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					</table>The Asian Development Bank (<a href="https://www.adb.org/" target="_blank" rel="noopener">ADB</a>) has approved a $148.5 million loan to enhance, upgrade, and climate-proof the electricity distribution system in Sikkim and improve the power supply&#8217;s reliability, quality, and resilience.
The project aims to improve the livelihoods of at least 1,100 women, including self-help groups, producer groups, and individual businesses, through the installation of customized renewable energy systems and vocational skills training.
It will deploy solar energy systems and energy-efficient equipment in 24 primary healthcare sub-centers, enhancing rural healthcare facilities&#8217; capacity to provide inpatient treatments, especially during winter.
&#8220;This project fully aligns with Sikkim&#8217;s Power for All initiative, guaranteeing uninterrupted, high-quality electricity access around the clock for households, industries, businesses, and the public. Moreover, it complements the Government of India&#8217;s Revamped Distribution Sector Scheme by bolstering the distribution network, thereby enhancing operational efficiency and financial viability of the distribution sector in the state,&#8221; stated ADB Principal Energy Specialist Jaimes Kolantharaj.
ADB said the project will support the efficient transfer and integration of renewable energy into the distribution system and improve electricity access in rural areas and businesses, thereby boosting economic opportunities, ensuring productivity, and improving living standards.
The initiative is expected to modernize Sikkim&#8217;s power distribution system by installing approximately 770 kilometers of climate-resilient medium-voltage underground and/or covered conductors.
Additionally, 580 kilometers of outdated and low-capacity bare conductors will be replaced to increase network capacity.
The project also involves upgrading 26 power substations with a supervisory control and data acquisition system, installing 15,000 units of public street lighting in remote areas, and conducting electricity conservation and safety awareness programs in 28 villages.
ADB will support the development of a financial sustainability strategy and a plan to establish Sikkim&#8217;s Power Department (PDS) as an independent entity to enhance the sector&#8217;s financial stability.
It will assist PDS in creating a power distribution master plan, integrating geographic information systems and distribution system modeling, and establishing a real-time monitoring control center for improved power management.
ADB recently <a href="https://www.mercomindia.com/adb-%E2%82%B912-5-billion-currency-bond-finance-green-projects" target="_blank" rel="noopener">raised</a> ₹12.5 billion (~$150 million) through green bonds.
ADB has also financed several of India&#8217;s clean energy projects in the past. Last December, it <a href="https://www.mercomindia.com/adb-200-million-loan-enhance-power-efficiency-uttarakhand" target="_blank" rel="noopener">loaned</a> $200 million to enhance Uttarakhand&#8217;s electricity supply and enable the state&#8217;s transition to clean energy sources.
It also <a href="https://www.mercomindia.com/adb-approves-250-million-loan-indias-power-sector" target="_blank" rel="noopener">approved</a> a loan of $250 million to strengthen India&#8217;s power sector. The funds would be used to enhance the financial performance of electricity distribution companies and enable an environment conducive to private sector investment.

