Asian bank eyes funding to reorganize, expand China hydro firm

The Asian Development Bank (ADB) is considering providing funds to China’s Sanchuan Clean Energy Development Co. Ltd. to assist in its creation and financing of its portfolio of hydroelectric projects.

Sanchuan is being established by hydro operator Zhejiang Zhongda Sanchuan Hydropower Development Co. Ltd. as a new holding company that will control Zhejiang Zhongda’s 17 small hydropower plants in three provinces totaling 133 MW.

In the next three to four years, Sanchuan plans to add about 300 MW in additional hydropower in underdeveloped regions through: privatization of existing small projects owned by local governments; acquisition of partly completed projects; and development of greenfield small hydro projects.

The ADB board is to consider a proposal in October to support equity investment of US$25 million, a private sector loan of US$58.3 million, and an ADB loan of US$120 million.

Sanchuan plans to build, rehabilitate, expand, upgrade, privatize, and operate small hydropower plants, most in relatively underdeveloped central and western regions of China. ADB said its support would increase clean electricity supply and rural electrification, transfer proven technology and experience of the private sector to the region, and catalyze commercial equity investment and long-term international and local bank financing for small hydropower plants.

Sanchuan submits environmental assessment for 32-MW Tangcun

In related action, Zhejiang Zhongda Sanchuan Hydropower submitted an environmental assessment to ADB of its proposed 32-MW Tangcun hydroelectric project, proposed for Tongxi River in the Yungang Valley of Zhejiang Province.

Tangcun is one of six hydropower projects proposed for the Yungang River Basin, which has an estimated total hydro potential of 50 MW. Currently, the basin has 11 small hydro plants totaling 13.41 MW.

Sanchuan proposes diverting water from the existing Longtou Reservoir on the Yungang through a 5.5-kilometer tunnel to the Tangcun powerhouse to be built on the Tongxi River. After flowing through the plant’s two 16-MW turbine-generators, the water would be discharged into the Tonxi to flow into the Xinan River, which forms Xinan Reservoir, which also impounds the flows from Yungang River.

The diversion will effectively bypass the Yungang River below Longtou Reservoir, reducing flows to Sanchuan’s existing 5-MW Yungang 1, 2.52-MW Yungang 2, and 1.6-MW Yungang 3 downstream. Including the loss of some capacity from the Yungang plants, addition of Tangcun will increase total basin generating capacity to 39.38 MW from 13.41 MW.

The total US$14.09 million project also includes a 30-kilometer transmission line.

The applicant-submitted environmental assessment said Tangcun would have no major ecological effects. It said the only potentially significant environmental issue would be reducing flows in the Yungang. Sanchuan said that could be minimized by maintaining minimum flows in the bypassed reach.

Sanchuan said overall the project would bring environmental benefits by avoiding fossil-fueled generation and ensuring a sustainable and renewable supply of clean energy to the area.

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