investmentin power facilities. However, as EPPI' s financial position declines by 1967,timely action will be necessary to secure a rate adjustment.
EPMI Financial Background
34. As indicated above (see paragraph 5), EPM owns and operates notonly the electric power system, but also the telephone, water supply andsewage systems of Pedelli01. Each of the four departments is independentlyadministered with separate and independent accounts. On December 31, 1955,
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the title to the assets and liabilities of the four departments was trans-ferred to EPM by the Mumicipality of Medellin with no change in their bookvalue. The municipality received no consideration for this transfer exceptthat, by agreement with EPM, the municipality was relieved of 85% of thedebt service on its 3% US dollar bonds due 1978.Y The assumed 85% of theservice of the municipal debt was apportioned among EPM's four departments.The Power Department was allotted 70%, Water Supply 8%, Telephone 5% andSewage 2%.
35. Between 1948 and 1960 these 3%o bonds have been purchased by asinking fund at substantial discounts, and on October 31, 1960 the outstandingdebt assumed by EPM had been reduced to abouLt 4`3.26 million, of which thePower Department's quota was '112.68 million or about Ps 18 million.
36. The accounts of EPM's four departments are maintained separatelyand there are no consolidated statements. The departments' balance sheetsoriginally did not reflect the assumption of the municipal debt, althoughthe servicing of this obligation was deducted from operating revenues asa tax payment would be This has been changed, and the balance sheets ofDecember 31, 1959 include this municipal debt as a long-term obligation.
37. Furthermore, a provision was incorporated in EPII's statutes wherebyEPM pays an annual tax to the Municipality of Medellin calculated as apercentage of total gross revenues of each of the four departments andamounting to 4.425% for Power, 2% for Water supply, 3.1$ for Telephone and2.5% for Sewage.
38. The 1959 Loan Agreement provides that EPM may not use the revenuesor assets of the Power Department to meet obligation-s of any other department.Similar assurances have been given with respect to the proposedloan. It would be impractical, however, for the various departments to borrowfrom Banks for temporary cash needs instead of utilizing monies available inthe general fund. In this connection the Bank did not obiect to a resolutionpassed by EPMt s Board of Directors in February 1960, which put a 11mit onthe amounts and on the time for current departmental overdrafts 4'
2, The City of Medellin criginally sold two issues of tUS dollar bonds in1926 and 1928 for the purpose of financing municipal public utility works,but had defaulted in 1931. A reorganization plan wient into effect in July1948 by which every US t^l00 of old bonds with the unpaid interest couponswere offered to be exchanged for new bonds at the rate of US 8'120. BetweenJuly 1948 and October 31, 1960 new bonds for the total amount of $5.31 millionhad been exchanged, EPMT s portion amounting to `4. 52 million. At October 1960a small amount of defaulted bonds, equivalent to about $192,000 of new bonds,remained unexchanged.2 The time limit is 3 months. The amounts are the following: Water,Ps 1.5 million; Sewage, Ps 0.5 million; Power, Ps 5 million, and Telephone,Ps 2 million. At October 31, 1960 the Water Supply Department had borrowedPs 481,000 from the Telephone Department.
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39. Only the financial prospects of the Power Department have beenappraised. However, a brief description of the other departments' presentposition and future program is given in Annex 6. It is also noted that atOctober 31, 1960 the other departments' net fixed assets, including workin progress, accounted for about 39% of EPM;s total. The financial forecastsindicate that the aggregate assets of these departments will continue to besmaller than those of the Power Department.
40. Historical financial data pertinent to the departments other thaziPower are included in this report;. Annexes 7 and 8 show condensed incomestatements of EPM's Telephone, Water Supply and Sewage Departments for theyears 1956-59 and for the first 10 months of 1960 and condensed balancesheets as of December 31, 1956 to 1959 and as of October 31, 1960. TheWater Supply Department had a rate increase of about 30%K early in 1960.Taking this into consideration, each department reported good earnings,satisfactory returns on the investment at historical value and reasonabledebt/equity ratios.
Present Financial Position of the Power Department
41. Annex 9 shows condensed balance sheets of EPM's Power Departmentfor December 31, 1955 to 1959 and for October 31, 1960. Vet fixed assetsas of October 31, 1960 totalled Ps 168.2 million as follows:
Fixed Assets Millions of Pesos
Power plants 85.1Transmission and distribution 36.oLand and buildings 12.3Other 6
Gross fixed assets 139.5Less depreciation 22.0
Net fixed assets 117.5Work in Progress 50.7Net fixed assets and work in progress 168,2
42, In 1957 and 1958 about Ps 12 million was added to fixed assetsto offset the devaluation of the peso in the Power Department's foreigndebt. Fixed assets were also written up by Ps 13 million in 1959 to offsetthe inclusion of the municipal debt in the liability side of the balancesheet. However, if the net fixed assets in 1960 amounting to Ps 11765million had been revalued in proportion to the increase in the exchange rateof the peso to the US dollar during the ten-year period 1951-60 (from Ps 2.5in 1951 to Ps 7 to the dollar in 1960), the new value of the Power Department'snet fixed assets would have then been approximately Ps 280 million.y
2/ This figure of Ps 280 million is obtained by taking the net fixed assets,which have not been revalued, amounting to Ps 90.5 million (Ps 117.5 millionminus Ps 27 million of foreign debt exclusive of the IBRD loan 225 CO whichfinances work in progress), increasing them by 280% (equal to the increase ofthe peso exchange rate from 2.50 in 1951 to Ps 7 to the dollar in 1960) to thenew value of Ps 253 million, and adding thereto Ps 27 million of assets whichhave already been revalued. This revaluation applies to plysical assets whichwere in existence in 1951,
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43. On October 31, 1960 funded debt totalled Ps 68.1 million. Theequity was Ps 103.3 million and consisted of the accumulated surplus at thetime of the transfer, Ps 47.7 million (December 31, 1955), plus earnnedsurplus to October 31, 1960 of Ps 55.6 million. As of October 31, 1960 EPIMcapitalization comprised:
Long-Term Debt
Peso Debt (millions of Pesos)
7% Bonds due 1969 2.7 1.56% Bonds due 1962 .5 .37% Bonds due 1973 6.8 4.06% Notes of Banco de la Republica and
Fondo de Establizacion due 1962 1XL .8Total Peso Debt 11.4 6.6
ForeijgnCurrency Debt
3% YMnicipal foreign debt due 1978 18.O 10.5?7% Foreign suppliers due 1960 .3 .24-bo Notes of Ex-Im Bank due 1967 8.7 5.16%o IBRD Loan 225 GO due 1984 242 17K3
Total foreign debt 56.7 33.1Total debt 68.1 39.7
-hnijt 103.3 60.3
Total capitalization 171.4 100.0Debt/Equity ratio 40/60
44. The largest internal Bond issue runs to 1973, the 3% US dollarissue runs to 1978 and the IBRD Loan 225 CO to 1984. The remaining issueshave relatively early maturities.
45. The foreign debt, which was carried in the 1958 balance sheet atthe exchange rate of US$1 = Ps 8, has been restated at Ps 6.70 in the 1959balance sheet with the exception of the IBRD Loan which is carried at Ps 7to the dollar. The difference was entered into a newly created reserve forfluctuation in the rate of exchange. EPM intends to adjust all the foreigndebt at the rate of exchange prevailing at December 31, 1960.
