The European Bank for Reconstruction and Development (EBRD) and the Asian Development Bank (ADB) have joined hands to support the large-scale upgradation of the power distribution network in Armenia.
EBRD is providing financial assistance of US$ 70 million, including a B-loan from the Netherlands Development Finance Company (FMO), to Electric Networks of Armenia (ENA), the country’s sole electricity distribution company and long-standing client of the Bank.
Nandita Parshad, EBRD Managing Director, Sustainable Infrastructure Group, said: “This is an important milestone for the development of a stable and reliable power system in Armenia and a model for private grid operators in other countries. ENA will become a strategic platform for scaling up renewables, thus supporting its 2021-30 Nationally Determined Contributions and its greenhouse gas emissions reduction targets under the Paris Agreement”
For this project, ADB is providing US$ 35 million in financing.
ADB Private Sector Operations Department’s Infrastructure Finance Division Director for Central and West Asia and South Asia, Shantanu Chakraborty said: “Energy efficiency and security rely on strong infrastructure investment. ADB continues to support Armenia in achieving this goal by providing long-term financing for the private sector that is not readily available in the country. The project will fund the second phase of ENA’s long-term investment program, which aims to further expand electricity access in Armenia’s provinces.”
The loan aims to strengthen ENA’s distribution infrastructure, with a focus on the regions as well as the country’s two largest cities, Yerevan and Gyumri, both of which are part of the EBRD Green Cities programme. ENA will address specific environmental priorities identified in the Cities’ Green City Action Plans (GCAPs), such as the reduction of greenhouse gas (GHG) emissions and the integration of renewables into the power system.
The financing will support Armenia’s digital transition through the large-scale implementation of automatic control and smart metering systems, enhancing the power network’s reliability and flexibility and significantly improving systems performance. The digital economy is one of the pillars of the EBRD’s Strategic and Capital Framework.
Dimitri Gvindadze, EBRD Head of Armenia, said: “This multi-stage energy infrastructure modernisation project includes several key elements – system digitalisation, improved energy efficiency and reliability of supply. The project is important in the context of the EBRD’s work to develop Armenia’s clean energy generation capacity, including utility-scale solar power generation.”
The project is expected to improve energy efficiency, reduce technical and commercial losses and GHG emissions and remove technical barriers to the installation of small and medium-sized renewable projects (especially solar and wind), thus improving the overall reliability of the country’s power supply and helping both Yerevan and Gyumri to meet their climate goals.
ENA is owned by Tashir Group, a large, diversified group of industrial and construction companies.
ENA General Director Karen Harutyunyan said: “The effective implementation this investment program is aimed at further enhancing the quality of our customer service, a priority for Electric Networks of Armenia. We are pleased to be working with the Asian Development Bank and the European Bank for Reconstruction and Development on the second phase of this program.”