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ANNUAL REPORT

2006

The Hashemite Kingdom of Jordan

NATIONAL ELECTRICPOWER COMPANY

H. M. King AbdullahThe Second Ben Al-Hussein

Chairman and Board Members of the NationalElectric Power Company are Honoured to submit the40th Annual Report of the Year 2006 to His MajestyKing Abdullah The Second Ben Al-Hussein.

5National Electric Power Company

Board of Directors

Auditors Messrs Abbasi & Co.

Chairman

Dr. Hisham Gharaibeh

Eng. W. NabulsiPrivate Sector

Eng. A. SamaraGeneral Director

of Lands andSurvey Department

Until 14/4/2006

Dr. Ahmad Hiyasat

Managing Director of NEPCO

Vice ChairmanEng. Khaldoun Qutishat

General Secretary of Ministry ofEnergy &Mineral Resources

Members

Dr. F. ElkarmiPrivate Sector

Dr. A. Al-FauriPrivate Sector

Eng. Malek KabaritiPresident of National

Energy Research Center

National Electric Power Company6

National Electric Power CompanyCentral Electricity Generating CompanyElectricity Distribution CompanyJordan Electric Power CompanyIrbid District Electricity CompanySamra Electric Power Generation CompanyHussein Thermal Power StationQueen Alia International AirportSubstationGross National ProductPower StationAqaba Thermal Power StationThousand Ton of Oil EquivalentGas TurbineOverhead Lineper annumHeavy Fuel OilKilogram of oil equivalent

NEPCOCEGCOEDECOJEPCOIDECOSEPGCOHTPSQAIASSG.N.PP.SATPST.T.O.E.G.T.OHLp.a.H.F.OKgoe

ContentsMessage from Managing Director ............................................................................................................................................................

Energy and Electricity in 2006 ....................................................................................................................................................................

Significant Figures for Electricity Sector in Jordan for 2006 .................................................................................

NEPCO's Significant Figures for 2006 ...............................................................................................................................................

Performance Indicators in Electricity Sector in Jordan ...........................................................................................

NEPCO's Performance Indicators ..........................................................................................................................................................

Gross National Product and Energy Demand in Jordan ...............................................................................................

Cost of Energy Relative to the National Economy ................................................................................................................

Electricity Demand Forecast in Jordan .............................................................................................................................................

Electrical Power System in Jordan .........................................................................................................................................................

Main Operating Components of The Electrical Power System in Jordan ................................................

Electrical Energy in Jordan .............................................................................................................................................................................

Generated Energy ..................................................................................................................................................................................................

Power Demand .........................................................................................................................................................................................................

Electrical Energy Consumption ..............................................................................................................................................................

NEPCO's Electricity Purchased in 2006 ...........................................................................................................................................

NEPCO's Electricity Sales in 2006 ..........................................................................................................................................................

Number of Consumers in Jordan ..............................................................................................................................................................

Rural Electrification in Jordan ....................................................................................................................................................................Electricity Tariff as of end 2006 ..................................................................................................................................................................

Financial Statements ................................................................................................................................................................................................

Page No.

Abbreviation

Jordan Dinar (10^3 Fils)Kilovolt (10^3 Volt)Kilovolt Ampere (10^3 Volt Ampere)Mega volt Ampere (10^3 kVA)Kilowatt (10^3 Watt)Megawatt (10^6 Watt)Kilowatt-hour (10^3 Watt-hour)Megawatt-hour (10^6 Watt-hour)Kilometer (10^3 Meter)Gegawatt-hour (10^9 Watt-hour)

JDkVkVAMVAkWMWkWhMWhkmGWh

Measures

79

24252626272828293031313334363638394041


A message from the Managing Director

The National Electric Power Company (NEPCO), continued its

efforts, alongside the other parties in the electricity sector, to

bolster the national economy and serve the local community.

These efforts came through working strenuously to promote and

develop the electric power industry in the Kingdom, in order to

match with the continuous demand for electric power which is

considered one of the most important requisites of development

and economical growth for all sectors.

NEPCO worked in the year 2006 on developing and enhancing the national grid and

interconnection networks with the neighbouring countries, by constructing new

substations and the transmission lines needed for them, in addition to expanding the

existing substations.

At the same time, NEPCO took all the operational measures and made the preventive

and annual regular maintenance for all the components of the national grid. It also set

up the plans needed to meet the increasing electric loads and improve the standard of

continuity and reliability of electric supply meeting the needs of all consumers.

I would like to seize the chance of releasing the Company's Annual Report for 2006,

to convey my deep appreciation for His Excellency, The Chairman and the Board of

Directors for their diligent cooperation, support and directing NEPCO'S works. I would

like as well to thank all the colleague employees wherever they are, for their fruitful

efforts which led to the upgrade of the efficiency of the Company, and to putting it in

the ranks of distinguished companies in the Kingdom.

Meanwhile, I ask the Almighty God to help us in serving the country and citizens

under the leadership of His Majesty King Abdullah the Second Ben Al-Hussein.

Dr. Ahmad Hiyasat

Managing Director


National Electric Power Company (NEPCO)

Vision

To elevate the Company’s status in all aspects to world standards at the same class of

the best regional and international electric utilities.

Mission

Provision of secured electric energy; with high levels of reliability of the electric

power system; and continuity of supply of electric energy demand at economical prices

pursuant to international quality standards; meeting environmental requirements and

good business practice in exchanging electric energy with neighboring countries;

consolidation of corporate governance at the company; achieving optimal investment in

the infrastructure of the electric power transmission grid for the benefit of society;

contribution in the technology transfer; attraction of national and international

investments in electricity sector and creation of job opportunities for Jordanian

professionals.


Energy and Electricity in 2006

Signing Ceremony of Jericho Area Supply Agreement

This station works on the technology ofcombined cycle, burning natural gas as a mainfuel and with a gross capacity of (380) MW. Thefirst phase, which comprises two gas units is dueto be operational in year 2008, while the steamunit will be operational in year 2009.

The first and second phases of the project ofArab gas pipeline was completed, extendingfrom Al Arish area in the Arab Republic ofEgypt, to Aqaba and to the middle and to northof the Kingdom, through this line the Aqabathermal power station in the south, Rehab andSamra generation stations in the north and in themiddle of the kingdom were fed with natural gasrequired to operate them. This line will becompleted till The Jordanian – Syrian borders.The Syrian side commissioned an internationalcompany, in October 2005, to carry out the thirdphase of the Arab gas pipeline, extending fromthe southern part of the Syrian-Jordanianborders, to Hems with a length of (310) km. Thework on carrying out this part started in year2006. The Turkish side will complete thenorthern part which comes after the third phase,extending from Hems (in Syria) to theSyrian-Turkish borders, with a length of (210)km. The Egyptian gas is due to be exported toTurkey and Europe in a later stage.

The National Electric Power Company (NEPCO)continued work to achieve its stated mission todevelop the national grid and the electricinterconnection with neighbouring countries, while

The Government of Jordan, represented by theExecutive Privatization Commission, and theMinistry of Energy and Mineral Resources,continued the completion of the procedures ofprivatization of the electricity generation anddistribution. It is now negotiating withinternational companies to sell (51%) of theCentral Electricity Generation Company(CEGCO) in addition to the shares of the SocialSecurity Corporation (S.S.C) which is (9%).This is expected to be completed during thesecond quarter of 2007. The government alsointends to sell all the shares of the ElectricityDistribution Company (EDCO), and it’s sharesin Irbid District Electricity Company (IDECO)which are (55.4%) and Samra Electric PowerGeneration Company in later stages, since thegovernment decided in mid 2005, the necessityof completing the privatization process of thesectors of electricity generation and distribution,through selling its shares to the private sector.

The Government also approved the agreementdocuments needed to go on in building the firstIndependent Power Producer (IPP) Project inJordan on the basis of Build, Operate and Own(B.O.O) which is the project of Amman EastGeneration Station (Manakher area). TheCompany that developed the project finalizedthe procedures with the financiers, This fundingagreement was signed and the financial closewas reached for the Project. This was done in thefirst quarter of 2007.


Amman) (380)MW with the national grid. Thisproject is expected to be completed in the firstquarter of 2008.

The importance of this substation lies in futureinterconnections with neighbouring countries(Syria and Iraq), in addition to any future needfor interconnecting any generation expansion inthe same site.

During 2006, NEPCO carried out the projectof replacing the overhead lines with undergroundcables of 132 kV in some populated areas inAmman with the aim of maintaining publicsafety for the inhabitants. This project comprisestwo parts: the first interconnects Amman SouthSubstation with Abdoun Substation, with alength of (7) km. The second part interconnectsthe new Al-Bayader Substation with TareqSubstation, with a length of (12.4) km. Theestimated cost of the project was about JD (10)million. NEPCO plans, on the long run, andwithin the available capabilities, to replace allthe overhead lines, passing over the populatedareas, by underground cables.

NEPCO constructed 132 kV lines in additionto the 400 kV transmission lines needed tointerconnect the main substations, in order toensure continued electricity supply for thecitizens. The lengths of the added lines were (18)km, as well as several projects for transmissionlines, constructing new main substations andexpanding some existing substations and theones which are under construction.

In 2006, NEPCO continued its effort in thefield of expanding the existing 132/33 kVsubstations, constructing new ones, where theadded transforming capacities in Amman area, in2006, were (250) MVA, by adding (45) MVA toeach of Queen Alia International Airportsubstation and Amman South substation, and(80) MVA to each of Abdoun Substation andMarka Substation.

Also, during 2006, NEPCO continued takingall the operational procedures and the preventiveregular and annual maintenance for all thecomponents of the transmission network. Thiscomes out of the Company's keenness to providesafe electric energy, maintain the reliability ofthe electric system and the continuity of electricsupply to all the consumers with economic cost,and in compliance with the internationalstandard, while taking the requirements ofenvironment, in consideration.

In comparison with the year 2005, the year2006 witnessed a considerable growth of someeconomic sectors, along with a noticeable change

paying attention to the quality standards, public safetyand environment, also the purchasing of electricenergy from different sources, and transmitting andselling this energy to the distribution companies andthe bulk supply consumers supplied by the nationalgrid all over the Kingdom, as well as the electricenergy exchange with other countries throughimporting and exporting.

To achieve this goal, NEPCO updated inMarch 2006 the contract agreement to exchangethe electric energy with the Egyptian ElectricityTransmission Company, in order to meet theKingdom's needs of electric energy within theavailable limits. Also the two parties agreed tocontinue applying the electric energy exchangecontract for another year till the end of year2007. As the electric energy exchange with theSyrian Public Establishment for ElectricityGeneration and Transmission, the contract whichwas signed in June 2005 remained in effect and itwill be applied till the end of year 2007.

In translating the directives of His MajestyKing Abdullah the Second and to support ourbrothers in Palestine, NEPCO signed anagreement with Jerusalem District ElectricityCompany ( in the Palestinian Autonomy areas) tosupply Jericho Governorate with the requiredelectric energy. The supply project will becarried out on two stages. The first includesconstructing a double circuit overhead line of132 kV with a length of (22) km, inside theJordanian territories, to interconnect Sweimehsubstation with the substation to be built inJericho Governorate. The second stagecomprises expansion of Sweimeh substation byadding a new transformer of 132/33 kV, with acapacity of (80) MVA.

Work has begun on implementationprocedures and bids issuance for the project. Thefirst stage of this project is expected to becompleted in mid-2007. While work on thesecond stage will go in parallel with the firststage, to be completed in August 2008.

To reinforce the national electric network andallow it to face the increasing growth demandwhich results in expanding and constructingmain substation and overhead lines to feed theelectrical loads or connect new generationstations to the national network,NEPCO awardedduring 2006 the contract of supplying,constructing and operating the electricswitchgear panels and their ancillaries, to theSpanish Company, CYMI. The contract aims toconstruct Amman East outdoor substation of 400kV needed to interconnect the first IPP (East


convenient investment environments which ledto attracting foreign investments that overpassedthe targeted rations in the Government plan.

The cost of living index was (169%) in 2006,against (159%) in 2005, and with an inflation rateof around (6.3%) against (3.5%) in 2005.

Demand For Primary EnergyDemand for primary energy in 2006 was about

(7.2) million tons of oil equivalent (M.T.O.E.),with a growth rate of (2.3%) against a growthrate of (8.3%) in 2005 (table No. 5)

The average per capita consumption ofprimary energy in 2006 was about (1284) kg ofoil equivalent, against (1284) kg in 2005.

The electricity sector ranked first in primaryenergy consumption. Its consumption rate was(37.9%) of the total energy consumed in 2006,against (34.0%) in 2005 (table No. 11). This meansthat the electricity sector share of energy constitutesa high ratio of the total consumption, becauseelectricity is more efficient, clean and easily used,in addition to its wide spread as it is available tomore than (99.9%) of the Kingdom's population.

It is worth mentioning the CEGCO is thelargest consumer of primary energy in theelectricity sector, having consumed about(80.0%) of the total fuel used in electricitygeneration in 2006, against (93.6%) in 2005.

Demand For Electricity The demand for electricity continued in the year

2006, where the total peak load in the Kingdomwas (1901) MW against (1751) MW in 2005, witha growth rate of (8.6%). The peak load of theinterconnected system was (1860) MW inDecember 2006 against (1710) MW in August2005, with a growth rate of (8.8%) (table No. 12).

The generated and imported electric energy inthe Kingdom was (11634) million kWh in 2006,against (10636) million kWh in 2005 with agrowth rate of (9.4%).

The electricity production of the interconnectedsystem was (11349) million kWh with a growthrate of (10%) against 2005 (table No. 9). CEGCOcontributed, in 2006, with (81%) of the totalgenerated electricity, while the other partiescontributed with (19%) of the total production.

Electricity consumption in the Kingdomamounted to (9593) million kWh in 2006,against (8712) million kWh in 2005, whichmeans an annual increase of (10.1%) against(7.7%) in 2005 (tables No. 13 and 14).

in the electricity consumption pattern of theconsumers which resulted in a large growth ofdemand for electricity. The growth rate of bothgenerated and imported energy in Kingdom wasabout (9.4%), where the growth of the electricloads was about (8.6%), against a growth rate of(8.6%) for the generated and imported energyand (12.6%) for the electric loads during 2005.

The peak load of the interconnected system in2006, was (1860) MW and was recorded for thefirst time in December, against (1710) MW inAugust 2005, with a growth rate of (8.8%).NEPCO made tangible effort to meet this greatdemand for electric power, by setting up theconvenient strategies and operational plans,which were implemented by the Control Centreaffiliated to NEPCO to ensure supplying allconsumers with electric power according to theinternational standards without any interruptionin the electric power.

NEPCO is preparing to meet the increasingloads, which will witness a great growth ofdemand for electric power, since the peak load isexpected to reach (2030) MW in 2007.

Through the National Control Centre, andcoordination with generation and distributioncompanies in the Kingdom, NEPCO makes allthe effort to secure continued electric power forall the consumers all over the country.

It is worth mentioning that the actualgeneration capacity of the Jordanian electricsystem in 2006, was about (2076) MW, against(1873) MW in 2005. To meet the increasinggrowth in demand for electricity in the Kingdom,Al Samra Electricity Generation Station addedand operated a steam unit and a gas turbine unit,each with a capacity of (100) MW, in addition tothe existing gas turbine unit of (100) MW, whichused to burn diesel. The capacity of thisgeneration station is (300) MW, and it works onthe combined cycle system and burns theimported natural gas.

