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Nepal: Electricity Grid Modernization Project

Sovereign (Public) Project | 54107-001 Status: Approved

The project will finance high-priority electricity grid modernization investments both in transmission and distribution system in Nepal under the following outputs:

Output 1: Electricity transmission capacity in project areas strengthened and modernized. The project will finance (i) automation of 40 grid substations throughout the country; (ii) construction of 3 units of modern 132/11 kV grid substations with automation (each with 2x45 megavolt ampleres [MVA] capacity) together with 16 km of 132 kV double circuit underground line along Chobhar-Lagankhel-Sinamangal, and 5 km of 66 kV double circuit underground transmission line along Sinamangal-Chabahil in Kathmandu Valley; (iii) upgrading of 237 km of 132 kV transmission lines with more efficient high-temperature-low-sag conductors; and (iv) commissioning of transmission system consisting of 4 automated grid substations with capacity of 290 MVA and 48 km transmission lines in Myagdi and Dhading districts.

Project Details

Project Officer
Acharya, Jiwan S. South Asia Department Request for information
Country
  • Nepal
Sector
  • Energy
 
Project Name Electricity Grid Modernization Project
Project Number 54107-001
Country Nepal
Project Status Approved
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan 4014-NEP: Electricity Grid Modernization Project
concessional ordinary capital resources lending / Asian Development Fund US$ 156.00 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Regional integration
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Sector / Subsector

Energy / Electricity transmission and distribution

Gender Equity and Mainstreaming Effective gender mainstreaming
Description

The project will finance high-priority electricity grid modernization investments both in transmission and distribution system in Nepal under the following outputs:

Output 1: Electricity transmission capacity in project areas strengthened and modernized. The project will finance (i) automation of 40 grid substations throughout the country; (ii) construction of 3 units of modern 132/11 kV grid substations with automation (each with 2x45 megavolt ampleres [MVA] capacity) together with 16 km of 132 kV double circuit underground line along Chobhar-Lagankhel-Sinamangal, and 5 km of 66 kV double circuit underground transmission line along Sinamangal-Chabahil in Kathmandu Valley; (iii) upgrading of 237 km of 132 kV transmission lines with more efficient high-temperature-low-sag conductors; and (iv) commissioning of transmission system consisting of 4 automated grid substations with capacity of 290 MVA and 48 km transmission lines in Myagdi and Dhading districts.

Output 2: Electricity distribution system in project areas modernized. This will include (i) construction of distribution control center in Kathmandu; (ii) installation of additional 350,000 smart meters in Kathmandu Valley; (iii) construction of 8 substations with automation along with distribution system reinforced and extended in Dhading, Dharan, Morang, Nepalgunj, Parasi, Sindhupalchowk and Surkhet; and (iv) 150,000 new households (including xx women-headed households) connected to the national grid.

Output 3: Capacity of NEA and electricity users in project areas strengthened. Considering the importance of continued support to NEA and users, the project will support increasing knowledge of (i) at least 40 eligible NEA staff (including 30% eligible women) on automation of grid substations; (ii) at least 30 eligible NEA staff (including 30% women) on NEA's organizational development; (iii) at least 20 eligible NEA staff (including 30% women) on putting in place improved billing and collection measures; and (iv) at least 2,000 electricity consumers in project areas (40% women and disadvantaged group on safe and efficient use at distribution centers. The project will also support implementation of key actions from NEA's gender equality and social inclusion (GESI) strategy and operational guidelines in its regional offices, to complement corporate level activities covered under a forthcoming project.

These outputs will result in the following outcome: access to efficient grid electricity supply in Nepal improved. The project will be aligned with the following impact: investments in industrial and commercial hubs promoted.

