The Council of the Eurasian Fund for Stabilization and Development (EFSD) has approved a US $40 million investment loan to finance Phase I of the Nurek Hydroelectric Power Plant (HPP) Rehabilitation Project.
The project envisions the purchase, supply, installation and commissioning of six single-phase autotransformers to replace the obsolete equipment installed at the plant’s switchyard over 40 years ago.
The loan will be extended for twenty years, with an eight-year grace period for principal repayments. The project will improve safety and reliability of the plant, ensure uninterrupted electricity supplies in the country, and reduce costs of operations and repair of autotransformers.
The project is part of a bigger project to reconstruct the Nurek HPP, which consists of two phases, with financing totaling up to US $700 million. The first phase of reconstruction is currently underway. It is financed, in addition to the EFSD, by the International Development Association (the World Bank Group) and the Asian Infrastructure Investment Bank.
Phase I of the Nurek HPP Rehabilitation Project is the EFSD’s first investment project in Tajikistan. The EFSD and the Government of Tajikistan are expected to sign a loan agreement in the near future, and the project will be launched this year.
The Nurek HPP, with an installed capacity in excess of 3,000 megawatts, is the key asset of Tajikistan’s energy system. Its rehabilitation is central to the Government’s efforts to provide reliable electricity supply, especially during the winter months. The power plant, which generates about 70 percent of total annual energy demand, suffers from dilapidated equipment and infrastructure. The facility did not go through major rehabilitation since it was commissioned in 1972; it is currently only 77 percent operational.
Established on June 9, 2009, the Eurasian Fund for Stabilization and Development (the former EURASEC Anti-crisis Fund) in the amount of US$8.513 billion is an international financial institution established by Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia and Tajikistan with the goals to assist its member nations in overcoming the consequences of global financial crisis, to ensure their long-run economic stability and to foster economic integration of EFSD member-countries.
The Fund assists member states with the following instruments: financial credits, available to governments only; investment loans, provided either to EFSD member states or to companies implementing interstate and national investment projects; and grants to finance government programs in social sector.
The EFSD member nations authorized the EDB to act as the Fund Manager, and signed a Fund Management Agreement with the Bank.
The Council of the Fund represents the interests of Fund member states in all mobilization, placement (investment) and utilization of Fund resources, and in all other matters related to Fund activities.
