WB to lend $195 million to boost DISCOs efficiency
Deposit amount shall become part of central bank’s foreign exchange reserves. PHOTO: FILE
The World Bank will lend $195 million to Pakistan to help it enhance electricity distribution efficiency.
In this regard, an agreement was signed by Pakistan’s Economic Affairs Division and the international lender in Islamabad on Thursday.
The project objectives of the Electricity Distribution Efficiency Improvement Project are to improve operational efficiency in targeted areas of three Electricity Distribution Companies i.e. Hyderabad Electric Supply Company (HESCO), Multan Electric Power Company (MEPCO), Peshawar Electric Supply Company (PESCO) and achieve progress on the power sector reform agenda.
Economic Affairs Division Secretary Mian Asad Hayaud Din signed the loan agreement on behalf of Government of Pakistan while representatives of HESCO, MEPCO and PESCO signed the project agreements. WB Operations Manager Anjum Ahmad signed the agreements on behalf of the international lender.
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The project aims to support investment programmes of three DISCOs’ to improve the reliability of electricity supply and reduce technical losses through; (a) new grid stations; (b) augmentation and upgradation of existing grid stations; (c) construction, rehabilitation of transmission lines, modernisation of DISCOs operations and management functions, revenue and equipment protection programme and improving operations and maintenance.
The project will also support the Power Division in fulfilling its policy mandate under the National Electricity Policy 2021 and implement power sector reforms.
The interventions under the project specifically aim at improving governance, technical capabilities, safety, and commercial performance of the DISCOs to better serve their customers.
The project will also support Ministry of Energy (Power Division) to implement power sector reforms, strengthen its oversight function and support enhancing private participation in the management of the DISCOs. It will also contribute to focus area on growth by improving supply of electricity to businesses, industry and agriculture consumers. It also has significant contributions towards achieving the goals for Green and Clean Pakistan initiative.
The EAD secretary thanked and appreciated the international lender’s management for extending continuous support to the present government to promote inclusive and sustainable economic development.
At the occasion, the EAD secretary shared that even during difficult situations, the Government of Pakistan retained its focus on implementing structural reforms to help the economy regains its strength.
He reiterated the government’s commitment to further strengthen implementation of reforms, including comprehensive power sector reforms focusing strongly on reducing current and future power costs, reducing reliance on imported fossil fuel, increasing renewable energy, addressing inefficiencies in distribution and lowering subsidies in the sector by better targeting them to those most in need.