Project Rationale and Linkage to Country/Regional Strategy Nepal is a landlocked, mountainous country located between the large and fast-growing economies of the People's Republic of China to the north and India to the east, west, and south. Nepal's gross domestic product (GDP) growth averaged 7.3% during FY2017 FY2019. With deepening economic uncertainties because of the coronavirus disease (COVID-19) pandemic, compounded by social and health emergencies, the preliminary estimates from the Central Bureau of Statistics in Nepal show that GDP growth will significantly decline to 2.3% in FY2020. The need to stimulate post-COVID-19 economic recovery by developing Nepal's infrastructure has become more relevant.
Impact

Reliable and efficient electricity for all achieved (White Paper on Energy, Water Resources and Irrigation Sector's Current Status and Roadmap for Future)

(ii) NEA developed as modern and sustainable corporate entity that provides reliable services to its customers (NEA's Corporate Development Plan)

Project Outcome
Description of Outcome Reliability, efficiency, and financial sustainability of electricity supply in Nepal improved
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

Electricity transmission capacity in project areas strengthened and modernized

Electricity distribution system in project areas strengthened and modernized

Capacity of NEA to implement its corporate development plan strengthened

Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location Nation-wide
Safeguard Categories
Environment B
Involuntary Resettlement B
Indigenous Peoples B
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Business Opportunities
Consulting Services The project will be implemented and supervised by the project management unit under the Project Management Directorate (PMD) of NEA. NEA will assign a dedicated team headed by a project director. Environmental and Social Management Plans and Occupational Health and Safety Plan implementation and monitoring support will be provided to the safeguard unit at PMD. A project supervision consultant will be hired to support NEA in implementing the project. Most of the contracts are expected to be tendered as turnkey for project implementation. Procurement (including consulting services) will follow ADB Procurement Policy (2017, as amended from time to time) and Procurement Regulations for ADB Borrowers (2017, as amended from time to time). The government will ensure proper coordination during implementation of this project.
Procurement Nepal Electricity Authority (NEA) is the proposed executing and implementing agency which has significant experience in implementing ADB projects and established processes and capacity to handle ADB procurement. While most of the contracts are limited to specific geographical area, the substation automation package involves 40 substations throughout the country but would be easy to implement.
Responsible ADB Officer Acharya, Jiwan S.
Responsible ADB Department South Asia Department
Responsible ADB Division Energy Division, SARD
Executing Agencies
Nepal Electricity Authority (NEA)
P. O. Box 5352
Kathmandu
Nepal
Timetable
Concept Clearance 03 Jun 2020
Fact Finding 22 Jun 2020 to 26 Jun 2020
MRM 20 Aug 2020
Approval 26 Nov 2020
Last Review Mission -
Last PDS Update 27 Nov 2020

Loan 4014-NEP

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
26 Nov 2020 - - 30 Sep 2026 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 195.00 Cumulative Contract Awards
ADB 156.00 26 Nov 2020 0.00 0.00 0%
Counterpart 39.00 Cumulative Disbursements
Cofinancing 0.00 26 Nov 2020 0.00 0.00 0%

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 Access to Information Policy (AIP) 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.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.

In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

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

None currently available.

Related Publications

None currently available.


The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

Requests for information may also be directed to the InfoUnit.

Tenders

Tender Title Type Status Posting Date Deadline
54107-NEP: Electricity Grid Modernization Project [PMD/EGMP/DCC-077/78-01] C2 Invitation for Bids Closed 07 Aug 2020 10 Dec 2020
54107-NEP: Electricity Grid Modernization Project [PMD/EGMP/DRTLS-077/78-01] Invitation for Bids Closed 07 Aug 2020 22 Oct 2020
54107-NEP: Electricity Grid Modernization Project [PMD/EGMP/KRON- 077/78-01] Invitation for Bids Closed 07 Aug 2020 01 Nov 2020
54107-NEP: Electricity Grid Modernization Project [PMD/EGMP/TLUP-077/78-01] D1 Invitation for Bids Closed 07 Aug 2020 10 Dec 2020
54107-NEP: Electricity Grid Modernization Project (EGMP) Advance Notice Active 30 Jul 2020
Project Supervision Consultant Firm - Consulting Closed 24 Aug 2020 29 Sep 2020

Contracts Awarded

No contracts awarded for this project were found

Procurement Plan