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The Asian Development Bank (ADB) and the Government of India on 31stDecember 2020 signed a $100 million loan to modernise and upgrade the power distribution system to enhance the quality and reliability of electricity supply in Bengaluru city in the state of Karnataka. The signatories to the Beng
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FAQ :
The total loan amount is $190 million, comprising a $100 million sovereign loan from ADB to the Government of India and a $90 million non-sovereign loan to BESCOM.
The project aims to enhance the quality and reliability of electricity supply in Bengaluru by modernising the distribution system, converting overhead lines to underground cables, reducing technical and commercial losses, and minimising outages.
The upgrade involves converting approximately 7,200 km of distribution lines to underground cables, installing over 2,800 km of fibre optical cables for communication networks, and implementing smart metering systems and distribution automation.
Moving distribution lines underground is expected to help build an energy-efficient network, reduce technical and commercial losses by about 30%, and minimise electricity outages caused by natural hazards or external disturbances.
This project features an innovative financing arrangement, the first of its kind for ADB, by combining sovereign and non-sovereign loans for a state government-owned enterprise, aiming to reduce sovereign exposure and encourage market-based funding for BESCOM.
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