Project to rationalize unmetered power
The Asian Development Bank (ADB) has signed a US$300 million loan to support the upgrade of rural power distribution networks to provide reliable electricity supply to consumers in Uttar Pradesh.
“The project will establish separate feeders for electricity supply to agriculture and residential consumers to promote better rationing and utilization of unmetered power, said Takeo Konishi, Country Director of ADB’s India Resident Mission who signed the loan with the Indian Government on 18 Dec 2020.
“It is to strengthen the financial management of the state power distribution entity and improve bill collection in rural areas through community engagement involving the women’s self-help groups,” said Konishi.
Upgrading the distribution network will help improve the quality and reliability of electricity supply, reduce the aggregate technical and commercial (ATC) losses and restore the financial sustainability of the rural electricity supply in Uttar Pradesh, added Dr. C. S. Mohapatra, Additional Secretary, Department of Economic Affairs, who signed for the Government.
The US$300 million is for the tranche 1 loan for Uttar Pradesh Power Distribution Network Rehabilitation Project, said the Finance Ministry.
Overall, the $430 million multi-tranche financing facility (MFF) approved for the project constituting two tranches, envisages the conversion of 65,000-km of rural low-voltage distribution lines from bare conductors to aerial bundled conductors (ABC) to create a robust distribution network that will benefit an estimated 70 million people in 46,000 villages.
The feeder separation network to be established over 17,000-km for agriculture and domestic consumers 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).
To improve bill collection, the project will pilot test engaging rural women through women’s self-help groups as community collection agents which will also help increase their family income.
The MFF is proposed to be complemented by a US$2 million technical assistance (TA) grant from ADB’s TA Special Fund and the Japan Fund for Poverty Reduction to strengthen the gender inclusivity and institutional capacity building of Uttar Pradesh power sector. #banking #loans #power #projects #infrastructure /fiinews.com
