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ADB’s Power Sector Operations in India∗ Overview p. 1 ADB Lending Prior to 2003 Electricity Act p. 2 ADB Lending Post-2003 p. 3 ADB Lending to Central-Level Power Agencies p. 4 ADB Lending to Private Sector p. 5 Labor Standards ‘Flagged’ in ADB Power Projects (1986-2006) p. 6 Annex A. ADB Power Projects in India p. 8 References p. 27 Overview India is a founding member of Asian Development Bank (ADB), and is among the top 5 shareholder and borrower, with Japan, China and the United States. ADB began its lending operations in India in 1986 and has since approved 159 loans amounting to $24,122.7M. ADB’s current portfolio in the country includes 67 sovereign (or public sector) loans amounting to $10.2B. ADB’s Country Operations Business Plan for 2011–2013 is targeting $2.4B of loans a year, for allocation to the following sectors – transport (38%), energy (25%), urban (16%), agriculture and natural resources management (12%), and finance (9%). ADB will continue to engage with states with “weak capacity” such as Assam, Bihar, Chhattisgarh, Himachal Pradesh, Madhya Pradesh, and Rajasthan, incorporate public-private partnership (PPP) modalities into projects where feasible, and “facilitate policy reforms, especially in consecutive loans with the same state or executing agency.” 1 ADB's power sector program for India focuses on reforms that aim to make the sector financially viable, operationally efficient, and conducive to private sector investments. 2 Power reforms are now instituted in Electricity Act, 2003 and National Electricity Policy, 2005. More recently, ADB’s ‘investment’ loans have focused on transmission and distribution and power sector restructuring. Private sector operations are taking a larger role in financing generation. ADB’s power loans are focused in Uttaranchal, Madya Pradesh, Bihar and Himachal, Assam and Haryana, Gujarat, Jammu & Kashmir, and central-level power agencies such as Power Grid Corporation of India (Power Grid), National Thermal Power Corporation (NTPC) and Power Finance Corporation (PFC). [See ANNEX A for a list and description of ADB power projects in India.] In 2007, ADB evaluated its energy sector lending in India and concluded that its assistance had been successful due to the targeting of state electricity sectors that were “thoroughly committed to change;” this entails unbundling state electricity boards (SEBs) into separate generation, transmission and distribution entities. ADB’s evaluation also concluded that electricity reforms have increased competitiveness in the sector and led to a “demonstration effect” among the states’ electricity sectors and their regulators, as well as “added momentum” to the central government’s impetus for reform. ADB provided ∗ By Violeta P. Corral, Consultant, Public Services International (PSI), December 2011

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program assistance to restructure three SEBs (Assam, Gujarat, and Madhya Pradesh); in all three, unbundling has been achieved and new separate corporate entities with “clean” balance sheets have been established. All three states also indicated that ADB’s assistance was catalytic in providing the impetus to implementing the reform process. 3 ADB will continue to expand its promotion of state power sector reforms by including more states such as Uttaranchal, West Bengal and in the Northeastern states; and by “deepening” its efforts in the states where it is active such as Assam, Kerala and Madhya Pradesh.4 ADB's energy sector operations have been guided by its Energy Policy in 1995 and a review in 2000. The new policy, approved in 2009, aims to help Developing Member Countries (DMCs) to provide “reliable, adequate, and affordable energy for inclusive growth in a socially, economically, and environmentally sustainable way.” The policy has three pillars – promoting energy efficiency and renewable energy; maximizing access to energy for all; and promoting energy sector reform, capacity building, and governance. The new policy continues ADB’s focus in promoting energy sector reform, capacity building, and governance: “ADB will help DMCs restructure and reform their energy sectors through technical assistance and project support for regulating natural monopolies and introducing competition where feasible; it will build on the lessons from previous sector reforms.” Moreover, private sector participation will be encouraged, particularly PPPs. ADB’s policy likewise says that although privatization will not be the target or the end objective of sector reforms, it will be one of the options available: “Sector reforms, including privatization or corporatization, will be designed and sequenced carefully on a country-by-country basis in a transparent manner.”5

ADB Lending Prior to 2003 Electricity Act Prior to the passage of 2003 Electricity Act, ADB supported state-level power sector reforms and ‘stand-alone’ investments in Assam, Gujarat and Madhya Pradesh; the loans facilitated the entry of private sector companies in generation facilities. Since 2000, ADB worked with states to reform and restructure their power sectors and “bring a holistic change in their macroeconomic management and provide financial sustainability.”6 Tamil Nadu. ADB’s first loan to India was the $150M North Madras Thermal Power Plant in 1986. During project implementation, steps were taken to rationalize the tariff structure of Tamil Nadu Electricity Board (TNEB) to reduce the “heavy cross-subsidization” of agricultural and residential consumption.7 Gujarat. In 1996, ADB provided several Technical Assistance (TA) projects, including Reorganization Plan for Gujarat Electricity Board. In 2000, ADB approved Gujarat Power Sector Development Program, a $350M “policy” / project loan to promote sweeping reforms in the power sector. Madhya Pradesh. In 2001, ADB approved the $350M loan Madhya Pradesh Power Sector Development Program to assist restructuring of Madya Pradesh State Electricity Board (MPSEB). Several TAs accompanied the loan, e.g., Legal Support for Madhya

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Pradesh Power Sector Reform, Development of (Employee) Transfer Scheme for Madhya Pradesh Power Sector Reform. Assam. In 2002, ADB approved a TA to help the state government plan the restructuring of Assam State Electricity Board (ASEB); another TA was provided in 2003 to boost the capacity of the regulatory commission to promote power sector reforms. In 2003, ADB approved $250M Assam Power Sector Development Program, a mix of ‘policy’ and project (infrastructure) loans, to further assist power reforms in the state. ASEB has since been unbundled into new companies – Assam Power Generation Co Ltd, Assam Electricity Grid Co Ltd, and Assam Power Distribution Co Ltd.

ADB Lending Post-2003 With the passage and implementation of the 2003 Electricity Act, ADB’s focus shifted toward strengthening system expansion and promoting commercial operations through ‘sector’ and ‘investment’ loan support. At the central level, projects supporting the development of interstate transmission systems have been fundamental to ADB’s overall energy sector program. ADB’s intervention in the transmission subsector has “improved commercialization” and overall operating efficiencies.8 Gujarat. In 2004-2008, ADB approved three loans to the private sector for the construction and operation of several power plants – (a) $54M in 2004 to Torrent Power Generation Ltd, but this was later cancelled; (b) $105M in 2008 to Gujarat Paguthan Energy Corporation Private Limited (GPEC) for wind projects; and (c) $450M in 2008 to Tata Power’s Mundra Ultra Mega Power Project. In 2011, ADB approved $100M Gujarat Solar Power Transmission Project to catalyze development of PPP model; executing agencies are the Government of Gujarat and Gujarat Energy Transmission Corporation Ltd. Uttaranchal. In 2006, ADB approved up to $300M ‘multi-tranche facility’ (MFF) loan to Uttaranchal Power Sector Investment Program to raise output and efficiency and ensure “fully inclusive” power services for all type of consumers in Uttaranchal: residential, industrial, commercial, and public administrations. Madya Pradesh. In 2007, ADB approved up to $620M loan (MFF) to Madhya Pradesh Power Sector II Investment Program to build new transmission lines and continue assisting power reforms by financing other costs of adjustments, e.g., financial restructuring plan, improving legal and regulatory compliance. In 2011, ADB approved $400M loan (MFF) for Madhya Pradesh Energy Efficiency Improvement Investment Program to install high voltage distribution systems, provide new power connections, install meters, etc; executing agencies are the 3 new distribution companies (discoms). Himachal Pradesh. In 2008, ADB approved up to $800M loan (MFF) to Himachal Clean Power Development to build hydropower generation facilities. In 2011, ADB approved $350M loan to Himachal Pradesh Clean Energy Transmission to increase transmission system capacity internally and for export to the national grid; a capacity

