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Energy sector 2020 investments approach $3.4 billion marks with more projects approved

Energy sector lending for the year looks to surpass investments done in 2019 by a billion dollars with the additional three projects approved in recent days. The ADB Board approved on 3 December a loan of $150 million for the Air Quality Improvement of the Greater Beijing-Tianjin-Hebei (BTH) Region. This is the 6th intervention that ADB provided for the curtailment air pollution in this region in the People’s Republic of China. It will focus on promoting cutting-edge technologies in transport, renewable energy, industrial energy efficiency, and cooling systems to further this process of containing air quality deterioration in greater BTH and Yangtze River Delta regions, which is the largest economic cluster in the PRC. The project will support Clean Air Bonds (CABs) meeting international standards to catalyze domestic financing for sustainable clean energy investments, develop a financial technology-powered lending platform and enhance financial access for micro, small, and medium-sized enterprises (MSMEs) and women. The project team is being co-led by EASI’s Lei Zhang and Shigeru Yamamura.
 
ADB is also supporting Tajikistan in improving the financial sustainability of its power sector through a grant of $105 million. The Power Sector Development Program will support the ongoing sector reforms and improve the financial sustainability of the power sector in the country. The reforms include unbundling the vertically integrated power utility Barki Tojik into three independent companies responsible for power generation, transmission, and distribution; restructuring Barki Tojik’s excessive liabilities; establishing a new power sector regulator; adopting a tariff methodology; and setting up a new centralized cash control system among the unbundled entities. As part of the reforms and institutional capacity building, a newly established power distribution company will be operated under a 5-year management contract by an internationally reputable company with experience operating power utilities. The team is led by CWEN’s Yuki Inoue.
 
In yet another demonstration of One ADB and collaboration between sovereign and nonsovereign operations - but a first of such to be implemented in India, SAEN’s Teruhisa Oi and PSIF1’s Mayank Choudhary co-led the preparation of the Bengaluru Smart Energy Efficient Power Distribution Project in India that was approved on 4 December. ADB is providing a $100 million sovereign loan and a $90 million loan to Bangalore Electricity Supply Company Limited sans sovereign guarantee. The project is designed as an innovative financing arrangement, the first of its kind for ADB, combining public and private sector loans to a state government-owned enterprise. This financing structure reduces BESCOM’s sovereign exposure while helping it raise resources for capital expenditure using a market-based approach
 
The project will convert 7,200 kilometers (km) of overhead distribution lines to underground cables with parallel installation of 2,800 km of fiber optic communication cables. Moving the distribution lines underground protects them from natural hazards and interference, reducing technical and commercial losses by about 30%. The fiber optic cables will be used for smart metering systems, distribution automation system (DAS) in the distribution grid, and other communication networks. The project will install 1,700 automated ring main units adapted with a DAS to monitor and control the distribution line switch gears from the control center.  


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