ADB Approves $430 Million to Upgrade Uttar Pradesh’s Power Distribution Network

The Asian Development Bank (ADB) announced that it approved a $430 million multi-tranche financing facility (MFF) to improve the reliability and quality of power supply in Uttar Pradesh.

The funding will be utilized for the Uttar Pradesh Power Distribution Network Rehabilitation project, which will improve the sustainability and efficiency of the electricity supply in the state.

The bank said the project would finance the transformation of 65,000 kilometers of rural low-voltage distribution lines from bare conductors to aerial bundle conductors that can benefit around 70 million people in 46,000 villages.

According to its press statement, the project will provide funding to construct a parallel network of 11 kV feeders with 17,000 kilometers long distribution lines to split up power distribution between agricultural consumers and residential consumers. This will help improve the supply duration of power supply to rural residential customers and facilitate solar power usage to satisfy the demand of agricultural consumers.

The bank said the project would also improve the gender inclusivity, financial management capacity, and corporate governance of Uttar Pradesh Power Corporation Limited (UPPCL).

In addition to the MFF, a $2 million technical assistance grant will be provided from ADB’s TA Special grant and the Japan Fund for Poverty Reduction to strengthen gender inclusivity and institutional capacity building of the Uttar Pradesh power sector. The funding will be utilized for the innovative bill collection strategies that include rural women self-help groups, gender-sensitive workplace practices. It will also be used to improve financial management, project management and safeguard the compliance capacity of UPPCL.

“This project fully supports the Government of India’s vision of ‘Power for All’ in a sustainable and inclusive way in the largest and one of the poorest states in India. Existing rural power distribution will be upgraded to enable the provision of a reliable power supply to consumers in rural Uttar Pradesh in a financially suitable manner,” said Pradeep Perera, ADB Principal Energy Specialist for South Asia.

Last month, the Asian Development Bank announced that it had approved a $132.8 million loan to modernize the power distribution network in Meghalaya.

Earlier this year, the bank also approved a $346 million (~₹26.92 billion) loan to India to help provide efficient and reliable power to rural agriculture customers in Maharashtra.