46. The first item in the above table represents two public issuesmade in 1946 and 1949, totalling Ps 5.7 million, for the financing of theinitial construction of the Rio Grande and of the Ouadalupe No. 2 plants.Substantial additional funds needed to complete the project were obtainedby requiring the electric consumers to pay double the amount of their electricbills during two years 1951 and 1952. For this supplementary payment consumersreceived 6%o 10-year bonds. The following year, 1953, the holders of these 61bonds were offered 7% 20-year bonds par for par in exchanze. Ps 8.4 millionof the 7% bonds were issued of which Ps 6.8 million were outstanding at
-12 -
October 31, 1960. There were also outstanding at that time Ps 0,,5 million ofthe unexchanged 6% bonds.
47, In 1948 and 1949 new 6% loans were obtained from the Banco de laRepublica and the Stabilization Fund for an aggregate amount of Ps 7.4 millionfor the construction of the Rio Grande and Guadalupe No.2 plants. Both issuesmature in 1962.
48. The 15-year Ex-Im Bank Loan ($2.6 million) was obtained in 1952 forfinancing electrical equipment for the Rio Grande plant; as of October 31,1960 it had been reduced to about M-1.3 million. Tho medium-term loans fromforeign manufacturers which were contracted in 1955 and 1957 for equipmentinstalled at the Rio G..rande and Piedras Blancas plants, were paid off at theend of 1960.
49. The municipal debt has been discussed in paragraphs 34 to 36. The1959 IBRD Loan will be disbursed by the end of 1962 and amortization paymentswill start in 1963 and terminate in 1984.
Recent Earnings Record
50. Condensed income statements of the Power Department for the years1955-59 and for the first 10 months of 1960 are shown in Annex 10. Annualsales of electricity increased 38% from 465 million kwh in 1955 to 644 millionkwh in 1959. During the first 10 months of 1960 sales of electricity amountedto 587 million kwh and gross revenue to Ps 30.2 million.
51. Annual gross revenues from sales of electricity increased fromPs 16.6 million in 1955 to Ps 29.2 million in 1959 or 76%. This was due inpart to the fact that the average revenue in centavos per kwh increasedfrom 3.57 (5.1 US mills) in 1955 to 5.2 (7.4 US mills) in 1960.
52. Net income from operations, after depreciation and tax equivalentsbut before interest, increased from Ps 8.8 million in 1955 to Ps 14.8 millionin 1959 or 68%. Net income from operations during the first 10 months of 1960amounted to Ps 17.4 million. The return on net fixed assets, including workin progress, during the period 1955-60 ranged between a high of 13.1o and a lowof 10%. At October 31, 1960 it was 10.3%. These relatively high rates ofreturn reflect the undervaluation of fixed assets. Interest payments werecovered 4.2 times in 1955 and aroumd 6 times during 1956-59. For the 10 monthsended October 31, 1960 the coverage was 5.5 times.
53. The income statements show relatively large annual net profits aftermaking all payments including interest. These profits have also been animportant source of cash for expansion.
Financial Plan
54. A nine-year forecast (196c-68) of sources and applications of fundsis given in Annex 11. To meet the forecast demand for power, EPM requiresa long-range program of plant additions involving considerable capital
- 13 -
expenditures. It is estimated that the total expenditures for the nine-yearconstruction program 1960-68 amount to Ps 741.7 million ($P106 million) .This program includes the Guadalupe project financed by Loan 225 CO, thepresent project, the Nare project and future expansion program.
55. A summary of costs and funds assumed to be available forconstruction during the nine-year period 1960-68, including interest andother charges during construction follows:
Cost of Construction Progrm (1960-68)
US DollarsPesos Equivalent
(in millions)
Guadalupe project (Loan 225 CO) 133.3 19.1Second stage of the Guadalupe project
(Proposed IBRD Loan) 163.3 23.3Ware project (Santa Rita) 258.8 37.0Future expansion program 2J 123.8 17.7Total construction 679.2 97.1
Interest during construction financed byBank Loan 225 CO and proposed loan 35.1 5.0
Interest during construction to be paidby EPM for Nare project and futureconstruction 27.4 3.9
Total interest during construction 62.5 8.9
Total cost of program 741.7 106.0
Estimated Sources of Funds
Balance of IBRD Loan 225 CO 64-42/ 9.2 80Proposed IBRD Loan 154.0 22.0 21%/,Foreign currency loan for Blare 154.0 22.0 21%Foreign currency loan for future expansion 80.5 11.5 11%
452.9 64.7 61%
Internal cash generation 288.8 -41.3 39,<07L1.7 106.0 _C__
1/ This amount does not include expenditures of Ps 27.7 mdllion made in 1959on the Guadalupe Project (Loan 225 CO).
/ Construction expenditures in 1967 and 1968 only. This is a four-yearprogram for the period 1967-70 and the total cost would amount to Ps 370million (U52.9 million).
]/ This amount does not include disbursement of Ps 19.6 million equivalentmade in 1959.
- 14 -
56. For the purpose of calculation, the proposed Bank loan has beentaken at 5-3/4% interest and a term of 25 years, including a grace periodof five years during construction. Amortization is calculated with equalsemi-annual payments of ccmbined principal and interest and is assumed tobegin in 1966 and end in 1985.
57. No definite plans have been made for financing the Nare and futureprojects. However, it has been assumed that the foreign currency borrowingfor the Mare project would amount to Ps 154 million ($t22 million) and wouldbe provided by a foreign currency loan made in 1964 bearing 5 3/L4 interestand running for a period of 25 years including 4 years of grace forconstruction. The foreign currency borrowing during the first two yearsof the future expansion program, 1967-68, would amount to Ps 80.5 million($11.5 million)V2 and the terms would be similar to those for the Nare Loan.It is also assumed that interest during construction on the two last loanswould be paid by EPM out of revenues.
58. Local currency requirements for the above nine year program,including interest during construction on the future foreign currency loans,would amount to Ps 288.8 million and would be covered by internal cashgeneration. It is estimated that about 3976 of the nine year constructionprogram would thus be financed.
59. Construction expenditures for the project now proposed to theBank for financing, and amounting to Ps 207.4 million, are expected to beincurred during the period 1961-65. Construction cost and sources of fundoare estimated as follows:
Cost of Proposed Project (1961-65)US Dollars
Pesos Euivalent(in millions)
Second Stage of the Guadalupe Project 163.3 23.3Interest during construction 17.5 2.5
Total 180.8 25.8
Foreign exchange addition to the firststage of the Guadalupe project financedby Loan 225 C0 21.0 3.0
Interest during construction 5.6 .826.6 3.8
Total cost of construction program (1961-65) 2074A 29.6
Estimated Sources of Funds
Proposed Bank loan 154.0 22.0 74%Internal cash generation 53.4 7.6 26,
207.4 29.6 __
1 The total amount of this loan would be Ps 197.4 million ($28.2 million)and disbursement would occur during the four-year period 1967-70.
