Nepal: Electricity Grid Modernization Project – Additional Financing
ADB approved the Electricity Grid Modernization Project (the project) amounting to $156 million on 26 November 2020 financed by ADB's concessional OCR. The legal agreements were signed on 30 December 2020, and the project became effective on 4 February 2021. The original loan closing date is 30 September 2026.
The outcome of the ongoing project is to improve reliability, efficiency, and financial sustainability of electricity supply in Nepal. The ongoing project includes three main outputs: (i) electricity transmission capacity in project areas strengthened and modernized (output 1); (ii) electricity distribution system in project areas strengthened and modernized (output 2); and (iii) capacity of Nepal Electricity Authority (NEA) to implement its Corporate Development Plan strengthened (output 3)._The executing agency for the project is NEA.
Project Details
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Project Officer
Acharya, Jiwan S.
South Asia Department
Request for information -
Country/Economy
Nepal -
Sector
- Energy
Related Projects
| Project Name | Electricity Grid Modernization Project – Additional Financing | ||||
| Project Number | 54107-002 | ||||
| Country / Economy | Nepal |
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| Project Status | Active | ||||
| Project Type / Modality of Assistance | Loan |
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| Source of Funding / Amount |
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| Strategic Agendas | Environmentally sustainable growth Inclusive economic growth Regional integration |
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| Drivers of Change | Gender Equity and Mainstreaming Governance and capacity development |
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| Sector / Subsector | Energy / Electricity transmission and distribution |
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| Gender Equity and Mainstreaming | Effective gender mainstreaming | ||||
| Description | ADB approved the Electricity Grid Modernization Project (the project) amounting to $156 million on 26 November 2020 financed by ADB's concessional OCR. The legal agreements were signed on 30 December 2020, and the project became effective on 4 February 2021. The original loan closing date is 30 September 2026. The outcome of the ongoing project is to improve reliability, efficiency, and financial sustainability of electricity supply in Nepal. The ongoing project includes three main outputs: (i) electricity transmission capacity in project areas strengthened and modernized (output 1); (ii) electricity distribution system in project areas strengthened and modernized (output 2); and (iii) capacity of Nepal Electricity Authority (NEA) to implement its Corporate Development Plan strengthened (output 3)._The executing agency for the project is NEA. The proposed additional financing is for NEA to further improve transmission and distribution network in the country (output 1 and 2) and is programmed to be delivered in 2021 as Electricity Grid Modernization Project Additional Financing in ADB's Country Operations Business Plan (COBP) 20212023 for Nepal._ |
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| Project Rationale and Linkage to Country/Regional Strategy | The additional financing for NEA is proposed to further improve transmission and distribution system in the country. Government has sought assistance from ADB to enhance the capacity of critical transmission and distribution network to improve electricity supply in the selected load centers. These investments [which could not be accommodated in the ongoing project due to lack of readiness at the time] are needed to ensure delivery of increasing requirement of power and meet customer demand in an efficient and reliable manner. The proposed additional scope is strongly linked to the ongoing project's scope and can be efficiently implemented under the same implementation arrangements. The overall project scope is aligned with the government's 2018 white paper in which government's vision for the energy sector_ has been articulated._It is also aligned with the ADB's country partnership strategy (CPS) for Nepal, 20202024 and supports the government's development objective of accelerated and inclusive economic growth. | ||||
| Impact | Reliable and efficient electricity for all achieved NEA developed as modern and sustainable corporate entity that provides reliable services to its customers |
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| 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) | Implementation is ongoing |
| 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 | 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. There is 1 contract for project supervision . |
| 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. There are 6 contracts including one for project supervision and all are below $20m. There are contractors and consulting firms easily available and expected to receive good response during the bidding. |
| Responsible ADB Officer | Acharya, Jiwan S. |
| Responsible ADB Department | South Asia Department |
| Responsible ADB Division | Energy Division, SARD |
| Executing Agencies |
Nepal Electricity Authority (NEA) |
| Timetable | |
|---|---|
| Concept Clearance | 10 Mar 2021 |
| Fact Finding | 19 Apr 2021 to 23 Apr 2021 |
| MRM | 17 Jun 2021 |
| Approval | 17 Sep 2021 |
| Last Review Mission | - |
| Last PDS Update | 16 Sep 2022 |
Loan 4109-NEP
| Milestones | |||||
|---|---|---|---|---|---|
| Approval | Signing Date | Effectivity Date | Closing | ||
| Original | Revised | Actual | |||
| 17 Sep 2021 | 26 Nov 2021 | 08 Feb 2022 | 30 Sep 2026 | - | - |
| Financing Plan | Loan Utilization | ||||
|---|---|---|---|---|---|
| Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
| Project Cost | 75.00 | Cumulative Contract Awards | |||
| ADB | 60.00 | 16 Sep 2022 | 17.01 | 0.00 | 28% |
| Counterpart | 15.00 | Cumulative Disbursements | |||
| Cofinancing | 0.00 | 16 Sep 2022 | 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.
