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VietNamNews

ADB loans $730m for electricity upgrade

Update: February, 11/2012 - 10:05

HA NOI — The Asian Development Bank and the Government of Viet Nam yesterday signed the first instalment of a US$730 million investment programme to upgrade the country's power transmission network to improve delivery and meet growing demands from industry and households.

The loan, worth $120.5 million, was signed by Governor of the State Bank Nguyen Van Binh and ADB Vice-President Stephen P. Groff. It is expected to support the construction of almost 648 kilometres of 500 kilovolt (kV) lines and more than 100 kilometres of 220 kV lines, plus upgrades to associated substations and training and other support to the National Power Transmission Corporation.

Speaking at the signing ceremony, Binh said the project was aimed at expanding the national power grid and building transformer stations, minimising overload and ensuring reliable transmission.

Groff said to keep the economy powering forward, the country needed a stable, steady supply of electricity.

He said although Viet Nam had made remarkable progress in expanding access to electricity, many communities – mainly in rural and mountainous areas – were still not connected to the grid.

Without additional network expansion, the share of urban and rural populations without electricity is expected to increase, particularly among populations with lower income and electricity consumption.

As Viet Nam's economy grows, demand for electricity is expected to grow by an average of 14 per cent per year from 2011-2015, and then by 11 per cent per year until 2020.

ADB funds are expected to be released in four instalments, with the first loan from ordinary capital resources having a 25-year term. The programme is due for completion in 2020. — VNS

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