Asian Development Bank approves USD 148.5 million loan for Sikkim to boost power supply

New Delhi [India], May 17 : The Asian Development Bank (ADB) has approved a USD 148.5 million loan to boost electricity supply to Sikkim.

The loan will help strengthen, modernise, and create a climate-proof distribution system to enhance the reliability, quality, and resilience of the electricity supply in the region.

"This project fully supports Sikkim's Power for all initiative, ensuring round-the-clock uninterrupted access to quality electricity for households, industries, businesses, and the public. Additionally, it synergizes with the Government of India's Revamped Distribution Sector Scheme by enhancing the distribution network, thereby boosting operational efficiency and financial sustainability of the distribution business in the state," Jaimes Kolantharaj, ADB principal Energy specialist, said.

"The project will facilitate the efficient transfer and integration of renewable energy into the distribution system and provide improved access to electricity in rural areas and businesses, thereby increasing economic opportunities, ensuring productivity, and improving living conditions," he added.

The project bankrolled by ADB will upgrade and modernise Sikkim's power distribution system by upgrading it with approximately 770 kilometres of climate-resilient medium-voltage underground and covered conductors.

According to the ADB, 580 kilometres of ageing and low-capacity bare conductors will be replaced with new ones to increase distribution network capacity. The project will upgrade 26 existing power substations, including the installation of a supervisory control and data acquisition system, install 15,000 units of public street lighting in remote areas, and conduct electricity conservation and safety awareness programs in 28 villages.

The ADB will also help develop a financial sustainability strategy and a plan to establish Sikkim's Power Department (PDS) as an independent entity, aimed at enhancing the financial sustainability of the electricity sector.

Additionally, it will assist the PDS in formulating a power distribution master plan, integrating geographic information systems and distribution system modelling, establishing a real-time monitoring control centre to enhance power management, and devising a strategy for gender and social inclusion.

The ADB stated that the project will enhance the livelihoods of a minimum of 1,100 women, comprising self-help groups, producer groups, and individual businesses, through the installation of tailored renewable energy systems and improving their vocational skills.

Additionally, the project will see the deployment of solar energy systems and energy-efficient electrical equipment in 24 primary healthcare subcenters to enhance the capacity of rural healthcare facilities in offering in-patient treatments, especially during winter.

Founded in 1966, the ADB is owned by 68 members, 49 of whom are from the Asian region. It is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific while sustaining its efforts to eradicate extreme poverty.

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