ADB is supporting power transmission upgrades in Viet Nam to meet growing demand for electricity. The second tranche of the multitranche loan facility will finance the expansion of the transmission network, improve the operational effectiveness and efficiency of the National Power Transmission Corporation, and project implementation support.
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|Power Transmission Investment Program - Tranche 2||Sep 2013|
|Project Name||Power Transmission Investment Program - Tranche 2|
|Project Type / Modality of Assistance||Loan
|Source of Funding / Amount||
|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|
|Description of Outcome||Strengthened financial and operational capacity of NPT|
|Progress Toward Outcome||Component 2 deferred to Tranche 4.|
|Description of Project Outputs||
Component 1: Expanded Transmission Network
Energized transmission lines
Improved Operational Effectiveness and Efficiency of NPT
Strengthened investment planning and management capacity of NPT
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.|
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|
|Consulting Services||The procurement plan has been uploaded on ADB's website.|
|Procurement||The procurement plan has been uploaded in ADB's website.|
|Responsible ADB Officer||Lee, Hyunjung|
|Responsible ADB Department||Southeast Asia Department|
|Responsible ADB Division||Viet Nam Resident Mission|
National Power Transmission Corporation
18 Tran Nguyen Han Street,
Hoan Kiem District, Hanoi-Vietnam
|MRM||24 Aug 2012|
|Approval||05 Dec 2012|
|Last Review Mission||-|
|Last PDS Update||28 Mar 2017|
|Approval||Signing Date||Effectivity Date||Closing|
|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%|
|Cofinancing||0.00||05 Dec 2012||62.85||0.00||92%|
Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.
The Public Communications Policy (PCP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.
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|Title||Document Type||Document Date|
|Power Transmission Investment Program - Tranche 2: Audited Project Financial Statements (January-December 2015)||Audited Project Financial Statements||Jun 2016|
|Power Transmission Investment Program - Tranche 2: Audited Project Financial Statements (January-December 2014)||Audited Project Financial Statements||Jun 2015|
|Power Transmission Investment Program - Tranche 2: Audited Project Financial Statements (21 December 2012 - 31 December 2013)||Audited Project Financial Statements||Sep 2014|
|Power Transmission Investment Program - Tranche 2||Procurement Plans||Sep 2013|
|Loan Agreement for Power Transmission Investment Program - Loan 2||Loan Agreement (Ordinary Resources)||Dec 2012|
|Project Agreement for Power Transmission Investment Program - Loan 2||Project/Program Agreements||Dec 2012|
|Power Transmission Investment Program - Tranche 2||Design and Monitoring Frameworks||Nov 2012|
Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.
Evaluation Documents See also: Independent Evaluation
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