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VietNamNews

World Bank funds project to improve power quality

Update: September, 14/2012 - 10:38

WASHINGTON DC (VNS)— The World Bank on Wednesday approved funding for a Distribution Efficiency Project for Viet Nam to provide electricity users with better quality and reliable electricity services, and to reduce greenhouse-gas emissions through efficiency improvements.

The World Bank has worked with the Government over the last decade to expand the power network and to provide electricity to all parts of the country. Access to electricity increased from 50 per cent in 1996 to nearly 97 per cent in 2011.

World Bank assistance, however, has now shifted from providing new electricity connections to improving the quality of services to consumers, according to a press release from the bank.

"The efficiency and modernisation investments under this project will improve the reliability of energy supply to industries and households and contribute to Viet Nam's socio-economic development," said Van Tien Hung, senior energy specialist and task team leader for the project.

"A reliable electricity supply will reduce the need of households to use alternative and often more polluting fuels, such as coal and kerosene. This should also have a positive gender and poverty impact," Hung added.

The project will help meet the objectives of the National Energy Development Strategy to 2020 by reducing investment needs in the power sector, strengthening energy security and contributing to climate-change mitigation.

It covers the construction and reinforcement of electricity distribution networks, the introduction of smart-grid technologies in distribution and a technical-assistance and capacity-building facility for the Electricity Regulatory Authority of Viet Nam (ERAV) and five power companies to develop efficient electricity tariffs and design effective energy-demand programmes.

The total project cost is US$800 million. The World Bank contributes $449 million, with funding from the WB's International Development Association, and $30 million from the Clean Investment Fund to support the implementation of smart-grid technologies.

The Australian Agency for International Development provides $8 million in grants for technical assistance and capacity building.

The remaining investment of $313 million will come from the Vietnamese government in counterpart funds. —VNS

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