Jordanian EconomyThe predictions of the International Monetary

Fund and Jordanian local institutions showed that theJordanian economy continued achieving satisfactorygrowth rates in spite of the tough conditionsprevalent in the area. These sources predicted thatthe growth rate of the GDP in the fixed prices will be(6%) in 2006 and will reach (5%) in 2007.

The improvement in the performance of theJordanian economy is due to the policies,procedures and measures taken by thegovernment, in addition to facilitating the


adding the equipments needed.

Samra Electric Power Generation CompanySEPGCO operated the second gas unit of (100)

MW in January 2006, and a steam unit of (100)MW in August 2006. The first gas unit had beenoperated in 2005. The total capacity of thisstation is (300) MW, which burns importednatural gas from Egypt. This station wasconnected to the interconnected system through asubstation and a (400) kV transmission line,connecting it to Amman North Substation. Thegenerated energy of this station in 2006 was(1660) GWh, constituting about (15%) of thetotal generated energy in the Kingdom.

Also the Tender of adding the third and fourthgas turbine was awarded. These Turbines areexpected to be operational in mid year 2007, andin mid year 2008 respectively.

The First Independent Power Producer(IPP) Project Amman East GenerationStation (Al -Manakher)

The government approved the documents ofagreements needed to go through constructingAmman East Generation Station (Al-Manakherarea). The project developing company finalizedthe procedures with financiers. This fundingagreement was signed and the financial closewas reached for the project, This was done in thefirst quarter of year 2007. This generation stationis the first of its kind in Jordan, which isconstructed on (B.O.O) basis. It works using thetechnology of combined cycle, burning naturalgas, as a main fuel, with a gross capacity of(380) MW. It comprises two gas units and asteam unit. The first phase of this station whichis composed of the two gas turbines is expectedto be in operation in June 2008, while the steamunit as a second phase, is expected to be inoperation in June 2009.

Arab Gas Pipeline ProjectThis project includes constructing a pipeline to

export the Egyptian natural gas to Turkey andEurope through Jordan and Syria, while a branchwill be connected to Lebanon. Iraq joined latelythis project to connect a pipeline to carry gasfrom Iraq to the Arab gas pipeline at a point inthe north of Hems in Syria. This connection hasnot been made yet.

Work was completed on the first and secondstages, extending from Al-Areesh in Egypt to theJordanian-Syrian borders, with a length of (661)km. Through these two stages, ATPS, SEPGCO

The average per capita consumption ofelectricity was (2079) kWh in 2006, against(1943) kWh in 2005 with growth rate of (7%).

The sectorial distribution of electricityconsumption in 2006 was as follows:

Sector

Domestic

Industrial

Commercial

Water Pumping

Others

Total

Consumption(GWh)

3434.7

2757.0

1515.8

1396.3

489.6

9593.4

SectorWeight

(%)35.80

28.75

15.80

14.55

5.10

100

ConsumersNEPCO and the distribution companies

JEPCO, IDECO and EDCO continued to meetthe needs of the new customers by connecting(66) thousand new customers in the Kingdom,against (62) thousand in 2005.

The total number of consumers, by the end of2006 was (1195) thousand consumers against(1129) thousand in 2005, with a growth rate of(5.8%) against (5.8%) in 2005 (tables No. 18 and19).

The number of consumers, by the end of 2006,in JEPCO concession area was (781) thousandagainst (739) thousand in 2005, while thenumber of consumers in IDECO concession areawas (267) thousand against (251) thousand in2005 and the number of consumers in EDCOconcession area was (147) thousand against(140) thousand in 2005.

Electric Power System ProjectsThrough the year 2006, all the parties

concerned with electric power systemdevelopment, namely MEMR, CEGCO,SEPGCO, NEPCO and the distributioncompanies, continued their efforts to develop thegeneration capacities, transmission anddistribution networks. The most importantachievements and activities in this field were asfollows:

Generation Projects:

Central Electricity Generation CompanyCEGCO operated Rehab Power Generation

Station of (360) MW in February 2006, burningimported natural gas. This was achieved after


the combustion spaces. In this field this workwas done with the help of the expertise of aGerman Company and under the supervision ofthe Natural Resources Authority and theMinistry of the Environment.

It is worth mentioning that Oil shale in Jordanis available in great quantities in Al-Lajoun area,Jorf al Darawish and other areas in the southernpart of the Kingdom. These quantities areestimated at about (40) billion tons, or theequivalent of (28) billion barrels of oil. The costof extracting the oil barrel from oil shale isconsidered feasible economically, in the light ofthe increasing rise of oil prices, witnessed in theworld oil markets.

Wind EnergyNEPCO is taking part in making technical and

economical feasibility studies done by DilinofaCompany of America for installing wind turbineswith a capacity of (35) MW, through a project tobe carried out, on (B.O.O.T) basis at Hofa andAl-Ibrahimiyah. These studies are expected to becompleted in the second quarter of 2007.

Ministry of Energy and Mineral Resources(MEMR) is preparing studies to increase anddevelop the utilization of the renewable energyresources. These studies are funded by theJapanese grant of (one) million dollars, andunder the supervision of the World Bank.

It is worth mentioning that MEMR signed acontract with an international consultant to studythe current legislations and set a law to promoteutilizing the renewable energy resources. This lawwas drafted then put in its final version. It isexpected to be issued during a short period of time.

BiogasNEPCO took part in the study titled: "National

Strategy for Biogas and Waste Treatment", whichwas completed by the National Centre for EnergyResearch, in cooperation with several ministries,corporations and government departments. Thisstudy included recommendations to overcome thetechnical, financial and legal obstacles whichhinder the utilization of biogas resources and otherenergy resources available in the wastes. Thefollow up is continuing on this matter in order toovercome these obstacles and to start utilization ofthese resources.

The Jordanian Biogas company continued togenerate electrical energy. The installed capacitywas increased to reach (4) MW in 2006, thegenerated energy has reached (6) GWh in year2006 against (5) GWh in year 2005. This station

and Rehab Power Generation Station were fed toburn the imported natural gas.

The Syrian party assigned, in 2005, aninternational company to implement the thirdstage of the gas project, extending from thesouthern part of the Jordanian-Syrian borders toHems City with a length of (310) km. Work onthis part has begun in early 2006. The Turkishparty will complete the northern part that comesafter the third stage, extending from Hems city tothe Syrian Turkish borders with a length of (210)km , to export the Egyptian gas to Turkey andEurope at a later stage.

The Arab gas pipeline project is consideredone of the most important strategic and vitalprojects, due to the increasing economicalsignificance of natural gas, since it is a source ofcost-effective energy, with suitable productioncost and its being one of the environmentfriendly energy sources.

Projects of Utilizing the Local EnergySources For Electricity Generation

Natural Gas at Al -RishaDuring 2006, Al-Risha field remained working

as usual in producing the natural gas, burnt byAl-Risha Power Generation Station.

Two agreements were signed with oilexploration companies for exploring in the easternareas of the country. If these exploration effortssucceeded, the electric energy generated at AlRisha station will increase in large quantities.

The extracted natural gas from Al-Risha fieldsin 2006 was (251) million cubic metres, against(242) million cubic metres in 2005 with aincrease of (3.7%). The volume of generatedenergy at this station was (662) GWh against(655) GWh in 2005, with a increase of (1.1%).

Oil ShaleMEMR signed three memorandums of

understanding with specialized companies toutilize the oil shale in Al Lajoun area. Thesecompanies were given a respiting period to offerthe technology they have, the productionmechanism they use and the results of theresearch they do, after which they go intopartnership agreements with the government.

The Jordan Cement Company made a trialutilization of oil shale as a substitute for the fuelused in electricity generation, by consuming (56)thousand tons of oil shale which were extractedand transported to Al-Fuhais, to be crushed inwell-locked chambers, then to be transferred to


in addition to carrying out the essential activitiesaiming, in general, to enhance and develop thenational transmission network, NEPCO alsobegan implementing another set of projectswhich will be accomplished in the coming years.

The projects and activities of NEPCO can besummed up as follows:

* Projects for Enhancement of the 132 kVTransmission Network And the ElectricitySupply Points to the Areas of theDistribution CompaniesTo enhance the main electricity supply points to

the areas of the distribution companies, NEPCOcould in 2006, implement, operate, test and completethe following projects, by its own technical cadre:- Expanding Zarqa Substation of 132/33 kV by

adding one new (80) MVA transformer andtwo new bays of 132 kV (a generator bay and atransformer bay (80) MVA), and replacingexisting bays. The whole project wascompleted and electrified in July 2006 exceptfor the transformer (80) MVA, which isexpected to be electrified in the second quarterof 2007. The cost of the project was about JD(1.456) million. It aims to enhance the nationalgrid and increase its reliability and continuity.

- Expanding Queen Alia International Airportmain substation of 132/33 kV. This expansionincludes adding a double bus bar bay of 132kV, two bays of 33 kV and a transformer with acapacity of (45) MVA. This aims to feed thefurnaces at the factory of the Jordan UnitedCompany for Iron and Steel Manufacturing.The estimated cost of the project was about JD(870) thousand. It was electrified in May 2006.

- Expanding Amman South substation of 132/33kV, by adding (3) bays of 132 kV and a newtransformer with a capacity of (45) MVA. Theproject was electrified in November 2006. Itsestimated cost was about JD (1.08) million.

- Expanding Al-Subeihi Substation of 132/33kV, by adding two bays of 132 kV to connectthis substation with Amman North Substationof 400/132 kV, and adding six sets of capacitorbanks of (10) MVA each. This project waselectrified in April 2007. It estimated cost isabout JD (1.5) million.

- Expanding Al-Abdali Substation of 132/33 kV,by adding four bays of 33 kV, to enhance thedistribution network of JEPCO in ZarqaGovernorate. The project was electrified in July2007. Its estimated cost was about JD (320)thousand.

has stopped the emission of about (5.7) millionCubic meters of methane gas to the environment.

Utilization Of Solar Energy Resources ByMeans of Photo Cells

A leading industrial company in the field of photocells (Isophoton) made a visit to the Kingdom. Itheld a seminar on the merits of photo cells and theireconomic feasibility, especially in the countries thatenjoy a high solar radiation such as Jordan. There ishope that the projects of generation by means ofphoto cells for the purposes of connection with thenetwork, will be feasible economically during aperiod of not more than five years. The cost of thesecells are witnessing continuous decrease due to thecompetition in this field.

NEPCO’s ActivitiesNEPCO continued carrying out the mission

assigned to it, which achieves the followingobjectives:• Conducting planning studies on the needs of

the electric system in the Kingdom, includingthe generation capacity, the main substationsand transmission lines.

• Construction, planning, development,operation, maintenance and management of thecontrol systems, the transmission networks andthe electric interconnection.

• Management of the processes of purchasing,transmitting, control and selling of the electricenergy inside Jordan and with the neighbouringcountries, in addition to conducting the planningstudies required in this field.

• Providing services, consultancy and studiesrelating to the electric energy to various partiesinside and outside Jordan.

• Setting a comprehensive quality control systemfor all NEPCO's activities and following up itsimplementation and developing it.

• Purchasing natural gas to meet the needs of thepower stations, and selling it to the electricitygeneration companies.During 2006, a data base was built, related to

following-up of the projects under construction,and the different projects, in addition to theissuance of monthly technical and financialreports on the development of the work..

Another data base is being prepared, on theperformance standards of the Jordan nationaltransmission network, which is expected to becompleted and put in service during 2007.

In 2006, NEPCO could accomplish a numberof Substations and Transmission lines projects,


will replace the existing Substation with acapacity of (3 x 80) MVA, ten circuits of 132 kV,26 circuits of 33 kV and capacitor bank with acapacity of (60) MVAr. This project waselectrified in March of 2007. Its estimated cost isabout JD (5.8) million.

- Constructing Al-Hashimiyah Substation of132/33 kV, which comprises constructing fourbays of 132 kV, one of them will be a completetransformer bay. The others will be insulatorscurrent and voltage transformers andtransformer bays with a capacity of (63) MVA,and two bays of 33 kV and their ancillaries tosupply the Jordan Iron Coalition Company.NEPCO's technicians began implementing theworks of the project, This project waselectrified in March of 2007, with an estimatedcost of about JD (905) thousand.

- Constructing Al-Salt substation of 132/33 kV.This project comprises two 132/33kVtransformers (80)MVA each and theirancillaries and seven outdoor double bar baysof 132 kV, 13 bays of 33 kV, four capacitorbays of 33 kV (4 x 10) MVAr and theirancillaries. This project aims to enhanceelectricity supply for JEPCO in the middle ofthe Kingdom. It will be implemented by theCompany's technical cadre, and it is expectedto be completed in December 2007. Itsestimated cost is about JD (2.3) million

- Constructing Al-Dhuleil Substation of 132/33kV. The project comprises two transformers of132/33 KV with a capacity of (2x80) MVA andtheir auxiliaries and seven outdoor double barbays of 132 kV, 13 bays of 33 kV, four capacitor

- Expanding Sahab Substation of 132/33 kV, byadding a transformer bay of 132 kV, and atransformer of 132/33 kV with a capacity of(63) MVA. This project was electrified in April2007. Its estimated cost was about JD (474)thousand.

- Expanding Ma’an substation of 132/33 kV, byadding two bays of 33 kV. The project waselectrified in January 2006. Its estimated costwas about JD (80) thousand.

- Expanding Abdoun Substation of 132/33 kV,by adding two bays of 132 kV (GIS) to connectthis station with Amman South Substation, atransformer bay of 132/33 kV and atransformer with a capacity of (80) MVA andtwo bays of 33 kV (a transformer and a feeder).This project was electrified in October 2006. Itestimated cost was about JD (1.56) million.

- Expanding Marka Substation of 132/33 kV, byadding a bay of 132 kV, a transformer of 132/33kV with a capacity of (80) MVA and 24 bays of 33kV and their ancillaries. The project aims toenhance the electric supply for Amman area. Theproject was completed and electrified in July 2006.It's estimated cost was about JD (2.2) million.

- Expanding Tareq Substation of 132/33 kV, byadding a bay of 132 kV, a transformer of132/33 kV with a capacity of (80) MVA andfour bays of 33 kV with their ancillaries.NEPCO's cadre will implement the works ofthe project, which is expected to be completedin the second quarter of 2007. Its estimated costis about JD (850) thousand.

- Constructing the new Bayader Substation of132/33 kV. This new indoor Substation (GIS)

Transmission Lines Maintenance


NEPCO, and another billing centre at theheadquarters of CEGCO.

The total cost of the project is about JD (1.2)million. NEPCO will cover about (55%), whileCEGCO will cover (45%) of the cost. This newsystem was connected to the old one, where themeter system of all the circuits included in thisproject were electrified in the first third of 2006.Work is going on programming the billing systemwhich is expected to be effective in mid 2007.

* Transmission Lines ProjectsDuring 2006, NEPCO implemented the

following transmission lines projects as follows:- Connecting Amman South and Abdoun

Substations with a double circuit underground132 kV cable, with a length of (7) km.