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development component will assist the state to achieve its power sector reform objectives. Executing agency is Himachal Pradesh Power Transmission Company Ltd (HPPTCL), established in 2009 as part of unbundling of Himachal Pradesh State Electricity Board (HPSEB). Assam. In 2009, ADB approved up to $200M loan (MFF) for Assam Power Sector Enhancement Investment Program to partially fund Assam’s $764M power sector investment plan to 2014. Bihar. In 2010, ADB approved $132M loan for Bihar Power Sector Improvement Program to develop “run-of-river” hydropower projects and expand and rehabilitate transmission and distribution lines and substations. The loan is premised on the need for “fundamental restructuring and institutional development of distribution operations in Bihar.” 9 ADB Lending to Central-Level Power Agencies ADB further sought to help implement nationwide reforms by providing loans to central-level power agencies for onlending only to states that undertake or will implement power sector reforms. These agencies include: (a) Power Finance Corporation – PFC’s mandate is to finance, facilitate, and promote power sector development in India, including private sector power projects; it finances all types of power projects, except rural electrification, and provides technical assistance and advisory services. PFC promoted reforms from 1996 and is well placed to support state-level power sector reforms. (b) Power Grid Corporation of India – Power Grid is the public sector corporation responsible for construction, expansion, operations and maintenance of the inter-state and inter-regional power transmission network of India. (c) NTPC Ltd – Formerly known as the National Thermal Power Corporation, NTPC is the largest power generator in India with a 33% market share. It is majority owned by the Government of India (89.5%), having listed 10.5% of its shares on Indian stock exchanges in 2004. Although a state-owned enterprise, NTPC is operated as an independent commercial entity; it can raise commercial financing without explicit Government approvals. ADB loans to NTPC are classified as ‘nonsovereign’ or corporate loans which are processed by its Private Sector Operations Department. Power Finance Corporation. In 1992, ADB provided $250M loan to Power Sector Efficiency Project; upon completion, ADB recommended that future ADB lending to SEBs through PFC should be extended “only if borrowing states have embarked on a reform agenda.” 10 A subsequent ADB loan in 2002 (State Power Reform Project, $150M) was targeted for onlending to SEBs (Karnataka, Maharashtra, Punjab, Tamil Nadu and West Bengal) and other state-level power utilities “that make firm commitment to institute reforms.”11 Power Grid. In 2000, ADB provided $250M loan to Power Grid Transmission II to build transmission projects that would “leverage sector reform at state level” and “switch power supply from delinquent or non reforming states to states that have good payment

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records and have implemented or will implement sector reform.” The loan was designed to “differentiate between states undertaking sector reform from those that are not.” Moreover, “transmission services to delinquent states will be suspended but states that have implemented power sector reform programs will receive preference for investment under the loan.”12 In 2004, ADB approved a $400M loan for Power Grid Transmission III. In 2011, a $500M loan National Grid Improvement Project will strengthen transmission connection between Chhattisgarh and Haryana to “support bulk power supply from private generation companies of 14 independent power producers (IPPs).” ‘Reforming’ states such as Tamil Nadu, Andra Pradesh, Uttaranchal, Chattisgarh and Haryana are among those benefiting from ADB investment loans to Power Grid. NTPC Ltd. In 2006, ADB approved $300M for NTPC Capacity Expansion Financing Facility I to build two thermal power plants in Chhattisgarh and Bihar. Another $150M loan (NTPC Capacity Expansion Financing II) had been set for approval in 2009; it included subprojects for hydroelectric plants in Uttarakhand state. ADB Lending to Private Sector According to ADB’s energy policy, it will encourage private sector participation (and PPPs) to “enhance energy sector efficiency through competition,” and to increase investable resources, “but not as the end objective of reforms.” Moreover, ADB’s Strategy 2020 which sets the Bank’s strategic direction, will scale up its private sector operations / private sector development from 12% in 2008 to 50% of annual operations by 2020. Calcutta Electricity Supply Co (CESC). In 1990-1991, ADB approved two loans (total $40M) to the GOENKA Group to increase power supply and “support expansion of private sector in an area traditionally dominated by public sector.”13 Balagarh Power Co. Ltd. (BPCL). In 1996, ADB approved its third project involving the CESC group, to build 500MW coal-fired thermal power station in Calcutta; BPCL would build, own and operate power plant for 30 years and sell the power to CESC. ADB provided total $140M financing through $15M equity investment, $25M loan and an additional $100M cofinancing from other sources. Tata Power. In 2003, ADB approved its first private sector loan ($62M) for a power transmission project to Tata Power, India’s largest private power utility. The loan will finance a joint venture between Tata Power and Power Grid (TDTL) to build the Tala-Delhi transmission project on a build-own-operate-transfer basis. In 2007-2008, ADB approved two more loans to Tata Power: (a) $79M for wind power projects in Maharashtra and(b) $750M for 4,000 MW coal-fired Mundra Ultra Mega Power Project in Gujarat on a build-own-operate basis, with $1B co-financing from Korean EximBank. Mundra’s project sponsor is Coastal Gujarat Power Ltd (CGPL), a wholly-owned subsidiary of Tata Power.

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Torrent Power Generation Ltd (TGPL). In 2004, ADB approved a total $75M loan and equity investment to TGPL for construction and operation of 1,095-MW gas-fired combined-cycle power plant in Gujarat. The loan package was later cancelled. Gujarat Paguthan Energy Corporation Private Ltd (GPEC). In 2008, ADB provided GPEC with $105M loan financing for the construction of 132MW wind power projects in Gujarat. Kyushu Electric Power. In 2010, ADB provided $40M equity investment in a joint venture company (JVC) that will develop and operate 500MW of renewable energy projects in the next three years. ADB will have 25% stake, NTPC 50%, and Kyushu Electric 25%. Kyushu Electric is an integrated private sector generation, transmission and distribution company which owns and operates 20,024MW of power generation capacity including hydroelectric, wind, solar and geothermal projects on Japan's Kyushu Island. As “honest broker,” ADB provides “direct comfort” to both local and foreign investors through its equity participation in the JVC. Dahanu Solar Power Private Ltd. ADB is set to soon approve a $48M loan to Dahanu for the construction and operation of 40MW solar power plant in Rajasthan. Labor Standards ‘Flagged’ in ADB Power Projects (1986-2006) In 2001, ADB approved its Social Protection Strategy which is the only major Board-approved ADB document which commits the Bank to comply with Core Labor Standards (CLS). Par. 84 states that: “(a) in the design and formulation of its loans, ADB will comply with the internationally recognized core labor standards; (b) take all necessary and appropriate steps to ensure that for ADB-financed procurement of goods and services, contractors, subcontractors and consultants will comply with the country’s labor legislation (e.g., minimum wages, safe working conditions, and social security contributions, etc.) as well as with the Core Labor Standards; and (iii) As part of its regular loan reviews, ADB will monitor that (i) and (ii) are complied with.”14 ADB’s Handbook on Core Labor Standards, published with the International Labor Organization (ILO) in 2006, states that: “Since the approval of ADB’s Social Protection Strategy in September 2001, CLS have become an integral part of ADB’s development mission. ADB’s Social Protection Strategy and its Action Plan commit ADB to comply with the CLS, and guide ADB operations to good labor and social protection practices.”15 The CLS Handbook also provides for the incorporation of CLS in ADB’s lending operations and project cycle (Box 9). CLS are internationally-agreed fundamental human rights for all workers, irrespective of countries' level of development, that are defined by the International Labor Organization (ILO) conventions that cover – - freedom of association and the right to collective bargaining (Conventions 87, 98); - elimination of discrimination in respect of employment and occupation (Conventions 100, 111); - elimination of all forms of forced or compulsory labor (Conventions 29, 105); - effective abolition of child labor, including its worst forms (Conventions 138, 182).

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Other ILO charters and labor standards support workers’ conditions of employment, occupation health and safety, and community standards. ILO members must comply with CLS even without the ratification of the ILO Conventions; ADB’s DMCs who are also ILO members need to comply with CLS in ADB-financed projects. For large infrastructure projects (major construction works), ADB has agreed to adopt labor standards requirements in MDBs Harmonized June 2010 edition16 that has reference to all 4 CLS requirements. The June 2010 edition has two new sub-clauses on ‘Workers’ Organizations’ and ‘Non-discrimination and Equal Opportunity’ where earlier editions would only refer to the CLS on forced labor and child labor. The new labor standards will be obligatory for all MDB-financed construction works that are subject to International Competitive Bidding (ICB), as part of Standard Bidding Documents (SBDs) for Procurement of Works. At the International Finance Corporation (IFC), non-compliance with CLS by its private sector clients could lead to cancellation of the loan. The harmonized labor standards requirements were negotiated over the years by global unions with MDBs (multilateral development banks) and Geneva-based International Federation of Consulting Engineers (FIDIC). 17 Since ADB started lending operations in India in 1986, very few ADB power projects have ‘flagged’ or identified labor standards as part of social “safeguards” that are mandatory in ADB-financed projects. Some of these projects and the labor standards identified are listed below:18 North Madras Thermal Power Plant (1986): - Actual project implementation was supervised by Chief Engineer who was supported

by about 200 experienced professional staff, but his arrangement was adversely affected because of high turnover of senior staff due to promotion or retirement.

- Safety issues were not addressed and safety-related equipment, e.g., helmets, safety shoes, and belts were not given to the workers.

- In 1992-1993, TNEB provided regular employment to a large number of contract laborers as directed by a labor tribunal.

Madya Pradesh (2002): - One condition for release of the final tranche of Madhya Pradesh Power Sector

Development Program I was the development of an employees transfer scheme. ADB’s TA on Development of a Transfer Scheme for Madhya Pradesh Power Sector Reform aimed would assist MPSEB to transfer employees to successor entities and reach agreement on the scheme with its labor representatives. The transfer of personnel was completed in 2004.

