Review of Sustainability of Operations at Afghanistan's Tarakhil Power Plant

The plant consists of eighteen 5.8-megawatt diesel engine generators, housed in three power blocks, capable of collectively producing 105 megawatts of electricity. The plant was built under USAID's Afghanistan Infrastructure and Rehabilitation Program in 2007, with a budget of $126 million, but the final cost was approximately $307 million due to construction delays and budget overruns. The plant was transferred to the Afghan Government's Ministry of Energy and Water in June 2010, and Da Afghanistan Breshna Sherkat (DABS), the national utility company, was charged with operating and maintaining the plant. USAID provided operation and maintenance (O&M) support through a $27.7 million contract with the Louis Berger Group/Black & Veatch Joint Venture (LBG/B&V) that continued through June 30, 2012. This assistance included training and mentoring power plant staff to build their capacity to operate and maintain the plant on their own. However, the review conducted by the Office of Inspector General (OIG) in early 2014 found that the plant was not being operated and maintained in a sustainable manner. The plant was severely underused, generating only 2.2 percent of the power it was designed to produce. The review also found that operation and maintenance training did not adequately prepare staff to run the plant, and staff needed further assistance to fix the plant's malfunctioning computerized control systems. The review disclosed several issues with the plant's operation and maintenance, including the lack of inventory tracking, inadequate management support from DABS, and the plant's failure to operate regularly. The plant was not used regularly, but as an emergency back-up supply, and therefore was not increasing Kabul's power supply to help reduce its energy deficit, particularly during the winter season, as intended. The OIG report recommends that USAID/Afghanistan take several steps to promote the sustainability of the Tarakhil Power Plant. These recommendations include performing an analysis to identify a more economical and affordable fuel supply, implementing a strategy to strengthen the capacity of Tarakhil Power Plant staff, and implementing a training strategy to equip staff with the skills to operate and maintain the plant sustainably. The report also recommends that DABS management provide a plan to strengthen the management support it provides to the Tarakhil Power Plant. The review results show that the power plant was intended to fill a gap in the available supply of power on Afghanistan's national power grid to alleviate the acute electrical power shortage currently being experienced in Kabul. However, since its handover in June 2010, the power plant has been severely underused and operating at a level far below what it was designed for. The plant's output during the period from July 2010 to December 31, 2013, totaled only about 63,000 megawatt-hours, a small fraction (2.2 percent) of Tarakhil's potential production capacity. The cost of diesel was a big factor in the plant's limited operations. The power plant's generators operate on diesel fuel, which is very expensive in Afghanistan. Operating at full capacity, 24 hours a day, would require a significant amount of fuel, which DABS could not afford. The government committed to paying for the plant's fuel and operating costs starting a year after completion, but later acknowledged it could not afford the fuel and would need assistance with the other operating costs.