World Bank will provide additional $ 65 million for modernization of Nurek hydropower plant

The World Bank's Board of Executive Directors has approved additional funding in the form of a $ 65 million grant to finance the second phase of the Nurek hydropower plant rehabilitation project.

It is noted that this project will contribute to improving the reliability of electricity supply and expanding the export of "green" electricity from Tajikistan.

“Investments in the Nurek HPP, the backbone of the country's energy system, are necessary to ensure stable and reliable electricity supply to households and businesses within the country, as well as to increase export revenues in the regional market,” said Ozan Sevimli, World Bank Resident Representative in Tajikistan.

The first phase of the Nurek HPP rehabilitation project, financed by the World Bank ($ 225.7 million), the Asian Infrastructure Investment Bank (AIIB) ($ 60 million) and the Eurasian Development Bank (EDB) ($ 40 million), was launched in March 2019.

 As part of its implementation, support is being provided for the rehabilitation of three of the nine hydraulic units and key infrastructure components of the power plant, the replacement of six autotransformers that are used to transmit generated electricity, improving the safety of the dam in order to protect the facility from seismic hazards and floods, as well as technical assistance to strengthen the operating, technical and financial potential for management of the energy company OJSC “Barki Tochik”.

According to the source, the second phase of the project, funded by the World Bank ($ 50 million, approved in June 2020), is supporting the rehabilitation of the remaining six hydroelectric units, the Nurek bridge, the power plant and other key structures, along with building the capacity of the hydroelectric power plant for the purpose of efficient operation and power plant maintenance.

The additional funding of $ 65 million approved the day before was directed to cover the funding gap of $ 164 million within the second phase of the project.

It is expected that the remaining deficit will be covered by other potential sources of co-financing, including reallocation of savings from EDB and AIIB allocated to support the first phase of the project. The total investment of the World Bank for this strategically important project is $ 341 million.

Nurek HPP provides about 50% of the total annual energy demand in Tajikistan and supplies most of the energy for export. Due to technical problems, the plant's original installed capacity has dropped from 3,000 megawatts to 2,320 megawatts over the past four decades. Currently, the facility is undergoing the first major overhaul since its commissioning in 1972-1979.

Once the rehabilitation is complete, the plant will increase its capacity to 3.214 megawatts, which will provide improved electricity supplies during the colder winter months and generate much-needed revenues from expanding electricity exports in the summer months.

As part of the rehabilitation of the hydropower plant, measures will also be taken to improve the safety of the dam, which will help reduce operating and maintenance costs. Finally, the project will deliver global environmental and climatic benefits in the form of net CO₂ emissions reductions, resulting in a net emission reduction of 69 Mt CO₂ from baseline over the life of the facility.