ADB to modernise energy sector in Uzbekistan and Tajikistan

Tajikistan and Uzbekistan have agreed to a project with the Asian Development Bank (ADB) aimed at modernising their regional power transmission systems - a step to improving the ageing Soviet-built infrastructure in the region. "This is a significant first step for regional cooperation and enhancing power trade relations between Tajikistan and Uzbekistan," Sean O'Sullivan, ADB country director for Uzbekistan, said in a statement on Tuesday. Uzbekistan and Tajikistan account for 65 pecent of the electricity generation capacity in the Central Asian power grid. Enhancing their bilateral power trading relationship would encourage broader economic cooperation in this area within Central Asia, the ADB said. The Central Asian power system comprises high-voltage transmission links connecting southern Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan. The system operates more than 80 power plants with a total installed capacity of 25,000 megawatts. The project is set to address improvements in the Soviet-built infrastructure, including rehabilitation of 500 kilovolt substations and switchyards to improve system reliability, upgrading dispatch and communications facilities to optimise system operation and installing new transborder metering arrangements to better measure traded power. Also, the ADB is planning to work toward an improved policy, institutional, and regulatory environment through the implementation of a regional power trade action plan and a bilateral power trade relations agreement. The Uzbekistan leg of the project will be financed by a US $70 million ADB loan and $49 million in co-financing from the European Bank for Reconstruction and Development (EBRD). The executing agency, Uzbekenergo, a state joint-stock owned electricity company, will provide $29 million. As for Tajikistan, $20 million will be provided by an ADB loan, co-financing of $2.4 million from the OPEC Fund, and $4.6 million from the executing agency, Barki Tajik, a Tajik state-owned electricity utility.