Tajikistan : Power Sector Development Program

Sovereign Project | 53315-001

The proposed Power Sector Development Program (PSDP) will accelerate the implementation of on-going reforms and restore financial sustainability of the power sector in Tajikistan. ADB has supported Tajikistan power sector reforms through the ongoing Sector Operation Performance Improvements (SOPI) program, which has built the basis for the fundamental reform program of PSDP that includes unbundling of the vertically integrated power utility company, restructuring of the utility's excessive liabilities, establishment of a regulator, adoption of a tariff methodology, and establishment of a new centralized cash control system among unbundled entities. As a part of reforms and institutional capacity building, a newly established power distribution company will be given a 5-year management contract. Investments in the retail advanced metering system in Dushanbe and 6 other cities will also fill the key deficiencies in the sector's power loss accounting and bill collection systems.

Project Details

Project Name Power Sector Development Program
Project Number 53315-001
Country / Economy Tajikistan
Project Status Active
Project Type / Modality of Assistance Grant
Loan
Technical Assistance
Source of Funding / Amount
Grant 0777-TAJ: Power Sector Development Program
Asian Development Fund US$ 20.00 million
Grant 0778-TAJ: Power Sector Development Program
Asian Development Fund US$ 85.00 million
Loan: Power Sector Development Program
European Bank for Reconstruction and Development US$ 25.00 million
TA 6639-TAJ: Preparing and Implementing Gender-Inclusive Projects in Central and West Asia Subproject 4: Empowering Women in the Power Sector in Tajikistan
Technical Assistance Special Fund US$ 200,000.00
Operational Priorities OP1: Addressing remaining poverty and reducing inequalities
OP2: Accelerating progress in gender equality
OP3: Tackling climate change, building climate and disaster resilience, and enhancing environmental sustainability
OP6: Strengthening governance and institutional capacity
OP7: Fostering regional cooperation and integration
Sector / Subsector

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

Gender Effective gender mainstreaming
Description The proposed Power Sector Development Program (PSDP) will accelerate the implementation of on-going reforms and restore financial sustainability of the power sector in Tajikistan. ADB has supported Tajikistan power sector reforms through the ongoing Sector Operation Performance Improvements (SOPI) program, which has built the basis for the fundamental reform program of PSDP that includes unbundling of the vertically integrated power utility company, restructuring of the utility's excessive liabilities, establishment of a regulator, adoption of a tariff methodology, and establishment of a new centralized cash control system among unbundled entities. As a part of reforms and institutional capacity building, a newly established power distribution company will be given a 5-year management contract. Investments in the retail advanced metering system in Dushanbe and 6 other cities will also fill the key deficiencies in the sector's power loss accounting and bill collection systems. The program is included in the Country Operations Business Plan, 2019-2021. A separately approved transaction technical assistance facility (FTRTA) will be used to finalize due diligence activities.
Project Rationale and Linkage to Country/Regional Strategy The mix of policy-based and investment components of a sector development program is ideal in resolving the severe financial distress faced by the Tajikistan power sector, which requires a combined approach of institutional and regulatory reforms and investments. The sector's financial sustainability and competitiveness will be vital in benefitting from reviving regional integration. Management contract promotes public private partnership and future private sector participation. The program will be designed to align with operational priorities 1 (address poverty and inequality), 2 (accelerate gender equality), 3 (tackle climate, disasters, environment), 6 (strengthen governance, institutions) and 7 (foster regional cooperation, integration).
Impact

Sustainable access to energy resources increased (National Development Strategy of the Republic of Tajikistan for the period up to 2030)

Project Outcome
Description of Outcome

Financial sustainability of the power subsector improved

Progress Toward Outcome Package G1 - Contract signed on 1 July 2022, Package G2 - Contract signed on 28 July 2022. Design ongoing.
Implementation Progress
Description of Project Outputs

Power subsector governance structure strengthened

Financial management of power utilities improved

Sustainable corporate management in the new distribution company introduced

Sector's reform and operational capacity strengthened (including increased female participation in power subsector activities)

Retail billing and collection system modernized

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

Target revised from 2020 to 2022 after G0777 extension

Target year revised from 2020 to 2021.

Decree to establish escrow account (policy action and withdrawal condition for G0777) issued on 22 May 2021, and amended on 25 Nov 2021. Grant extended from 30 June to 30 Sep, then to 30 Nov 2021, and to 10 March 2022.

Mgt contract signed on 1 July 2022 after CA condition (decree on STB's independence) was complied in March 2022.

Mgt contract signed on 1 July 2022 after CA condition (decree on STB's independence) was complied in March 2022. EDN's assessment by mgt contractor delayed by pending power sector reforms (fully functional escrow account; fully functional supervisory boards, and good governance of unbundled power utilities (former STB CEO still in control). ADB. EBRD, EU and WB sent joint letter to Prime Minister requesting urgent resolution of issues on 9 Dec 2022. On 15 Dec 2022, the President's office requested to grant full authority to STB CFO/acting CEO until new CEO is appointed. ADB sent appeal to Prime Minister on 1 March 2023. On 3 March, Minister of Energy responded that reform and management contract issues.