- Connecting Tareq and Al Bayader Substationswith a double circuit underground 132 kVcable, with a length of (12.4) km.

* Projects Under Construction:- Al-Subeihi-Amman South 132 kV double

circuit overhead transmission line. This projectaims to enhance the stability of the nationalgrid and increase its reliability, throughconnecting Al-Subeihi Substation with AmmanNorth with an overhead transmission line of132 kV with a length of about (34) km. Theproject consists of the following components:• A double circuit transmission line of 132 kV

with a length of about (25) km, that carries thetwo circuits of Al-Subeihi and Amman North.

• A quad circuit transmission line of 132 kVwith a length of about (6) km that carries thetwo circuits of Al-Subeihi - Amman Northcircuits, carries two extra circuits with alength of (6) km from Amman North S/S.

• A quad circuit transmission line that carries thetwo circuit of Al-Subeihi – Amman North, andthe two circuits of Al-Subeihi-Amman Southwith a length of (3) km, from Al-Subeihi S/S.

- A project of a quad circuit of the Al-Dhleilbranch of 132 kV. This project aims to connectAl-Dhleil Substation to the national gridthrough modifying Zarqa-Sabha transmissionline to become as follows:• Zarqa-Al-Dhleil transmission line of 132 kV

with a length of about (20.78) km.• Al Dhleil-Sabha transmission line of 132 kV

with a length of (29.51) km.- A project of a quad circuit Al-Sarow branch of

132 kV. This project aims to connect Al-Salt

bays of 33 kV (4x10) MVAr and theirancillaries. This project aims to enhance theelectricity supply for the networks of JEPCOand IDECO. The project will be implemented bythe technical cadre of NEPCO. It is expected tobe completed in December 2007 with anestimated cost of about JD (2.3) million.

* Projects for Connecting the PowerGeneration Stations

- Expanding Al-Samra Substation of 400 kV (firststage), by adding a generator bay of 400 kV, to beconnected to the new gas turbine which isexpected to be operated in July 2007, in additionto a 400 kV bus section bay. The project isexpected to be electrified in the second half of2007, with an estimated cost of JD (6.65) million.

- Expanding Al-Samra Substation of 400 kV(second stage), by adding two 400 kVgenerator bays and one 400kV transformer bay.The total estimated cost of the project in aboutJD (12.5) million. The works of the project hasstarted and it is expected to completed in thefirst half of year 2008.

- Expanding Zerqa Substation of 132/33 kV byadding a new generator bay of 132 kV,replacing all the equipment of the existing baysand upgrading the capacity of the bars of 132kV. The project aims to enhance the nationalgrid and increase its reliability and stability. Allthe replaced bays in the station and thegenerator bay were electrified in July 2006.The project's cost was JD (1.456) million.

- Constructing Amman East Substation of 400kV. A switching station 400 kV will beconstructed. It is an outdoor station whosetender was awarded to CYMI of Spain. Thestation comprises four transmission line bays of400 kV, three generator bays of 400 kV, one400 kV bus coupler bay, and two stand-bybays. The estimated total cost of the project isabout JD (11.15) million. Work on the projecthas commenced. It is expected to be completedin the first quarter of 2008.

* Energy Measuring Systems and BillingCentres With CEGCOThis project comprises providing, installing,

testing and operating the systems of electricenergy metres between NEPCO and CEGCO.This project covers the power stations of Aqaba,Karak, Amman South, Rehab, Marka, HusseinThermal, Al-Risha, Al-Samra and a number ofother substations, in addition to establishing abilling centre at the National Control Centre of


development tender, management of the projectand supervision on implementing it.

- Tender no 37/2006 concerning the developmentof the control centre equipments and programs,was issued in August 2006. The technical andfinancial offers were received in December 2006for the equipment of control operating systems.

- With cooperation with the InternationalServices Department, the project ofSCADA/RANGER was accomplished in theEmirate of Abu Dhabi.

b- Communication SystemsDuring 2006, NEPCO carried out many

communication systems which are as follows:- Modern telephone switchboards were supplied and

operated, within tender number 16/2005 to thesubstations of Qatarneh, Maan, Amman North,Irbid, Aqaba,, Karak, Sahab, Al-Azraq andAl-Risha, to enhance and increase the rehabilitationof the existing telephone services at NEPCO.

- Fiber optic equipment and preventive alternateequipment were supplied, installed and operated,within tender number 32/2004, to the substationsin the middle area and the control centre.

- The communication channels concerning theprevention system were modified to meet theneeds of the defensive plan of the electricsystem, which came from the recommendationsof the consultant (CESI).

* Projects Under Construction- Supplying chargers for the substations of Irbid,

Fuheis, Marka, Zerqa, Sahab, Aqaba Thermal andSubeihi, tender number 1/2006, in addition totender number 49/2006 for installing batteries.

- Supervision on installing control cameras atdifferent sites within tender number 12/2006.These sites are the main offices, Amman South,Amman North, Qatraneh and centralwarehouses.

- Supervision on laying and welding the opticalfibres laid with the high voltage cable, withinthe cables tender concerning Amman-SouthAbdoun line and Tareq-Al-Bayader line.

- Installing and operating the equipment of opticalfibres for the new substations (The University ,Al-Hashimiah, Amman East) within thevariation order of tender number 32/2004.

* Communication Projects through theInternational Services Department

- Connecting the site of Ministry of HigherEducation, Faculty of Medicine-Muta

Substation to the national grid, by modifyingAmman South - Al-Subeihi transmission lineof 132 kV to be as follows:• Amman South-Al-Salt transmission line of

132 kV, with a length of about (27.96) km• Al Salt-Al Subeihi transmission line of 132

kV with a length of about (15.38) km.- Project of a quad circuit of Al-Hashimiyah

branch of 132 kV. It aims to electrifyAl-Hashimiyah Substation by connecting it tothe national grid with an overhead doublecircuit transmission line of 132 kV of about(2.6) km long, branching from Zarqa-Rehabexisting overhead transmission line of 132 kV.

* Overhead Transmission Lines to BeImplemented By The Beginning of 2007

- Connecting Amman East to AmmanNorth-Amman South line of 400 kV with a lengthof about (16) km. This project aims to connect theIPP at Amman East to the national grid.

- Jericho-Sweimeh line of 132 kV with a lengthof about (22) km. This project aims to supplyJericho city with the needed electric energyfrom the Jordanian electric network.

* Operating the Interconnected SystemDuring 2006, NEPCO continued the effective

management of the Jordanian electric system tosecure supplying the consumers with electricpower, according to the adopted standard fromall available sources, for the least possibleeconomical cost, while maintaining the securityof the electric system.

The operation pattern was prepared whileimplementing the needed maintenance plans, inaddition to making the needed calculationsconcerning the management of electric energyexchange on the interconnection lines withneighbouring countries.

a- Supervisory and Control Systems

During 2006, NEPCO continued thedevelopment of supervisory and control systemto meet the operational needs of the electricsystem, represented in the followingachievements: - Studying the technical and financial offers to

develop the supervisory and control centre,tender no. 35/2005, concerning the secondstage of the development project. The tenderdocuments were accomplished, and the finalversion was issued, in addition to the missionof consultancy services included in the


2007 to continue the work with this contract tillthe end of year 2007.

- In June 2005, the contract on electric energyexchange for the years (2005-2006) betweenthe Jordanian and Syrian sides was renewedand it was decided in Jan 2007 to continue thework with this contract till the end of year2007.

- During 2006, NEPCO imported (472) GWhfrom the Egyptian network and (42) GWh fromthe Syrian network to meet Jordan's needs ofelectric energy. This led to technical andeconomical benefits for the three parties.

- (51) GWh of electric energy were passed in2006 from the Egyptian network to the Syriannetwork, through the Jordanian electricnetwork. This led to economical benefits forthe Jordanian party as a result of the wheelingcharges fees.

- The exchange of electric energy continuedbetween Libya and Egypt, since the operationof the interconnection between the twocountries which was in 1998. But Jordan has noelectric energy purchase or exchange with theLibyan side. And there was not any case ofelectric energy passing from or to the Libyannetwork through the Jordanian network.

Syrian-Turkish Electric Interconnection- A technical and a trade agreement for the

transfer of electric energy from Turkey toSyria via 400 kV Bireik-Aleppo electricitytransmission line were signed on October 2006in Damascus/ Syria.

- The Syrian-Turkish electric interconnectionline is expected to be operated synchronouslyafter the approval of the European Union forElectric Energy Transmission and Distribution(UCTE) on the seven countries electricinterconnection's joining this union, which isexpected in mid year 2008.

Syrian-Lebanese Electric InterconnectionThe Syrian-Lebanese electric interconnection

line is expected to be in operation in the end ofyear 2007.

The Iraqi-Turkey Electric Interconnection- Since September 2003 a single circuit 400 kV

transmission line was operated between Turkeyand Iraq and this line is working on 154 kVvoltage. This line is used to provide someisolated area’s in Iraq from the rest of theelectrical network . Another 400 kV line willbe constructed to increase the amount of

University to the network of the optical fibresrelated to the state universities.

- Making welding joints of optical fibres for MajCompany within the project of Al-Samra, andconducting a study to connect the civil defencesites within one communication network.Maintenance works were carried out for theoptical fibres network of the universities network,where Al-Hussein University was re-connected,after the path of optical fibres was cut.

* Interconnection ProjectsThe most important achievements of NEPCO

in the field of electric interconnection withneighbouring countries can be summed up asfollows:

• The Seven Countries ElectricityInterconnection Project (EIJLLST)This project aims to connect the electric

networks of Egypt, Iraq, Jordan, Lebanon, Libya,Syria, and Turkey. The networks of Jordan,Egypt, Syria and Libya have been connected. Abrief on the work progress of the projects is asfollows:

The Jordanian, Egyptian, Syrian and LibyanElectric Interconnection- In March 2006, the contract on electric energy

exchange for the year 2006 between theJordanian and Egyptian sides, was renewed,and it was agreed between the two sides in Jan

Live Transmission Lines Insulators Washing


Operational experiments will be conductedagain to connect the Libyan electric networkwith the Tunisian network during 2007.

The interconnection line between the twocountries is expected to be operated after thesuccess of these experiments.

With the operation of the Libyan-Tunisianinterconnection line, the electric networks ofSyria, Jordan, Egypt and Libya will be connecteddirectly with the European electric networkthrough Al-Maghreb - Spain interconnection.

• The Pan Arab Electric Interconnection ProjectIn the year 2006, NEPCO, through

representing the general secretariat of the sevencountries electic interconnection project, in themeetings of the Arab experts, members of theexecutive office of the Arab Ministers Council,concerned with electricity affairs, continued thepreparation of the draft of terms of reference tostudy the electric interconnection between theArab countries and the other countries andevaluation of utilizing the natural gas to exportelectricity.

This aims to prepare technical and economicalfeasibility studies to select the best method tocomplete connecting the electric networks of theArab countries, including those which are notpart of the existing projects of electricinterconnection, in addition to review the electricinterconnection projects and existing and futuregas networks. It is expected that these terms ofreference will be accredited by the executiveoffice of the Arab ministers Council, concernedwith electricity affairs, then initiating taking theneeded procedures to conduct these studies in thefirst half of 2007.

* Planning StudiesIn the year 2006, NEPCO set up a five year

corporate plan covering the programmes andwork plans for the projects during the years(2007-2011), to achieve the goals and futureaspirations, on public and private levels.

In 2006, NEPCO updated the study on thecomprehensive plan for the electricity sector in thecountry for the period (2007-2020) and prepared astudy of load forecast for the period (2007-2011).The study included preparing the electricitydemand forecast and the planning studies todetermine the Jordanian electricity needs of thegeneration capacity needed to meet the expectedelectric loads, and to maintain a good generationreserve and safe operation of the electric system.The study was issued in July 2006.

electrical energy exchanged between the twosides.

- Synchronous parallel operation of Turkish andIraqi power systems will be considered afterthe connection of Turkey to (UCTE).

The Syrian-Iraqi Electric InterconnectionThe works concerning this interconnection

have not begun yet, but the two sides haveshown their willingness to start implementing theproject between the Qaim 400 kV S/S in Iraq andTayem 400 kV S/S in Syria, this requires theconstruction of a 400 kV, (160) km transmissionline between the two S/S and requires thereinforcement of the Syrian electrical networkwhich is expected in mid 2008.

The Most Important Activities Concerningthe Project- A regional office based in the Egyptian

Electricity Holding Company, was establishedto collect, distribute and exchange thetechnical information among the seveninterconnected countries and the ArabMaghreb countries. This office started work inJune 2006. It is considered the first nucleus toestablish a coordinating control centre for theseven interconnected countries and the ArabMaghreb countries, after the completion of theprojects of electric interconnection betweenthese countries.

- A specialized committee of the concerned fromJordan, Egypt and Syria is conducting a studyfor the integrated planning for theinterconnected Jordanian, Egyptian and Syriannetworks. This study is expected to becompleted in the end of year 2007.

- The eleventh ministerial meeting for the(EIJLLST) countries was held in Cairo in Jan2007, the most important results of the meetingwere as follows:-• The approving in principle the joining of the

Palestinian grid to the (EIJLLST) project.• The importance to reinforce the electrical

interconnection networks between theconcerned countries in order to increase theexchanged electrical capacities between them.

• The importance of activating the General &Bilateral operation and planning committeesamong all concerned parties.

• Electric Interconnection Between TheSeven Interconnected Countries andEurope (Mediterranean Countries)


The most important achievements can besummed as follows:1- The Extensive Computerizing Programme

which was Implemented, Including:a- Adopting one safe and developed computer

network for all applications, in addition tothe automatic reserve copying

b- Adopting operation systems and open databases

c- Adopting the ERP system for a set ofapplications at NEPCO.

2- Geographical Information System (GIS) :A system for geographical information wasbuilt to meet NEPCO'S need, where thegeographical sites were connected with thetechnical information concerning the electricequipment. Work was made to convert all themaps and designs of NEPCO transmissionnetwork, and substations, particularly theinformation related to usage, property andcompensation , in addition to benefiting fromthe designs and maps to study the designs andlocating the lines paths and future stations.

3- Portal project for NEPCO :This project was designed and implemented,in addition to exploiting and employing thestructure of modern information technology,that is available in NEPCO.

4- NEPCO's Computer Network :NEPCO constructed through its cadre themanagement of this network, control of itsperformance, upgrading its efficiency andavailability though programmes put speciallyto control this network.

5- NEPCO'S Website on the Internet :An automated updating system wasprogrammed for NEPCO's electronic website.This system adopts a modern and developingmechanism for the updating process, neededfor the site's information and data.

6- The Electronic Site of CIGRE Committee :Work has been started to design and update awebsite for the Jordanian National CIGREcommittee.

7- NEPCO's Data Base :Work has continued to control theinformation security on the Company's database. This data base is under continuousmanagement and daily, weekly and monthlycontrol, to perform according to integratedwork mechanism which keeps this data baseworking and proper all the time.

In cooperation with the Egyptian ElectricityHolding Company and the Public Establishmentfor Electricity Generation and Transmission inSyria, NEPCO is conducting a study onintegrated planning for the needs of the threecountries, of generation capacity andtransmission network, in addition to determiningthe economical optimal alternative for thecombined generation expansion. The economicalstudy draft was issued in December 2006. Inearly 2007, it is expected to commenceconducting the technical studies on theinterconnected electric networks to determine theoptimal site, technically and economically, toconstruct the future generation stations. This willlead to curb considerably, the capital andoperational costs in the three countries. Thestudy is expected to be completed in the secondhalf of 2007.

