ISLAMABAD, Dec 24: The Asian Development Bank announced on Monday approval of a loan worth $245 million for eight power distribution companies to improve power distribution system in Pakistan.

The investment is part of the ongoing $810m Power Distribution Enhancement Investment Programme agreed in 2008. The multi-tranche financing facility (MFF) targets investment in priority areas to reduce power losses and increase the reliability of the power distribution system.

Through this facility, ADB has already provided financial assistance for up-gradation work at 250 grid stations of 66KV and 132KV across Pakistan, out of which work relating to 125 grid stations have already been completed.

The loan will help increase distribution capacity of 106 grid stations including construction of 14 new grid stations.

“Energy sector in Pakistan is suffering due to shortages in generation and system bottlenecks at distribution and transmission level. ADB has made available four MFFs amounting to $2.9 billion to address these system constraints, and will continue to assist Pakistan in the energy sector,” said Werner E Liepach, Country Director of ADB in Pakistan.

The project will help all the eight power distribution companies improve reliability and quality of power supply to customers.The eight power distribution companies are: Fesco, Gepco, Hesco, Iesco, Lesco, Mepco, Pesco and Qesco. The outcome will be removal of power system bottlenecks through distribution system rehabilitation, augmentation, and expansion.

The project will add 1,881 megavolt-amperes (MVA) of transformer capacity and will improve the transmissionsystem by adding 791km of new transmission lines and upgrading 399km of the existing 66kV and 132kV transmission lines.