- 15 -
60. The proposed Bank loan of $22 million (Ps 154 million) wouldcover 74% of the total cost of the program including $3 million (Ps 21million) of additional foreign exchange for the Guadalupe project financedby Loan 225 CO and interest during construction amounting to W3.3 million(Ps 23.1 million). No financial contribution can be expected from theMunicipality. ER4 expects to provide all local currency through internalcash generation for the proposed project which will double its presentgenerating capacity, as well as for the large expansion program thereafter.
Estimated Future Earnings
61. Forecast of income statements for the nine years ending in 1968are shown in Annex 12. The following assumptions have been made:
a) revenues from sales of electricity are based on the present averagerate of 6 centavos per kwh. For the purpose of forecast no future increasein tariffs has been taken into consideration;
b) total operating expenses, including maintenance and administration, andmunicipal taxes would increase about 10% per year as a result of expansionof the system;
c) the power department will continue to pay as a tax to the City ofMedellin 4.h25% of its total gross revenue;
d) depreciation will continue at the present rate of 3% of the averagevalue of the plant (at historical cost) in service during each year. Thedepreciation rate is high for a purely hydroelectric system but in part off-sets the undervaluation of the assets.
62. On the basis of these assumptions, the financial position duringthe nine years would be as follows:
a) net income from operations, after depreciation but before interest,should increase from Ps 20.4 million in 1960 to Ps 46.2 million in 1968.The return on net fixed assets in operation would range between 17.4% in1960 and 7% in 1967, the average being 9.2% during the nine year period.If work in progress were included the return would range between 10.7% in1961 and 5.9% in 1968, the average being 7.3%;
b) net profit after interest charge would rise from Ps 18e2 million in1960 to Ps 31.9 million in 1965 and would be Ps 24.2 million in 1968;
c) cash receipts from operations should cover debt service (includinginterest during construction financed by Bank loans) 2.8 times in 1960,2.7 times in 1963 (when amortization payments would start on the Bankloan 225 CO), 1.9 times by 1966 (when amortization payments would starton the proposed Bank loan) and 1.8 times in 1967 and 1968;
d) net income from operation would cover interest payable (including in-terest during construction financed by Bank loans) 4.3 times in 1960; thecoverage would decline to 1.8 times by 1968 mainly due to the large inter-est payments on the foreign currency loans;
- 16 -
e) the year-end debt/equity ratio would be 46/54 in 1960, 59/41 in 1966and 58/42 in 1968 (see Annex 13).
63. The nine-year forecast, based on present conditions, indicatesa declining trend for EPM's financial position at the end of the period.By 1967 the return on net fixed assets in operation would drop to about 7%and the debt service coverage would decline to 1.8 times. Although nofuture tariff increase has been assumed in this report, it is evident thattimely action in securing a rate adjustment will be necessary to prevent adecline.
64. The high return on the investment during the early years of thefinancial forecast results from the fact that EPIvIts fixed assets have beenwritten up as a result of the devaluation of the peso only in so far asforeign loans are concerned. If all EP`'s net fixed assets in operation hadbeen revalued as indicated in paragraph 43, tCe net fixed assets in operationin 1960 would have been approximately Ps 280 million and the return about7.3%.
Debt Linitation
65. The Loan Agreement for Loan 225 Co contained a covenant (Section5.09) that EFMA's ;Pbwer Department will not incur additional debt if therebythe proportion of long-term indebtedness to equity for that departmentwould exceed 60/40. Similar assurances will be included in the proposed2r.oan Agreement.
Rate Covenant
66. EPM has agreed to continue to take all necessary steps, not lessoften than once every two years, to obtain such adjustments in the ratescharged for the services of each of its four departments as will assurerevenue sufficient:
a) to meet all operating expenses, including taxes, if any; contributionsto the Municipality of Modellin; adequate maintenance and depreciation; andinterest;
b) to meet repayments on long-term indebtedness but only to the extentthat such repayments shall exceed provision for depreciation;
c) to leave a surplus which would meet a reasonable part of the cost ofthe expansion of the enterprise.
ER4 has also agreed that power rates should be set at a level which wouldpermit about 40% of new investment in power facilities to be financedfrom internal cash generation.
- 17 -
Auditors
67. In connection wJith the signing of Loan 225 CO the Bank requestedEPM to engage an outside accounting firm to audit EMPI's accounts. To com-ply with this request ERPN has employed Haskins and Sells, a well known firmof accountants satisfactory to the Bank.
68. At present EPl has an Auditor which controls its fiscal activit-ies. The auditor is appointed by the Municipal Council from a list ofsix persons submitted by the Governor of Antioquia. The auditor in turnappoints his own staff. The present Auditing Department is composed ofcompetent people who perform their work in accordance with sound account-ing procedures.
VII. CONCLUSIONS
69. The present management of EPM4 is well qualified and its staffincludes capable engineers. The operation of EPl has been successful,and there is every reason to believe this condition will continue underthe autonomous basis on which it is organized.
704 The present power restrictions, the favorable prospects of loadgrowth and the forecast of general development and growth in the Medellinarea justify continued rapid expansion of EFM's system. EIvI is now plan-ning for this future expansion and it appears that low cost and economicalexpansion can continue because of the very favorable natural conditionsfor hydro development which exist in the area.
71. The estimates of costs of the project are based on current con-tracting experience in the area and are reasonable and adequate.
72. Satisfactory arrangements have been made by EFM to ensure properengineering services and effective coordination and supervision of con-struction activities.
73. E1N's financial position appears to be good. Currently, thereturn on the investment, the debt service coverage and the debt/equityratio are satisfactory. Approximately 40% of the nine-year constructionprogram would be financed from internal cash generation. The financialforecast, based on present conditions, shows that satisfactory resultswould continue for the next few years but it also indicates a decliningtrend at the end of the period. Timely action in securing a rate adjust-ment will be necessary to prevent such decline.
74. The current rates for power which average about 6 centavos perkwh are at present sufficient to meet all operating costs and generateadequate funds for future expansion.
75. The project is feasible, sound, and is suitable for a Bank loanin the amount equivalent to j$22 million for a term of 25 years includinga grace period of five years on amortization payments.
ANNEX I540 r
540 | COLOMBIA _0f 522
PEAK LOADS, CAPABILITIES c
500 A N D . N g =
INSTALLATION SCHEDULE ,EMPRESAS PUBLICAS DE MEDELLIN 472
0~~~~
420 z 4
D ci U,
4~~~~~~~~
0 a.
380 _. _ OOSor
3L2~~42
iB340 D--<'3Zl i¢ 3 -, or 33o300 .
sL a6 292__ s _. IC CDo D4 _- C t
220~~~~~~~ a _____ r-____ urdrrevi
380 / r-7_ _
cn 4~~~~~~~~~
/. < lrorAL vA*/EP ATE CAPAC ,/TY
340 ,_ _ = _ _IT ------- t------- I I
o w~~~-.
