The Asian Development Bank (ADB) on Wednesday approved a $200 million loan to modernise Pakistan’s power distribution infrastructure and improve distribution companies’ ability to deliver reliable electricity.
As per a statement released by the Manila-based lender, ADB’s Power Distribution Strengthening Project aims to upgrade and modernise distribution systems to meet Pakistan’s rapidly growing electricity demand.
“The project will focus on reducing significant energy losses during transit and enhancing the resilience of infrastructure against climate change and disaster-related risks,” read the statement.
The ADB disclosed that in its initial phase, the project will support three major distribution companies i.e. Lahore Electric Supply Company (LESCO), Multan Electric Power Company (MEPCO), and Sukkur Electric Power Company (SEPCO).
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“This project is part of ADB’s ongoing efforts to address challenges in Pakistan’s power sector,” said ADB Director General for Central and West Asia Yevgeniy Zhukov.
“Reliable grid-connected electricity improves the quality of life. The loss reduction and revenue protection measures supported by this project will also help reduce the power sector’s financial losses – alleviating at least one source of strain on the country’s economy.”
The project will fund the installation of at least 332,000 advanced metering infrastructure, along with data management and communication systems, and at least 15,800 online transformer performance monitoring systems in LESCO, MEPCO, and SEPCO.
“Furthermore, the voltage of four grid stations in SEPCO will also be upgraded from 66 kilovolts (kV) to 132 kV, a critical enhancement that will mitigate losses across the transmission system and address growing electricity demand.”
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Meanwhile, in LESCO, at least 25 grid stations will be constructed and modernised with the provision of critical equipment. Whereas, high-loss 11 kV feeder lines will be replaced with aerial bundled conductor cables, and feeder line configuration will be improved.
“These upgrades will reduce losses, enhance revenue collection, and provide distribution companies with real-time data on electricity consumption and grid performance,” said ADB Principal Energy Specialist Seung Duck Kim.
“In the event of extreme weather, they can help identify and isolate faults quickly, reducing the time required for recovery and minimizing outages.”
Moreover, the project will also study reform actions and policy recommendations that would improve the operational efficiency and overall performance of the three distribution companies.
The ADB also approved an additional $330 million in financing to strengthen Pakistan’s federally administered social protection programmes.