Power Grid (2004): - Under Power Grid Transmission (Sector) III, Power Grid will ensure that civil works

contracts incorporate provisions where contractors (i) will not use children as labor; and (ii) will follow legally-mandated provisions of labor (including equal pay for equal work), health, safety, sanitation and working conditions. The contracts will also provide for termination of the contracts by Power Grid in case of breach of any of the stated provisions by the contractors.

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Annex A. ADB Power Projects in India

[As of November 2011. Includes ongoing, proposed & recently completed projects. OCR – Ordinary Capital Resources (less concessional terms); MFF – Multi-tranche Financing Facility; TA – Technical Assistance’ SARD – South Asia Regional Department; PSOD – Private Sector Operations Department.]

TITLE DESCRIPTION TYPE OF ASSISTANCE

DATE OF APPROVAL

AMOUNT (US$) ♣

ANDRA PRADESH Power Grid Transmission III (Subproject)

Grid strengthening for Tamil Nadu, Andhra Pradesh, and Union Territory of Pondicherry

Loan Dec 2004 400.0M (Total)

CLOSED TA Development of a Framework for Electricity Tariffs in Andra Pradesh (approved Dec 1995)19 ASSAM Assam Power Sector Enhancement Investment Program (Facility Concept) 20 SRINAVASAN JANARDANAM jsrinivasan@adb.org TIKA RAM LIMBU tlimbu@adb.org (SARD)

Transmission and Distribution Sector Investment Program. Executing Agency (EA) is Assam State Electricity Board (ASEB). Involves construction of new 220/132 kV substation and new 132/33 kV substations; extension and augmentation of existing substations; new distribution substations and lines to enable rollout of relevant franchising models. Expansion of the distribution franchise scheme expected to result in 1,500 new jobs.

Loan - MFF Nov 2009 200.0M - OCR

MFF - Tranche 1 Nov 2009 60.3M - OCR

MFF - Tranche 2 Oct 2010 89.7M - OCR

MFF - Tranche 3 Nov 2011 50.0M - OCR

Assam Power Sector Development Program 21 TOMOYUKI KIMURA tkimura@adb.org KIYOSHI TAKEBAYASHI ktakebayashi@adb.org (SARD – Policy)

(i) Develop appropriate policy, legal and regulatory framework to ensure a balanced growth of power sector; (ii) enhance sector efficiencies by establishing commercial and competitive business environment; and (iii) improve financial viability of sector.

Policy loan Dec 2003 (CLOSED)

150.0M – OCR

(i) Improve transmission system; (ii) Improve distribution system (APDRP fund); (iii) Intensify rural electrification; (iv) Revenue Management System; (v) Consulting Services

Project loan Dec 2003 (CLOSED)

100.0M – OCR

CLOSED TAs (approved Dec 2003) 22

Institutional Development for Rural Electrification; Reorganization of ASEB (formerly Restructuring of ASEB); Policy and Legal Support for Power Sector Reforms; Building Capacity of Assam Electricity Regulatory Commission

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BIHAR Bihar Power Sector Improvement Program 23 MUKHTOR KHAMUDKHANOV mkhamudkhanov@adb.org (SARD)

(i) Meet GOI’s “power for all by 2012” objective, (ii) develop run-of-river hydropower to meet Bihar’s generation gap, (iii) expand and rehabilitate transmission and distribution lines, substations to improve reliability of power. Fundamental restructuring and institutional development of distribution operations in Bihar is crucial to the reforms envisaged in the power sector as a whole. EA is Bihar State Electricity Board (BSEB).

Loan Oct 2010 132.2M - OCR

Bihar Power Sector Capacity Development Implementation Support24 ANDREW JEFFRIES ajeffries@adb.org (SARD)

Capacity development of BESB, e.g. project implementation –training related to procurement and contracts management, environment and social safeguards, training and human resource management, and finance and accounts management and reporting.

TA Special Fund Oct 2010 0.3M

Developing the Power System Master Plan for Bihar 25 ANDREW JEFFRIES ajeffries@adb.org (SARD)

Linked to sector policy. Outputs include an electricity demand forecast for Bihar, determination of generation supply options, generation expansion planning and transmission planning completed by the end of May 2009, followed by distribution planning by the end of July 2009. A transmission & distribution capital works program and final project reports are currently proposed for completion by the end of September 2009.

TA Special Fund April 2008, Aug 2011

0.624M

NTPC Capacity Expansion Financing Facility I 26 MARTIN LEMOINE mlemoine@adb.org (PSOD)

Partially finance: (i) 2,980 MW Sipat Super Thermal Power Project in Chhattisgarh state and (ii) Kahalgaon Super Thermal Power Project Stage II extension (1,500 MW) in Bihar state.

Non-sovereign loan

July 2006 75.0M – Loan; 225.0M –

Complementary Financing Scheme

CALCUTTA Balagarh Power Co. Ltd. (BPCL) 27

Third CESC - ADB’s third project involving CESC/RPG group, to build 500-MW coal-fired thermal power station comprising two 250 MW units on an island in Hugli river 70 kms north of Calcutta; to be operational in mid-2000.

Private sector (without govt

guarantee)

1996 $15.0M – Equity investment;

$25.0M – Loan; $100.0M -

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Notable as first power scheme financed without Government guarantee, project is 35% owned by CESC Limited, a licensee to generate and distribute electricity in Calcutta. CESC is also a unit of RPG Group, India’s fifth largest industrial group. BPCL will build, own and operate power plant for 30 years, selling power to CESC. ADB’s presence and support of International Finance Corporation (World Bank) designed to promote participation by other international financial investors and lenders.

Cofinancing

Calcutta Electricity Supply Company (CESC) 28 SHANTANU CHAKRABORTY schakraborty@adb.org (PSOD)

Second CESC – A 500 MW expansion project connecting the power station to 132-kV transmission network Augment CESC’s generation capacity: (i) increase power supply over next ten years to industry which is a primary customer of CESC; (ii) improve quality of life style due to more assured availability of power; (iii) support expansion of private sector in an area traditionally dominated by public sector. Project sponsor is GOENKA Group.

Private sector Loan

Dec 1991 (CLOSED)

32.0M

First CESC - Augmentation of transmission system. Sponsor is GOENKA Group

Private sector Loan

Oct 1990 (CLOSED)

17.8M

CHATTISGARH NTPC Capacity Expansion Financing Facility I 29 MARTIN LEMOINE mlemoine@adb.org (PSOD)

Partially finance: (i) 2,980 MW Sipat Super Thermal Power Project in Chhattisgarh state and (ii) Kahalgaon Super Thermal Power Project Stage II extension (1,500 MW) in Bihar state.

Non-sovereign loan

July 2006 75.0M – Loan; 225.0M –

Complementary Financing Scheme

GUJARAT Gujarat Solar Power Transmission Project 30 NAOKI SAKAI nsakai@adb.org (SARD)

Develop transmission infrastructure for evacuation of power from solar power generation plants to be located in Charanka solar park in Patan district, which will site over 500 MW of solar photovoltaic and concentrated solar power plants. To catalyze development of PPP model. EAs are Government of Gujarat and Gujarat Energy Transmission Corporation Limited.

Loan Sep 2011 100.0M - OCR

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Mundra Ultra Mega Power Project (UMPP) TAKEO KOIKE tkoike@adb.org (PSOD)

Construct, operate, and maintain a 4,000 MW coal-fired power plant (5 units of 800 MW each) on a build-own-operate basis in Gujarat, incorporating supercritical technology which improves thermal efficiencies and reduces emissions. Borrower is Tata Power Company Limited.

Private sector loan

April 2008 450.0M [Cofinancing from KEXIM]

Gujarat Paguthan Energy Corporation Private Limited (GPEC) 31 ANIRUDHA V. PATIL apatil@adb.org MA ELEANOR T. RAZ (PSOD)

Gujarat Paguthan Wind Energy Financing Facility. Phase I Samana wind energy facilities in Gujarat with a total installed capacity of 50.4MW. CLP Wind Farms Pvt. Ltd. Samana (Phase II) and Saundatti Wind Power Project involves construction and operation of 82.4 MW of wind power generation facility (103 units of 800 kilowatts each).

Private sector loan

April 2008 45.0M – Paguthan;

60.0M – CLP

Torrent Power Generation Ltd (TGPL) 32 KURUMI FUKAYA kfukaya@adb.org (PSOD)

Construction and operation of 1,095-MW gas-fired combined-cycle power plant at Surat District, Gujarat. Power plant will be fueled on natural gas to be supplied under a long-term gas supply agreement. Project will sell power to Surat Electricity Company Ltd (SEC), Ahmedabad Electricity Company Ltd (AEC), and Power Trading Corporation of India Ltd (PTC) under long-term power purchase agreements. Project to begin commercial operations in November 2006; TGPL, a special purpose company, established to implement Project.