YEAfRU
FERUR IX IBD7?
w (A~~~~ I
4 W ~~~~~~~~~I-< z 234 I AACT
140 ~~~~~136 0F
220r d--r--------
FEBRIJARY 1961 IBRD-7194R
COLOMBIA: ANNUAL ENERGY REQUIREMENTS AT MEDELLIN(MILLION KWH)
2,500 2,500
TOTAL PRODUCTION
2,250 2,250
LOSSES
2,000 2,000
TOTAL CONSUMPTION
1,750 1,750
1,500 COMECIL 1,500COMERCENIAL
OTHER CONSUMPTUION O RESIDTIAL
CITY LIGHTING1,250 1,250
1,000 1,000
750 19750
500 500INDUSTRIAL CONSUMPTION
250 ~~~~~~~~~~~~~~~~~~~~~~~250
0 10'47 '48 '49 '50 '51 '52 '53 '54 '55 '56 '57 '58 '59 '60 '61 '62 '63 '64 '65 '66 '67 '68 '69 '70
-4 MEASURED - ~----ESTIMATED------zz
IBRD -Ecoflomic Staff 'C
COLOMBIAEMPRESAS PUBLICAS DE MEDELLIN
SECOND POWER EXPANSION PROJECTCONSTRUCTION SCHEDULE
DESCR I PTION 1961 1962 1963 1964 1965 1966TRONERAS POWERPLANT
Award of Contracts for Equipment
Award of Contract for Construction
Civil Engineering Work A
Equipment Fabrication _ LEquipment Installation
GUADALUPE Et POWERPLANT(Units 3 - 4 - 5)Award of Contracts for Equipment
Award of Construction Contracts
Civil Engineering Work _ _
Penstock Erection and Installation A _ _ __ __
Equipment Fabrication -_ _ -_
Equipment Installation _ _ _ _ _ _ _
Transmission Facilities
MIRAFLORES DAMInvestigations and Design
Award of Construction Contract >
Construction _ _ _ _ _ _ _ __
Filling Reservoir ___
Delivery of Equipment
FEBRUARY !96 In service dote of units IBRD-769R
AN'E2l'X2
FACILITIES OF EPM's
PC01'!R DEPARTYEiiT
A. Existing Plant
The Power Department owns and operates four hydro plants with atotal name plate capacity of 136 MH: Rio Grande (75.5 1N), Guadalupe I (40 M4W),Guadalupe II (10 ,'W) and Piedras Blancas (10.5 MW). At sustained overload theplants are capable of an output of approximately 146 Mi. The transmissionsystem currently totals about 130 km of double circuit 115 Kv line. Theprincipal features of the existing facilities are:
Maximum Flow No. and size Capacity MaximumHead utilized of units nameplate Capacitym_ m3/sec KW KW KW
Rio Grande 312 33.0 2-25,000 75,500 84,0001-25,500
Guadalupe I 555 10.5 2-5,000 40,000 40,COO3-10,000
Guadalupe II 160 10.0 1-10,000 10,000 11,000
Piedras Blancas 555.6 2.5 1-10,5C0 10,500 11,COO
B. Power Facilities Under ConstructionALoan 220
The works currently under construction will increase the capacityof the system by 98 MW. They will consist of:
a) Divrsin CL_ theConep_ion nd Tenche Pivers
The purpose of these works is to increase the minimum flow of theGuadalupe River approximately 47%. They include:
1) an arch dam on the Tenche River, approximately 7CO m. downstreamfrom the confluence with the Concepcion River:
- height: 12.5 meters at spillway crest above foundation
- volume of concrete: 1,520 m3
- storage capacity: negligible
- diversion tunnel in the right bank, leneth 70 meters, crosssection at area 16 sq. meters.
AN v.BX 4Page 2
2) a tunnel from the Tenche River to the Troneras reservoir:
- length: 4,255 meters
- net area - lined section: 4.97 sq. m.- unlined section: 8.60 sq. m.
- discharge capacity: 18.5 cm./s.
b) Troneras Dam
This dam will be located approximately one kilometer above theintake of the existing Guadalupe I plant and just below the confluence ofthe Guadalupe River and the "Quebrada La Herradura".
- type: earth fill dam
- volume: 750,000 m3
- height: 46 m. above excavations37 m. above streambed
- length: 365 m.
- total capacity of the reservoir: 49.0 million cubic meters
- useful capacity of the reservoir: 35.3 million cubic meters
- drainage area: 424 sq. kilometers
- spillway: overflow chute type, capaciLty 690 m3/sec. locatedin the left bank
- control tower with an outlet capacity of 70 m3/sec.
- outlet tunnel in the left bank, length 433 m., diameter 4 m.
c) Troneras Plant
This plant is located at the downstream end of the outlet works ofthe dam. The powerhouse is designed for two units. One financed underLoan 225 CO ard the second under the proposed projectt
- maximum gross head: 88 meters
- minimum gross head- 74 meters
- 18 MW unit, 60 cycles (Francis vertical shaft 300 r.p.m.) controlledfrom Guadalupe III powerhouse.
.ATEY APage ,
d) Guadalupe III Powerplant
This plant is located at the Guadalupe Falls near Guadalupe I. Thisnew plant is designed for six 40 MW units but under Loan 225 C0 only two 40 NWJunits will be initially installed (except that the intake and the tunnel areto be constructed to full capacity). The plant includes:
- intake entrance for 59 m3/sec.
- pressuare tunnel: 200 m. long, 4 m. diameter
- valve chamber: at the head of the penstock
-- one penstock (for 80 1W) 880 m. long, average diameter 2.1 m.
- two 40 MJ units 60 cycles (Pelton vertical shaft, 4 water jets,450 r.p.m.
- gross head: 555 m.
- maximum flow utilized 18 m-3 /sec. (for 80 IVW)
_ transformer bank with a set of three single-phase 13.8/120 kvtransformers per unit plvis a set of 6.6/120 kv transformers forthe total generating capacity of Guadalupe I.
- control board for both Guadalupe III and Guadalupe I.
e) Transmission Lines
The existing 120 kv switch,yard will be removed and a new orne builtnear the intakes. This switchyard will be connected to:
- Guadalupe I by one 120 kv circuit from the new 6.6/120 kv transformeis
- Guadalupe II by one 120 kv circuit
- Guadalupe III by one 120 kv circuit for each unit
- Troneras plant by one 13.2 kv line
- Medellin by the old double-circuit 120 kv line and by a new double-circuit 120 kv line.
DETAIL DESCRIPTION OF THE
PROPOSED FPROJECT
The works included in the proposed project will increase thecapacity of the system by 138 1KW. The principal features will consist of:
a) Expansion of Troneras Power Plant
Comprising the installation of the second 18 MW urLit, 60 cycles(Francis vertical shaft, 3CO r.p.m.), identical to the one to be installedas a part of the work under Loan 225 CO.
b) EPnsion of Guadalupe III Power Plant
Which consists of the completion of minor civil engineering workfor the Guadalupe III powerhouse, presently under c.onstruction for two 40 -I4units, and the installation of three 40 M4 units of similar characteristicsto those being presently installed. The work will include the following:
- penstocks for four 40 MvW units
- completion of the powerhouse civil work for the ultimateinstallation of six 40 MW units
- installation of three 40 MW units, 60 cycles (Pelton vertical shaft,4 water jets, 450 r.p.m.)
- transformer bank with a set of three single-phase 13.8,/120 kv trans-formers per unit
- auxiliary and control equipment for four 40 MW units.
c) M4iraflores Dam
Which will supplement the storage of Troneras dam, and will belocated in the upper part of the Tenche River, approximately 6 kilometersupstream from the confluence with the Concepcion River.
