World Bank weighs to in­vest in power dis­tri­bu­tion net­work

The Pak Banker - - COMPANIES/BOSS - Staff Reporter

IS­LAM­ABAD: The World Bank is as­sess­ing a pro­posal to in­vest in high-pri­or­ity trans­mis­sion in­fra­struc­ture to re­vamp se­lected seg­ments of the coun­try's elec­tric­ity dis­tri­bu­tion net­work. The pro­posed $493 mil­lion pro­ject aims to in­crease the re­li­a­bil­ity and ef­fi­ciency of the na­tional trans­mis­sion sys­tem.

Re­cent ef­forts have con­cen­trated on in­creas­ing power gen­er­a­tion ca­pac­ity in the coun­try, but age­ing and in­creas­ingly un­re­li­able trans­mis­sion and dis­tri­bu­tion sys­tems also im­pose se­vere con­straints.

Anec­do­tal ev­i­dence sug­gests that the trans­mis­sion sys­tem has the ca­pac­ity to dis­patch only 15,000MW safely. There have been sev­eral in­stances of sys­tem break­down and they ap­pear to be in­creas­ing in fre­quency and sever­ity.

Ac­cord­ing to sources at the World Bank, the In­ter­na­tional Bank for Re­con­struc­tion and De­vel­op­ment will pro­vide a loan of $425m for the pro­ject, while the re­main­ing $68m will be pro­vided by the Na­tional Trans­mis­sion and Des­patch Com­pany (NTDC) as coun­ter­part funds.

The pro­ject en­tails up­grad­ing, ex­pand­ing and re­ha­bil­i­tat­ing se­lected 500kV and 220kV sub­sta­tions and trans­mis­sion lines. It will also be vi­able at 765kV, if the NTDC de­cides to start op­er­at­ing at the higher volt­age.

Sub-projects will be se­lected on the ba­sis of plan­ning car­ried out by the NTDC, which will iden­tify the ar­eas where im­prove­ments are re­quired first.

The World Bank has em­barked upon a "Trans­for­ma­tional Power Ini­tia­tive" as part of the Coun­try Part­ner­ship Strat­egy (for 2015-2019). The ini­tia­tive aims to sup­port new in­vest­ments and re­forms in the power sec­tor and mo­bilise over $10 bil­lion over the next five years to sup­port sys­tem ex­pan­sion through the pub­lic and pri­vate sec­tors.

The In­ter­na­tional Fi­nance Cor­po­ra­tion (IFC) has made in­vest­ments in medium to large hy­dropower projects and wind gen­er­a­tion and LNG im­port schemes. Cur­rently, the WB and IFC are work­ing on the Cen­tral Asia-South Asia Re­gional Elec­tric­ity Trans­mis­sion and Trade Pro­ject (CASA-1000) to bring Cen­tral Asian power to Pak­istan. The pro­posed pro­ject will com­ple­ment the Dasu hy­dropower pro­ject, Tar­bela ex­ten­sions 4 and 5 and the CASA-1000. Al­though it is not part of the coun­try part­ner­ship strat­egy, ad­di­tional trans­mis­sion in­fra­struc­ture is needed to dis­trib­ute the elec­tric­ity pro­duced from cur­rent or planned WB­fi­nanced in­vest­ment op­er­a­tions.

A WB re­port says mas­sive, well-tar­geted and ef­fi­ciently ex­e­cuted in­vest­ment is needed through­out the elec­tric­ity value chain. To bridge the gap be­tween sup­ply and de­mand, the govern­ment has fo­cused on im­prov­ing elec­tric­ity sup­ply through de­vel­op­ment of low-cost gen­er­a­tion, par­tic­u­larly hy­dropower, projects in the north and plants based on gas and coal in the cen­tre and south of the coun­try.

In­vest­ment in gen­er­a­tion will not, how­ever, have the in­tended ben­e­fits with­out ad­e­quate and timely up-gra­da­tion of trans­mis­sion and dis­tri­bu­tion sys­tems.

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