Uzbekistan: Advanced Electricity Metering Project

Project Name Advanced Electricity Metering Project
Project Number 41340-013
Country / Economy Uzbekistan
Project Status Closed
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan 2779-UZB: Advanced Electricity Metering Project (formerly Automated Metering System)
Ordinary capital resources US$ 150.00 million
Strategic Agendas Inclusive economic growth
Drivers of Change Gender Equity and Mainstreaming
Sector / Subsector

Energy / Electricity transmission and distribution

Gender Effective gender mainstreaming
Description The Advanced Electricity Metering Project will install an advanced electricity metering (AEM) system, with modern, accurate, and theft-proof revenue meters for about one million residential and commercial entity customers in Samarkand, Bukhara, and Jizzakh regions. AEM will allow appropriate accounting for every unit of power consumed, which is essential for minimizing commercial losses and identifying upgrades that would result in a lower technical loss. The project will contribute to improving energy efficiency, and will help reduce commercial losses and improve collection efficiency of electricity revenue.
Project Rationale and Linkage to Country/Regional Strategy

Uzbekistan economy has achieved sustained high growth averaging 8.5% since 2006. The growth prospects for 2011 and beyond remain within a range of 8%-9%. The Government of Uzbekistan prioritizes industrial modernization, infrastructure development, and private sector development. Reliable and affordable electricity supply is vital in achieving these goals.

Uzbekistan is one of the most energy intensive and one of the highest electricity consumption countries in the world. A high energy intensity and electricity consumption relative to the size of economy mean high potential impacts for energy efficiency improvement. Energy efficiency is a strategic priority for Uzbekistan and ADB . It represents the least-cost and low-carbon solution to sustain energy security. It cuts the high energy intensity and increases energy productivity.

Efficient use of electricity can be promoted by appropriately accounting for every unit of power consumed. Minimizing commercial losses and identifying upgrades that would result in a lower technical loss help address energy efficiency. Uzbekistan suffers from high losses in the transmission and distribution system. State Joint Stock Company Uzbekenergo, the vertically integrated utility owned 100% by the government, estimates total system losses of nearly 20% (transmission losses of 2%-4% and distribution losses of 13%-15%), compared with around 5% in advanced countries. But the actual losses are considered to be higher with commercial losses in the range of 25% to 35%. Given that the total annual power supply in Uzbekistan is about 51,935 gigawatt-hour (GWh), a 1% loss reduction means savings of 520 GWh or $26 million a year.

Uzbekistan electrification rate is almost 100%. All connections are metered, billed according to the tariffs set for respective consumer categories. But the meters are generally old and/or unreliable. This has made it difficult for Uzbekenergo to appropriately account for use of electricity. Further, these electricity meters are easy to tamper. The existing electricity meters are of electromechanical type and were manufactured during 1960-1990. These meters have been in service well beyond their designed economic life and without recalibration, resulting in reduced measurement accuracy.

Not all meters are regularly read due to meter reading personnel shortage. As a result, customers read their meters themselves, but this is subject to under-reporting of consumption. Under-reporting is further compounded by meter readers (controllers) who are not able to effectively read the meters and collect revenue. Most meters are installed inside the house. Controllers can either decide to disconnect the customers immediately for past unpaid consumption or overlook the excess consumption and enter a lower than actual reading into the system.

Uzbekenergo, with an internal budget of $32 million, is installing bulk revenue meters, capable of accurately measuring and reporting interval demand at high/medium voltage large industrial customers and transmission/distribution interfaces (to be completed by the end of 2014). The installation of AEM system that encompasses low voltage residential and small commercial customers will provide the missing link for accurate measurement of losses in various system components, allowing focusing of the loss reduction efforts on feeders with the highest losses.

Uzbekenergo has already undertaken several pilot automated and advanced metering projects in Tashkent for 53,000 consumers. The pilot schemes were generally successful in reducing commercial and collection losses, resulting in substantial revenue increases. It was found that the effective metering functionalities were two-way communication that allows remote connection and disconnection, anti-theft and anti-bypassing. But integration was difficult because of the different and incompatible technologies used. Building on the experience of the pilot projects in Tashkent, Uzbekenergo and the government plan to integrate and expand the AEM system to all 4.5 million customers in phases.