- type: earth fill dam
- volume: 350,000 m3
- height: 48 m. above foundation
- length: 180 m.
- reservoir capacity - total: 108 million cubic meters- active storage: 80 million cubic meters- silt storage: 20 million cubic meters- dead storage: 8 million cubic meters
AL'UIEIX 5Page 2
- drainage area: 70.7 square kilometers
- spillway: morning glory type crest with 3 m. I.D. tunne'l discharge
- diversion tunnel: concrete lined, horseshoe section, 3 m. I.D.,length 500 m. provided with a 25 m. long shaftat the upstream end
- outlet works: 280 m. long tunnel on the left bank provided withtrashrack structure at the intake, regulating valveat the discharge end, and emergency valve at achamber near the dam axis. Regulating capacity10.5 c.mi.,s
d) Expansion of Transmission Facilities
The capacity of the transmission facilities from Guadalupe toMedellin will be increased by 100 14W, either by constructing one additionaldouble-circuit 120 kv line, 70 km long, parallel to the or.e under construction,or by providing the existing line and the one be-ing built, with capacitors orcondensers.
e) Distribution System
The substation facilities will be increased by the constructionin the Medellin area of the two new IMtraflores and Castilla substations of50,COO kva each. Additions wnll also be made to the Bello, Oeste and Sursubstations and 24.5 km of 120 kv substation interconnecting lines wil1 beconstructed. The primary distribution system will be expanded by theconstruction of 250 km of three-phase lines and 240 km of single-phase linesat 13.2 kv with 80,000 kva of step-down transformers. To the secondarydistribution system 600 km of lines will be added.
ANNEX 6
TEIEPHONE, WATER SUPPLY AND SDIAGE DEPARTI4ENTS
The current status and the future expansion program of EPM'sTelephones Water Supply and Sewage Departments may be summarized as follows:
A. Telephone Department
As of the end of November 1960 there were 55,000 lines servingMedellin and some suburban municipalities. This included 47,000 customersand 1,000 public telephones. Lines should have been increased to 58,000 byJanuary 1, 1961. At present EFM is connecting an average of 11 newcustomers per day. Telephone tariffs appear to be sufficient for the moment.The present telephone tariff was increased by about 30% in April 1958 andmay be described as follows:
1) Residential
A monthly fixed charge of Ps 5 per line plus Ps 1 for eachPs 5000 of value of the property with a maximum of Ps 30. The customer hasthe right to make 210 free calls with this tariff and is charged 5centavos for any additional call. EMS is planning to change this tariffstructure in several stages during the next three years. In the final stagethe customer would pay a fixed charge of Ps 5 with no free call but everycall would be charged 10 centavos.
2) Industrial and Commercial
A monthly fixed charge of Ps 9 per line plus Ps 1 per eachPs 5000 of capital registered with the Chamber of Commerce with the rightto 210 free calls and 5 centavos for each additional call. In the finalstage of the proposed tariff change, industrial and commercial customerswould be charged with a fixed tariff of Ps 10 and 10 centavos for everycall.
During the period 1961-63, EPM plans to add 23,000 telephone linesto be supplied by Ericsson of Sweden. The total cost of this program wouldamount to about Ps 30 million most of which would be in foreign currencyto be financed by a suppliers'credit from Ericsson payable during the five-year 1961-65 at 7% interest.
B. Water Supply Department
As of the end of November 1960, the Water Supply Department had63,000 consumers. The system is sufficient for present needs during periodsof abundant river flow, but rationing will be necessary during dry periods atthe beginning of each year.
The present tariff has been increased by 30% at the beginningof 1960. The average monthly tariff amounts to 21 centavos per m3 for thefirst 30 m3 consumed. For any consumption above, the average tariff is about20 centavos per m3 . (The tariff on the first 30m3 of water consumed consists
ANdNE - 6
of a fixed charge of Ps 1 plus Ps 0.20 per each Ps 2000 of value of theproperty up to Ps 100,000 and Ps 0.15 per each Ps 1CC0 of value in excessof Ps 1CO,000). In addition, since lUovember 1959, EPM charges a connectionfee on new installations amounting to about 3% of the value of the property.
EPM has prepared a report showing the works needed to improve thewater supply system and proposing a program for construction of new facil-ities needed to meet the growing demand of the metropolitan area of Medelin.Detailed technical and financial studies have been prepared for the period1961-1975. EPMT's consulting engineers, Integral, have revised EPM's reportand have prepared a supplementary report for the immediate phase of theprogram, which includes the construction of the Rio Negro pro,ect, to becarried out during the five-year period 1961-1965. Total expenditures forthe 1961-65 program would amount to Ps 68.5 million of which foreign currencyexpenditures are estimated at Ps 26 million (.3.5 million). EPM estimatesthat internal cash generation would cover about Ps 19 million of the costof the program, or 28%. EPM has already contracted a loan of Ps 7.5 millionfrom the Coffee Federation at 7% interest to be paid off by 1970 and is nowseeking financial assistance in the order of Ps 42 million in the form ofa long-term loan. EPM has made an application for a loan from the Inter-American Development Bank.
C. Sewage Department
Sewage tariffs amount to half of the fixed charge for the first30 m3 of water supply and are collected as an overcharge to the watertariffs. The system is, in general, adequate, except in the older partof the city where sewers are now serving an area greater than they wereoriginally designed for. Moreover, many sewers in this area are also inpoor structural condition. The unsatisfactory practice of dumping rawsewage into the river is now necessary because treatment facilities arenot available. A master plan for developnent of expanded sewage facilitieswas prepared by a consulting engineering firm in 1956, but work has notbeen started because financing was not available. This general developmentplan for M4edellin and other towns in the M4edellin Valley would cost aboutPs 58 million ($8.3 million). Construction would probably start in 1962and would be spread over a period of 8-10 years.
ENPRfEAS PUBLICAS DE MEDEILIN
Income Stataumnt for the Telephone. Water Supp3Y and SewaRe Departmentt
(in millions of Pesos)
Telephones Water Swpply SewageOct.31 Oct.31 33 Oct. 31
1956 i 1958 1959 1960 1956 1957 1958 1959 1960 .g 1956 1957 1958 1959 1960
Gross Rewenues 4.02 4.59 8.31 10.08 9.89 4.17 4.51 5.07 5.88 7.09 1.09 1.16 1.29 1.41 1.65Other Izwr 1.09 1.24 -97 1.00 1.56 1.43 173 1.67 1.90 2,44 .10 .36 .14 .21 .30
Total Rp.g 5.1 5.83 9.28 11.08 11.45 5.60 6.24 6.74 7.78 9.53 1.19 1.32 1.43 1.62 1.95
Cost of Operatimos
Operating Ibpenses 1.72 2.06 2.36 2.85 3.01 2.55 3.14 3.51 4.23 3.34 .51 .71 .61 .81 .81Depreciation *79 1.07 1.59 1.94 2.37 .90 8 .97 1.13 .91 .03 .10 .12 .19 .17
Total 2.51 3.13 3.95 4.79 5.38 3.45 3.98 4.48 5.36 4.25 .54 .81 .73 1.00 .98
Operatirg Profits 2.60 2.70 5.33 6.29 6.07 2.25 2.26 2.26 2.42 5.28 .65 .51 .70 .62 .97
Leasst Paynt to the City of Nedellin .15 .15 .32 .38 .38 .10 .10 .13 .15 .18 .03 .03 .04 .04 .05Quot for Service on hztermal
Debtafoa of M lin .03 .05 .09 - .05 .08 .14 - - .01 .02 .03 - -Payent to Other Municipalities - - - - - -
Total .18 .20 .41 .38 .38 .15 .18 .27 .16 .18 .04 .05 .07 .04 .05
Net Ineme from Operations 2.42 2.50 4.92 5.91 5.69 2.10 2.08 1.99 2.26 5.10 .61 .46 .63 .96 .92Lesst Interest - - .53 .74 .63 .70 .93 1.21 1.29 1.07 _ - - .01 .01
Net Profit 1' 2.42 2.50 4.39 5.17 5.06 1.40 1.15 .78 .97 4.03 .61 .46 .63 .95 .91
}/ Between 1955 and 1957 the Telephone Departnent has contributed Ps 1.1 million for the capital expenditures of the Water Supply.3/ Water Supply rates were incemased about 30% in January 1960.
