The Government of India and the Asian Development Bank (ADB) signed here a $50.2 million loan agreement to continue to support improvements to transmission and distribution systems in the State of Assam for better electricity service to end users.

The fourth tranche loan under the $200 million multi-tranche financing facility for the Assam Power Sector Enhancement Investment Program will build on earlier loans which aimed to improve operational efficiency in the sector through better transmission and distribution networks.

Shri Tarun Bajaj, Joint Secretary (Multilateral Institutions), Department of Economic Affairs, Ministry of Finance, who signed the loan agreement on behalf of Government of India said that this loan will help strengthen the state’s sub-transmission and distribution system, improve energy efficiency and reduce technical and commercial losses,” said He added that project will also undertake modernization of metering and maintenance of repair system.

Speaking on the occasion, Ms. Teresa Kho, Country Director of ADB`s India Resident Mission, who signed the agreement for ADB said that the increased access to electricity in remote communities can help meet growing demand and reduce poverty. Sh. V. B. Pyarelal, Additional Chief Secretary (Power), Government of Assam signed the agreement on behalf of the State Government along with Shri K. V. Eapen, Chairman, Assam Power Distribution Company Limited (APDCL).

The project, which is expected to be completed by December 31, 2018, will help APDCL add an additional 222 megavolt amperes (MVA) substation capacity and reduce system losses by 4%. Part of the loan will be used to enhance energy efficiency through renovation and modernization of existing 33/11 kilovolt (kV) substations. It will also deliver a dedicated power supply to tea estates by undertaking feeder separation for better service to the economically important tea sector.

The loan of $50 million from ADB’s ordinary capital resources makes up to 74% of the total project cost of almost $68 million, with the Government of Assam providing counterpart finance of $18 million.

Loan agreement funds Assam power distribution upgrades to modernize substations, improve efficiency and reduce system losses. A loan agreement under the fourth tranche of a multi tranche financing facility provides $50.2 million to strengthen sub transmission and distribution systems in Assam, modernize metering and 33/11 kV substations, add substation capacity, undertake feeder separation for dedicated supply to tea estates, and reduce technical and commercial losses, with a specified counterpart contribution from the state government.