ADB Approves $148 Million Loan for Modernization of Sikkim’s Power Distribution

In a significant development, the Asian Development Bank (<a href="https://www.adb.org/" target="_blank" rel="noopener noreferrer">ADB</a>) has approved a loan of $190 million (~₹13.9 billion) to upgrade the existing power distribution system in the city of Bengaluru in Karnataka, according to a press release.
The financial aid will include $100 million (~₹7.36 billion) as a sovereign loan and $90 million (~₹6.62 billion) as a non-sovereign loan to Bangalore Electricity Supply Company Limited (<a href="https://bescom.karnataka.gov.in/english" target="_blank" rel="noopener noreferrer">BESCOM</a>) for its &#8216;Bengaluru Smart Energy Efficient Power Distribution&#8217; project. BESCOM is one of the five state-owned power distribution companies in the state.
The loan is expected to help the DISCOM in operation and maintenance (O&amp;M) activities and financial management.
Speaking on the development, Principal Energy Specialist for South Asia, Teruhisa Oi, said, &#8220;Reliable and sustainable electricity distribution and service is an important aspect of India&#8217;s growth and development. We believe that this project will improve the efficient distribution and delivery of electricity supply to residents of Bengaluru and support the Government of India&#8217;s strategy of building an energy-efficient distribution network.&#8221;
Echoing similar sentiments, Mayank Choudhary, Principal Investment Specialist at ADB&#8217;s Private Sector Operations Department, said, &#8220;This feature is an innovative financing arrangement, the first of its kind combining public and private loans to a state-owned enterprise. This financing structure reduces BESCOM&#8217;s sovereign exposure while helping it raise resources for capital expenditure using a market-based approach.&#8221;
As per the press release, the project is expected to streamline the city&#8217;s whole power distribution process. The project will convert 7,200 km of overhead distribution lines to underground cables, with 2,800 km of fiber optic cabling. This move is expected to protect the distribution lines from natural hazards and, in the process, reduce the commercial losses by 30%. The fiber cabling used for the project will be used for smart metering systems, distribution automation system (DAS), and other communication networks. The project will also put in place 1,700 automated ring main units with DAS to monitor the distribution line switchgear.
Established in 1966, ADB now has 68 members, out of which 49 members are from the region.
Recently, ADB <a href="https://mercomindia.com/adb-upgrade-uttar-pradesh/" target="_blank" rel="noopener noreferrer">announced</a> that it approved a $430 million (~₹31.64 billion) 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 enhance the sustainability and efficiency of the electricity supply in the state.
Earlier, ADB <a href="https://mercomindia.com/adb-133-million-to-modernize-meghalaya/" target="_blank" rel="noopener noreferrer">announced</a> that it had approved a $132.8 million (~₹9.77 billion) loan to modernize Meghalaya&#8217;s power distribution network. The loan will be utilized to support a joint initiative of the Meghalaya government and the Government of India called&#8217; 24*7 Power for All Meghalaya&#8217; that aims to provide continuous, reliable, and affordable power supply to all.
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ADB Approves ₹13.9 Billion Loan to Upgrade Bengaluru’s Power Distribution System

<a href="https://www.tatapower.com/" target="_blank" rel="noopener noreferrer">Tata Power</a> has announced that it has taken over the management of Central Electricity Supply Utility of Odisha (CESU) for the distribution and supply of power in Odisha’s five circles.
These five circles are Bhubaneshwar, Cuttack, Puri, Paradeep, and Dhenekal.
The company has received the Letter of Intent (LoI) from the Odisha Electricity Regulatory Commission (<a href="http://www.orierc.org/" target="_blank" rel="noopener noreferrer">OERC</a>). According to its press statement, Tata Power will have a 51% stake with management control, and the state-owned Grid Corporation of Odisha (<a href="https://www.gridco.co.in/" target="_blank" rel="noopener noreferrer">GRIDCO</a>) will have the remaining 49% stake in the company.
The company said that it will retain all the existing employees of CESU and will try to improve reliability, reduce the aggregate technical and commercial (AT&amp;C) losses, and offer customer service.
The license for the distribution and supply of power will be valid for 25 years, and with this tie-up with CESU, the company is planning to expand its consumer base to five million from 2.5 million currently. The five circles are spread across an area of 3,000 square kilometers with a population base of 14 million and a consumer base of 2.5 million. The average power demand of CESU is around 1.3 GW, with the average input energy of 8,400 million units.
Commenting on the latest development, Praveer Sinha, CEO &amp; MD of Tata Power, said, “Our tie-up with CESU is a huge development for Tata Power. We are thankful to the Odisha government and OERC for giving us this opportunity. We are committed to providing reliable, affordable, and quality power supply along with superior customer service, backed by innovative technology. We constantly strive to be the most preferred distribution company in the country. The success of our Delhi, Mumbai, and Ajmer distribution businesses is a testament to this fact.”
Tata Power added that it had been a success in Delhi and Ajmer, and the company has been able to reduce the AT&amp;C losses from 53.1% in July 2002 to 8% in March 2019 in Delhi. Similarly, in Ajmer, the company brought down the AT&amp;C losses from 21.6% in July 2017 to less than 10% in August 2019.
Mercom had <a href="https://mercomindia.com/tata-power-acquire-power-distribution-license-in-odisha/" target="_blank" rel="noopener noreferrer">reported</a> about Tata&#8217;s takeover plan of Odisha&#8217;s five circles in December 2019.
The privatization of distribution companies (DISCOMs) is being seen by many as the solution to improve their financial inefficiency.
Last month, the Ministry of Finance <a href="https://mercomindia.com/discoms-union-territories-privatized-new-tariff-policy/" target="_blank" rel="noopener noreferrer">proposed</a> to privatize DISCOMs in the union territories of the country. DISCOMs in the regions come under the administration of the central government while the respective state governments govern those in the states.
Mercom has <a href="https://mercomindia.com/privatizing-discoms-financial-mess/" target="_blank" rel="noopener noreferrer">discussed</a> the topic of the privatization of DISCOMs in the past. Newer business models through which DISCOMs can be privatized have to be explored immediately.
Recently, Tata Power <a href="https://mercomindia.com/tata-power-registers-3-revenue-dip/" target="_blank" rel="noopener noreferrer">announced</a> its annual results for the financial year (FY) 2019-20. The company’s income statement said that in the FY 2020, its revenue declined by 3% and stood at ₹289.48 billion ($3.8 billion) as compared to ₹299.84 billion (~$3.9 billion) in the last financial year. The company attributed the decline to lower power demand, delay in project execution in its solar engineering, procurement, and construction (EPC) business on account of COVID 19, and lower coal prices.