AEM, known as "smart metering", is a technology with digital meters that allows two-way communication between the utility and consumers. AEM enables the utility to remotely monitor, and if necessary, disconnect the supply without sending reading personnel to the site, and the consumers to have access to power usage information more frequently, possibly on real time. It is an effective tool in loss identification and useful in addressing commercial losses, and low tariff collection. The AEM system will incorporate both pre-paid and post-paid modes of payment. Uzbekenergo, thus, expects to use AEM technology to increase energy efficiency through loss reduction, and potentially through demand side management.

The project follows the ADB strategy for Uzbekistan, which includes focus on energy efficiency and reliable power supply. It will be ADB's second intervention in Uzbekistan's power sector.

Impact

Power sector financial viability increased

Project Outcome
Description of Outcome

Commercial and tariff collection losses for residential and small business entity customers substantially reduced in the targeted regions of Bukhara, Jizzakh and Samarkand.

Progress Toward Outcome Turnkey contract was awarded to KT Corporation (Contractor) and have been mobilized since Dec 2015. Advance metering infrastructure is installed for 1 million customers in three regions. Typical meter installations are completed in Bhukhara, Jizzakh and Samarkand. The guarantee tests for the installed advanced electricity metering infrastructure has been completed and the roll out of the remaining meters is expected to start shortly.
Implementation Progress
Description of Project Outputs

1. Advanced meters installed and associated data communication equipment functional.

2. Data management system developed and operational.

3. Customer services for end-users improved.

Status of Implementation Progress (Outputs, Activities, and Issues)

1. Advanced meters installed and associated data communication equipment functional: achievable with delay.

2. Data management system developed and operation: achievable with delay

3. Customer services for end-users improved: achievable with delay

Geographical Location Bukhara, Jizzakh Province, Samarqand Viloyati
Safeguard Categories
Environment C
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects No major environmental safeguards issues are envisaged under the project.
Involuntary Resettlement No major issues on involuntary resettlement are envisaged under the project.
Indigenous Peoples No major issues on indigenous peoples are envisaged under the project.
Stakeholder Communication, Participation, and Consultation
During Project Design

Stakeholders' consultations through community meetings, discussions, and interviews will be conducted during the PPTA. Strategies to encourage poor women's participation as individual consumers or as representatives of interest groups will be encouraged. At the same time, women leaders in government and business will be involved to participate in the consumer education campaign.

Level of participation during project design is information sharing and consultation.

During Project Implementation Consultation and Participation Plan will be prepared.
Business Opportunities
Consulting Services Supervision Consultant for 56 person-months (QCBS).
Procurement One contract for goods and related services for AEM meters and communication system, meter data management and billing system (ICB). Installation of AEM meters by Uzbekenergo. Supplier(s) will provide training and trouble-shooting during implementation.
Responsible ADB Officer Musaev, Shokhimardon
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Uzbekistan Resident Mission (URM)
Executing Agencies
Joint-Stock Company Regional Electrical Power Networks
Timetable
Concept Clearance 16 Dec 2010
Fact Finding 09 May 2011 to 26 May 2011
MRM 19 Jul 2011
Approval 19 Sep 2011
Last Review Mission -
Last PDS Update 24 Sep 2018

Loan 2779-UZB

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
19 Sep 2011 16 Feb 2012 20 Apr 2012 30 Jun 2015 31 Dec 2020 30 Apr 2021
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 200.00 Cumulative Contract Awards
ADB 150.00 10 Jan 2023 148.29 0.00 100%
Counterpart 50.00 Cumulative Disbursements
Cofinancing 0.00 10 Jan 2023 148.29 0.00 100%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory Satisfactory Satisfactory Satisfactory Satisfactory Satisfactory

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Source URL: https://www.adb.org/projects/41340-013/main