Asian bank rates Mekong energy sector assistance a success

The Asian Development Bank (ADB) rates as “successful” its aid program to the energy sector in the Greater Mekong Subregion (GMS) of Southeast Asia, including assistance to major hydroelectric projects in the region.

ADB issued an assessment of its aid to the energy sector program of the GMS, which includes Cambodia, Laos, Vietnam, Thailand, Myanmar, and provinces in southeastern China. (HydroWorld 6/24/08)

“The evaluation found that ADB’s GMS energy program has resulted in significant economic benefits to the participating countries,” ADB said. An important apparent benefit of the GMS energy program has been the demonstration effect. There is clear evidence that investor confidence in undertaking power export projects in the region has risen strongly in recent years.

The bank said total energy investment costs under the GMS program have amounted to US$1.7 billion, 17 percent of the total GMS project costs of US$10.3 billion. It said, to date, ADB has provided US$185.4 million additional and concessionary assistance for the GMS energy sector, of which 95 percent is loans and the remainder is technical assistance grants.

Three of the loans financed construction of hydropower projects in Laos aimed at exporting power to Thailand. They include 60-MW Nam Leuk; 210-MW Theun-Hinboun, which is being expanded by the 280-MW Theun-Hinboun Expansion project (HydroWorld 2/6/09); and 1,070-MW Nam Theun 2. (HydroWorld 8/4/08)

The assessment recommended ADB operations:
o Promote other energy investments besides power trading, consistent with ADB initiatives for energy efficiency and climate change;
o Expand cofinancing, leveraging ADB concessional resources to mobilize financing from the private sector and other development partners; and
o Pay attention to safeguard implementation on high-impact energy projects.

A summary of the assessment is available on the ADB Internet site, www.adb.org, under www.adb.org/Documents/Evaluation/Learning-Curves/SAPE/LC-Energy-Sector-GMS.pdf.

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