Private sector loan

Nov 2004 (CANCELLED in Oct 2005,

before financial closing)

54.36M – Loan; 20.64M – Equity

investment

Gujarat Power Sector Development Program 33 S. CHANDER schander@adb.org (SARD)

Undertake sweeping power sector reforms/restructuring in heavily industrialized western Indian state

Policy loan Dec 2000 (CLOSED)

150.0M

Project loan Dec 2000 (CLOSED)

200.0M

CLOSED TAs (approved Dec 1996) 34

Reorganization Plan for Gujarat Electricity Board; Support to Gujarat Electricity Regulatory Commission; Consumer Awareness & Participation in Power Sector Reforms; Preparation of a Power System Master Plan for State of Gujarat; Financial Management Support to Kheda & Rajkot Distribution Centers of Gujarat Electricity Board; Development of a Framework for Electricity Tariffs in Gujarat; Review of Electricity Legislation and Regulations in Gujarat

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HARYANA National Grid Improvement Project 35 KAORU OGINO kogino@adb.org (SARD)

Strengthen transmission connection between Chhattisgarh in Western grid and Haryana in Northern grid to support bulk power supply from private generation companies of 14 IPPs.

Loan Sep 2011 500.0M – OCR

HIMACHAL PRADESH Himachal Pradesh Clean Energy Transmission 36 ANDREW JEFFRIES ajeffries@adb.org (SARD)

Fund electric transmission system upgrades and expansion to increase transmission system capacity internally and for export to national grid.

MFF - Loan

Sep2011 350.0M – OCR

Construction of transmission line and substations from Hatkoti to Pragati Nagar, District Shimla

MFF - Tranche 1 Oct 2011 113.0M – OCR

A $225,000 TA (approved Nov 2010) will implement technical, environmental and social safeguards project preparatory works and reports for the ensuing MFF loan. A capacity development component ($600,000, approved Sep 2011) will assist the state to achieve its power sector reform objectives including formation of an independent transmission utility. EA is Himachal Pradesh Power Transmission Company Ltd. (HPPTCL)

Capacity Building for Himachal Pradesh Power Sector Agencies 37 ANDREW JEFFRIES ajeffries@adb.org (SARD)

Comprehensive power system master plan, with focus on transmission system expansion plans to ensure their adequacy and that they are coordinated with the existing and already planned generation expansion.

TA Special Fund Nov 2008 0.9M

Himachal Clean Power Development (Facility Concept) 38 ANDREW JEFFRIES ajeffries@adb.org HIROKI KOBAYASHI hkobayashi@adb.org (SARD)

Construction of hydropower generation facilities, underground power houses, associated civil works, tunnels, river diversion and power evacuation systems – Sawra Kuddu (111 MW), Integrated Kashang (stage I, II and III totaling 243 MW), Sainj (100 MW) and Shongtong-Karcham (402 MW). EAs are Himachal Pradesh Power Corporation Ltd (HPPCL) and Multipurpose Projects & Power Dept of Govt of HP. Capacity development to HPPCL includes fiduciary oversight and governance, knowledge management, safeguards, procurement, project implementation, supervision, and monitoring capabilities.

MFF - Loan Oct 2008 800.0M – OCR

MFF - Tranche 1 Oct 2008 150.0M – OCR

MFF - Tranche 2 Dec 2009 59.1M – OCR

MFF - Tranche 3 Oct 2010 208.0M – OCR

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JAMMU AND KASHMIR Jammu and Kashmir State Clean Power Development39 TOMOYUKI KIMURA tkimura@adb.org (SARD)

Prepare a project designed to support selected investments in hydropower development and associated transmission system expansion to facilitate sector sustainability, and promote sector reforms in J&K to further facilitate clean power generation, transmission and distribution in J&K with minimum advance environmental and social adverse impacts.

TA Dec 2007 [TERMINATED/ CANCELLED]

0.8M – Japan Special Fund

KERALA Kerala Power Sector Development Program 40

Improve sector performance technically and financially, including proposing policy and legislative reforms to address issues constraining sector development.

TA Oct 2001 (CLOSED)

0.8M

(i) Review studies carried out on power sector reforms and restructuring; (ii) recommend changes or actions needed for restructuring process, and draft a reform bill; (iii) propose time-bound action plan to continue and strengthen reform process; (iv) develop financial model for Kerala State Electricity Board/KSEB to draw up a financial restructuring plan; (v) help operationalize restructuring process by identifying key performance indicators of new sector agencies and suitable benchmarks, and draft associated performance contracts; (vi) review KSEB’s power system investment plans to identify projects suitable for ADB financing.

MADYA PRADESH Madhya Pradesh Energy Efficiency Improvement Investment Program 41 HERATH M. GUNATILAKE hgunatilake@adb.org (SARD)

Install separate feeders for households and irrigation water pumps, install high voltage distribution systems, provide new power connections, install meters, map assets of distribution companies and undertake network analysis. EAs are 3 discoms: Madhya Pradesh Madhya Kshetra Vidyut Vitaran Company Limited (DISCOM-C); Madhya Pradesh Poorva Kshetra Vidyut Vitaran Company Limited (DISCOM-E); and Madhya Pradesh Paschim Kshetra Vidyut Vitaran Company Limited (DISCOM-W)

MFF – Loan

July 2011 400.0M – OCR

MFF – Tranche 1 July 2011 200.0M – OCR

MFF – Tranche 2 PROPOSED (for approval April 2012)

200.0M – OCR

Energy Smart-Facilitating the Operations of Energy Conservation Fund in Madhya Pradesh 42 ANDREW JEFFRIES ajeffries@adb.org (SARD)

TA will provide impetus to Energy Efficiency program by financially supporting activities of ECF created for this purpose.

TA Nov 2008 1.7M - ATF Denmark

Renewable Energy

14

Madhya Pradesh Power Sector II (Investment Program) 43 HIROKI KOBAYASHI hkobayashi@adb.org (SARD) K. VALLABHA RAO vkarbar@adb.org (SARD)

Continue promoting power sector reforms, by financing further costs of adjustments: (i) implementation of financial restructuring plan, ii) align financial restructuring plan with medium term fiscal frameworks, (iii) ensure full autonomy for power sector companies, (iv) improve legal and regulatory compliance, and (v) enhance awareness and communication with stakeholders. ADB will finance transmission component; construction of new transmission lines will remove constraints to power flow and provide additional operational flexibility to TRANSCO in its role as independent system operator. Supply reliability will be further improved and promote open access and development of intra-state and inter-state power trading by providing sufficient excess substation and line capacity to handle unplanned power transfers.

MFF – Loan

Mar 2007 620.0M – OCR

MFF – Tranche 1 April 2007

106.0M – OCR

MFF – Tranche 2 April 2007

45.0M – OCR

MFF – Tranche 3 Aug 2007

144.0M – OCR

MFF – Tranche 4 Aug 2007

90.0M – OCR

MFF – Project 5 April 2009 166.0M – OCR

Madhya Pradesh Power Sector Development Program 44 DAGMAR GRACZYK dgraczyk@adb.org (SARD)

Program to facilitate restructuring power sector in Madhya Pradesh to improve sector efficiencies and to reduce the financial transfers from State Government into power sector. Program to instill competition, corporatization, commercialization and private sector participation in power sector to improve quality and quantity of power supply to customers. Included a policy loan and a project loan.

Program loan; Project loan

Dec 2001 (CLOSED)

150.0M – OCR; 200.0M – OCR

Policy framework supported: (1) Madhya Pradesh Vidyut Sudhar Vidheyak, 2000 (the Reform Act) brought into force 3 July 2001. Act was the most progressive in India at the time and includes provision for (a) restructuring of Madhya Pradesh State Electricity Board/MPSEB, (b) mandatory metering of all consumers, (c) rationalization of tariff that all classes of consumers will pay at least 75 percent of cost of supply (progressively phased over 5 years), (d) subsidies through Government budget to be allocated before subsidizing any category of consumers (e) creation of Madhya Pradesh State Electricity Regulatory Commission/MPSERC, and (f) dispute resolution between GOMP and the MPSERC by reference to Central Electricity Regulatory Commission/CERC as against reference to courts. (2) Conversion of existing MPSERC into the first MPSERC (3) Corporatization and commercialization of generation, transmission and distribution functions of MPSEB. (4) Rationalization of tariff structure and restrictions of free power supply in Madhya Pradesh (5) Financial restructuring of sector. Project loan component financed investments for metering, and transmission and distribution systems strengthening and upgrading.

15

CLOSED TAs 45 (approved 2002)

Development of a Transfer Scheme for Madhya Pradesh Power Sector Reform (0.4M TA) – assist MPSEB in developing a scheme under which employees would be transferred to successor entities. Cabinet approved ‘Employment Data and Transfer Scheme, Organizational Structures, and Service Rules and Conditions” in August 2003; transfer of personnel was completed in Sep 2004. Strengthening Consumer and Stakeholder Communication for Madhya Pradesh Power Sector Reform (0.15M TA). Legal Support for Madhya Pradesh Power Sector Reform (0.15M TA). Review of Electricity Legislation and Regulations (1.0M TA)

MAHARASHTRA Tata Power Wind Energy Financing Facility TAKEO KOIKE tkoike@adb.org (PSOD)

Demonstrate successful implementation of large-scale wind power projects by private sector; and facilitate commercial cofinancing of at least $50M.

