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The World Bank’s Board of Directors have approved $195 million as financial assistance to enable Pakistan to improve electricity distribution and the implementation of various energy sector reforms. This is done with the vision of increasing service quality for consumers.
The Electricity Distribution Efficiency Improvement Project (EDEIP) aims to help distribution companies improve their operations in order to efficiently manage the electricity supply as well as increase the reliability of the electrical grid.
EDEIP supplements the ongoing power sector support received from the World Bank revolving around transmission network, renewable energy generation, along with reforms initiated by the Pakistan Program For Affordable and Clean Energy (PACE). The program predominantly centres around improving financial viability and smoothly transitioning to low-carbon energy.
The increased reliability of electricity services are presumed to benefit the consumers of the residential, agricultural, industrial and commercial sectors alike in the designated project areas, all while also reducing carbon emissions.
The project will be under the leadership of the Ministry of Energy and will focus to “strengthen the market-sector reforms, reduce transmissions, and distribution losses, and improve the sector’s financial performance”, as per Mr. Mohammad Saqib, Task Team Leader of the project.
The project guarantees greater revenues through cost-saving interventions and loss reductions. It further emphasizes on achieving substantial modernisation of the operations. This will be accomplished with the help of cutting-edge technology. Additionally, investments in climate-resilient infrastructure, particularly, grid stations and transmission lines, are also expected.
It will facilitate enhanced transparency, improved managerial performance, and timely compliance with regulatory requirements. Moreover, the project also aims to engage in training with regard to capacity building (by providing different tools) for this will positively impact staff performance in key utility operations.
According to Najy Benhassine, World Bank country director for Pakistan, “The long-term financial viability of the power sector depends on improving the efficiency of electricity distribution companies that deliver electricity to consumers. These efforts will improve the operational and financial performance of select distribution companies to improve their bankability and ultimately generate more private sector participation.”