NEPCO also prepares quarterly and annuallyreports on the performance criteria of the electricsystem according to the international basics. Theperformance indicators of NEPCO werecalculated according to the performance criteriaprepared by the Electricity RegulatoryCommission. The results showed the indicatorswere within the permissible limits .

* Energy Conservation and Electric LoadManagement

Due to the sharp rise in the international oilprices during the year 2006, which resulted inlocal rise in the fuel prices, which is expected tocontinue in the future, and in light of thegovernment's interest in energy conservationeffort which was expressed through manycirculations on this regard, NEPCO paidincreasing attention to electric energyconservation and load management. This aimedto reduce the peak load of the electric system,through studying the electric load patterns of theconsumers, and determining the availableconservation chances and load management.During 2006, a study on the electric load patternfor many sectors consuming electric energy wasconducted. The study dealt with the loads ofseveral economical sectors. It aimed to draw theappropriate plans to conserve the electric energyconsumption of these sectors and shift their loadsoutside the period of the peak load.

Computer TechnologyIn the year 2006, NEPCO continued attaining

many achievements in the field of the computertechnology development, and provided services forall the concerned parties inside and outside NEPCO.


IEC adopted by the Company.- Paying continued attention to the scientific re-

search by obtaining the scientific material andthe findings of studies and research, throughthe pamphlets and scientific papers issued bythe international unions and societies con-cerned with electricity affairs.

- Developing cooperation with the Jordanianuniversities in the field of scientific researchand arranging for lectures and seminarsspecialized in electricity sector .

- Providing the main library at the headquartersand the other libraries at NEPCO, withscientific books and pamphlets.

As for the field of public safety andoccupational and environmental health, NEPCOcontinued its efforts to provide its staff and thepeople dealing with it, with utmost measures ofsafety. NEPCO adopted the policy of publicsafety and occupational and environmentalhealth through the following:- Providing the instructions and regulations in regard

to safety and the occupational and environmentalhealth related to the Company's activities, issuingthe needed legalizations and following up theirbeing applied while updating them according to thework needs and developments.

- Educating the staff and raising their awarenessto comply with the regulations, instructions ofsafety and occupational health andenvironment.

- Providing the equipment of public safety andfire extinguishing, and personal protection forthe staff according to the internationalspecifications.

- Evaluating the safety performance by makingtours to the various sites.

- Preparing the reports on the work accidents andmaking the appropriate investigation to identifythe real causes and prevent their occurrence inthe future.

- Setting the emergency plans and upgradingthem in coordination with the concerned partiesinside and outside the Company.

- Following up conducting studies on the effectsof the different Company's projects on theenvironment.

Electric Training CentreNEPCO implemented several training projects

and programmes at its Electric Training Centre,as follows:• Internal long term training programmes

8- The Electronic Government :NEPCO participated effectively in theelectronic government project, as forproviding the information about theCompany, the services it delivers, andfollowing-up and updating the information ina continuous manner.

Quality, Public Safety and the EnvironemntNEPCO continued its efforts to develop its

services by adopting the most modern systemsfor quality management, technical auditing,public safety, occupational health and theenvironment needed to develop the work andimprove the performance while paying attentionto the environmental affairs at the Company. Inthe field of quality and technical auditing, thefollowing tasks were achieved as follows: - Setting a system for quality control to match the

technical development and conform with thechanges , in addition to putting accurate, realisticand measurable standards of performance.

- Drawing strategic policies which lead to theinternational quality stages, and be acquaintedto the practices, indicators and standards ofArab and international quality control.

- Endorsing the internal policies and internal instruc-tions on quality control, and taking the steps need-ed to acquire the certificate of the quality manage-ment system according to ISO 9001: 2000.

- Upgrading the excellence values and the com-petition abilities, in addition to disseminatingthe culture of quality as wide as possible, sinceit is a civilized behaviour.

- Preparing comprehensive periodical reports onthe application of quality control systemsthrough the different technical activities.

- Following up updating the technical auditingsystem for all the technical departments andsections.

- Auditing the works of maintenance and opera-tion of the equipment and systems, to get surethat those works are implemented according tothe laid plans.

- Auditing the works under implementation to getsure of their compliance with the plans,specifications and terms, included in their tenders.

- Getting sure of compliance with the laws, sys-tems, instructions, work guides, practice codesand measurements adopted by the Company,when implementing the new constructions ormaintenance works.

- Auditing and reviewing the technical standards


NEPCO, in addition to providing support andfunding from (JICA) with about JD 134 thousand.

• Testing and installing the earthing system,installing lightening rods, and measurements ofthe earthing resistance for a new station onbehalf of the Jordan United Company for Ironand Steel Manufacturing.

Consultancies and International ServicesDuring 2006, NEPCO continued providing a

number of services and consultancies inside andoutside Jordan, as follows:- Implementing the agreements on regular testing

of the oils of transformers of Jordan CementFactories Company.

- Setting and implementing technical trainingprogrammes for engineers and technicians fromthe Jordanian electricity companies and the Jor-danian Rural Electrification project affiliated tothe MEMR.

- Implementing the project of studying andanalyzing the tenders and offers from thesupplying and manufacturing companies, of thematerial which the Public Electricity Authorityof Yemen, imports through public tenders.

- Implementing five training programmes forcadres from the Palestinian Ministry of Energy.These programmes were funded by the WorldBank..

- Training cadres from the Public ElectricityAuthority of Yemen. This activity was fundedby (JICA).

- Signing a cooperation agreement with UNDP tofund training programmes, to be implementedat the Electric Training Centre on behalf of thecadres of the Iraqi Ministry of Electricity.

- Signing an agreement to provide consultancyservices to supervise constructing an electricitypower station of (20) MW for the PublicYemeni Authority for Cement Manufacturingand Marketing in Al Barh area.

- Implementing agreements with (JICA) withinthe programme of the third party training intechnical, administrative and financial fieldsfor a number of employees from the IraqiMinistry of Electricity for the years 2006-2007.

- Implementing the project of consultancyservices in regard to conducting the economicalfeasibility studies and documents of bids, for anumber of electric energy projects in theRepublic of Yemen.

- Signing an agreement to carry out three trainingprogrammes in the field of live maintenance of

(regular) where the number of trainees withinthe thirteenth batch amounted to (15) on behalfof NEPCO.

• Local long term training programme (regular)where the number of trainees within the twelfthbatch was (45) on behalf of EDCO.

• Local training programme (short term) where(22) programmes were held for local entitiesand companies which were invited throughcorrespondence by fax, electronic mail andadvertising in the newspapers and the Centre'squarterly pamphlet. The number of participantswas (113) trainees.

• The internal training programme (efficiencyupgrading), where (52) programmes were heldfor all departments of NEPCO. The number ofparticipants was (252) trainees.

• Summer training programmes (universities andinstitutes) where the number of participantswas (54) students from Al Balqa' AppliedUniversity, Yarmouk University (HijjawiCollege) and Jerusalem college.

• External training programme: which was heldin the field of maintenance of substations,transmission lines and protection of the electricsystem. This programme was for (3) engineersfrom Palestine, supported and funded by theWorld Bank.

• In cooperation with the Japanese InternationalCooperation (JICA), five training programmeswere held, in which (41) trainees participatedin. These programmes were as follows:- Two in the field of power cables technology,

and designing the electric distribution systemfor (21) participants from the Republic of Iraq.

- Three training programmes for (20)participants from Yemen. The programmeswere on analyzing the load losses, operationof steam generation stations, and maintenanceof substations and transmission lines.

- Three training programmes were held in thefield of welding technology, power cablestechnology and developing electricdistribution networks. These programmeswere for (31) participants from the Republicof Iraq in cooperation with the UNDP.

- A training programme was held in the field oflive maintenance of medium voltagenetworks, in cooperation with EMECO, for(10) participants from Jerusalem GovernorateElectricity Company, in addition to providingthe equipment needed for this purpose.

• Updating the Centre's equipment by support from


to JD (375.3) million in 2006 against JD(327.1) million in 2005, with a growth rate of(14.7 %) while the increase in sales growth ratewas (11.8%).

- The operation expenditures were JD (497.0)million in 2006, against JD (399.7) million in2005, with a growth rate of (24.3%). Thiscomes as a result of increasing the electricalenergy purchase during 2006 with a growthrate of (11.4%), compared to (9.0%) in 2005.

- The operational profit percentage to the energysales revenues in 2006 was (2.4%), against(1.4%) in 2005.

- The value of purchased electric energy in 2006was JD (336.1) million against JD (295.8)million in 2005 with a growth rate of (13.6%).

- The interest on loans and the bank expenditureswas JD (8.0) million in 2006, against JD (7.2)million in 2005 with increasing of (11.1%).The increasing in loan interests was due to thewithdraw of all of the Arab Bank loan 2004with a value of JD (40) million, and thewithdraw of the Kuwait Fund loan with a valueof JD (18.7) million in 2006, as a result theinterests are becoming due on these loans.

- The net profit before tax, amounted to JD(0.478) million in 2006 against net losses JD(2.92) million in 2005. The most importantreasons for the profit in 2006 was due to :1- The decreasing of the average costs of the

kWh purchased in 2006 compared to theaverage costs of the kWh purchased in 2005 asa result of starting to operate Al-Samra andRehab power stations as a combined cycletechnology burning natural gas as a main fuel.

2- The obvious increase on the electricalenergy demand during 2006 from thedistribution companies and large consumers.

- The net book value of the fixed assets was JD(382.8) million in the end of 2006 against JD(386.2) million in the end of 2005, with adecrease of (0.9%). The covering of theburdens of debt service was (112.2%) in 2006against (106.2%) in 2005 .

- Current ratio in 2006 was (0.74) times against(0.82) in 2005.

- The net value of electric energy sales comparedwith the average fixed assets in 2006 was(103.8%) against (90.0%) in 2005. An evidentgrowth in this rate is well noticed which showsgood utilization of NEPCO’s assets, where thisrate in 2004, and 2003 was (89.1%) and(85.0%) respectively.

medium voltage networks for employees fromPalestinian Energy Authority, in cooperationwith EMECO.

- Signing an agreement between NEPCO andEDF to enter together in the tender ofsupervision project on the works oftransmission lines, substations and engineeringworks in the project of Ma'reb-Sana'a inYemen.

- Preparing a technical and financial offer foreconomical feasibility study on the project ofproviding electric energy to the western part ofIraq.

- Cooperation with Norconsultant Company ofNorway, through entering the tender tosupervise the works of provisional designing,setting the specifications and tender documentsand administering the project related to ruralelectrification in Capu Daljado/third stage, inMozambiqu.

- Bidding for the project of implementing distri-bution networks in the United Kingdom andIreland in cooperation with EMECO.

Manpower and TrainingAt the end of 2006, the number of NEPCO's

employees was (1084), as follows:

Out of the belief of the Company'smanagement in the importance of continuousdevelopment of the staff and upgrading theircapabilities to be competent in the following thedevelopments in the different fields of work,NEPCO pays special attention to the trainingprocess. In this field the Company draws atraining plan and carries out training coursesinside and outside the country to upgrade thestaff's efficiency, modernize their informationand develop their skills to acquire the ability ofinteraction with NEPCO future directions. Thetraining index for the year 2006 was (1.14%)against (1.64%) in 2005.

Financial PerformanceThe most important financial indicators for

NEPCO in 2006 can be summarized as follows:- The revenue of electric energy sales amounted

21.1%35.8%11.8%12.6%18.7%

- Engineers- Technicians- Financiers:- Administrators- Others


Table (1)

Significant Figures for Electricity Sector in Jordan

Growth2006/2005

(%)

2005 2006

8.610.115.2

-22.5-56.2-80.445.5

-10.5-

20.0588.410.1

234.2-36.3-82.6

-7.0

13.8-20.344.7

-55.90.5

7.3

5.82.2

--

2.4

1751201996547969

733416485735

5588712

3.8741241

18.1019432475809

1428238

3400

3429

11295468

99.999.87200

Peak load of Jordan (MW)Available Capacity (MW)Generated Energy (GWh)

Steam UnitsDiesel UnitsGas Turbines / DieselGas Turbines / Natural GasHydro UnitsWind EnergyBiogasCombind Cycle

Consumed Energy (GWh)Energy Exported (GWh)Energy Imported from Egypt (GWh)Energy Imported from Syria (GWh)Loss Percentage (%)Average(kWh) Consumed Per Capita Electricity Fuel Consumption (Thousands Tons)*

Heavy FuelNatural GasDiesel

National Grid Transmission Lines132 kV and above (km-Circuit)Substations Installed Capacities132/33 kV (MVA)No. of Consumers(Thousands)Population Under Supply(Thousands)Percentage of Population Under Supply (%)

All JordanRural

No. of Employees

19012222

111206177

3267

9435136

3841959312.747242

17.4720792817645

2067105

3418

3679

11955591

99.999.87370

* Equivalent Heavy Fuel Oil


Table (2)

NEPCO's Significant Figures

20032001 2002

1387

7967

7664

3.80

3346

3333

1280

901

354

1225

6937

6673

3.81

3026

2607

1280

807

333

1370

7436

7129

4.13

3037

2670

1280

861

339

2004

1515

8767

8447

3.65

3346

3413

2080

991

379

Growth2006/2005

(%)

8.8

11.4

11.8

-

0.5

7.3

-

4.1

3.2

NEPCO’s Purchased & Sold Electrical Energy (GWh)Fig (1)

Peak load for Interconnected System (MW)

Purchased Energy (GWh)

Sold Energy (GWh)

Transmission losses (%)

National Grid Transmission Lines

132 kV and above (km-Circuit)

Substation Installed Capacities

132/33kV (MVA)

Substation Installed Capacities

400/132/33 kV (MVA)

No. of Employees

NEPCO's Fixed Assets (Million JD)

2005

1710

9555

9219

3.52

3400

3429

2560

1041

407

2006

1860

10643

10307

3.16

3418

3679

2560

1084

420

GWh


12380.24148

42.9019.7223.1869.76

34.5085.4418.216.56

13.97

11170.24138

40.4417.5222.9260.21

35.8086.2018.246.71

12.46

1. Manpower IndicatorsAnnual Productivity (MWh / Employee)Installed Capacity (MW / Employee)No. of Consumers Per Employee

2. Financial IndicatorsTotal Cost per kWh Sold (Fils)

Fuel Cost per kWh Sold (Fils)Non Fuel Cost Per kWh Sold (Fils)

Average Heavy Fuel Price (JD / TON)*3. Technical Indicators

Thermal Efficiency of Generating plants (%)Availability of Generation Units (%)Total Energy Losses (%)Generation Losses (%)Transmission & Distribution Losses (%)

11750.24143

42.6819.4323.2567.40

35.8092.1218.306.64

13.60

13300.23153

44.3421.0523.2973.54

34.0086.4117.376.75

14.15

7.77.73.2

8.814.04.0

62.6

-----

* The price represents the average price during the year

Table(3)

