Khatlon Energy Loss Reduction Project

Location:

Tajikistan

Project number:

49930

Business sector:

Energy

Notice type:

Public

Environmental category:

B

Approval date:

22 Jul 2020

Status:

Passed Final Review, Pending Approval

PSD disclosed:

23 Jul 2019

Translated version of this PSD: Russian | Tajik

Project Description

The provision of 20 million financing for the modernisation of power distribution grid in southern Tajikistan. The Bank's financing will target the modernisation of a low-voltage distribution grid in the cities of Kulob and Bokhtar, the construction of a new and an upgrade of the existing 110/35/10 kV substation in Kulob, and the installation of automatic billing and metering systems in both cities. The National Electricity Distribution Company of Tajikistan (the "Company") to be established as part of the on-going unbundling of the Open Stock Holding Company "Barki Tojik" (OSHC Barki Tojik), the national power utility, will be the Project implementing entity.   

Project Objectives

The Project will target one of the key constraints to economic development in the country - limited access to the reliable energy supply. The Project's principal objectives are to: (i) address the most urgent needs for the replacement of aged infrastructure, (ii) contribute towards the reduction of distribution network losses resulting in financial and CO2 emissions savings, and (iii) introduce modern billing and metering infrastructure, improving payment discipline and cash collection, upholding operational and financial efficiency and sustainability of OSHC Barki Tojik at present. 

Transition Impact

Good

The expected transition impact of the Project is twofold:

-         Green: The Project is expected to deliver climate mitigation benefits through improving energy efficiency of the electricity distribution network. The Project will reduce significantly technical and commercial electricity distribution losses, and is expected to result in GHG emissions savings. 

-         Resilient: Through the planned network upgrades and replacement of over 730 km of distribution lines, the reliability of the electricity distribution network in the cities of Bokhtar and Kulob will be significantly improved. Additionally, the Project will support more efficient functioning of the distribution network operator through improved transparency and accountability and introduction of billing and metering.

Client Information

TAJIKISTAN SOVEREIGN

The Project implementing entity is to be established upon unbundling of OSHC Barki Tojik during 2019 and will consolidate all distribution activities and attributable infrastructure, revenues and expenses.

EBRD Finance Summary

EUR 20,000,000.00

Up to  20 million long-term sovereign loan to the Republic of Tajikistan.  The Project is expected to be co-financed with a  15 million grant from the European Union's Investment Fund for Central Asia (IFCA).

Total Project Cost

EUR 36,400,000

Environmental and Social Summary

Categorised B under the 2014 ESP.  E&S impacts/risks to consider include potential land acquisition and restriction of access, labour issues, client Environmental and Social capacity, management of contractors, and construction related health and safety risks. Environmental and Social (E&S) due diligence will be undertaken by an independent consultant and will include a site visit, a review of the proposed E&S organisation and practices of the to-be-established implementing entity, and an assessment of impacts and benefits of the proposed investment. The ESDD will also undertake a top level review of the Company's EHS management systems and capacity to implement the Bank's PRs.

Technical Cooperation

  • Consultancy support for environmental due diligence of the Project financed by the SSF.
  • Project implementation support to assist the project implementation unit with procurement of goods, works and services for the Project and to provide organizational and technical assistance financed by the SSF.
  • Gender assessment to be financed by the IFCA grant.

Business opportunities

For business opportunities or procurement, contact the client company.

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