Asian Development Bank to provide USD 563 million loan for power projects in Uttar Pradesh, Meghalaya
ADB has also signed a USD 132.8 million loan to strengthen and modernise the distribution network and improve the quality of power supplied to household.
Published: 01st December 2020 06:55 PM | Last Updated: 01st December 2020 06:55 PM | A+A A-
NEW DELHI: Multi-lateral funding agency Asian Development Bank (ADB) on Tuesday said it will provide loan of USD 562.8 million (about Rs 4,143 crore) for power projects in Uttar Pradesh and Meghalaya.
The Asian Development Bank (ADB) has approved a USD 430 million multi-tranche financing facility (MFF) to improve the quality and reliability of electricity supply in Uttar Pradesh in India, it said in a release.
Besides, ADB has also signed a USD 132.8 million loan to strengthen and modernise the distribution network and improve the quality of power supplied to households, industries, and businesses in Meghalaya, it said in a separate release.
The Uttar Pradesh Power Distribution Network Rehabilitation Project will improve the efficiency and sustainability of power supply in the state.
The project is estimated to benefit 70 million people in 46,000 rural villages, ADB said.
It will also finance the construction of a parallel network of 11-kilovolt feeders with a total length of 17,000 km to separate the distribution of electricity between residential consumers and agriculture consumers.
This will facilitate the use of solar energy to meet the agriculture demand, increase in electricity supply duration to rural residential consumers, and energy and water conservation.
In addition, the project will improve the gender inclusivity, corporate governance, and financial management capacity of Uttar Pradesh Power Corporation Limited (UPPCL).
"Reliable and sustainable power distribution and service is an important aspect to India's growth and development. This project fully supports the Government of India's vision of 'Power for All' in a sustainable and inclusive way in the largest and one of the poorest states in India," said ADB Principal Energy Specialist for South Asia Pradeep Perera.
Existing rural power distribution networks will be upgraded to enable the provision of reliable supply to customers in rural Uttar Pradesh in a financially sustainable manner, he said.
ADB said the MFF is complemented by a USD 2 million technical assistance (TA) grant from the ADB TA Special Fund and the Japan Fund for Poverty Reduction to strengthen the gender inclusivity and institutional capacity building of Uttar Pradesh power sector.
The TA will pilot test innovative bill collection strategies involving rural women self-help groups, pilot test gender-sensitive workplace practices, provide capacity building for improved financial management, gender-inclusive workplace practices, and strengthen project management and safeguard compliance capacity of UPPCL.
The funding to Meghalaya will be used for construction of 23 sub-stations; renovate and modernise 45 sub-stations, including provision of control room equipment and protection systems.
Also, it will install and upgrade 2,214 km of distribution lines and associated facilities covering three out of the six circles in the state.
Installation of smart metres will benefit about 1,80,000 households, ADB said.
The loan will be supplemented by a USD 2 million grant from ADB Japan Fund for Poverty Reduction.
The project will help develop a distribution sector road map and a financial road map for the Meghalaya Power Distribution Corporation Limited (MePDCL).
These road maps will strengthen the capacity of MePDCL to operate and manage the distribution networks, said the Manila-headquartered global funding body.
It said though Meghalaya has achieved 100 per cent electrification, remote rural areas in the state suffer from frequent power interruptions due to overloaded distribution networks and sub-stations that use outdated technology, resulting in high aggregate technical and commercial (AT&C) losses.
The Government of India and the state government of Meghalaya embarked on a joint 24x7 Power for All Meghalaya initiative to provide uninterrupted, quality, reliable, and affordable power supply to all electricity consumers, ADB said.