Performance Indicators for Electricity Sector in Jordan

20032001 2002 2004 Growth2006/2005

(%)

Table(4)

NEPCO's Performance Indicators20032001 2002 2004 Growth

2006/2005(%)

8.5

5.3

34.0530.233.82

34.451.3610.5

135.0

3.80-

121468

1.17

8.3

5.2

30.5226.933.59

32.054.1344.4

136.0

3.81---

-

1. Manpower IndicatorsAnnual Productivity (GWh Sold per Employee)Transforming Installed Capacity

(MVA / Employee)2. Financial Indicators

Total Cost per kWh Sold (Fils)Cost of Energy Purchased (Fils/kWh sold)Other Cost per kWh sold ( Fils)

Revenue per kWh (Fils)Return on Average Net Electrical Assets ( %)Self Financing Ratio (%)Debt Coverage Ratio (%)

3. Technical IndicatorsTransmission losses (%)Circuit AvailabilityUnsupplied Energy (MWh)Average Incident Duration (Min)Average Frequency of Outages Per 100km-Circuit (400 , 132 kV) (times)

8.3

4.8

31.5228.213.31

33.504.0925.6

123.2

4.13---

1.09

8.5

5.7

34.0230.223.80

34.590.7614.5

119.0

3.6599.832541

69

0.84

6.7

-

2.21.77.13.4

---

--

-57.8-74.1

-

14060.26157

47.0322.8224.2187.20

34.3088.4118.106.17

13.57

2005

2005

8.9

5.9

35.8632.083.78

35.62-

2.7106.2

3.5299.68

85385

1.86

15140.28162

51.1926.0225.17

141.80

34.7085.2217.594.94

13.92

2006

2006

9.5

5.9

36.6632.614.05

36.840.1313.1

112.2

3.1699.56

36022

2.20


* Central Bank Figures

** Thousand Ton of Oil Equivalent.

*** Estimated

Table (5)

Gross National Product and Energy Demand in Jordan

GNP

in Current

Price

(Million JD)*

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

Year

2521.4

2736.9

3424.3

3735.2

4206.9

4597.9

4799.9

5090.1

5604.0

5769.0

6093.9

6496.7

6879.0

7312.6

8246.3

9278.6

10319.3***

Cost of

Living Index

(%)©1990Ω100%®

100.0

108.2

112.6

116.2

120.4

123.1

131.2

135.1

139.3

140.1

141.1

143.6

146.2

148.6

153.6

158.9

168.8

Total Energy

Demand

(Fuel)**

-

0.3

20.2

5.7

8.7

6.9

-2.1

3.0

6.8

2.4

4.9

4.8

4.0

4.6

9.1

8.8

4.7

GNP

Growth in

Real Terms

(%)

3306

3272

3770

3935

4152

4400

4590

4673

4784

4755

5114

5150

5299

5774

6489

7028

7187

Total Energy

Demand

Growth

(%)

5.5

-1.0

15.2

4.4

5.5

6.0

4.3

1.8

2.4

-0.6

7.5

0.7

2.9

9.0

12.4

8.3

2.3


* Estimated

Table(6)

Cost of Energy Relative to The National Economy

Table (7)

Electricity Demand Forecast in Jordan *

Growth©%®

Year

MW

8.9

7.6

7.5

6.3

5.1

3.7

2007

2008

2009

2010

2015

2020

2071

2228

2394

2545

3267

3910

Max. Demand

* Includes Energy Imported

Growth

(%)

GWh

10.4

7.4

7.2

7.0

4.9

3.7

12847

13794

14790

15819

20105

24146

Electrical Energy

Imports

(%)

Year Exports

(%)

16.4

16.9

18.8

19.9

23.9

23.6

2001

2002

2003

2004

2005

2006*

39.5

36.3

42.6

47.2

65.4

61.1

GNP

(%)

8.7

8.9

10.4

14.0

19.1

18.5

Cost of Consumed Crude Oil Relative to


Electrical Power System in Jordan

intergrated network and there are a few privatepower stations, which are not connected with theinterconnected network and serve only theirowners.

The total system installed capacity at the endof 2005 was (2222) MW, of which (2076) MW isthe capacity of the interconnected system, thismeans that the interconnected system constitutes(93.3%) of the total installed capacity in Jordan.

The total length of 132 kV network and aboveis about (3418) km- circuit and the total installedcapacity of the substations is (6439) MVA.

The interconnected system in Jordan consistsof the main generating power stations, 132 kVand 400 kV transmission network. Thistransmission network interconnects the powerstations with the load centers and different areasin the kingdom. The system also includes the 230kV, 400 kV tie lines with Syria and 400 kV tieline with Egypt and the distribution networkswhich serve about (99.9 %) of the totalpopulation in Jordan. In addition to that, theelectrical power system in Jordan includes someprivate power stations, which are synchronizedwith the rest of the power stations in the

National Grid in Jordan’sPower System


Table(8)

Main Operating Components of The Electrical Power System in JordanA- Generating Plants Available Capacity (MW)

B-Substations Installed Capacity (MVA)

C- HV Transmission Lines Length (km-Circuit)

* Converted to Work on 33 kV

D- Distribution Networks of ( JEPCO, IDECO & EDCO ) as of end 2006

Voltage (kV)

a- Overhead Linesb- Underground Cables

D-1-Distrbution Lines (km)

0.46.61133

11/6.633/11,6.633,11,6.6/0.4D-2-Substations (MVA)

12.52216.05419.6Capacities of Substations as of end 2006

25972.54188.4

0.55.4

1376.42589.4

7845.61418.9

66/3310-----

132/6757575757575

132/33260726703333341334293679

230/132200100100100100100

400/132/33128012801280208025602560

Year200120022003200420052006

132/11-

1313252525

Year

200120022003200420052006

400 kV

809809817817871871

230 kV

171717171717

66 kV*

171717171717

Gas TurbinesTotal154116431643164318732076

Hydro Units101212121212

N.Gas120120120120150210

Diesel353453453453353193

Diesel Engines434343434343

Steam101310131013101310131013

Year200120022003200420052006

Biogas111114

Wind1.41.41.41.41.41.4

Combind Cycle----

300600

OverheadLines220022112512251225122491

UndergroundCables

-----

39

132 kV


10.0

-1.3

-

4.0

-95.0

-3.4

-17.6

20.0

-36.3

-82.6

-11.5

-

-

-20.0

-68.0

10314

9086

30

101

6

87

17

5

741

241

322

91

166

15

50

10636

8.6

1.Interconnected System

CEGCO

SEPGCO

Potash Co.

Cement Factory

Indo-Jordan Chemicals Co.

King Talal Dam

Jordan Biogas Company

Imported Energy from Egypt

Imported Energy from Syria

2. Other Large Industries

Refinery

Fertilizer Co.

Hussein Iron Factory

United Iron & Steal Manufacturing Co.

Total

Growth Rate ( % )

9483

8449

-

96

10

80

16

6

788

38

310

83

163

16

48

9793

9.2

8651

7468

-

96

10

84

15

6

972

-

315

92

156

16

51

8966

6.1

8150

7615

-

95

10

93

10

5

322

-

304

93

153

15

43

8454

8.2

7616

7132

-

115

25

65

7

5

267

-

200

87

97

16

-

7816

5.3

Electrical Energy in Jordan

GWh. Table (9&10).

The share in the generated energy was asfollows:

From the above percentage, it is clear thatCEGCO covers the largest part of the kingdomelectrical demand since it participated in about(81%) of the generated energy.

Generated EnergyThe generated energy for the purpose of local

consumption amounted to (11120) GWh in 2006,compared to (9654) GWh in 2005 representingan annual growth of (15.2%) Compared to(7.7%) in 2005.

CEGCO produced (8966) GWh in 2006compared to (9086) GWh in 2005 representing andecrease of (1.3%), and Samra Electric PowerGeneration Company (SEPGCO) produced (1660)GWh in 2006 compared to (30) GWh in 2005

The industrial companies produced (474)

Table(9)

Electrical Energy Generated and Imported in Jordan (GWh)

Growth2006/2005

(%)

20052004200320022001

(80.6%)(14.9%)(0.1%)(0.1%)(4.3%)

CEGCOSEPGCOKing Talal DamJordan Biogas CompanyIndustrial companies

11349

8966

1660

105

0.3

84

14

6

472

42

285

91

166

12

16

11634

9.4

2006


16.5-23.8-80.445.5

100.0-10.5

-20.0

588.4-8.10.2

-60.615.2

106465731

67943

45136

384147444628

11120

1. Electricity SectorSteam UnitsGas Turbines / DieselGas Turbines / Natural GasDiesel Engines / HFOHydro UnitsWind EnergyBiogasCombind Cycle

2. Industrial SectorSteam UnitsDiesel Engines / HFO

Total

91387524341648

25735

55851644571

9654

84717168464776

15336-

49642274

8967

74896430262746

14136-

50542877

7994

76306771115680

35335-

50243468

8132

71446240

83769

14335-

40536441

7549

15.2-2.8

--7.6

13.82.3

-

25912178413133

2724718737.9

1. Electricity SectorCEGCOSEPGCO

2.Industrial Companies withSelf Generation

Total All Jordan Fuel ConsumptionElectricity Fuel Consumptionto Total Fuel Consumption (%)

22492240

9144

2393702834.0

21132113

-139

2252648934.7

18451845

-141

1986577434.4

18021802

-145

1947529936.7

17011701

-119

1820515035.3

Table (10)

Electrical Energy Production by Type of Generation in Jordan (GWh)

200620052004200320022001

Table ( 11)

All Jordan Fuel Consumption for Electricity Generation (Thousand Tons of Oil Equivalent)Growth

2006/2005(%)

200620052004200320022001

Fig (2) Electrical Energy Generated andImported and Consumed in Jordan (GWh)

Fig (3)Electrical Energy Production byType of Generation in Jordan (2001-2006)

Growth2006/2005

(%)

GWhGWh


Steam Units

Gas Units (Burning Diesel)

Gas Units (Burning Natural Gas)

Combind Cycle

Other Companies

Imported from ( Egypt & Syria)

Power Demand

The generating unites share in covering thesystem peak load (1860) MW was as follows:

The peak load in the Jordanian power systemin 2006 was (1901) MW compared with (1751)MW in 2005 representing an annual growth of(8.6%).

The annual peak load for the interconnectedsystem amounted to (1860) MW duringdecember 2006 compared with (1710) MW inAugust 2005, representing an annual growth rateof (8.8 %). Fig (4), shows the daily load curvesfor the interconnected system during 2005,2006.

Table (12)

System Peak Loads (MW)

2001

2002

2003

2004

2005

2006

187

112

92

241

276

404

1068

1311

1336

1314

1495

1641

1.6

11.8

1.2

9.2

12.9

8.8

1225

1370

1387

1515

1710

1860

-

13

-

-

20

144

Interconnected System Daily Load Curve for (2005-2006)

14.2%

3.1%

31.7%

35.4%

1.6%

14.0%

Growth(%)

(MW)

Interconnected System

ImportedYear Local

All Jordan (MW)

Exported

Fig (4)

1255

1410

1428

1555

1751

1901

Total


Electrical Energy Consumptiontype of sectors in 2005 was as follows:Electricity consumption in Jordan for 2006

amounted to (9593.4) GWh compared with(8712.2) GWh in 2005, representing an annualgrowth of (10.1%).

The average annual growth rate of electricalenergy consumption during the last five yearsamounted to (8.5%).

EDCO responsibility covers all consumers inNEPCO’s concession areas and water projects(Subeihi & Wadi Arab) and Fertilizers Factoryin Aqaba.

The distribution of electrical consumption by

Table (13)

Electrical Energy Consumption by Sector Type (GWh)

CommercialDomestic Industrial

177.91166.6123.2

-48.1

1515.8131611901047971880

448.22308.5678.0

--

3434.729892745247122702110

EDCOJEPCOIDECOIndustrial CompaniesOther CompaniesTotal 200620052004200320022001

130.51222.9150.0

1253.6-

2757.026602479229421932024

OthersWaterPumping

StreetLighting

15.5196.0

4.8-

11.9228.2

201201213237219

731.5368.6296.2

--

1396.31298126111041045981

56.7130.474.3

--

261.4248213201190178

Total

1560.35393.01326.51253.6

60.09593.4

87128089733069066392

Growth2006/2005

(%)14.91

3.65

15.18

7.57

5.40

13.53

Consumption

(%)

35.80

28.75

15.80

14.55

2.71

2.38

Sector

Domestic

Industrial

Commercial

Water Pumping

Street Lighting

Others

Fig (5) Fig (6)Electrical Energy Consumption

by Sector Type in Jordan (2001 - 2006)Sectorial Distribution of Electrical

Energy Consumption in Jordan 2006GWh


Table (14)

Electrical Energy Consumption in Jordan (GWh)Growth

2006/2005(%)

200620052004200320022001

9.3

12.5

9.6

1.9

-0.8

10.1

-0.9

22.9

8.0

-0.3

0.6

-18.1

0.8

-67.2

-

8.1

3.4

133.3

10.1

1560.3

5393.0

1326.5

1253.6

104.3

225.7

68.3

56.3

300.1

153.9

205.0

11.3

48.5

15.1

-

65.1

48.1

11.9

9593.4

1. EDCO's Areas

2. JEPCO's Areas

3. IDECO's Areas

4. Industrial Companies

Refinery

Cement Factory

EL-Hasa Phosphate

Sheidiyah Phosphate

Potash Co.

Fertilizer Co.*

South Cement Co.

Hussein Iron Factory**

Indo-Jordan Chemicals Co.

United Iron & Steal Manufacturing Co.***

Jordan Magnesia Co.

Jordan Bromine Co.

5. Queen Alia Airport

6. Haraneh B.Station

Total

1427.9

4793.0

1209.9

1229.8

105.1

205.0

68.9

45.8

277.9

154.4

203.8

13.8

48.1

46.0

0.8

60.2

46.5

5.1

8712.2

1305.2

4396.3

1125.6

1210.9

91.1

204.4

68.9

54.0

284.3

158.4

200.5

14.9

46.5

44.3

26.3

17.3

45.2

5.6

8088.8

1117.1

3972.9

1023.1

1165.9

99.7

199.3

68.0

55.1

292.4

144.2

181.6

15.1

43.9

48.1

8.8

9.7

45.0

6.2

7330.2

1009.7

3728.8

967.6

1147.1

97.5

194.6

70.9

58.4

288.7

142.1

189.3

14.2

48.7

39.6

0.3

2.8

45.5

6.9

6905.6

969.7

3506.9

886.6

978.0

90.0

161.2

68.4

32.7

289.1

90.4

172.7

14.6

58.9

-

-

-

44.2

6.8

6392.2

* EDCO's sales to Fertilizer are not included** The consumption from self generation*** JEPCO's sales toUnited Iron & Steal Manufacturing Company are not included

Domestic and CommercialElectricity Consumption


Table (15)

NEPCO's Purchased Energy (GWh)

20032001 2002

6977.33815.12158.3

744.2256.7

3.0-

990.015.3

2.4972.3

-7967.3

6661.34022.61789.1

766.480.5

2.7-

275.26.71.5

267.0-

6936.5

A. CEGCOAqaba Thermal P.SHussein Thermal P.S.Risha / Natural GasGas & Diesel UnitsWind Energy

B. SEPGCOC. Others

King Talal DamIndo-Jordan Chemicals Co.Imported Energy from EgyptImported Energy from Syria

Total

7102.14688.91617.2

678.0115.0

3.0-

334.310.1

2.4321.8

-7436.4

2004Growth

2006/2005(%)

7922.74499.52188.4

780.1452.0

2.7-

844.016.1

1.6788.038.3

8766.7

-0.5-24.5-23.0

0.3195.2-12.5

--47.2-17.3-73.0-36.3-82.511.4

Table (16)

NEPCO's Electrical Energy Sales (GWh)Growth

2006/2005(%)

200620052004200320022001

12.013.3

9.8

9.3

8.5-5.4

13.0

0.6

10.2

-0.9

83.8

3.4

-

8.1

133.3

-11.8

9426.36151.6

1793.2

1481.5

872.119.4

225.4

205.0

202.8

68.3

26.1

48.1

-

65.1

11.9

8.610307.0

A. Distribution Companies

JEPCO

EDCO

IDECO

B. Large Consumers

Refinery Co.

