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Azerbaijan launches Power Transmission Enhancement Project

04 March 2009 09:52 (UTC +04:00)

Baku. Nijat Mustafayev â€“ APA-Economics. The implementation of an ADB-funded Azerbaijan Power Transmission Enhancement Project has commenced, said the ADB Office in Baku.
Tianhua Luo, an Energy Specialist with ADBâ€™s Central and West Asia Department, led a mission to Azerbaijan for the next round of talks on the Project from February 25-27.
The ADB Office said the delegation completed the final round of negotiations with the Government of Azerbaijan, and the parties to the agreement made a decision to launch the project.
The Board of Directors of the Asian Development Bank approved a $160 million loan for the Power Transmission Enhancement Project in Azerbaijan.
The 25-year loan will help build a double-circuit 220 kilovolt transmission line and associated substation facilities, replacing two existing lines which have been in use for about 60 years by state-owned power company, AzerEnerji.
Over 20% of the countryâ€™s energy equipment and more than half of its network facilities are well beyond their useful life, resulting in frequent power failures, system losses, and the threat of a collapse of the energy grid.
The upgrade will remove transmission choke points, lower system losses, and provide a more stable power supply, especially in the key Azeri industrial hub, near the capital city of Baku.
It will also cut the need for imported electricity, optimize the countryâ€™s hydropower resource, and reduce fossil fuel consumption and pollution. The gas and oil saved will be exported, giving a boost to government coffers.
ADBâ€™s loan will support the Governmentâ€™s priority program of reforming and developing the power industry to protect its energy security. It will also act as a potential catalyst for attracting private sector investment.
The project costs in total $240 million in total, $80 million of which will be provided by AzerEnerji.