KATHMANDU, July 1: The Asian Development Bank's (ADB) has approved a US$ 150 million loan to help improve the reliability and efficiency of Nepal's electricity supply and distribution.
The project will be implemented by the Nepal Electricity Authority (NEA).
In addition to the loan, the board of director of ADB has authorized the multilateral donor to administer a $2 million technical assistance grant from the Japan Fund for Poverty Reduction (JFPR) financed by the Government of Japan to strengthen the capacity of Nepal's energy sector to deliver Gender Equality and Social Inclusion (GESI) results.
“Electricity supplies are expected to increase rapidly during the next several years through various hydropower projects nearing completion and imports from India through cross-border line,” the ADB said in a statement issued on Friday. “Therefore, existing transmission and distribution systems need to be immediately rehabilitated and upgraded for the network to be able to deliver the additional electricity supplies to consumers.”
The project is expected to enhance the distribution capacity and improve reliability and quality of electricity supply in the Kathmandu Valley by reducing distribution system overloads and technical and commercial losses. “This will be done through the strengthening of the transmission grid capacity, increasing capacity and rehabilitating the distribution network in the project area, and enhancing operational and financial performance of NEA distribution centers,” the statement read.
“Reliable and sustainable electricity distribution and service is an important aspect to Nepal's growth and development, as well as in the improvement of the quality of life of all its people,” reads the statement, quoting Jiwan Acharya, a senior energy specialist with ADB.
“We are confident that the project will help improve electricity distribution and efficiency in the country, and significantly support the government's goal of ending the country's energy crisis within the next two years and achieving Sustainable Development Goal 7 (Sustainable Energy for All),” added Acharya.