Private sector loan (without govt

guarantee)

April 2007 79.26M (Rs3.52B)

(i) Khandke Wind Power Project involves construction and operation of 50.4 MW of wind power generation facilities and a 30-132 kilovolt (kV) substation at Khandke village, and a 4 km transmission line to nearest line-in-line-out point on 132 kV transmission lines of Maharashtra State Electricity Transmission Company Limited/MSETC. (ii) Bramanvel Wind Power Project involves construction and operation of 50 MW of wind power generation facilities and a 30-220 kV substation at Bramanvel village, and a 35 km transmission line to nearest 220 kV substation of MSETC.

Power Grid Transmission III (Subproject)

(i) Khandke Wind Power Project involves construction and operation of 50.4 MW of wind power generation facilities and a 30-132 kilovolt (kV) substation at Khandke village, and a 4 km transmission line to nearest line-in-line-out point on 132 kV transmission lines of Maharashtra State Electricity Transmission Company Limited/MSETC. (ii) Bramanvel Wind Power Project involves construction and operation of 50 MW of wind power generation facilities and a 30-220 kV substation at Bramanvel village, and a 35 km transmission line to nearest 220 kV substation of MSETC.

Loan 2004 10.0M

16

State Power Reform Project (Subproject)46 PRODYUT DUTT pdutt@adb.org (SARD)

Support reforms in selected reform-oriented states and establish independent regulatory bodies; unbundle sector entities to make them commercially and operationally autonomous and efficient, financially viable. PFC will onlend funds to SEBs (Karnataka, Maharashtra, Punjab, Tamil Nadu and West Bengal) and other state-level power utilities that make firm commitment to institute reforms to make sector operationally efficient and financially self-sustaining. ADB will provide loan assistance to selected sub-borrowers/SEBs, through PFC, to meet part of their financing requirements: (i) transmission and distribution rehabilitation; (ii) transmission and distribution facilities required for system expansion and reinforcements; and (iii) renovation and modernization of existing generating plants.

Loan Dec 2002 (CLOSED:

PARTIALLY CANCELLED) - Cancellation of

$100M uncommitted balance due to

non-availability of candidate sub-projects from Karanataka,

Punjab and Tamil Nadu

150.0M – OCR

Power Finance Corporation (Subproject)

PFC requested by MSEB in July 1999 for technical and financial assistance in its reform and restructuring process

Loan 1999 --

NORTHEAST REGION (NER) - comprised of Assam, Arunachal Pradesh, Meghalaya, Nagaland, Tripura, Mizoram, Manipur, and Sikkim North East Region Power Development Project47 (SARD)

Project is expected to include clean power generation, transmission, distribution, and efficiency enhancements in power system and improve the well being of the people and the environmental quality.

Loan STATUS UNCLEAR

[for approval in Jan 2010]

250.0M – OCR

PPTA Dec 2004 0.75M Project will support Government’s Power for All by 2012 efforts in NER using locally available resources including hydropower, natural gas, renewable energy sources, provision of critical transmission and distribution facilities, and support for institutional strengthening.

RAJASTHAN Dahanu Solar Power Project 48 ANIRUDHA V. PATIL apatil@adb.org (PSOD)

Construction and operation of a 40MW solar photo-voltaic (PV) power plant in Dhursar, Jaisalmer district, Rajasthan. Borrower is Dahanu Solar Power Private Limited.

Private sector loan

PROPOSED (for approval Nov 2011)

48.0M

TAMIL NADU Power Grid Transmission III (Subproject)

Grid strengthening for Tamil Nadu, Andhra Pradesh, and Union Territory of Pondicherry

Loan Dec 2004 400.0M (Total)

17

Second North Madras Thermal Power 49

- Loan Aug 1990 (CLOSED)

200.0M

North Madras Thermal Power (NMTPP) 50

ADB’s first loan to India to build 2 units of 200-MW power plants. During project implementation, steps were taken to rationalize tariff structure of Tamil Nadu Electricity Board’s (TNEB) to reduce heavy cross-subsidization of agricultural and residential consumption.

Loan Nov 1986 (CLOSED)

150.0M

CLOSED PROJECTS Tamil Nadu Electricity Board Operational Improvement (TA); North Madras Thermal Power Plant (Loan, 1986) ADB’s first loan to India, consisting of two units of 210 MW capacity

UTTARANCHAL NTPC Capacity Expansion Financing II 51 DON PURKA dpurka@adb.org (PSOD)

A corporate financing facility to be used for capital expenditures of power generation plants being developed by NTPC Limited, largest electric power utility in India.

Non-sovereign loan

STATUS UNCLEAR

[for approval in 2009]

150.0M

i) Help India meet long-term power generation needs; ii) leverage foreign currency financing from syndicated commercial bank and capital/bond markets; iii) strengthen commercial financing of state-owned enterprises without requiring Government guarantees. Sub-projects (run of river hydroelectric) in Uttarakhand state: (1) 520-MW Tapovan-Vishnughad; (2) 600-MW Loharinag-Pala.

National Power Grid Development Investment Program (Power Grid Corporation Transmission Project II) 52 TOMOYUKI KIMURA tkimura@adb.org K. VALLABHA RAO vkarbar@adb.org AJAY GUHA aguha@adb.org TIKA RAM LIMBU tlimbu@adb.org (SARD)

Increase inter-regional transmission capacity and enhance reliability and efficiency of inter-state network, including Upgradation of Transmission Corridor from Uttaranchal and 800kV High Voltage Direct Current North-eastern – Northern/Western Inter-connector. Upgrading transmission corridor from Uttaranchal.

MFF – Loan

March 2008 600.0M – OCR

MFF – Loan (Tranche 1)

March 2008 400.0M – OCR

MFF – Loan (Tranche 3)

PROPOSED (for approval Dec 2011)

76.0M – OCR

18

Uttaranchal Power Sector Investment Program (Facility Concept) (formerly Chhattisgarh Power Sector Development Program) 53 HIROKI KOBAYASHI hkobayashi@adb.org (SARD)

(a) Raise output and efficiency of Uttaranchal power sector; and (b) ensure fully inclusive power services for all type of consumers in Uttaranchal: residential, industrial, commercial, and public administrations. ADB-supported investments will increase power supplies by 2012, from large and small plants, by adding new assets, and rehabilitating existing ones. Transmission expansion will enable a more efficient transfer of power within state, and sale of excess power to Northern Region grid. Small hydropower plants investments expected to generate carbon credits. Subprojects include design, construction, and commissioning of: (a) 10-MW Madhyamaheswar Hydropower Plant; (b) 9-MW Kaldigad Hydropower Plant; (c) 4-MW Kaliganga I-Hydropower Plant; (d) 6-MW Kaliganga II-Hydropower Plantand (e) Hydrological Information System.

MFF – Loan

March 2006 300.0M – OCR

MFF (Subproject 1)

Jan 2007 41.92M – OCR

MFF (Subproject 2)

Dec 2008 62.4M - OCR

MFF (Subproject 3)

Jan 2009 30.6M - OCR

MFF (Subproject 4)

PROPOSED (for approval)

OCR

Strengthen existing feasibility, environmental, and social impact studies: (i) expansion of high-voltage transmission system; (ii) small hydropower development (3–25 MW) and rehabilitation of existing mini-hydropower facilities (<1 MW); and (iii) institutional strengthening, inc. preliminary development of a power trading system.

TA Special Fund

Aug 2004 (CLOSED)

0.15M

Uttaranchal Power Sector Capacity Building 54

To accelerate project readiness, and improve project management and implementation capabilities.

TA Special Fund Aug 2005 0.5M

Hydropower Development 55

Assist NTPC in strengthening feasibility studies of Loharinag-Pala and Tapoyan-Vishnugad hydropower plants in Uttranchal State.

TA May 2004 (CANCELLED)

0.8M

WEST BENGAL State Power Reform Project (Subproject) 56 PRODYUT DUTT pdutt@adb.org (SARD)

Support reforms in selected reform-oriented states and establish independent regulatory bodies; unbundle sector entities to make them commercially and operationally autonomous and efficient, financially viable. PFC will onlend funds to SEBs (Karnataka, Maharashtra, Punjab, Tamil Nadu and West Bengal) and other state-level power utilities that make firm commitment to institute reforms to make sector

Loan Dec 2002 (CLOSED:

PARTIALLY CANCELLED) - Cancellation of

$100M uncommitted balance due to

150.0M – OCR

19

operationally efficient and financially self-sustaining. ADB will provide loan assistance to selected sub-borrowers/SEBs, through PFC, to meet part of their financing requirements: (i) transmission and distribution rehabilitation; (ii) transmission and distribution facilities required for system expansion and reinforcements; and (iii) renovation and modernization of existing generating plants.

non-availability of candidate sub-projects from Karanataka,

Punjab and Tamil Nadu

CENTRAL-LEVEL POWER AGENCIES POWER GRID CORP OF INDIA LTD National Grid Improvement Project 57 KAORU OGINO kogino@adb.org (SARD)

Strengthen transmission connection between Chhattisgarh in Western grid and Haryana in Northern grid to support bulk power supply from private generation companies of 14 IPPs.