| Title | Document Type | Document Date |
|---|---|---|
| Project Agreement for Loan 4109-NEP(COL): Additional Financing for the Electricity Grid Modernization Project | Project/Program Agreements | Nov 2021 |
| Loan Agreement (Ordinary Operations [Concessional]) for Loan 4109-NEP: Additional Financing for Electricity Grid Modernization Project | Loan Agreement (Ordinary Resources) | Nov 2021 |
| Electricity Grid Modernization Project - Additional Financing: Project Administration Manual | Project/Program Administration Manual | Aug 2021 |
| Electricity Grid Modernization Project - Additional Financing: Gender Action Plan | Gender Action Plans | Aug 2021 |
| Electricity Grid Modernization Project - Additional Financing: Report and Recommendation of the President | Reports and Recommendations of the President | Aug 2021 |
| Electricity Grid Modernization Project - Additional Financing: Procurement Plan | Procurement Plans | Jul 2021 |
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.
| Title | Document Type | Document Date |
|---|---|---|
| Electricity Grid Modernization Project - Additional Financing: Environmental and Social Safeguard Monitoring Report (January-June 2022) | Environmental and Social Monitoring Reports | Nov 2022 |
| Electricity Grid Modernization Project - Additional Financing: Resettlement and Indigenous Peoples Plan | Combined Resettlement Plan and Indigenous Peoples Plans | Jun 2021 |
| Electricity Grid Modernization Project - Additional Financing: Initial Environmental Examination | Initial Environmental Examination | Jun 2021 |
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.
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ADB Approves Power Project Loan in Nepal
The Asian Development Bank has approved a $60 million loan as additional support for the ongoing Electricity Grid Modernization Project that is upgrading power transmission and distribution systems in Nepal.
Tenders
Contracts Awarded
| Contract Title | Approval Number | Contract Date | Contractor | Address | Executing Agency | Total Contract Amount (US$) | Contract Amount Financed by ADB (US$) |
|---|---|---|---|---|---|---|
| Design, Supply, Installation, Testing and Commissioning of 132/33/11 kV Air Insulated Substation at Dumkibas, Binayi Triveni Rural Municipality, Nawalparasi (Bardaghat-Susta East) District | Loan 4109 | 21 Oct 2022 | Godrej & Boyce Manufacturing Co. Ltd. | Pirojshanagar, Vikhroli (W), Mumbai, India | Nepal Electricity Authority (NEA) | 6,499,951.47 | 6,494,178.85 |
| Design, Supply, Installation, Testing and Commissioning of Mulpani 132/11kV GIS Substation | Loan 4109 | 22 Aug 2022 | TBEA Co. Ltd. | No. 189, South Beijing Road, Changji, Xinjiang, People's Republic of China | Nepal Electricity Authority (NEA) | 10,637,661.78 | 10,637,206.51 |
Procurement Plan
| Title | Document Type | Document Date |
|---|---|---|
| Electricity Grid Modernization Project - Additional Financing: Procurement Plan | Procurement Plans | Jul 2021 |