FNPRESAS PUBLICAS DE k4EDELLIN
Balarnce Sheets for the Telephone. Water Supply and Sewage Departments
(in milliDns of Pesos)
Telephones Water Supply Sewaje
---- Dec. 31 - Oct. 31 -- Dec. 31j -- - Oct. 31 ------ Dec. 3 Oct. 31
1956 1957 1958 19 1960 16.195 956 8 1959 1960 1956 1957 1958 1959 1% 0
ASSETS
Fixed Assets 22.1 35.3 55.5 60.6 66.2 30.8 35.0 37.3 42.1 43.7 3.7 4.4 4.9 8.8 9.9
Less Depreciation 4.4 5.4 7.0 9.0 11. 32. 4.6 5.6 6.6 7.5 .1 .2 .3 .S .6
Net Fixed Assets 17.7 29.9 48.5 51.6 54.9 27.1 30.4 31.7 35.5 36.2 3.6 4.2 4.6 8.3 9.3
Current Assets 2.4 4.2 9.7 7.8 7.8 6.8 4.2 3.3 3.2 3.3 .2 .2 .3 .3 .3
Miscellaneous _ _ .1 .2 .1 . .6 .6 .7 . 9
Total Assets 20.1 34.1 58.3 59.6 62.8 34.3 35.2 35.6 39.4 40.4 3.8 4.4 4.9 8.6 9.6
LIABILIlIES
Canital and Surplus 12.7 15.0 19.4 24.1 29.3 13.01/ 14.41/ 15.1 16.5 20.8 3.6 4.1 4.7 7.7 8.6
Long-Term Debta) In local currency .4 .4 2.7 18.8 19.2 19.71/ 19.5 15.5 - - - - -
b) In foreign currency 6.0 16.8 Zfi / 25.8 207 - 2.1 2.0 .5 5
Total Long-Term Debt 6.4 17.2 36.5 25.8 23.4- 18.8 19.2 19.7 21.6 17.5 - - - .5 .5
Current Liabilities .8 1.8 2.1 1.5 1.7 2.2 1.4 .6 .7 1.0 .1 .2 - -
Reserve for foreign exchange fluctuation - - - 8.1 7.9 - - - .2 .3 - - -
Miscellaneous .2 ,1 .3 .1 5 23 .2 .2 .4 .8 .1 .1 .2 .4 .5
Total Liabilities 20.1 34.1 58.3 59.6 62.8 34.3 35.2 35.6 39.4 40.4 3.8 4.4 4.9 8.6 9.6
Debt/Equity Ratio 34/66 53/47 65/35 52/48 44/56 59/41 57/43 57/43 57/43 46/54 - - - 6/94 5/95
Return on the Net Fixed Assets 13.7 8.4 10.0 11.5 10.4 7.7 6.8 6.4 6.4 14.12/ 16.9 11.0 13.7 11.6. 9.9
;/ Includes capital contributions from telephone.3/ Water supply rates were increased about 30% in January 1960.
]/ Supplier's credit from Erickson (Sweden) repayable in five years starting in 1959. EPM pledged the Telephones revenues (after operating expenses, de'rreciation and Taxes) as a guarantee
for servicing this debt./ Includes a Ps 17 million loan fran the Banco de la Renublica repayable in 10 years starting in 1959. EPM has pledged the Water Supply revenues (after operating expenses, depreciation
and taxes) as a guarantee for servicing this debt.
EMPRESAS PUBLICAS DE MEDELLIN
~Nnesa de Energia
Condensed Balance Sheets(in milions of Pesos)
December 31 October1955 1956 1957 A/ 1958 2/ 1959 3/ 31, 1960
ASSETSFixed asssts 72.2 81.8 100.7 135.6 165.9 190.2Less depreciation 6.6 8.8 11.6 14.8 18.8 22.0Net fixed assets 65.6 73.0 89.1 120.8 147.1 168.2
Current assets 11.9 10.2 8.5 9.0 9.6 16.7Deferred charges & miscellaneous .4 .1 .2 1.0 1.3 2.1
Total Assets 77.7 83.3 97.8 130.8 158.0 167.0
LIABILITIESCapital and Suriius 47.7 55.5 63.2 73.5 86.3 103.3
Debt:a) Bonds 13.3 12.7 12.1 11.3 10.7 10.0b) Local loans 6.9 5.4 5.6 8.0 2.3 1.4c) Foreign currency loans 7.8 6.4 13.1 33.5 10.5 9.0d) Municipal debt _- - - 18.8 18.0e) IBRD Loan 225 CO _ _ 19.6 29.7
Total Indebtedness 28,0 24.5 30.8 52.8 61.9 68.1
Current liabilities 1.0 1.8 2.5 3.0 2.2 3.5Miscellaneous 1.2 1.5 1.3 1.5 1.2 5.2Reserve for foreign exchange fluctuation - - _ - 6.4 6.9
Total Liabilities 77*9 83.3 97.8 130.8 156.0 17.70
Debt/Equity Ratio 37/63 31/69 33/67 42/58 42/58 40/60Return on net fixed assets including
work ini progress 13.4 12.6 10.3 10.0 10.1 10.3
_ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~(D1/ The 1957 balance sheet has been adjusted to reflect the increase in the exchange rate from Ps.2.51 to Ps. 6 = US$1 x7/ The 1958 balance sheet has been adjusted to reflect the increase in the exchange rate from Ps. 6 to Ps. 8 = US$131 The 1959 balance sheet has been adjusted to reflect the decrease in the exchange rate from Ps. 8 to Ps. 6.70 = US$1,
the difference has been entered into the newly created reserve for foreign exchange fluctuation.
