BEST-PAK MPA Program Phase 1: Grid Stability Enhancement Project

pipeline

The BEST Pakistan (BEST-PAK) program is structured as a vertical MPA, consisting of multiple IPF operations designed to support critical investments in domestic transmission infrastructure, while advancing sector reforms and institutional capacity building to unlock the potential of the power sector. The proposed BEST-PAK vertical MPA accelerates the TSEP’s critical transmission investments, including through PPPs, and advances NTDC’s restructuring. The proposed BEST-PAK MPA will be implemented over 10 years (FY26–35). All its operations are aligned with the TSEP 2024–34 and designed to be responsive to future updates of the plan. The MPA framework consists of two complementary program areas that lay the groundwork for a well-performing power transmission system and institutions: • Program Area 1, Strengthening Transmission Infrastructure: With a focus on financing hard infrastructure, projects in this area aim to advance power transmission development and modernization, including high-voltage transmission lines, substations, reactive power supply and control equipment, and battery energy storage systems. BEST-PAK MPA’s four simultaneous phases support TSEP investment requirements for both immediate-priority projects required to alleviate critical bottlenecks, and medium- to long-term projects for more reliable and resilient grid.• Program Area 2, Advancing Transmission sub-sector Reform and Institutional Capacity Development: This focuses on supporting the implementation of NTDC restructuring and strengthening institutional capacity. TAs support is offered at the project level (design, preparation, implementation) and restructuring level for well-functioning transmission institutions and a sustainable transmission subsector that attracts private investments.The preparation for subsequent phases will be supported under the Phase 1 operation. The program will leverage lessons learned and insights gained from earlier operations to inform the design of future phases and facilitate the dissemination of successful practices across operations. In parallel, targeted support for creating an enabling environment and strengthening institutional capacity will be instrumental in ensuring efficient project preparation and implementation.The BEST-PAK is planned to be implemented in four phases/operations, each with its own technical assistance (TA) for preparation and implementation support. The first two phases (and part of Phase 3) will focus on addressing the most urgent and critical transmission bottlenecks. The Government of Pakistan has requested funding support for these projects. In particular, Phase 1 will finance the installation of reactive power compensation devices (i.e., STATCOMs) in selected existing substations to enhance grid stability, along with associated TA, and support NTDC’s reforms. The subsequent phases will target projects aimed at further strengthening the national transmission system to enhance reliability and enable greater integration of renewable energy.