Cement Co.

South Cement Co.

Potash Co.

El-Hasa Phosphate Co.

Sheidiyah Phosphate

QAIA

Jordan Magnesia Co.

Jordan Bromine Co.

Haraneh

C. Electrical Energy Exported to Egypt

Total

8415.65427.2

1633.4

1355.0

803.520.5

199.5

203.8

184.0

68.9

14.2

46.5

0.8

60.2

5.1

0.39219.4

7655.84902.3

1489.9

1263.6

790.913.3

195.0

200.5

194.7

68.9

24.1

45.2

26.3

17.3

5.6

1.18447.8

6917.24478.0

1283.2

1156.0

746.913.7

190.2

181.6

202.9

68.0

20.8

45.0

8.8

9.7

6.2

-7664.1

6399.94140.4

1151.6

1107.9

729.510.8

185.6

189.3

200.7

70.9

16.7

45.5

0.3

2.8

6.9

-7129.4

6020.53883.0

1107.4

1030.1

652.98.6

137.5

172.5

182.2

68.4

32.7

44.2

-

-

6.8

-6673.4

2005

8524.64950.72076.6

649.9844.2

3.228.5

1002.316.8

3.7740.6241.2

9555.4

2006

8486.03739.91599.0

652.12492.2

2.81628.0

529.213.9

1.0472.142.2

10643.2


1083510300

4.94

1064310307

3.16

9426828012.16

11349933717.73

1. Generation LossesGenerated EnergySent Out EnergyLosses (%)

2. Transmission Losses*Sent Out Energy Bulk Sales Losses (%)

3. Distribution Losses**Sent Out EnergySold Energy Losses (%)

4. Interconnected System LossesGenerated and Purchased EnergyConsumed Energy***Losses (%)

933287566.17

955592193.52

8416743111.71

10315841718.40

865780736.75

876784473.65

7656682710.83

9483779217.83

767971756.56

796776643.80

6923611311.70

8651702118.84

782873086.64

743671294.13

6405570110.99

8150662918.66

734968566.71

693766733.81

6026536610.95

7616621718.37

* Transmission lines (400, 132 kV)

** It does not include Industrial Companies Networks.

*** Include the total exported energy and the consumed energy in other NEPCO's facilities.

Table (17)

Interconnected System Network Losses (GWh)

200620052004200320022001

Losses (%)Electrical Energy Losses / Interconnected System (2001 - 2006)

Fig (7)


Table (18)

Number of Consumers in Jordan (Thousand)

200620052004200320022001

-5.45.76.55.82.2

-

0.014147.4780.7266.8

1194.95591

99.9

NEPCO*

EDCO

JEPCO

IDECO

Total

Population Under Supply

(Thousand)

Population Under Supply

as Percentage of Total (%)

0.014139.8738.7250.6

1129.15468

99.9

0.016133.2697.0236.7

1066.95345

99.9

0.014127.6660.2226.0

1013.85225

99.9

0.016123.5629.7215.8969.05093

99.9

0.012118.7593.6204.8917.14973

99.9

* This represents the distribution Companies and other large Consumers.

Growth2006/2005

(%)

CommercialDomestic Industrial

317525

11377030093

161391

-119848640594226806

987248

1. NEPCO's Areas

2. EDCO's Areas

3. JEPCO's Areas

4. IDECO's Areas

Total

8134799573193

14505

OthersW.Pumping Governmental

-211082651575

11950

-254812501484

5282

-406268643625

14551

DistributionCompanies

3---

3

Total

14147440780700266776

1194930

Table (19)

Number of Consumers by Type of Consumption for 2006

Sectorial Distribution of Consumers in Jordan (2001 - 2006)Fig (8)


Table (20)

Rural Electrification in Jordan as of end 2006

Kingdom

Year

497850985230535054735596

200120022003200420052006

Total Population(000's)

Rural

175018641919197020152060

Kingdom

497350935225534554685591

Population Supplied(000's)

Rural

175418601915196620102056

Kingdom

99.999.999.999.999.999.9

(%) of PopulationUnder Supply

Rural

99.799.899.899.899.899.8

The Jordanian RuralElectrification

Table (21)

Population Supplied With Electricity in Jordan

Villages

Area

33334572

1189239

999

Amman & BalqaIrbid and Mafraq Jordan ValleyKarakMa'an,Aqaba & ShoubakTafilaTotal

Total Villages

Population(000's)

64090517518910744

2060

Villages

33334572

1189239

999

Electrified Villages

Population(000's)

64090517418810643

2056

Villages(%)

100.0100.0100.0100.0100.0100.0100.0

No. of Villages and

Population Electrified

as (%) of the Total

Population(%)

100.0100.099.499.599.197.799.8


Table (22)

Electricity Tariff as of end 2006

* The 5 & 4 Stars Hotels Can Choose Between The 3 Categries Tariff or Continue Using The Flat Rate Tariff.** Applied for Consumption Which Exceeds The Average Level of 1988 Consumption

1. Bulk Supply TariffA- JEPCO

Peak load (JD/kW/Month)Day Energy (Fils/kWh)Night Energy (Fils/kWh)

B- EDCOPeak load (JD/kW/Month)Day Energy (Fils/kWh)Night Energy (Fils/kWh)

C- IDECOPeak load (JD/kW/Month)Day Energy (Fils/kWh)Night Energy (Fils/kWh)

D- Large IndustriesPeak load (JD/kW/Month)Day Energy (Fils/kWh)Night Energy (Fils/kWh)

2.429.0

19.00

2.429.0

19.00

2.429.0

19.00

2.447

32.02. Retail Tariffa. Domestic (Fils/kWh)

First Block : From 1-160 kWh/MonthSecond Block : From 161-300 kWh/MonthThird Block : From 301-500 kWh/MonthFourth Block : More Than 500 kWh/Month

b. Flat Rate Tariff For T.V and Broadcasting Stations (Fils/kWh)c. Commercial (Fils/kWh)d. Small Industries (Fils/kWh)e. Medium Industries


f. Agriculture (Fils/kWh)Peak load (JD/kW/Month)Day Energy (Fils/kWh)Night Energy (Fils/kWh)

g. Water Pumping (Fils/kWh)h. Hotels (Fils/kWh)


i. Street Lighting (Fils/kWh)**j. Armed Forces (Fils/kWh)k. Ports Corporation (Fils/kWh)

30526075606036

3.05332123

---

3460

---

20--

NoticeMonthly Minimum Charge a. Domestic (JD/Month) b. Other Consumers (JD/Month)

11.25

From1/5/1996

Until15/6/2002

2.431.4

21.40

2.431.4

21.40

2.431.4

21.40

2.448

33.5

31556480606238

3.05352526

---

3860

---

25--

11.25

From16/6/2002

Until31/12/2003

2.431.2521.20

2.431.2521.20

2.431.2521.20

2.448

33.5

31556480606238

3.05352526

---

3860

---

2567

-

11.25

From1/1/2004

Until2/4/2004

2.431.7421.69

2.431.7421.69

2.431.7421.69

2.448

33.5

31576580606239

3.05362728

---

3859

---

2767

44.6

11.25

From3/4/2004

Until31/5/2004

2.434.3024.25

2.433.5623.51

2.431.6621.61

2.448

33.5

31596782616341

3.05382831

3.05302040

60*3.05

56453067

46.6

11.25

From9/7/2005

2.431.7421.69

2.431.7421.69

2.431.7421.69

2.448

33.5

31576580606239

3.05362728

---

3859*3.05

55442767

44.6

11.25

From1/6/2004

Until8/7/2005

NATIONAL ELECTRICPOWER COMPANY

The Hashemite Kingdom of Jordan

FINANCIAL STATEMENTS

National Electric Power Company 43

Auditor's Report

To the Board of Directors,NATIONAL ELECTRICPOWER COMPANY

IBRAHIM ABBASI & CO.Ahmad M. Abbasi

Statements, whether due to fraud or error; Inmaking those risk assessments, the auditorconsiders internal control relevant to the entity'spreparation and fair presentation of the FinancialStatements in order to design audit proceduresthat are appropriate in the circumstances, but notfor the purpose of expressing an opinion on theeffectiveness of the entity's control. An auditalso includes evaluating the appropriateness ofaccounting policies used and the reasonablenessof accounting estimates made by management,as well as evaluating the overall presentation ofthe Financial Statement.

We believe that the audit evidence we haveobtained is sufficient and appropriate to providea basis for our audit opinion.

OpinionIn our opinion, the Financial Statements

present fairly, in all material respects theFinancial Position of the NATIONALELECTRIC POWER COMPANY as ofDecember 31, 2006 & 2005, and of its financialperformance and its Cash Flows for the yearsthen ended in accordance with the InternationalFinancial Reporting Standards.

Report on Other Legal and Regulatory RequirementsIn compliance with the Jordanian Companies

Law no. (22) of 1997 and its amendment laws,we obtained the necessary information andexplanations for our audit, and the companymaintains proper accounting books of accountsand the accompanying financial statementsagree with the Financial Statements incorporatedin the Board of Directors' report.

Based on the above, we recommend theGeneral Assembly to approve the accompanyingFinancial Statements.

We have audited the accompanying FinancialStatements of the NATIONAL ELECTRICPOWER COMPANY which comprise thebalance sheet as at December 31, 2006 & 2005,and the Income Statement, Statement of Changesin Equity, and Cash Flow Statement for the yearsthen ended. And a summary of significantaccounting policies and other explanatory notes.

Management's Responsibility for the Financial StatementsManagement is responsible for the

preparation and fair presentation of theseFinancial Statements in accordance withInternational Financial Reporting Standards. Thisresponsibility includes : desgining, implementingand maintaining internal control relevant to thepreparation and fair presentation of Financialstatements that are free from materialmisstatement, whether due to fraud or error;selecting and applying appropriate accountingpolicies; and making accounting estimates thatare reasonable in the circumstances.

Auditor's ResponsibilityOur responsibility is to express an opinion on

these Financial Statements based on our audit.We conducted our audit in accordance withInternational Standards on Auditing. Thosestandards require that we comply with ethicalrequirements and plan and perform the audit toobtain reasonable assurance whether theFinancial Statements are free of materialmisstatement.

An audit involves performing procedures toobtain audit evidence about the amounts anddisclosures in the Financial Statements. Theprocedures selected depend on the auditor'sjudgment, including the assessing the risks ofmaterial misstatement of the Financial


2 0 0 52 0 0 6

J DJ D

D e c e m b e r 3 1 ,

A S S E T S

BALANCE SHEET

THE ACCOMPANYING NOTES FORM INTEGRAL PART OF THIS STATEMENT

N o t e

Current Assets

Cash and cash equivalent

Accounts receivable - net

Spare parts, materials and supplies

Letters of Credit

Prepayments and other receivables

Projects and studies

Installments and interest prepaid on loans

Total Current Assets

Non-current Assets

Available for sale investments

Investments in subsidiaries and affiliates

Long-term loan receivable

Property and equipment - net

Property and equipment contributed by consumers - net

Projects under construction and payments to contractors

Total Non-current Assets

TOTAL ASSETS

3

4

5

6

7

8

9

10

18

11

5,857,439

73,098,095

10,796,632

730,490

958,121

14,543

475,508

91,930,828

1,662,104

4,632,790

801,060

357,488,833

28,656,086

20,824,829

414,065,702

505,996,530

6,967,788

70,814,729

10,567,814

1,374,074

564,131

19,578

542,469

90,850,583

1,243,848

4,632,790

1,001,060

355,619,558

27,181,855

36,963,883

426,642,994

517,493,577


28,117,622

1,691,215

11,628,751

64,801,349

5,814,864

110,946

7,878

112,172,625

137,935,603

2,470,193

2,947,826

382,261

28,656,086

172,391,969

230,000,000

2,365,185

4,730,371

4,730,371

(10,545,069)

8,912,678

(17,673,931)

1,367,507

(2,455,176)

221,431,936

505,996,530

11,776,663

1,392,069

16,078,021

86,565,925

5,939,906

125,991

357,195

122,235,770

138,056,128

3,203,869

4,040,378

701,367

27,181,855

173,183,597

230,000,000

2,412,981

4,730,371

4,730,371

(10,545,069)

10,034,307

(17,673,931)

949,251

(2,564,071)

222,074,209

517,493,577


Liabilities and Owners' Equity

Current Liabilities

Bank overdraft

Interest payable and due loans

Short-term loans

Accounts payable and other liabilities

Contractors' retentions

Advances received on studies and projects

Income tax provision

Total current liabilities

Non-current Liabilities

Long-term loans

End-of-service indemnity

Consumers' contribution received in advance

on projects under construction

Grants and donations

Consumers' contribution net of amortization

Total non-current liabilities

Owners' Equity

Capital

Statutory reserve

Voluntary reserve

Special reserve

Decline in Owners' Equity as a result of restructuring

Government treasure equity

Interest on payment delay of due energy sales prices

Fair value adjustments - available for sale investments

(Loss carried forward) Retained earnings

Total Owners' Equity

Total liabilities and Owners' Equity

2 0 0 52 0 0 6

J DJ D

N o t e

12

13

14

12

15

16

17

18

19

20

21

D e c e m b e r 3 1 ,


2 0 0 52 0 0 6

J DJ D

Income Statement


N o t e

Sales of electric power

Gas sales

Other operating revenue

Total operating revenues

Less: Operating expenses

Purchase of electric power

Gas purchases

Additional gas cost

Depreciation of property and equipment after amortization

of consumers' property and equipment contribution

Depreciation of slow moving spare parts

End-of-service indemnity

Maintenance & operating expenses

Administrative & operating expenses

Total operating expenses

Operating profit

Finance cost

Loss on foreign currency translation

Interest income

Other income

Other expenses

Prior years expenses

Bad debts

profit (Loss) for the year before tax and provisions


Jordanian universities fee

Scientific research supporting fund

Fund to support technical and professional training and scientific research

Board of directors' remuneration

profit (Loss) for the year after tax and provisions

Weighted-average number of share

Earning per share (JD/ Share)

327,106,558

77,204,220

7,952

404,318,730

(295,755,150)

(77,204,220)

-

(14,895,223)

(340,652)

-

(2,336,085)

(9,138,069)

(399,669,399)

4,649,331

(7,224,677)

