The key facts

  • The $200 million loan agreement was signed by ADB President Masato Kanda and Deputy Prime Minister Jamshid Kuchkarov
  • The plan is to modernize 60 substations and introduce digital grid management systems
  • Integration of at least 3.3 GW of renewables and a reduction in emissions of almost 23 thousand tonnes of CO₂-equivalent per year is expected

Signing of the $200 million agreement

Uzbekistan and the Asian Development Bank signed a loan agreement worth $200 million. The ceremony was attended by ADB President Masato Kanda and Deputy Prime Minister — Minister of Economy and Finance Jamshid Kuchkarov. The funds will be used to modernize the electricity distribution system, reduce losses, and improve the reliability of power supply amid growing demand.

What the program provides for

Under the Power Distribution System Modernization Program, 60 key distribution substations across the country are to be upgraded and digital systems introduced to improve the efficiency of grid management. The program also provides for improving grid management and strengthening the operational capacity of JSC National Electric Grid of Uzbekistan.

Expected results

According to sources, the investments will reduce electricity losses and transformer overloading, improve the reliability of power supply to households, businesses, and government institutions, create conditions for integrating at least 3.3 GW of renewable energy capacity, and cut greenhouse gas emissions by almost 23 thousand tonnes of CO₂-equivalent annually.

First project under the mechanism with the World Bank

The program will be the ADB's first energy project implemented under the Full Mutual Reliance Framework (FMRF) between the ADB and the World Bank, as well as the first results-oriented lending operation in Uzbekistan's energy sector. Later in October, World Bank management will submit to the Board of Directors the question of approving additional financing of $100 million.

ADB statement and context of cooperation

“Reliable electricity supply is one of the most basic commitments of a modern economy to its citizens. This agreement will help Uzbekistan fulfill this commitment amid growing demand by strengthening the power grids that supply electricity to families, businesses, and government institutions, and that are capable of taking in more energy from renewable sources,” said Masato Kanda. According to Spot.uz, since 2010 the ADB has provided the energy sector of Uzbekistan with financing and guarantees totaling more than $3.4 billion.