$100 mn ADB loan to up power distribution in Bengaluru

The ADB and the Centre signed it on December 31.

Published: 05th January 2021 05:24 AM  |   Last Updated: 05th January 2021 05:24 AM   |  A+A-

Electricity, Power

For representational purposes (File Photo | EPS)

By Express News Service

BENGALURU: The city’s power infrastructure is being overhauled in a big way. By 2022, all the overhead electricity cables will be replaced with underground power cables in all subdivisions of Bescom as part of the Bengaluru Smart Energy Efficient Power Distribution Project. The Asian Development Bank (ADB) will provide a $100 million loan to modernise and upgrade the power distribution system in Bengaluru city, a finance ministry statement said. The ADB and the Centre signed it on December 31.

This is the first of its kind financial arrangement by the ADB in which sovereign and non-sovereign loans have been put together for a state governmentowned enterprise (Bescom). “The modernisation and upgradation of power supply in the city is being done in a phased manner.

The initial phase was funded by Bescom and the State Government. Some loan was partly taken by the Karnataka Urban Infrastructure Development and Finance Corporation and some commercial banks. The ADB loan is for phase four – for the underground cabling of power lines and underground distribution of high-speed optical fibre cables (OFCs) – to strengthen communication network in the city,” said a senior Bescom officer.

Underground cabling to help cut Bescom’s losses

The underground power lines will cover over 7,200 km while OFCs will cover over 2,800 km across the city. The objective behind the underground cabling is to cut the transmission and distribution of losses of Bescom by 30%. “The OFCs will be used for smart metering systems, distribution automation system and other communication networks.

The project will install 1,700 automated ring main units adapted with a DAS to monitor and control the distribution line switchgears from the control centre,” the MoF stated. “The conversion of overhead distribution lines into underground cables will help build an energy-efficient network and minimise electricity outage resulting from natural hazards,” said Dr C S Mohapatra, additional secretary, Department of Economic Affairs in the Ministry of Finance.

Mohapatra and Officer-in- Charge of ADB’s India Resident Mission Hoe Yun Jeong were the signatories to Bengaluru Smart Energy Efficient Power Distribution Project. “The project demonstrates an innovative financing arrangement, the first of its kind for ADB, by combining sovereign and non-sovereign loans for a state governmentowned enterprise. This is to reduce the sovereign exposure and help Bescom move towards a market-based approach for raising funds for capital expenditure,” said Hoe Yun Jeong. “This will help Bescom access domestic and international financing markets,” MoF stated.


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