Loan Sep 2011 500.0M – OCR

Innovative Financial Instruments for Power Grid 58 SRINAVASAN JANARDANAM jsrinivasan@adb.org (SARD)

Outcome is Power Grid ’s financial closures with commercial lenders on nonsovereign basis increased.

TA Special Fund Nov 2010 0.225M

National Power Grid Development Investment Program (Power Grid Corporation Transmission Project II) 59 TOMOYUKI KIMURA tkimura@adb.org K. VALLABHA RAO vkarbar@adb.org AJAY GUHA aguha@adb.org TIKA RAM LIMBU tlimbu@adb.org (SARD)

Increase inter-regional transmission capacity and enhance reliability and efficiency of inter-state network, including Upgradation of Transmission Corridor from Uttaranchal and 800kV High Voltage Direct Current North-eastern – Northern/Western Inter-connector. Upgrading transmission corridor from Uttaranchal.

MFF – Loan

March 2008 600.0M – OCR

MFF – Loan (Tranche 1)

March 2008 400.0M – OCR

MFF – Loan (Tranche 3)

PROPOSED (for approval Dec 2011)

76.0M – OCR

20

Power Grid Transmission III (Sector) 60 K. VALLABHA RAO vkarbar@adb.org (SARD)

To help develop India’s national transmission grid, comprising 765 kV and 400 kV transmission lines and associated substations, to improve system reliability, facilitate interstate and interregional power transfers, facilitate development of a national power trading market, and hence promote increased private sector participation through open access to national transmission grid. Project represents a 5-year time slice of POWER GRID ’s National Transmission Development Plan covering 765 kV and 400 kV transmission lines and associated substations. Three subprojects cover the states of Andhra Pradesh, Tamil Nadu and the Union Territory of Pondicherry..

Loan Dec 2004 400.0M – OCR

Tata-Delhi Power Transmission (TDTL) TAKEO KOIKE tkoike@adb.org (PSOD)

Construct and operate 1,113 km of 400 kV, double circuit (D/C) power transmission lines about 20 km of 220 kV D/C power transmission lines from Siliguri, West Bengal to Mandaula near Delhi. Transmission lines will have a maximum load capacity of 3,000 MW (1,500 MW per circuit) and an average load capacity of 880 MW.

Private sector loan

Jan 2003

62.24M – Loan

TDTL is a joint venture between Tata Power (51%) and POWER GRID (49%). Project will evacuate power from Tala Hydro Electric Power Project in Bhutan and transfer surplus power from India’s eastern region to power-deficit northern region. Project is ADB’s first private sector power transmission project. Success of project expected to induce stronger flows of private investments to Indian power transmission sector.

Power Transmission Improvement II (Sector) 61 S. CHANDER schander@adb.org (SARD)

Project furthers ongoing power sector reforms at central level to by diverting supply of power from delinquent or non reforming states. To leverage sector reform at state level, Project is designed to differentiate between states undertaking sector reform from those that are not. Transmission services to delinquent states will be suspended but states that have implemented power sector reform programs will receive preference for investment.

Loan Oct 2000 (CLOSED)

250.0M – OCR; 120.0M -

cofinancing

Issues for Policy Dialogue (1) Sector Issues: (a) introduction of availability based tariff; (b) facilitating SEB reforms; (c) financial strengthening of transmission subsector; (2) Commercialization of POWER GRID : (a) enhancement of autonomy; (b) commercial borrowings from international money markets; and (c) private sector participation in transmission subsector.

21

Private Sector Participation in Electricity Transmission 62

Introduced PSP in 400-kV Meramundali-Jeypore transmission line through a transmission service agreement between POWER GRID and an independent power transmission company (IPTC). A successful bidder comprising a foreign and a local firm was selected and Central Electricity Regulatory Commission/CERC’s approval was obtained for proposed transmission tariff.

TA Dec 1999 (CLOSED)

0.6M

Power Transmission Improvement I (Sector) 63

Develop a national grid. POWER GRID to invest only in subprojects that would benefit states with outstanding dues of less than two months of sales and undertaking sector reforms. Regular discussions with Government prompted Government to increase rate of return on POWER GRID ’s equity from 12% to 16%, effective April 1997.

Loan Nov 1995 (CLOSED)

275.0M

POWER FINANCE CORP (PFC) Energy Efficiency Enhancement in the Power Generation Sector 64 NAOKI SAKAI nsakai@adb.org (SARD)

Identify pilot state utilities through screening process of clean development mechanism (CDM) eligible projects and verified emission reductions (VER) deliverable projects in thermal and hydropower generation sector. TA will be provided to power sector entities to renovate and modernize (R&M) existing power plants through PFC

TA Special Fund Nov 2007 1.0M

State Power Reform Project 65 PRODYUT DUTT pdutt@adb.org (SARD)

Support reforms in selected reform-oriented states and establish independent regulatory bodies; unbundle sector entities to make them commercially and operationally autonomous and efficient, financially viable. PFC will onlend funds to SEBs (Karnataka, Maharashtra, Punjab, Tamil Nadu and West Bengal) and other state-level power utilities that make firm commitment to institute reforms to make sector operationally efficient and financially self-sustaining. ADB will provide loan assistance to selected sub-borrowers/SEBs, through PFC, to meet part of their financing requirements: (i) transmission and distribution rehabilitation; (ii) transmission and distribution facilities required for system expansion and reinforcements; and (iii) renovation and modernization of existing generating plants.

Loan Dec 2002 (CLOSED:

PARTIALLY CANCELLED) - Cancellation of

$100M uncommitted balance due to

non-availability of candidate sub-projects from Karanataka,

Punjab and Tamil Nadu

150.0M – OCR

22

Power Sector Efficiency Project 66

For onlending to 4 core and other eligible sub-borrowers. Project achieved its physical objectives of investing in transmission, distribution, renovation and modernization of power plants;. Future ADB lending to SEBs through PFC should be extended only if borrowing states have embarked on a reform agenda. ADB will continue state-level support through PFC and directly with selected state governments.

Loan March 1992 (CLOSED)

250.0M

CLOSED PROJECT Support to Power Finance Corporation (1M TA, Nov 1999) NATIONAL THERMAL POWER CORPORATION LTD (NTPC LTD) PPP for Renewable Energy c/o NTPC 67 DON PURKA dpurka@adb.org (PSOD)

To develop and operate 500 megawatts of renewable energy projects in India in next three years. ADB will have 25% stake, NTPC 50% holding, Kyushu Electric 25%. Kyushu Electric Power is an integrated private sector generation, transmission and distribution company, and owns and operates 20,024 megawatts of power generation capacity including hydroelectric, wind, solar and geothermal projects on Japan's Kyushu Island. Joint venture company (JVC) is to be incorporated under Companies Act of 1956.

Equity investment

November 2010

40.0M

NTPC Capacity Expansion Financing II 68 DON PURKA dpurka@adb.org (PSOD)

i) Help India meet long-term power generation needs; ii) leverage foreign currency financing from syndicated commercial bank and capital/bond markets; iii) strengthen commercial financing of state-owned enterprises without requiring Government guarantees.

Non-sovereign loan

STATUS UNCLEAR

[for approval in 2009]

150.0M

A corporate financing facility to be used for capital expenditures of power generation plants being developed by NTPC Limited, largest electric power utility in India. Sub-projects (run of river hydroelectric) in Uttarakhand state: (1) 520-MW Tapovan-Vishnughad; (2) 600-MW Loharinag-Pala.

NTPC Capacity Expansion Financing Facility I 69 MARTIN LEMOINE mlemoine@adb.org (PSOD)

Partially finance: (i) 2,980 MW Sipat Super Thermal Power Project (Stages 1 and 2) in Chhattisgarh state and (ii) Kahalgaon Super Thermal Power Project Stage II extension (1,500 MW) in Bihar state.

Non-sovereign loan

July 2006 75.0M – Loan; 225.0M –

Complementary Financing Scheme

Hydropower Development 70

Assist NTPC in feasibility studies of Loharinag-Pala and Tapoyan-Vishnugad hydropower plants in Uttranchal

TA May 2004 (CANCELLED)

0.8M

23

PRIVATE SECTOR Dahanu Solar Power Project 71 ANIRUDDHA V. PATIL apatil@adb.org (PSOD)

Construction and operation of a 40MW solar photo-voltaic (PV) power plant in Dhursar, Jaisalmer district, Rajasthan. Borrower is Dahanu Solar Power Private Limited.

