Afghanistan: Energy Supply Improvement Investment Program Tranche 2 (Formerly Multitranche Financing Facility II: Energy Development 2014-2023)

Sovereign (Public) Project | 47282-004

The project will expand power imports from Turkmenistan through an asynchronous power interconnection, establish a unified power grid in Afghanistan, and extend the power grid into central Afghanistan. The 500-MW converter station will allow Turkmen power into the Afghan grid under the ten-year power purchase and sales agreement signed in November 2015. The Doshi-Bamyan line will expand the grid to eight additional provinces, distribute power to nearly 150,000 people, and provide redundancy to the existing transmission network. The project has transmission and distribution system linkages with several projects assisted by ADB and other development partners. The project is fully aligned with the National Energy Supply Program of the Government of Afghanistan.

Project Name Energy Supply Improvement Investment Program Tranche 2 (Formerly Multitranche Financing Facility II: Energy Development 2014-2023)
Project Number 47282-004
Country Afghanistan
Project Status Active
Project Type / Modality of Assistance Grant
Source of Funding / Amount
Grant 0521-AFG: Energy Supply Improvement Investment Program, Tranche 2 (formerly MFF II: Energy Development 2014-2023)
concessional ordinary capital resources lending / Asian Development Fund US$ 58.63 million
Grant 0522-AFG: Energy Supply Improvement Investment Program, Tranche 2 (formerly MFF II: Energy Development 2014-2023)
Afghanistan Infrastructure Trust Fund US$ 79.00 million
Grant 0523-AFG: Energy Supply Improvement Investment Program, Tranche 2 (formerly MFF II: Energy Development 2014-2023)
People's Republic of China Poverty Reduction and Regional Cooperation Fund US$ 1.00 million
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Partnerships
Sector / Subsector

Energy / Electricity transmission and distribution

Gender Equity and Mainstreaming No gender elements
Description The project will expand power imports from Turkmenistan through an asynchronous power interconnection, establish a unified power grid in Afghanistan, and extend the power grid into central Afghanistan. The 500-MW converter station will allow Turkmen power into the Afghan grid under the ten-year power purchase and sales agreement signed in November 2015. The Doshi-Bamyan line will expand the grid to eight additional provinces, distribute power to nearly 150,000 people, and provide redundancy to the existing transmission network. The project has transmission and distribution system linkages with several projects assisted by ADB and other development partners. The project is fully aligned with the National Energy Supply Program of the Government of Afghanistan.
Project Rationale and Linkage to Country/Regional Strategy

The project will allow year round Turkmen power (upto 500 MW) to be amalgamated and synchronized with indigenous power in Afghanistan. The projects under tranches 1, 2 and 4 are strengthening power supply, unifying the national grid, and extending the network into newer provinces with added distribution capacity. Tranche 1 is also financing multiple nonphysical interventions in capacity and governance support, project preparatory assistance, and sector reforms. Tranche 3 is financing solar connectivity, as the off-grid rural populace pays three times the energy cost compared to the urban grid-connected consumers. In summary, the MFF will sequentially support: (i) energy infrastructure improvements,

operations, and maintenance; (ii) feasibility studies and designs; and (iii) human resource development and institutional reform. Tranche 5 was approved in November 2019 and is under procurement.

Impact Improved access to sustainable energy supplies across Afghanistan, aligned with the targets of the National Energy Supply Program of the Government of Afghanistan (program-defined)
Project Outcome
Description of Outcome Increased supply of imported and indigenous power
Progress Toward Outcome All bids for the three EPC packages (Transmission, Distribution and Substation) were opened on 8-10 May 2017. The contracts were signed and awarded on 22 April 2018.The bid for the B2B converter station was bid out but the package has been cancelled per request from the Government. Savings from the package has been planned be used to finance (i) Ghor province electrification package, (ii) transmission lines in northern and western Afghanistan. However, it was decided to defer the plan following the COVID-19 outbreak.
Implementation Progress
Description of Project Outputs

New 500 megawatts high voltage direct current back to back voltage source convertor station commissioned at Dashte Alwan

New 180 kilometers of 220-kV transmission line commissioned from Doshi to Bamyan

New 220/20-kV substation commissioned in Bamyan with a distribution network 3,000 kilometers including 20,000 new connections.

Status of Implementation Progress (Outputs, Activities, and Issues) 500-kV high voltage DC back to back converter station at Dashte Alwan has been reallocated but awaiting government's letter to proceed with minor change in scope. Government letter will be submitted after further partial cancellation of $21.4 million.DMF to be revised.The contract for Doshi to Bamyan, 180 kilometers, 220kv Transmission Line has been awarded to the Indian company KEC International for $ 43,861,624.00 on 22 April 2018. Overall progress is 64% (as of Aug. 2020).The contract for Design, Supply, Installation, testing and commission of 220/20KV Bamyan Substation and expansion of 220/20KV Doshi Substation to Chines firm XINJIANG ELECTRIC POWER for 10,694,974.19 on 22 April 2018. The overall progress is 48% (as of Aug. 2020).
Geographical Location Nation-wide
Safeguard Categories
Environment B
Involuntary Resettlement B
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects The Project is categorized "B" for Environment. An Initial Environment Examination was posted on ADB's website on 31 October 2016. An Environmental Management Plan will be updated once physical implementation started in Q1 2019.
Involuntary Resettlement The Project is categorized "C" for Involuntary Resettlement. The Land Acquisition and Resettlement Plan (LARP) was finalized and posted on ADB's website on 31 October 2016. LARP will be further updated once detailed design is completed before project implementation begins in Q1 2019.
Indigenous Peoples The Project is categorized "C" for Indigenous Peoples. No reports are required.
Stakeholder Communication, Participation, and Consultation
During Project Design Being undertaken at project survey and preparatory phase.
During Project Implementation Being undertaken during detailed design stage in Q2 - Q4 2018.
Business Opportunities
Procurement Procurement of works and goods to be financed under the project will be undertaken in accordance with ADB's Procurement Guidelines (2015, as amended from time to time). International competitive bidding will be used for the turnkey contract packages.
Responsible ADB Officer ADB Disclosure
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Energy Division, CWRD
Timetable
Concept Clearance -
Fact Finding -
MRM 02 Nov 2016
Approval 05 Dec 2016
Last Review Mission -
Last PDS Update 30 Sep 2020

Grant 0521-AFG

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
05 Dec 2016 20 Dec 2016 12 Apr 2017 30 Jun 2023 - -
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 63.63 Cumulative Contract Awards
ADB 58.63 07 Sep 2021 0.00 0.00 0%
Counterpart 5.00 Cumulative Disbursements
Cofinancing 0.00 07 Sep 2021 0.00 0.00 0%

Grant 0522-AFG

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
05 Dec 2016 20 Dec 2016 12 Apr 2017 30 Jun 2023 - -
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 79.00 Cumulative Contract Awards
ADB 0.00 07 Sep 2021 0.00 78.45 99%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 79.00 07 Sep 2021 0.00 44.23 56%

Grant 0523-AFG

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
05 Dec 2016 20 Dec 2016 12 Apr 2017 30 Jun 2023 - -
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 1.00 Cumulative Contract Awards
ADB 0.00 07 Sep 2021 0.00 1.00 100%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 1.00 07 Sep 2021 0.00 0.00 0%

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