₹730 crore ADB loan to modernise Bengaluru’s power distribution system

‘Bescom to get access to domestic/global financing market’

As rising tariffs amidst unreliable power supply is riling up consumers, the Asian Development Bank (ADB) will provide a loan of $100 million (around ₹730 crore) to Bengaluru to fund the modernisation and upgrading of the city’s power distribution system.

“The ADB and the Government of India on December 31, 2020 signed a $100 million loan to modernise and upgrade the power distribution system to enhance the quality and reliability of electricity supply in Bengaluru city in Karnataka,” said a finance ministry statement on Monday.

As per the release, over 2,800 km of fibre optical cables will be installed, in parallel to underground distribution cables, to strengthen communication network. Pushing some 7,200 km of distribution lines underground is expected to reduce technical and commercial losses by 30%.

The project would install 1,700 automated ring main units adapted with a distribution automation system (DAS) to monitor and control the distribution line switch gears from the control centre. The fibre optical cables would be used for smart metering systems, distribution automation system in the distribution grid, and other communication networks said the statement.

According to the ministry statement, the loan will strengthen the capacity of the Bescom in operation and maintenance of underground cabling, environment and social safeguards, financial management and commercial financing. “Improved financial management capability will help Bescom access domestic and international commercial financing market,” it further said.

In addition to $100 million sovereign loan, ADB would also offer another $90 million loan without a sovereign guarantee for the project to Bescom.

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