Project Name Power Transmission Investment Program - Tranche 2
Project Number 42039-035
Country Viet Nam
Project Status Active
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan 2959-VIE: Power Transmission Investment Program, Tranche 2
Ordinary capital resources US$ 68.58 million
Loan: Power Transmission Investment Program - Tranche 2
Agence Francaise de Developpement US$ 100.00 million
Strategic Agendas Inclusive economic growth
Drivers of Change Partnerships
Sector / Subsector

Energy - Electricity transmission and distribution - Energy sector development and institutional reform

Gender Equity and Mainstreaming No gender elements

The investment program will contribute to meeting electricity demand growth of industrial, commercial, and residential consumers in an economically and environmentally sustainable manner. The outcome of the investment program is enhanced capacity of the transmission network to balance power load. The investment program also supports partial implementation of National Power Sector Development Master Plan VII (PDMP VII) to meet growing electricity demand of industrial, commercial and residential consumers throughout Viet Nam, and improve the operational effectiveness and efficiency of the National Power Transmission Corporation (NPT) _ the entity responsible for financing, managing, and operating the transmission network _ to ensure reliable electricity supply.

Tranche 2 will finance part of each of the three output components:

Component 1: Expanded Transmission Network (Physical investment)

Component 2: Improved Operational Effectiveness and Efficiency (Non-physical investment)

Component 3: Project Implementation Support (Non-physical investment)

Project Rationale and Linkage to Country/Regional Strategy

Recognizing the need to overcome current constraints in the power sector to ensure that rapidly growing electricity demand can be met in an economically and environmentally sustainable manner to sustain economic growth, the government of Viet Nam approved in 2011 the PDMP VII . With PDMP VII, the government approved multiple power generation and transmission projects to be implemented during 2011_-2020 and laid out a detailed road map and reform framework for (i) strengthening financial capacity, (ii) improving the operational performance of power sector entities, (iii) enhancing human resource capacity and development, (iv) improving the technological optimization and modernization of power sector infrastructure, and (v) enhancing energy efficiency in generation and consumption to sustainably develop and modernize Viet Nam's power sector.

To improve the financial sustainability of power sector entities, the Prime Minister approved in July 2012 EVN's 2011-_2015 Operation and Business Plan. The plan includes a provision for revaluation of NPT's assets of D15,000 billion to raise NPT's equity to D22,000 billion by the end of 2012. The asset revaluation will contribute to progressively improve NPT's financial performance in line with the objectives under the power transmission investment program of achieving a (i) debt-service coverage ratio of 1.5, (ii) self-financing ratio of 25%, and (iii) debt-to-equity ratio of 75:25 by 2015. Financial and implementation details of the asset revaluation are currently under approval by the Ministry of Finance. The asset revaluation is scheduled to take place end of 2012.

Impact Enhanced capacity to balance power load in southern Viet Nam

Project Outcome

Description of Outcome Strengthened financial and operational capacity of NPT
Progress Toward Outcome Component 2 deferred to Tranche 4.
Implementation Progress
Description of Project Outputs

Component 1: Expanded Transmission Network

Energized transmission lines

Component 2:

Improved Operational Effectiveness and Efficiency of NPT

Strengthened investment planning and management capacity of NPT

Component 3:

Project Implementation Support

Enhanced streamlined project implementation

Strengthened safeguard compliance management

Effective support in design and construction

Status of Implementation Progress (Outputs, Activities, and Issues) Except for Component 2 which was deferred to Tranche 4, all activities under Component 1 and Component 3 complied. Financial closure envisaged in April 2017.
Geographical Location

Safeguard Categories

Environment B
Involuntary Resettlement A
Indigenous Peoples B

Summary of Environmental and Social Aspects

Environmental Aspects Subprojects of tranche 2 are category B under ADB's environment guidelines. No component of any of the three subprojects is located in an environmentally sensitive or protected area, and potential impacts during construction will be mitigated by using good international construction practices. The main identified impact will be the clearing of 40 hectares of degraded forest within the right of way of the 500kV Pleiku-My Phuoc-Cau Bong transmission line. The impact will be offset through tree planting in equivalent areas. An initial environmental examination (IEE) report with an environmental management plan and implementation budget was prepared for each of the subprojects under tranche 2. The IEEs were disclosed on ADB's website in August 2012.Environmental units supported by individual national and international consultants have been formed within each PPMB to supervise implementation and assure occupational and community health and operation until operation of the transmission lines.
Involuntary Resettlement Tranche 2 will build transmission lines that require land acquisition but no need to relocate houses is expected. A total of 4,023 household, 56 plantations owned by local communes will be affected and 64 households will be severely affected. The following plans/measures are in place to address this - combined resettlement framework and ethnic minority planning framework, resettlement plan and combined resettlement and ethnic minority development plan.
Indigenous Peoples A total of 1,039 ethnic minority households will be affected. Where ethnic minorities will be affected by the construction of the 500kV Pleiku-My Phuoc-Cau Bong transmission line, combined resettlement and ethnic minority development plans were prepared. Implementation will be closely monitored.
Stakeholder Communication, Participation, and Consultation
During Project Design Consultations regarding land acquisition were undertaken with key government officials and the affected people for subprojects included in Tranche 2.
During Project Implementation

Business Opportunities

Consulting Services The procurement plan has been uploaded on ADB's website.
Procurement The procurement plan has been uploaded in ADB's website.

Responsible Staff

Responsible ADB Officer Lee, Hyunjung
Responsible ADB Department Southeast Asia Department
Responsible ADB Division Viet Nam Resident Mission
Executing Agencies
National Power Transmission Corporation
[email protected]
18 Tran Nguyen Han Street,
Hoan Kiem District, Hanoi-Vietnam
Ha Noi


Concept Clearance -
Fact Finding -
MRM 24 Aug 2012
Approval 05 Dec 2012
Last Review Mission -
Last PDS Update 28 Mar 2017

LoanĀ 2959-VIE

Approval Signing Date Effectivity Date Closing
Original Revised Actual
05 Dec 2012 21 Dec 2012 31 May 2013 30 Nov 2016 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 319.36 Cumulative Contract Awards
ADB 68.58 05 Dec 2012 61.67 0.00 90%
Counterpart 250.78 Cumulative Disbursements
Cofinancing 0.00 05 Dec 2012 62.85 0.00 92%

This page was generated from on 27 June 2017