ADB approves $200 million loan to modernise power distribution system in Nepal

The Asian Development Bank (ADB) has approved a concessional $200 million loan to improve the power supply and distribution systems in Nepal.

The project will fund, among others, the reinforcement and modernisation of the power supply system in Kathmandu Valley, Chitwan District Bharatpur Metropolitan Area in Bagmati Province and Kaski District Pokhara in Gandaki Province, where interruptions in supply are frequent and prolonged. The project also aims to support Province 2, where electricity supply quality is poor and about 20 per cent of households are still without access to the national grid. Complementing ADB’s loan, the Government of Norway is providing a $35 million co-financing grant for the installation and upgrading of power distribution networks in Province 2 and various substations to evacuate hydropower in the country. In addition, it is providing a $5 million technical assistance grant for capacity development of the Nepal Electricity Authority.