SHIMLA, India 10/19/11 (PennWell) -- The Asian Development Bank (ADB) has approved loans of up to US$350 million for transmission system upgrades to interconnect vast hydropower resources being developed in India's Himachal Pradesh State.
With five major rivers, Himachal Pradesh holds about one-fourth of India's potential hydropower resources. Projects being developed in the state include 450-MW Shongtong Karcham, 100-MW Tidong 1, 1,000-MW Karcham Wangtoo, 195-MW Kashang 1-3, 100-MW Sainj, and 800-MW Parbati 2.
ADB's Board of Directors approved a multi-tranche financing facility for the Himachal Pradesh Clean Energy Transmission Investment Program with a first investment of US$113 million. It is intended to help expand the supply of power both within and outside Himachal Pradesh, as well as promoting employment, increased social services, and poverty reduction.
The first tranche loan from ordinary capital resources, scheduled for 2011, has a 25-year term, a grace period of five years, and interest determined in accordance with ADB's LIBOR-based lending facility. Remaining funds are to be disbursed in two more tranches through 2014. Himachal Pradesh State is to provide counterpart funds of nearly US$88 million for a total program investment of about US$438 million.
A recently formed transmission utility, HP Power Transmission Corp., also is to receive assistance to strengthen its financial and asset management capabilities. ADB is extending a technical assistance grant of US$600,000 to help HP Power Transmission implement and plant projects.