Private sector loan

PROPOSED (for approval Nov 2011)

48.0M

Gujarat Paguthan Energy Corporation Private Limited (GPEC) 72 ANIRUDHA V. PATIL apatil@adb.org MA ELEANOR T. RAZ (PSOD)

Gujarat Paguthan Wind Energy Financing Facility – Phase I Samana wind energy facilities in Gujarat with a total installed capacity of 50.4MW. CLP Wind Farms Pvt. Ltd – Samana (Phase II) and Saundatti Wind Power Project involves construction and operation of 82.4 MW of wind power generation facility (103 units of 800 kilowatts each)

Private sector loan

April 2008 45.0M (Paguthan);

60.0M (CLP)

Tata Power Company Ltd 73 TAKEO KOIKE tkoike@adb.org (PSOD)

Mundra Ultra Mega Power Project (UMPP) - Construct, operate, and maintain a 4,000 MW coal-fired power plant (5 units of 800 MW each) on a build-own-operate basis in Gujarat, incorporating supercritical technology which improves thermal efficiencies and reduces emissions. Project sponsor is Coastal Gujarat Power Limited (CGPL), a wholly owned subsidiary of the Tata Power Company Ltd, the largest private power utility in India.

Private sector loan

April 2008 450.0M [with $1B cofinancing

from KEXIM]

First in a series of large energy-efficient power plants in India under Government's "Power for All" plan to provide reliable and quality access to power by 2012. Imported coal will brought to Project site thru development of jetty, unloading and handling of imported coal, transportation to site. Necessary infrastructure for utilization of sea-water for in-plant water requirements will be built, including intake and discharge location in sea-water intake pipeline and desalination plant. Project is one of first private sector generators in India to apply supercritical technology. In 2009, Mundra UMPP won two top-tier project finance awards: Euromoney PLC's Project Finance Magazine and Project Finance International have given Mundra project their Asia Pacific 2008 Power Deal of the Year award. A risk participation arrangement between ADB and Export-Import Bank of Korea (KEXIM) spurred $1 billion in debt financing from Republic of Korea, providing a significant contribution to completion of project's financing. 74 Tata Power Wind Energy Financing Facility – Loan aims to demonstrate successful implementation of large-scale wind power projects by private sector; and facilitate commercial cofinancing of at least $50M.

Private sector loan

(without govt guarantee)

April 2007 79.26M (Rs3.52B)

24

MARTIN LEMOINE mlemoine@adb.org (PSOD)

(i) Khandke Wind Power Project involves construction and operation of 50.4 MW of wind power generation facilities and a 30-132 kilovolt (kV) substation at Khandke village, and a 4 km transmission line to nearest line-in-line-out point on 132 kV transmission lines of Maharashtra State Electricity Transmission Company Limited/MSETC. (ii) Bramanvel Wind Power Project involves construction and operation of 50 MW of wind power generation facilities and a 30-220 kV substation at Bramanvel village, and a 35 km transmission line to nearest 220 kV substation of MSETC. Tata-Delhi Power Transmission (TDTL) – Construct and operate 1,113 km of 400 kV, double circuit (D/C) power transmission lines about 20 km of 220 kV D/C power transmission lines from Siliguri, West Bengal to Mandaula near Delhi.

Private sector loan

Jan 2003

62.24M – Loan (INR 3.0 billion)

Transmission lines will have a maximum load capacity of 3,000 MW (1,500 MW per circuit) and an average load capacity of 880 MW. TDTL is a joint venture between Tata Power and POWER GRID . Project will evacuate power from Tala Hydro Electric Power Project in Bhutan and transfer surplus power from India’s eastern region to power-deficit northern region. Project is ADB’s first private sector power transmission project. Success of project expected to induce stronger flows of private investments to Indian power transmission sector.

Torrent Power Generation Ltd (TGPL) 75 KURUMI FUKAYA kfukaya@adb.org (PSOD)

Construction and operation of 1,095-MW gas-fired combined-cycle power plant at Surat District, Gujarat. Power plant will be fueled on natural gas to be supplied under a long-term gas supply agreement. Project will sell power to Surat Electricity Company Ltd (SEC), Ahmedabad Electricity Company Ltd (AEC), and Power Trading Corporation of India Ltd (PTC) under long-term power purchase agreements. Project to begin commercial operations in November 2006; TGPL, a special purpose company, established to implement Project.

Private sector loan

Nov 2004 (CANCELLED in Oct 2005,

before financial closing)

54.36M – Loan; 20.64M – Equity

investment

Balagarh Power Co. Ltd. (BPCL) 76

Third CESC - ADB’s third project involving CESC/RPG group, to build 500-MW coal-fired thermal power station comprising two 250 MW units on an island in Hugli river 70 kms north of Calcutta; to be operational in mid-2000. Notable as first power scheme financed without Government guarantee, project is 35% owned by CESC Limited, a licensee to generate and distribute electricity in Calcutta. CESC is also a unit of RPG Group, India’s fifth largest industrial group. BPCL will build, own and operate power plant for 30 years, selling power to CESC. ADB’s

Private sector (without govt

guarantee)

1996 $15.0M – Equity investment;

$25.0M – Loan; $100.0M -

Cofinancing

25

presence and support of International Finance Corporation (World Bank) designed to promote participation by other international financial investors and lenders.

Calcutta Electricity Supply Company (CESC) 77 SHANTANU CHAKRABORTY schakraborty@adb.org (PSOD)

Second CESC – A 500 MW expansion project connecting the power station to 132-kV transmission network Augment CESC’s generation capacity: (i) increase power supply over next ten years to industry which is a primary customer of CESC; (ii) improve quality of life style due to more assured availability of power; (iii) support expansion of private sector in an area traditionally dominated by public sector. Project sponsor is GOENKA Group.

Private sector loan

Dec 1991 (CLOSED)

32.0M

First CESC - Augmentation of transmission system. Sponsor is GOENKA Group

Private sector loan

Oct 1990 (CLOSED)

17.8M

CLOSED PROJECT 78 Solicitation of Private Sector Implementation of Chhara Combined Cycle Power

TA Dec 1996 (CLOSED)

0.375M

OTHERS Integrated Renewable Energy Development (Facility Concept) 79 NAOKI SAKAI nsakai@adb.org (SARD)

Ministry of New and Renewable Energy plans to conduct three types of solar energy pilot projects taking a innovative PPP approach (i) 25 MW Solar Thermal Power Plants, (ii) 25 MW Solar Photovoltaic (SPV) Power Plants, and (iii) Bundled small grid-connected roof-top SPV projects at government building. EA is Ministry of New and Renewable Energy (MNRE)

Loan - MFF STATUS UNCLEAR

[for approval in May 2010]

200.0M - OCR

TA Special Fund July 2008 1.40M

Rural Electrification Corp of India 80 VIVEK RAO vrao@adb.org (SARD)

Line of credit to REC without government guarantee, structured as a stand-along Non-sovereign Public Sector Financing Facility (NPSFF) to REC for up to $150M, for onlending to State Electricity Boards and other borrowers engaged in rural power development.

Loan (without

government guarantee)

Nov 2008 225.0M

National Hydropower Development Corporation (NHDC) Capacity Development 81 PRATIMA DAYAL pdayal@adb.org (SARD)

To support National Hydropower Development Investment Program (NHDIP)

TA – United Kingdom Grant

April 2007 0.495M

(i) Feasibility studies for NHDIP and technical, economic, financial, and safeguard due diligence documents; (ii) identification of institutional development, financial management, and capacity development program for NHPC; (iii) identification of resettlement and land acquisition requirements; (iv) disclosure of such information to affected people; (v) completion of willingness-to-pay study for electricity tariff; (vi) completion of field surveys and preliminary designs.

26

Capacity Building for Clean Development Mechanism (CDM) in India 82 NAOKI SAKAI nsakai@adb.org (SARD)

Provide broad-based institutional development, technical, and training support to address capacity building needs of various stakeholders in Indian CDM market and follow a learning-by-doing approach. India had ratified Kyoto Protocol in August 2002 and established in Dec 2003 an inter-ministerial National Clean Development Mechanism Authority, involved in both regulatory and promotional roles and aims to create an enabling environment for developing a healthy and competitive CDM market in India. EA is Ministry of Environment and Forests.

