ADB lends $242 million for power sector

The power crisis has crippled industry, frequent power outages, lasting up to 18 hours in some rural areas.

ISLAMABAD: The Asian Development Bank (ADB) will provide $242 million to help the country modernise electricity transmission lines and curtail losses that have contributed to a crippling power shortage, the bank said on Friday.

The country faced a power shortfall that peaked to between 4,000 and 5,000 megawatts during the 2010 summer, sparking street protests and adding to the government’s problems.

The new loan is part of $810 million the Manila-based bank approved in 2008 for the Power Distribution Enhancement Investment Programme, the bank said in a statement.

“This project will not only reduce electricity loss during delivery to the customers but also improve the quality of service,” said ADB’s Country Director Rune Stroem, who signed the loan agreement with government officials on Friday.

Outdated power grids and rampant electricity theft mean that some grid companies experience line losses of up to 30 to 40 per cent, energy experts say. The project includes investments in a secondary transmission grid and will include the addition of 3,380 megavolt-amperes of transformer capacity, and 387 km of new distribution lines.

The bank, this month, also approved a loan of up to $100 million for UK-based International Power Plc to build a gas-fired 404-megawatt power plant in the southwestern Balochistan province, scheduled to be completed by September 2013.

The power crisis has crippled industry, and frequent power outages, lasting up to 18 hours in some rural areas, led to violent protests last year.

Published in The Express Tribune, January 29^th,  2011.