(489,853)

216,165

1,113,070

(59,680)

(334,674)

(785,702)

(2,916,019)

(7,878)

-

-

-

-

(2,923,897)

230,000,000

(0.013)

375,268,269

127,655,300

3,059,166

505,982,735

(336,117,480)

(127,655,300)

(1,004,567)

(17,048,648)

(339,970)

(833,746)

(1,988,496)

(11,958,992)

(496,947,199)

9,035,536

(7,950,538)

(1,508,366)

84,173

1,335,065

(109,612)

-

(408,302)

477,956

(357,195)

(4,780)

(4,780)

(483)

(15,086)

95,633

230,000,000

0.000

22

23

24

25

26

27

D e c e m b e r 3 1 ,


Detailed Incom

e Statement for the Y

ears Ended 31 Decem

ber 2006 and 2005

TH

E A

CC

OM

PAN

YIN

G N

OT

ES FO

RM

INT

EG

RA

L PA

RT

OF T

HIS ST

AT

EM

EN

T


Stat

emen

t of

Cha

nges

in O

wne

rs' E

quit

y fo

r th

e Y

ears

End

ed 3

1D

ecem

ber

2006

and

200

5

TH

E A

CC

OM

PAN

YIN

G N

OT

ES

FOR

M I

NT

EG

RA

L P

AR

T O

F T

HIS

ST

AT

EM

EN

T


Statement of Cash Flows

2 0 0 52 0 0 6

J DCash flows from operating activities J D

(2,916,019)14,895,223

340,652(21,472)785,702

-(1,477,000)

(216,165)7,223,207

18,614,128

(2,676,551)69,047

377,3735,298,841

(2,355,233)61,318

(14,543)(11,094)

19,363,286(98,219)

-(101,118)(13,232)

-(16,800)

(957,469)18,176,448

-(61,884,185)

103,64817,001,253

216,165(44,563,119)

11,653,130635,700

(7,223,207)41,431

24,760,236(608,745)

8,2651,159,289

30,426,0994,039,4281,818,0115,857,439

profit (Loss) for the yearDepreciation of property and equipment after amortization ofconsumers' property and equipment contributionDepreciation of slow moving spare partsGain on sale of property and equipmentBad debtsEnd-of-service indemnityTariff subsidy provisionInterest incomeFinancial costsTotalChange in current assets and liabilitiesAccounts receivable - netSpart parts, materials and suppliesLetters of CreditPrepayments and other receivablesAccounts payable and other liabilitiesContractors' retentionsstudies and projects under constructionAdvances received on studies and projectsConsumers' contribution received in advance on projects under constructionCash flows from operating activitiesEnd-of-service indemnity paidJordanian universities fee paidPaid from sientific research and technical training provisionPaid from fund to support technical and professional trainingPrior years revenues (Expenses)Paid from Board of directors' remunerationIncome tax paidNet cash flows from operating activitiesCash flows from investing activitiesLong-term loan receivablePurchase of property and equipmentSale of property and equipmentProjects under construction and payments to contractorsInterest income receivedNet cash flows from investing activitiesCash flows from financing activitiesBank overdraftConsumer’s contribution advance received to projects under constructionFinancial expensesInstallments and interest prepaid on loansLoansInterest payable and due loansGrants and donationsGovernment treasure equityNet cash flows from financing activitiesChange in cash balancesCash and cash equivalents at beginning of yearCash and cash equivalents at end of year

477,95617,048,648

339,970(16,095)408,302833,746

-(84,173)

7,950,53826,958,892

1,875,063(111,152)(643,585)

393,98922,431,504

125,042(5,035)15,045

51,039,763(100,070)

594,270(97,785)

-1,439

(16,800)(531,510)

49,700,767

(200,000)(15,192,432)

29,155(16,139,053)

84,173(31,418,157)

(16,340,959)1,092,553

(7,950,538)(66,961)120,524

4,150,124701,367

1,121,630(17,172,260)

1,110,3495,857,4396,967,788


D e c e m b e r 3 1 ,


NOTES TO FINANCIAL STATEMENTS

policies applied in preparation of thesefinancial statements. These policies have beenconsistently applied to all the years presented,unless otherwise stated.2-1. Basis of preparationFinancial statements have been prepared inaccordance with International ReportingStandards (IFRS). The financial statementshave been prepared under the historical costconvention except that financial assets andliabilites are carried at fair value.2-2. Cash and cash equivalentThis item represents cash balances, deposits atbanks and high liquid investments which areable to be liquidized within a period of 3months or less.2-3. Accounts receivbaleAccounts receivable are stated at fairrecoverable value less provision ofimpairment.2-4. Spare parts, materials and suppliesSpare parts, materials and supplies are statedat cost which is determined using the weightedaverage method.2-5. InvestmentsAvailable for sale investmentsAvailable for sale investments are stated atfair value. Unrealized gain or loss resultedfrom evaluation are stated as a shareholder'sequity item. Financial investments arere-evaluated using closing prices at AmmanStock Market at the balance sheet date. As forthe investments of which no fair values areavailable, they are stated at cost. Investments in subsidiary and associatesInvestments in companies the capital of whichthe Company owns (20%) or more with noexcercised financial and administrativeinfluence are stated at cost.2-6. Property and equipmentAll propery and equipment is stated athistorical cost less depreciation. Historicalcost includes expenditure that directlyattributable to the acquisition of the items.Maintenance and repair costs are expensed,

1. INCORPORATIONNational Electric Power Company wasregistered as a public shareholding companyat the Ministry of Industry and Trade on 29August 1996 as decided by the Concil ofMinisters' resolution to convert the JordanElectricity Authority into a publicshareholding company with a capital of JD230,000,000 devided into 230,000,000 sharesat JD 1 par value which is wholly owned bythe government. The company is consideredto become the natural and legal successor toJordan Electricity Authority which wasestablished in accordance with Special DecreeNo. (21) of 1997 with an independentfinancial and administrative existence. Inorder to enable the new compny to perform itsactivities, 1996 Decree No (10), subsequentlyamended by Decree No (13) of 1999, wasissued to regulate the electricity sector inJordan, espacially with respect to powergeneration, transmission and distribution .National Electric Power Company wasrestructured into three separated companiesstarting from 1 January 1999 in execution ofthe Council of Ministers' resolution taken on 4October 1997 which stipulated that govermentshould maintain the ownership of theactivities of transmission, power control.power purchase and sale and power exchangewith neighbouring countries.The accompanying financial statementsreflects assets, liabilities and results ofoperations of the transmission and control (theNational Electric Power Company) resultedfrom the restructuring process of the NationalElectric Power Company into threecompanies.The company’s headquarter is located inAmman. There are 1,090 employees as of 31Decemebr 2006 (31 December 2005: 1,048employees)

2. SIGNIFICANT ACCOUNTING POLICIESFollowing are the significant accounting


while betterment costs are captilized on the related items.In the execution of the Electricity Regulatory Commission resolution, legal compensations areclassified separately as a capital expenditure in property and equipment category. Thosecompensations comprise amounts paid by the Company to the owners of lands through whereelectrical networks pass. Those amounts are annually depreciated over a period of 10 years.Depreciation is calculated using the straight-line method over the estimated useful lives of assets atannual rates varying from (2 to 20%)An asset's carrying amount is written down immediately to its recoverable amount if its carryingamount is greater than its estimated recoverable amount.2-7. Pojects under constructionProjects under construction represent the cost of performed work in addition to the interest paid onloans that were used to fund these projects and the administrative and general expenses of thedepartments that supervise these projects.2-8. Property and equipment contributed by consumersProperty and equipment contributed by consumers are depreciated using the straight-line method atannual rate of 4%. Accordingly, the book value of consumers' contribution is amortized using thestraight-line method at annual rate of (4%). Depreciation expense is annually reduced byamortization.2-9. Foreign currency TranslationForeign currency transactions are translated into Jordanian Dinar at the exchange rates prevailing at thetime of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated atthe exhange rates prevailing at the balance sheet date except for the loans granted by Arab funds whichare stated either at the rates prevailing at the withdrawal dates or at the rates prevailing at the date ofsettlement as agreed. Foreign exchange gains or losses resulting from the settlement of currencies andfrom the translation at the balance sheet date are recognized in the income statement.2-10. End-of-service indemnity provisionEnd-of-service indemnity provision represents the amount that was deducted as a provsion for thedifference in the calculated end-of-service compensation that is due to the employees who stillwork for the Company as of the balance sheet date.2-11 ProvisionsScientific research supporting fundA provision of (1%) of the profit for the year is annually deducted as a scientific research andprofessional training provision.Jordanian universities fee provisionA provision of (1%) of the profit for the year is annually deducted as a Jordanian Universities fee provision.Fund to support technical and professional training and scientific researchA provision of (1%) of the profit for the year after deducting all provisions and reserves and theboard of directors remuneration is annually payed for income tax deparment .2-12 . Interest on payment delay of due energy sales due pricesAn interest is charged on payment delay of due energy sales prices. This interest is taken to incomestatement as an other income at a monthly rate of (1%) starting from the invoice mature date untilthe partial or full payment. The amount of the interest is at (9%) maximum limit as for subscribers.2-13. Revenue recognitionSale of energyIncome from sales is recognized when the services are rendered and the invoice is issued. Sellingprices (tariff) are determined by the government.Investment incomeInvestment income is recongnized when received.


2 0 0 52 0 0 6J DJ D

38,227,545

9,889,920

14,264,915

5,160,276

4,255,690

71,798,3464,685,761

-

77,080

20,797

1,205,431

1,164,498

78,951,913(5,853,818)

73,098,095

Jordan Electricity Company

Irbid District Electricity Company - subsidiary

Electricity Distribution Company

Electricity Distribution Company - prior to 1998

Wholesale consumers

Total energy sale debtorsCentral Electricity Generating Company - gas sales

Al-samra for Electricity Generating Company

Contractors

Due from employees

Other debtors


TotalLess: provision for doubtful debts

net

25,769,200

8,192,699

18,990,767

560,276

5,929,043

59,441,9859,186,148

3,498,901

153,205

17,036

2,215,152

177,758

74,690,185(3,875,456)

70,814,729

2-14. Administrative and general expensesIncluded in the administrative and general expenses are direct and inderict expenses which aredirectly related to other operating expenses in conformity with IFRS. Expenses are distributed, whenneeded, between administrave and genearal expenses and operating expenses in a stable basis.Operating expenses are distributed between Amman and Aqaba at a percentage on the proportion ofenergy sales of each of the two locations of the total energy sales.2-15. Income taxThe Company is subject to Income Tax Law no 57 of 1985 and subsequent amendments thereto andthe regulations issued by the Income Tax Department in the Hashemite Kingdom of Jordan andprovided on an accrual basis. Incom tax is computed based on adjusted taxable income. Anydifference in the estimate is recorded when the final assessment is approved at the time the provisionis cleared. According to IAS 12, the Company may have deferred tax assets resulting from thedifference between the accounting value and the tax value of the assets and liabilities related toprovisions. These assets are not shown in the accompanying financial statements since there is noassurance could be arise from the benifits of there deferred taxes during specific period of time.

3. Cash and cash equivelantsThis item comprises:

2 0 0 52 0 0 6J DJ D131,311

4,515

2,313,583

3,408,030

5,857,439

Cash on hand

Cheques under collection

Bank current accounts

Bank deposits

115,707

-

6,827,352

24,729

6,967,788

4. Accounts receivableThis item comprises:


2 0 0 52 0 0 6

J DJ D

8,414,326

9,519

117,035

2,255,752

10,796,632

Spare parts, transoformer stations, transmission lines and materials

Stationary and office supplies

Warehouse materials for training

Control and monitoring center materials

7,952,782

15,577

86,685

2,512,770

10,567,814

5. Spare parts, materials and suppliesThis item comprises:

6. Installments and interest prepaid on loansThis item represents installment which are prepaid to the Islamic Bank for Development andFinance, Jaddah on the loan which was matured on 1 january 2007. This loan had been prepaid bythe Company in order to make use of incentive discount at (15%).

7. Available for sale investments

1,662,104

2 0 0 5

436,438Jordan Electric Power Co.J D

363,699Shares

1,243,848

2 0 0 6J D

8. Investments in subsidiary and affiliates

Shares

2,032,790

50,000

50,000

2,132,7902,500,000

4,632,790

2 0 0 5

Subsidiaries:Irbid District Electricity Co.

Jordan - Swiss Automation Services LTD

International Electricity Maintenance and Training Co.

Affiliates:Electriciy Distribution Co.

J D

2,032,790

50,000

50,000

2,132,7902,500,000

4,632,790

JD

55.45

50.00

50.00

25.00

Share%

2 0 0 6

157,567

C o s tJ D

On 19 July 1997, National Electric Power Company signed an agreement with Jordan InvestmentCorporation whereby the company’s share in 1,663,023 shares of Irbid District Electricity Companywas transferred to the corporation at book value, which was JD 2,032,790 until they are sold inaccordance with the selling conditions stipulated by the agreement mentioned hereinbefore.All these investements have been temporarily recorded in the Company's records at cost due to thefact that the company has no financial or administrative influence over them as long as there is nofinal decision taken by the government in this regard.


9. Long-term debit loanThis item represents the loan granted to the Company's employees housing fund.

10. Property and equipment :

2 0 0 5

16,259,161

30,787,849

160,646,645

208,056,122

1,574,303

1

25,231,064

1,897,488

1,241,366

4,149,117

18,733

533,861

177,221

306,190

335,978

2,110,748

3,777,201

1,178,730

107,530

1,002,751

126,795

30,573,266

490,092,120

(38,055,778)

452,036,342

Cost:

Lands

Buildings

Transmission lines

Transformer stations

Earth lines

Consumers' meters

Transmission lines - sea cable

Communication equipment in fiber optics

Office equipment and furniture

Vehicles

Warehouse equipment

Tools and equipment

Insulator test stations

Laboratory equipment

Operating equipment

operators and communication equipments

Control equipment

Computers

Machines equipment

Other equipment

Training equipment

Legal compensations assets

Total cost

Less: Cost of property and equipment

contributed by consumers

Total

Additions

1,080,762

315,972

-

3,667,223

-

-

-

606,059

50,041

149,090

202

86,359

-

75,707

76,636

69,888

151

2,757,141

-

185,331

48,373

6,073,498

15,242,432

(50,000)

15,192,432

Disposals

-

-

-

-

-

-

-

-

-

28,000

-

-

-

-

-

-

-

-

-

-

-

-

28,000

-

28,000

2 0 0 6

17,339,923

31,103,821

160,646,645

211,723,345

1,574,303

1

25,231,064

2,503,547

1,291,407

4,270,207

18,935

620,220

177,221

381,897

412,614

2,180,636

3,777,352

3,935,871

107,530

1,188,082

175,168

36,646,764

505,306,552

(38,105,778)

467,200,774

JD JD JD JD


2 0 0 5

6,114,114

23,722,031

51,839,300

794,906

4,499,954

808,288

771,811

2,371,836

7,378

272,285

82,210

201,595

267,817

1,399,099

3,701,505

914,892

95,535

544,241

12,680

5,525,724

103,947,201

(9,399,692)

94,547,509

357,488,833

Depreciation:

Buildings

Transmission lines

Transformer stations

Earth lines

Transmission lines - sea cable

Communication equipment in fiber optics

Office equipment and furniture

Vehicles

Warehouse equipment

Tools and equipment

Insulator test stations

Laboratory equipment

Operating equipment

Operators and communication equipments

Control equipment

Computers

Machines equipment

Other equipment

Training equipment

Legal compensations assets

Total Depreciation

Less: Depreciation of property and

equipment contributed by consumers

Total

Net book value

Additions

1,022,096

3,154,301

7,856,843

86,345

630,687

232,309

168,466

474,427

1,550

93,535

15,902

35,868

26,229

93,977

16,537

854,030

3,463

136,726

4,911

3,664,676

18,572,879

(1,524,231)

17,048,648

Disposals

-

-

-

-

-

-

-

14,941

-

-

-

-

-

-

-

-

-

-

-

-

14,941

-

14,941

2 0 0 6

7,136,210

26,876,332

59,696,143

881,251

5,130,641

1,040,597

940,277

2,831,322

8,928

365,820

98,112

237,463

294,046

1,493,076

3,718,042

1,768,922

98,998

680,967

17,591

9,190,400

122,505,139

(10,923,923)

111,581,216

355,619,558

Depreciation Rate

2-3.33

1.5- 7.2

2.22- 7.2

1.66- 5.8

2.5

10

10

20

10

10

7.14

10

10

4 - 20

12.5

20

10

10

3.33

10

4

According to the resolution of the Electricity Regulatory Commission in its meeting held on 18October 2003, compensations paid by the electricity companies to the real estate owners of landsthrough where the electric networks pass were considered as capital expenditures and were classifiedas a separate item of the property and equipment section. These compensations are depreciated as anasset over an estimated life of 10 years provided that compensations paid during any one year arecapitlized at the end of that year starting from 1 January 2003.