EMPRESAS PUBLICAS DE MEDELLINEmLpresa De Energia
Condensed Income Statements(in thousands of Pesos)
First10 Months
1955 1956 1957 1958 1959 1960
Sales in millions of KWH's 465 489 548 582 644 587Average rate per MWE (centavos) 3.57 3.56 3.40 3.95 4.50 5.14
Gross Revenue from Sales 16,585 17,409 18,815 22,977 29,239 30,195Other Income 364 708 1.293 1.376 1 398 1,558
Total Revenue 16,999 18,ll7 20 108 24,353 30637 31:755
Cost of Operations:Operating Expenses 5,060 5,303 6,506 6,317 9,895 9,156Depreciation 1,674 2,248 2,650 3,219 i4067 3 510
Total 6-734 7 9,156 9,536 13,962
Operating Profit 10,215 10,566 10,952 144,817 16,675 19,054Lesss Payment to the City of Medellin 737 750 750 1,084 1,356 1,394
Quota for Service on External Debtof the City of Medellin 419 398 674 1,185 - -
Payment to other Municipalities 224 _ 261 313 410 546 295Total 1 0 ,409 1,7372 1,902
Net Income from Operations 8,835 9,157 9,215 12,137 14,773 17,365
Interest 2,133 1,419 1,473 1,792 2,638 3,170Less: Interest charged to construction - - - 333 2,203Interest charged to operation 1.33 419 1,473 79: 2,305 967 1/Net Profits 6,702 7147 72,466 16T,798
Interest Coverage 4.2 6.6 6.1 6.7 5.6 5.5
1/ Preliminary figure.
Asns~ U
NŽ4PIESAS PUBLICAS DE SEDELLIM
E,csresas de Energia
Foreost of cash flow for 1960 - 68(in mifllicns of Pesos)
Year ending De-emd-er 31 1960 1961 1962 1963 1964 1965 1966 1967 0996 156 -
S00DCES OF FUiDS
Internal cash gener.tionNet income from noeration 20.40 27.00 29.60 32.30 34.90 37.90 47*30 14.60 2i.?0 315.10De reniation 4.10 5.40 9.10 10.00 11.00 lO .00 16. 1 3.00 i09.60Gash recsip,ts fron ogeration 24.50 32.40 37.70 40.30 46.90 51.90 57.30 62.60 69.20 424.7Q
BorrowingIBRD Loan 225 CO ($12.0)!/ 32.70 20.90 10.80 - - - - 64.LOProrosed IBRI Loan (?22.0) - 14.18 31.64 43.48 45.54v' 19.191 - - - 154.C0Foreign currency loan for Nare ($22.0) - - - - 29.40 54.60 54.60 15.40 - 154.00Future foreigo orre,ncy loan (928.2) - - - - - - - 24,.50 56.00 p1.50
Totn1 borrooing 32.70 35.08 42.44 43.48 74.91 73.79 54.60 39.90 56.00 452.90
Total Scurce of Funds 57.20 67.48 80.14 85.78 121.81 125.59 111.90 lC2.50 125.20 377.60
APPLIC'TIONS OF FUND3
C-3tructicna) Goadaluos Project: Foreign currenc--3/ 30.11 29.19 15.07 - - - - - - 73.36
Local c,rrency 17.I0 29.00 13.40 - - - - - - 9Tota];!/ 47.61 57.18 29.47 - - - - -
b) Second Power Project Foreign Currenoy - 2.10 19.39 39.06 38.92 10.43 - - 9.9QLocal currency - .60 6.90 19.81 19.33 10.87 - - 41Total 2.70 26.19 54.97 59.25 2. - _ 21
) S.are Proneot Foreign currenoy - - 29
.40 54.60 54.60 15.40 1 04.QOLocal currency - 1.00 6.00 10.60 13.60 22.30 33.80 17.50 104.60Total - 1.00 6.0 10.60 43.00 76.90 q4 32.90 . 238
i) Future . r.3.ra Foreig.n carreny - - - - - -O 24.50 56000 30 .50Local ourrency _ 40 3 00 42.0 0 310 43'Total a .
00 3.00 28.70 09 11 1303 9
Total Con6trction Escenditures 47.61 60.99 60.66 65.47 101.25 102.20 91.40 61.6C 6T2.17
Debt SrojosAmortization: a) Existing loans 3.90 3.42 3.20 2.74 2.70 2.73 2.59 2.51 1.3i 25.10
b) IBRD Loan 225 CO - - - 1.92 2.03 2.16 2.29 2.43 2.50 13.41G) Proposed TBRD Loan - - - - - - 4.20 4.45 L.70 13.35d) Foreign ourrency loan Nare - - 3.96 3.86e) Future foreign currency loan - - - -
Total Amortization 3.90 3.42 3.20 4.66 4.73 4.89 9.08 9.39 12.45 53.72
Interest: a) Existing loans 2.19 1.95 1.74 1.53 1.34 1.16 .98 .82 .70 12.41b) IB0D Loan 225 GO 2.59 4.o6 5.39 5.01 4.89 4.77 4.63 4.49 4.35 1o.10o) Proposed IBRD Loan - .74 2.59 4.42 6.59 8.76 8.86 8.61 8.36 41.93d) Foreign currency loan Nar - -- - 2.06 3.99 6.72 8.47 8.86 3,.10e) Future foreign ourrency loan - -. - - - - - 2.09 4.11 6.20
Total Interest 4.78 6.75 9.72 10.96 14.88 18.68 21.19 '4.48 26.38 137.82
Tot.1 Debt Ser-ice 8.68 10.17 12.92 15.62 19.61 23.57 3C.27 33.87 38.83 193.54
Total Applicstions of Funds 56.29 71.05 73.58 81.09 120.86 125.77 121.7 95.47 126.93 S72.71
Net cash accrual .91 (-) 3.57 6.56 4.69 .95 (-) .18 () 9.77 7.03 (-H 1.73 4.89Cash available at the beginning of year 3.97 4.88 1.31 7.87 12.56 13.51 13.33 3.56 1C.59Cash an4ilahls at ths end of y.ar 4.88 1.31 7.87 12.56 13.51 13.33 3.56 10.59 8.86
Interest covera-e
Net in-oae from o. ration 20.40 27.00 29.60 32.30 34.90 37.80 42.30 44.60 46.20 315.10Interest oaynble I 4.78 6.75 9.72 10.96 14.88 18.68 21.19 24.48 26.38 137.82
Number of times interest covered 4.3 4.0 3.0 2,9 2.3 2.0 2.0 1.8 1.9 2.3
Debt Servio coverage
Cash receipts from oppration 24.50 32.40 37.70 42.30 46.90 51.90 57.30 62.60 69.20 424.70Total debt service SkO 9.68 10.17 12.92 15.62 19.61 23.57 30.27 33.87 39.83 193.54
t'usier of tines debt service -ccered 2.8 3.2 2.9 2.7 2.4 2.2 1.9 1.8 1.9 2.2
Conoribution of earnings toward. cowstruction
Cash receipts from operation 24.50 32.40 37.70 42.30 46.90 51.80 57.30 62.60 69.20 424.70Less: Debt service, exclusive of interest during
onstruction 6.09 5.37 4.94 11.20 10.96 10.82 23.55 23.31 34.72 130.96Niet .. ssh avsi1lble for onstrection 19.41 27.03 37.76 31.10 35.94 48.99 3.75 39.29 34.49 293.74
Additions to plant 47.61 60.98 60.66 65.47 101.25 102.20 91.40 61.60 98.10 679.17Interest during const-rution 2.59 4.80 7.9I 4.42 e,65 12.75 6.72 10.56 4.11 .4355Total expansion re-airements 50.20 65.61 69.64 69.39 109.90 11.5 98.12 72.16 93.21 741.75
Cash available as % of expansion requireesets 36.7 41.2 47.7 44.5 32.7 35.7 34.4 54.4 37.4 39.6
' The equivalent of Ps 19.6 million has bees disbur-ed in 1959.-/ Inc1uding the f -rhl
0n smobange addition finanoed by thL -rapo-sd lsank loon amuo-ting to $3 nillion (Ps 21 m1ill0n).;, A total of Ps 27.7 nillion has been spent in 1959.