Tata Power Takes Charge of Power Distribution in Odisha

As the country enters the extended lockdown period to arrest the novel Coronavirus (COVID-19) outbreak, the Ministry of Home Affairs (<a href="https://www.mha.gov.in/" target="_blank" rel="noopener noreferrer">MHA</a>) has issued its revised guidelines allowing selected additional activities to keep the wheels of the economy turning. The new guidelines will come into effect from April 20, 2020. India’s lockdown has now been extended to May 3, 2020.
In a big respite to the renewable industry, the construction of renewable energy projects will now be allowed from April 20th.
It is unclear how the workers can get back from their hometowns to project construction sites considering there is no public transportation until May 3rd.
The government has also allowed the construction of roads, irrigation projects, and all kinds of industrial projects, including MSMEs (micro small and medium-scale enterprises) in rural areas, outside the limits of municipal corporations and municipalities. The continuation of construction work within the limits of municipal corporations and municipalities will be allowed, provided that workers are available on-site, and are not required to be brought in from outside. “There should be a total ban on non-essential visitors at the site,” added the MHA.
However, these guidelines will not apply to areas requiring containment, quarantine, and hotspots as per the guidelines of the Ministry of Health and Family Welfare (MoHFW).
The Ministry has also added that the generation, transmission, and distribution of power at the center and state/UT levels will continue to remain functional <a href="https://mercomindia.com/staff-renewable-allowed-work-covid-lockdown/" target="_blank" rel="noopener noreferrer">as before</a>.
The government has also allowed manufacturing and other industrial establishments with access control in special economic zones, export-oriented units, and industrial estates and townships to operate. They should have a standard operation protocol in place and should arrange for the stay and transportation of its workers.
Further, the Ministry also stated that all goods traffic would be allowed to ply interstate and intrastate. Railways and Airports will be allowed to operate for movement of cargo. Operations of seaports and inland container depots (ICDs) for cargo transport, including authorized custom clearing and forwarding agents, will also be allowed.
The Ministry of Shipping had earlier <a href="https://mercomindia.com/major-ports-asked-not-to-impose-penalties/" target="_blank" rel="noopener noreferrer">issued</a> a notice to major ports in the country with directions to deal with issues arising due to the Coronavirus pandemic. The Ministry, in its notice, had directed all major ports to ensure that no penalties, demurrage (charges to be paid to the owner of a chartered ship on failure to load or discharge the ship within the time agreed), charges, fees, or rentals are imposed on traders, shipping lines, concessionaires, licensees or other port users for any delays due to the lockdown in the country.
The government has enforced several measures to reduce the negative impact of COVID-19 outbreak on the industry. To track the initiatives taken by the government to fight the economic repercussions of the pandemic in the renewable industry, click <a href="https://mercomindia.com/mercom-coronavirus-live-updates-clean-energy-india/" target="_blank" rel="noopener noreferrer">here</a>.

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