Rural Electrification Project

active

The proposed AF is necessary to scale up the Project activities, and to address the cost overruns, utilizing potential savings from the AF if available. The parent project was launched to enhance electricity access in the GBAO and Khatlon region of Tajikistan. The PDO aims to enhance electricity access and improve the reliability of the power supply in both GBAO and Khatlon region of Tajikistan. Specifically, the proposed AF seeks to improve the reliability of supply for grid-connected customers in both regions. The Government prioritizes the proposed investments for project scale up and agreed to allocate funding to cover the financing gap in both GBAO and Khatlon region through other sources.The proposed AF will finance the following activities to scale up the existing investments, promote private sector participation and introduce energy efficiency in the irrigation pumping stations: (i) construction of the 110kV substation in Sharifobod area of Khorog town to complement the recently built 110kV overhead transmission line from Khorog to Ishkashin district of GBAO; (ii) investment in advanced metering of the irrigation pumping stations in Khatlon region; and (iii) carry out a study on market failures for attracting private sector investment into rooftop solar to identify the barriers and challenges that hinder the growth and scalability of rooftop solar installations. These new activities are expected to provide significant benefits, such as reducing energy costs, increasing energy reliability and resilience against future energy crisis, and promoting sustainable development. The urgency of proceeding with financing is underscored by increasing electricity supply outages affecting consumers in certain parts of the Khatlon region and the need for enhanced reliability of electricity supply for on-grid connected consumers in GBAO. The proposed AF represents the most optimal approach to maximize development impact and results of the existing infrastructure, aligning with the Government Programs in GBAO and the Khatlon region. A stable power supply is essential for attracting new businesses and industries, thereby creating jobs and boosting the local economy. The proposed AF also supports local job creation during the construction stage and indirect job creation through improved economic opportunities due to enhanced electricity supply reliability. The infrastructure development associated with the 110 kV line is expected to serve as a catalyst for broader economic growth in the region. The proposed AF is anticipated to generate local employment and stimulate the local economy. The proposed AF will also align with Government objectives of achieving secure and affordable energy in Tajikistan, with broader regional energy and climate resilience benefits, and the World Bank’s Country Partnership Framework (CPF) objectives to ensure affordable, climate resilient energy and enhance livelihood opportunities for women in rural settings. Project Cost and Financing. The total Project cost is US$48.7 million inclusive of US$7 million for the proposed AF. The total Project cost is financed with IDA grant. The proposed AF would scale up the parent project activities to enhance the efficiency of the existing infrastructure operation through supporting: (i) construction of a 110kV substation to complement the newly built 110kV transmission line in Khorog, GBAO; and (ii) advanced metering of irrigation pumping stations in Khatlon region to reduce energy costs, improve reliability and operational efficiency of the pumping stations; and (iii) Study on market failures and barriers to private sector investment in rooftop solar in Tajikistan, focusing on public sector challenges and opportunities for private capital mobilization to enhance renewable energy integration and energy efficiency solutions in the country's energy infrastructure.