Al Including interest daring construction financed by Bask lqans.
Annex 12
EWPRGAS PUBLIC AS DE MEDELLIN
Empresa de Energia
Forecast of Income Statemaents for 1960 - 68(in millions of Pesos
Year ending December 31 1960 1961 1962 196 1964 1965 1966 1267 1968
Power sold, in millions of KWH 700 760 850 950 1050 1160 1280 1400 1550Average price ner KWH (eentavos) 5.2 6.0 6.0 6.0 6.0 6.o 6.o 6.0 6.0
Gross revenue from power sales 36.40 45.60 51.00 57.00 63.00 69.60 76.80 84.00 93.00Other income 2.00 2.20 2.40 2.60 2.90 3.20 .50 3.90 4.20Total income 3o.40 47.80 53.40 59.60 65.90 72.80 80.30 87.90 97.20
Cost of Operation:Operating expenseo 10.97 11.95 13.20 14.67 16.09 17.72 19.44 21.42 23.70Depreciation 4.10 5.40 0.10 10.00 12.00 14.00 15.00 18.00 23.00Purchase of power 90 1.10 - - - -Total cost of operation 15.97 1.45 21.30 247 28.09 31.78 34.44 39.4? 46.70
Operating profit 22.43 29.35 32.10 34.93 37.81 41.02 45.86 48.48 50.50
Less: Payment to the City of Medellin(4.425% of total revenue) 1.70 2.11 2.36 2.63 2.91 3.22 3.56 3.88 4.30Payment to other Municipilities .3 .24 .14 - - - - - -
Total payments to Medellin and Municipalities 2.03 2.35 2.50 2.63 2.91 3.22 3.8 4.30
Net income from operation 20.40 27.00 29.60 32.30 34.90 37.80 42.30 44.60 46.20
Interest 4.78 6.75 - 9.72 10.96 14.88 18.60 21.19 24.48 26.38Less: Interest charged to construction 1/ 2.59 4.80 7.98 4.42 .612.5 6.72 10.56 4.11Interest charged to operation 2.19 1.95 1.74 6.54 23 5.93 14.47 13.92 22. 27
Net profit 18.21 25.05 27.86 25.76 28.67 31.87 27.03 30.68 23.93
Cuwulative profit 18.21 43.26 71.12 96.88 125.55 157.42 185.25 215.93 239.86
1/ Including interest financed by Bank loans.
EMNPESAS PUBLICAS DE NEDELLIN
Espreaa de Ihergia
Forecast of Balance Sheets for 1960 - 68(in millions of Pesos)
1960 1961 19 U 6 9 1%4 1965 1966 1967 1968
ASSErS
Fixed assets 139.9 219.9 319.9 349.9 449.9 489.9 519.9 739.9 779.9Less: Depreciation 22.9 28.3 36-4 46.4 58*4 72.4 87w4 105.4 128.4Net fixed assets 117.0 191.6 283.5 303.5 391.5 417.5 432.5 634.5 651L5Work in progress 76.2 61.9 30.5 70.4 80.3 155.2 223. 75.5 127.7Net fixed assets arnd work in progress 193.2 253.5 314.0 373.9 471.8 572.7 655.8 710.0 779.2
Current assets and other, net 8.3 4.7 11.3 16.0 16L9 16.7 6.9 13.9 12.2
Total Assets 201.5 258.2 325.3 389.9 488.7 589.4 662.7 723.9 791.4
LIABILITIES
Capital and surplus 104.5 129.5 157.4 183.1 211.7 243.5 271.3 301.9 325.9
Debt:a-Existing loans 38.4 35.0 31.8 29.1 26.4 23.7 21*1 18.6 17.3b) IBRD Loan 225 G0 52.3 73.2 84.0 82.1 80.1 77.9 75.6 73.2 70.6c) Proposed IBRD Loan - 14,2 45.8 89.3 134.8 154.0 149.8 145.4 140,7d) Foreign currency loan for Nare _- - - 29.4 84.0 138.6 154.0 150.1e) Future foreign currency loan _- - - -1_ - _2-5 80.5
Total Debt 90.7 122.4 161.6 200.5 270.7 339.6 385.1 415.7 459.2
Reserve for foreign exchange fluctuation 6.3 6.3 6_3
Total Liabilities 201.5 258.2 325.3 389.9 488.7 589.4 662.7 723.9 791.4
Debt/Equity Ratio 46/54 49/51 51/49 52/48 56/44 58/42 59/41 58/42 58/42
Return on net fixed assetsExcluding work in progress 17.4 14.1 10.4 10.6 8.9 9e1 9.8 7.0 7.1
Including work in progress 10.6 10.7 9.4 8.6 7.4 6.6 6.5 6.3 5.9
TECEDAM andRESERVOIR 0
COLOMBIA out
LOCATION MAP r Guadalupe
SECOND POWER EXPANSION PROJECT \T S GUADALUPE I
EMPRESAS PUBLICAS DE MEDELLIN . GUADALUPE m
_ /t~~~DAMS andS iRCAERAS I* Hydroelectric plants JE FE SEVOO/DAMjan
- - 210KV transmission lines RESEROIR
R_ilr_ _d Carol,\
PROJECT SHOWN IN COLOR 0 \ \>2 0 2 4 6 8 10 Km
Scnta Rosa \de Osos GQADjLU
p, 0~~~~~~~~~~~tQ
~XA rL A IVI Oi AV
c.'tI ~~~~~~~~~~~~~~~~~~~~~RIO~RORNDE ,v
.CIE8RADONA
= ~~~~~~~~~~~~~~~~~~~~~~/XA rLANr/C OCEA VENEaZUELAeOrioond
ODA MW ; ; /: 45 M e!5 Oaieo't,,e,t@x v _, DAM ond O a >
RESERVOI Don Mctias | / Santo Domingoo
BOGOTA , ,
Concepcion >,
E C U A D O R k I <<</ °nces¢'°
. BRAZIL A o alx
AELLO,9) (
/ }sql , ~~PIEDhASErtANCAS B(
i y Z g nOAM~~4 and RESERVOIRSnVlet
Son CristobalO IRobledo/{^ 2SA- o OGuaGne
I I /R TPIEDRAS- S_ ~La Honda
MEDELLX W; BLANCAS W(X ~~~~~~~~~~~~~~~~~~~~~~_ 7O 4 G~~~~~~~ucitape'O
f El Poboado
Prado
O/A "rENVIGADO Manno
La Estrella, Rio Negro
JANUARY1961 IB7OnturJANuaRY 1961 IHRD-770O