Target revised from 2021 to 2022 after G077 extension. This activity is supported by the mgt contract which was signed on 1 July 2022 after CA condition (decree on STB's independence) was complied in March 2022. Gender working group formation delayed by pending power sector reforms (see above).

Sector reform support consultant recruitment delayed, CA by Q3 2023.

Gender consultant, hired in June 2023 under PSG RETA 6639, will facilitate technical trainings for female graduates/graduating students. Consultant activities suspended after inception report pending award of EPC contracts. Activities resumed with loan inception in June 2022. Data collection ongoing.

Metering contract signed on 28 July 2022.

Metering contract signed on 28 July 2022.

Metering contract signed on 28 July 2022.

Geographical Location Nation-wide
Safeguard Categories
Environment C
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Responsible ADB Officer Mtchedlishvili, Levan
Responsible ADB Department Sectors Group
Responsible ADB Division Energy Sector Office (SG-ENE)
Executing Agencies
Asian Development Bank
Ministry of Energy and Water Resources
Timetable
Concept Clearance 27 Apr 2020
Fact Finding 15 Jun 2020 to 17 Jun 2020
MRM 05 Oct 2020
Approval 04 Dec 2020
Last Review Mission -
Last PDS Update 26 Apr 2023

Grant 0777-TAJ

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
04 Dec 2020 29 Dec 2020 11 Mar 2021 30 Jun 2021 10 Mar 2022 21 Dec 2021
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 20.00 Cumulative Contract Awards
ADB 20.00 19 Jan 2024 0.00 0.00 0%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 19 Jan 2024 20.00 0.00 100%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory Satisfactory Satisfactory Satisfactory - Satisfactory

Grant 0778-TAJ

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
04 Dec 2020 29 Dec 2020 11 Mar 2021 30 Sep 2026 - -
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 100.00 Cumulative Contract Awards
ADB 85.00 19 Jan 2024 76.78 0.00 90%
Counterpart 15.00 Cumulative Disbursements
Cofinancing 0.00 19 Jan 2024 22.91 0.00 27%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory Satisfactory Satisfactory Satisfactory - Satisfactory

TA 6639-TAJ

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
04 Dec 2020 - 04 Dec 2020 31 May 2022 31 Dec 2023 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
200,000.00 0.00 0.00 0.00 0.00 0.00 200,000.00 19 Jan 2024 129,182.38
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory Satisfactory Satisfactory Satisfactory - Satisfactory

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.

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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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Related Publications

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Tenders

Tender Title Type Status Posting Date Deadline
Sector Development Support Firm - Consulting Closed
0778-TAJ: Power Sector Development Program [G2] Invitation for Bids Closed
Gender and Energy Training Firm - Consulting Closed
Tajikistan Distribution Company Management Contract Firm - Consulting Closed
Project Implementation Consultant Firm - Consulting Closed
53315-TAJ: Power Sector Development Program Other Notice Active

Contracts Awarded

Contract Title Approval Number Contract Date Contractor | Address Executing Agency Total Contract Amount (US$) Contract Amount Financed by ADB (US$)
Sector Development Support Consultant Grant 0778 04 Aug 2023 Joint Venture of Ginger SOFRECO and BARS Consulting Ltd. | 92-98, Boulevard Victor Hugo, 92115 Clichy Cedex, France Ministry of Energy and Water Resources 2,499,975.00
Meter Data Management Billing and Customer Information Systems for Advanced Metering Infrastructure Grant 0778 01 Jul 2022 Hexing Electrical Co Ltd | 1418 Moganshan Road Shangcheng Industrial Zone 310011 Hangzhou Ministry of Energy and Water Resources 5,199,714.40
Provision of Management Services for Tajikistan Distribution Company Grant 0778 01 Jul 2022 The Tata Power Company Limited | Camac Bunder Mumbai Maharashtra 400001 Ministry of Energy and Water Resources 14,979,500.00
Advanced Metering Infrastructure Low-Voltage and Medium-Voltage Enhancement for Dushanbe Buston Dangara Panjakent Konibodom Isfara and Istaravshan plus Boundary Meters Grant 0778 28 Jul 2022 Pinggao Group Co Ltd | Unit 4 Building D Phase II Jiatian Business Center Southeast Corner of the Intersection of Shangdu Road and Kangping Road Zhengdong New District Zhengzhou City Henan Province Ministry of Energy and Water Resources 49,745,622.99

Procurement Plan

Title Document Type Document Date
Power Sector Development Program: Procurement Plan Procurement Plans Nov 2020