JD JD JD JD%


2 0 0 52 0 0 6

J DJ D

5,983,818

11,110,438

173,524

1,788,771

1,768,278

20,824,829

Transmission lines projects

Constructing and expanding of transforming stations

Monitoring and control center

Other projects

Payments to contractors

14,649,476

20,079,616

202,415

(31,740)

2,064,116

36,963,883

Included in the cost of the property and equipment is the cost of property items owned by IslamicDevelopment Bank - Jeddah totaling to JD 11,040,500 against long-term loan granted to theCompamy. Ownship of these property items shall be transferred to the Company after the lastinstallment of the loan being paid during the year 2008.

11. Projects under construction and payments to contractors

During the year, an amount of JD 450,260 of the financing costs have been capitalized to projectsunder construction.

12. Loans

Mature dates of loans expanding to 2033 at annual interest rates varying from (0.75%) to (8.0%).Loans granted to the Company are guaranteed by the government of the Hashemite Kingdom ofJordan. Furthermore, the government determined the proper methods of payment of these loans anddecided to keep the situation regarding the property items belonges to the Company and theownership of which refers to the Islamic Development Bank - Jeddah as is until the full payment ofthe loan on 1 July 2008. The loan granted by the Bank amounted to JD1,967,945 and JD2,853,049in the year 2006 and 2005 respectively.

2 0 0 52 0 0 6

J DJ D

120,018,771

29,545,583

149,564,354

(11,628,751)

137,935,603

Direct loans-foreign currencies

Local loans

Less: current portion

Long - term portion

113,359,462

40,774,687

154,134,149

(16,078,021)

138,056,128


2 0 0 52 0 0 6

J DJ D

49,137,951

4,281,302

536,327

347,192

772,052

60,044

55,134,8684,711,912

3,083,524

7,795,436848,847

143,539

6,732

17,667

594,270

257,087

-

2,903

64,801,349

Central Electricity Generating company- purchase of power

Egyption Company for Electricity Transmission - purchase of power

General Establishment for Electricity Transmission and Generating

Samra Electricity Generating Company

Jordan Valley Authority - King Talal Dam - purchase of power

Jordan Indian company for chemical purchase of power

Total payables to Electricity power providesJordanian Egyption Fajir Company for Natural Gas Transmission

and Supplies - purchase of gas

Ministry of Finance - purchase of gas

Total payables to Natural gas providersWithholdings due to government and other parties

Other payables and tenders

Due to employees

Accrued expenses

Jordanian universities fees provision

Scientific research and training provision

Education and technical and professional training fund provision


Provision for legal cases filed against the Company

Total

63,798,276

1,398,881

7,545

5,270,390

530,658

15,071

71,020,82113,689,617

152,034

13,841,651967,493

530,355

18,272

-

4,780

164,082

483

15,086

2,903

86,565,925

2 0 0 52 0 0 6

J DJ D

169,180

(957,469)

788,289

7,878

7,878

Starting balance on 1 January

Paid during the year

Prior years tax differences


Ending balance on 31 December

7,878

(7,878)

-

(357,195)

(357,195)

13. Accounts payable and other liabilities

14. Income tax provision

The Company filed all tax exposure on time in the Income Tax Department. The years 1998 to 2005are still unaudited by the department. The management's point of view is that the deducted incometax provision is sufficient.IFRS 12 stipulates that deferred tax resulted from the difference between accounting and tax valuesof assets and liabilities should be recognized. As a result, a deferred tax asset might arise to the


benefit of the Company resulting from the time differences of doubtful debt provision and end ofservice compensation provision in addition to fees. The management decided not to record suchdeferred taxes due to the fact that there is no assurance about the benefit of these time differences.

15. End-of-service indemnity

16. Consumers' contribution received in advance on projects under contruction

2 0 0 52 0 0 6

J DJ D

150,238

1,173,587

721,600

10,731

-

-

50,000

762,920

72,150

6,600

2,947,826

Dead Sea eastern coast development

Transmission line project Subiehi - Waqas and transformer station - Waqas

Transformer station project - Subiehi

Water Authority expansion project / Al-Hasa Transformer station

City of ariha electricity supply

Jordanian eatelaf for iron solid supply

Industrial City - Ma'an energy supply

United Company for Industry energy supply

Al-Hassa wells and water bumping energy supply

Air force Ground fiber optic cables

150,238

1,173,587

721,600

10,731

355,000

675,000

-

875,600

72,150

6,472

4,040,378

2 0 0 52 0 0 6

J DJ D

2,568,412

(98,219)

-

2,470,193


Paid during the year

Provision deducted


2,470,193

(100,070)

833,746

3,203,869

2 0 0 52 0 0 6J DJ D117,450

259,308

-

5,503

382,261

Japanease Government grant / JICA

Grants to develop a monitoring and control center

Grant Of Institute Of Sweden ( GIS )

Grants by other bodies

134,041

-

567,326

-

701,367

17. Grants and donationsThis item comprises grants and donations obtained through agreements signed by the government ofthe Hashemite Kingdom of Jordan with external parties. The following is a detail:


2 0 0 52 0 0 6J DJ D

(7,532,719)

90,877

(51,571)

493,923

9,419

(47,158)

(4,610)

3,563,272

1,043

(7,500,000)

(10,500)

10,685

432,270

(10,545,069)

Adjustment of National Electric Power Company's share in equity

upon separation after deduction of capital

Warehouse materials received according to the supervisory and

coordination committee resolution

Zarqa warehouse materials transferred from Central Electricity

Generating Company

Lands appropriated from the Hashemite Kingdom of Jordan

government to the company

Glass insulators received from Central Electricity Generating Company

Dual reading and timing meters transferred to Electricity Distrbution

Company

Net book value of Hyundai car transferred to Central Electricity

Generating Company

Land acquisition

Accounts receivable balances tranferred from Electricity Distribution

Company

Transferring Company's share of investments in Central Electricity

Generating Company of 7,500,000 shares with total value of JD

7,500,000 towards the government according to the Council of

Ministers' resolution

The government share of the waiver fees on the Electricity

Generating Company shares

Transfer of the ownership of Al-Karak land, plot no (11) pool (1)

Jabal Al-Masayer

Materials received from Central Electricity Generating Company

(7,532,719)

90,877

(51,571)

493,923

9,419

(47,158)

(4,610)

3,563,272

1,043

(7,500,000)

(10,500)

10,685

432,270

(10,545,069)

18. Consumers' contribution net of amortizationAccording to the Prime Minister's resolution number 23/11/6189 dated 4 June 1985, consumers'contributions, which represent contributions for works carried out at the request of consumers, areamortized at an annual rate of (4%) starting from 1985. This item is detailed as follows:

19. Decline in shareholders' equity as a result of restricturing

2 0 0 52 0 0 6

J DJ D

38,055,778

(9,399,692)

28,656,086

Consumers' contribution after revaluation

Less: accumulated amortization

Total

38,105,778

(10,923,923)

27,181,855


20. Government treasure equityThis item represents some of loan interests and installments balances which were credited to thetreasury which is presented in the balance sheet in the shareholders' section in execution of theseloans signed agreements. The balance of this item is not a liability payable by the Company.

21. Retained earnings

22. Sales of electric power

2 0 0 52 0 0 6

J DJ D1,263,310

(788,289)

(6,300)

-

-

(2,923,897)

(2,455,176)


Less: prior years income tax

Board of directors remuneration

prior years revenues & expenses

Grants and donations

Profit after provisions


(2,455,176)

(523,632)

(16,800)

1,438

382,261

47,837

(2,564,072)

MWh

6,151,636

1,481,446

1,793,186

8,555

871,950

10,306,773

JD/ MW

36.119

33.437

34.677

50.407

46.937

36.410

JD

222,193,295

49,535,527

62,181,795

431,229

40,926,423

375,268,269

MWh

5,427,180

1,355,032

1,633,397

260

803,695

9,219,564

JD/ MW

34.863

33.483

33.782

56.462

46.452

35.480

JD

189,207,983

45,370,962

55,179,591

14,680

37,333,342

327,106,558

Jordan Electric Power Company

Irbid District Electricity Company


Egypt sales

Wholesale consumers

Total

Qyt Sold Average

Tariff

Total enregy

sold

Qyt sold Average

Tariff

Total enregy

sold

2 0 0 6 2 0 0 5

23. Purchase of electric power

Central Electricity Generating Company

Egyption Company for Electricity Transmission

Syrian Public Electricity Establishment

Samra Electric Power Generation Company

King Talal Dam and Indian Company for

Chemical Industries

Total

Qyt

purchased

Average

Tariff

Total energy

purchased

JD

Qyt

purchased

Average

Tariff

Total energy

purchased

JD

2 0 0 6 2 0 0 5

257,371,71027,090,592

2,760,06148,552,950

342,167336,117,480

8,485,894472,06042,175

1,627,991

14,90910,643,029

30.32957.38865.44329.824

22.95031.581

8,524,604740,600241,16028,521

20,5009,555,385

28.92245.49654.23469.430

22.14830.952

246,547,40633,694,42713,079,0731,980,209

454,035295,755,150

MWh JD/ MW MWh JD/ MW


2 0 0 52 0 0 6

J DJ D

5,245,849

1,446,895

389,889

691,467

301,468

117,688

36,398

46,780

27,125

73,352

113,610

122,444

128,506

36,000

27,392

43,626

47,440

101,405

6,185

27,307

107,243

9,138,069

Salaries

Other employees benefit

Insurance of assets

Licensing with electric regulartory commission

Professional Fees

Expenses on vehicles

Subscripitions with organizations and unions

Stamps and fees

Licenses and custom fee on vehicles

Stationary, printings and office supplies

Water and electricity

Tickets and travel expenses

Communication cost


Entertainment expenses

Cleaning

Seminars conferences and arrivals expenses

Safe guarding

Rewards to committees and medical committees compensation

Advertisements

Miscellaneous

Total

6,958,266

1,683,424

866,316

773,008

406,444

134,160

38,678

149,433

38,687

92,486

119,262

165,408

120,213

34,000

23,277

45,330

37,071

177,488

5,824

40,061

50,158

11,958,992

24. Maintenance and operating expenses

25. Administrative and operating expenses

2 0 0 52 0 0 6J DJ D

1,869,498

184,722

244,976

36,624

265

2,336,085

Assets Maintenance

Building Maintenance

Vehicles Fuel and Maintenance

Safty supplies

Miscellaneous

1,350,637

217,826

365,390

47,237

7,406

1,988,496


26. Other income26-1. This item consists

2 0 0 52 0 0 6J DJ D261,082

94,682

576,640

22,440

21,472

330

5,668

52,756

13,903

64,096

1,113,070

Shares income

Compensations by insurance companies

International services revenues

Income from bids forms

Gain on sale of scaped assets

Interest on payment delay of due energy sales prices

Income from printing services

Gain on sale of asset items

Income from panelties on materials delivery delays

Other revenues

Total

315,424

129,562

641,942

40,857

16,095

67,108

9,734

35,284

31,249

47,810

1,335,065

26-2. Income from studies and consultations rendered to other parties - net

2 0 0 52 0 0 6

J DJ D

1,236,746(5,198)

(654,908)576,640

Income from studies and consultations rendered to other partiesRewards to projects services staffCost of studies and consultations rendered to other partiesNet

1,188,771(5,674)

(541,155)641,942

27. Other expenses27-1. This item consistsparties - net

2 0 0 52 0 0 6

J DJ D

21,920-

37,760-

59,680

Net costs of houses (Note 27-2)Materials written-offRoad lighting company contributionMiscellaneousTotal

29,03545,39434,511

672109,612


27-2. Net costs of houses

28. Contingent liabilities

As of December 31, 2006, the Company had the following contingencies:

a. Against letters of credited a liability amounted to JD 4,882,344.

b. Against letters of gurantees a liability amounted to JD 217,931.

c.1- Cases about claimes for towers and lines built on or through other owners, the lawyer think that

the court may be ruled amount of JD 5 millions as a claimes to owners.

2- A case for claim on owns of Abdoun Station Land and the damages and decrease the value of the

part not owns of the land No. 115 avenue No. 27 of Abdoun Land /Amman the court may be

ruled amount of JD 861,570.

29. Guarantees received from contractors

The Company had letters of guarantees amounted to JD 16,641,011 gived by contractors.

30. Fair value

As of the balance sheet date, fair values of the Company's financial assets and liabilities approximate

their carrying amount except for the long-term loans the fair values of which equal to the present

value of the future cash flows using the prevailing interest rate paid on similar loans.

31. Risk management

The Company is exposed to interest rate, credit and currency risk. Those risks are managed by the

Company as follows:

Interest rate risk

Financial instruments stated in the balance are not exposed to interest rate risk except for bank

overdraft and loans the interest rates of which change according to the prevailing interest rate in

market.

2 0 0 52 0 0 6

J DJ D

(19,890)41,81021,920

Income from housesCosts of housesNet

(19,302)48,33729,035


Credit risk

The Company maintains its cash at financial institution with good solvency.

Currency risk

The Company is exposed to risk resulted from the exchange rate changes of foreign currencies used

in the Company's operations, such as EURO, Streling Pound and Kuwait Dinar. These currencies are

of not fixed exchange rates. On the other hand, transactions made in USD is not exposed to such risk

due to the fixed exchange rate of USD (1.41 USD per 1 JD).

32. Approval of the financial statements

The financial statements have been approved by the board of directors' on May 15, 2007.

33. Comparative figures

Comparative figures have been reclassified, where needed, to conform with the current year figures.

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