TA – Cooperation Fund Climate

Change

Dec 2004 (CLOSED)

0.7M

Rayalaseema Thermal Power 83

- Loan Nov 1989 (CLOSED)

230.0M

Unchahar Thermal Power Extension 84

- Loan Sep 1988 (CLOSED)

160.0M

27

REFERENCES: 1 ADB and India: Fact Sheet (Dec 2010) http://www.adb.org/Documents/Fact_Sheets/IND.pdf 2 Power Grid Transmission (Sector) III, ADB-RRP (Nov 2004) http://www.adb.org/Documents/RRPs/IND/rrp-ind-38492.pdf 3 Energy Sector in India – Building on Success for More Results, Sector Assistance Program Evaluation, ADB, Aug 2007 (pp iii-vi) http://www.adb.org/Documents/Reports/SAPE/IND/SAP-IND-2007-17.pdf 4 Power Grid Transmission (Sector) III, ADB-RRP (Nov 2004) http://www.adb.org/Documents/RRPs/IND/rrp-ind-38492.pdf 5 2009 ADB Energy Policy http://www.adb.org/clean-energy/policy.asp 6 Power Grid Transmission (Sector) III, ADB-RRP (Nov 2004) http://www.adb.org/Documents/RRPs/IND/rrp-ind-38492.pdf 7 North Madras Thermal Power Project, ADB Project Completion Report (Mar 2001) http://www.adb.org/Documents/PCRs/IND/pcr_ind18181.pdf 8 Country Strategy and Program Update (2004-2006): India (ADB 2004). Country Strategy and Program Update (2005-2007): India (ADB 2005) 9 http://www.adb.org/Projects/project.asp?id=41626 10 Power sector efficiency project, ADB Project Completion Report (Aug 2001) http://www.adb.org/Documents/PCRs/IND/pcr_ind23013.pdf 11 State Power Reform Project http://www.adb.org/projects/project.asp?id=31324; Support to Power Finance Corporation http://www.adb.org/projects/project.asp?id=31394 12 http://www.adb.org/projects/project.asp?id=32107; India Steps Up Power Sector Reforms (Oct 2000) http://www.adb.org/Documents/News/2000/nr2000099.asp; ADB Report and Recommendation of the President (Sep 2000) http://www.adb.org/Documents/RRPs/IND/rrp-1764-ind.pdf 13 http://www.adb.org/Projects/project.asp?id=24721; http://www.adb.org/Projects/project.asp?id=23706 14 Social Protection Strategy, ADB (2001) http://www.adb.org/Documents/Policies/Social_Protection/default.asp; 15 See p. 6, Handbook on Core Labor Standards (ADB-ILO, 2006 ) http://www.adb.org/Documents/Handbooks/Core-Labor-Standards/default.asp 16 Available at: http://www.adb.org/Documents/Manuals/Bidding_Documents/Prequalification/fidic-conditions-of-contract-for-construction.pdf 17 Also see: Workers’ rights in development loans: Experience with MDBs’ labour standards requirements, Peter Bakvis, Director, ITUC/Global Unions - Washington Office; Staff and Labour and Health and Safety: Making Labour Clauses Operational, Fiona Murie,

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Global Director Construction and Health and Safety, BWI. Presented at FIDIC-BWI Conference on MDB Harmonized Construction Contract, Brussels, 27-28 January 2011. http://www1.fidic.org/events/mdb2011/presentations.asp 18 Also see: ADB & WB Projects in India’s Power Sector and Identified Labor Issues, Violeta P. Corral, Public Services International Research Unit (PSIRU), July 2006 http://isslerhall.org/drupal/content/adb-wb-projects-india%E2%80%99s-power-sector-identified-labor-issue 19 Development of a Framework for Electricity Tariffs in Andra Pradesh http://www.adb.org/Projects/project.asp?id=29056 20 Assam Power Sector Enhancement Investment Program (Facility Concept) http://www.adb.org/Projects/project.asp?id=41614 21 Assam Power Sector Development Program http://www.adb.org/projects/project.asp?id=36318 22 Institutional Development for Rural Electrification http://www.adb.org/Projects/project.asp?id=36326; Reorganization of Assam State Electricity Board http://www.adb.org/Projects/project.asp?id=36326; Policy and Legal Support for Power Sector Reforms http://www.adb.org/Projects/project.asp?id=36326; Building Capacity of Assam Electricity Regulatory Commission http://www.adb.org/Projects/project.asp?id=36323 23 Bihar Power Sector Investment Program http://www.adb.org/Projects/project.asp?id=41626 24 Bihar Power Sector Capacity Development Implementation Support http://www.adb.org/Projects/project.asp?id=41626 25 Developing the Power System Master Plan for Bihar http://www.adb.org/Projects/project.asp?id=42054 26 NTPC Capacity Expansion Financing Facility I http://www.adb.org/Projects/project.asp?id=39916 27 Balagarh Power Co. Ltd. (BPCL) ADB News release: ADB Finances Private Sector Power Project in India For Calcutta (Dec 1996) 28 Second CESC http://www.adb.org/Projects/project.asp?id=24721 First CESC http://www.adb.org/Projects/project.asp?id=23706 29 NTPC Capacity Expansion Financing Facility I http://www.adb.org/Projects/project.asp?id=39916 30 Gujarat Solar Power Transmission Project http://www.adb.org/Projects/project.asp?id=44431 31 Gujarat Paguthan Energy Corporation Private Limited (GPEC) http://www.adb.org/Projects/project.asp?id=42902 32 Torrent Power Generation Ltd http://www.adb.org/projects/project.asp?id=38907

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33 Gujarat Power Sector Development Program http://www.adb.org/projects/project.asp?id=29694 34 Preparation of a Power System Master Plan for State of Gujarat http://www.adb.org/projects/project.asp?id=30139; Financial Management Support to Kheda & Rajkot Distribution Centers of Gujarat Electricity Board http://www.adb.org/Projects/project.asp?id=30141; Development of a Framework for Electricity Tariffs in Gujarat http://www.adb.org/Projects/project.asp?id=30140; Review of Electricity Legislation and Regulations in Gujarat http://www.adb.org/Projects/project.asp?id=30142 35 National Grid Improvement Project http://www.adb.org/Projects/project.asp?id=44426 36 Himachal Pradesh Clean Energy Transmission http://www.adb.org/Projects/project.asp?id=43464 37 Capacity Building for Himachal Pradesh Power Sector Agencies http://www.adb.org/Projects/project.asp?id=41611 38 Himachal Clean Power Development (Facility Concept) http://www.adb.org/Projects/project.asp?id=41627 39 Jammu and Kashmir State Clean Power Development http://www.adb.org/Projects/project.asp?id=41593 40 Kerala Power Sector Development Program http://www.adb.org/projects/project.asp?id=31393 41 Madhya Pradesh Energy Efficiency Improvement Investment Program http://www.adb.org/Projects/project.asp?id=43467 42 Energy Smart-Facilitating the Operations of Energy Conservation Fund in Madhya Pradesh http://www.adb.org/Projects/project.asp?id=41681 43 Madhya Pradesh Power Sector II (Investment Program) http://www.adb.org/projects/project.asp?id=32298 44 Madhya Pradesh Power Sector Development Program http://www.adb.org/projects/project.asp?id=29473 45 Development of a Transfer Scheme for Madhya Pradesh Power Sector Reform http://www.adb.org/Projects/project.asp?id=36126; TACR (Nov 2005) http://www.adb.org/Documents/TACRs/IND/36126-IND-TACR.pdf; Strengthening Consumer and Stakeholder Communication for Madhya Pradesh Power Sector Reform http://www.adb.org/Projects/project.asp?id=35042; Legal Support for Madhya Pradesh Power Sector Reform Legal Support for Madhya Pradesh Power Sector Reform http://www.adb.org/Projects/project.asp?id=36153 46 State Power Reform Project http://www.adb.org/projects/project.asp?id=31324; Support to Power Finance Corporation http://www.adb.org/projects/project.asp?id=31394

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47 North East Region Power Development Project http://www.adb.org/Documents/PIDs/38312013.asp 48 Dahanu Solar Power Project http://www.adb.org/Projects/project.asp?id=45915 49 Second North Madras Thermal Power http://www.adb.org/Projects/project.asp?id=18181 50 North Madras Thermal Power http://www.adb.org/Projects/project.asp?id=18181 51 NTPC (National Thermal Power Corporation Ltd.) Capacity Expansion Financing II http://www.adb.org/Projects/project.asp?id=41904 52 Power Grid Corporation Transmission Project II http://www.adb.org/projects/project.asp?id=39630 53 Uttaranchal Power Sector Project (Facility Concept) http://www.adb.org/Projects/project.asp?id=37139 54 Uttaranchal Power Sector Capacity Building http://www.adb.org/projects/project.asp?id=39106 55 Hydropower Development http://www.adb.org/projects/project.asp?id=38010 56 State Power Reform Project http://www.adb.org/projects/project.asp?id=31324; Support to Power Finance Corporation http://www.adb.org/projects/project.asp?id=31394 57 National Grid Improvement Project http://www.adb.org/Projects/project.asp?id=44426 58 Innovative Financial Instruments for Power Grid http://www.adb.org/Projects/project.asp?id=44406 59 Power Grid Corporation Transmission Project II http://www.adb.org/projects/project.asp?id=39630 60 Power Grid Transmission III http://www.adb.org/projects/project.asp?id=38492 61 Power Transmission Improvement II http://www.adb.org/projects/project.asp?id=32107; ADB RRP (Sep 2000) http://www.adb.org/Documents/RRPs/IND/rrp-1764-ind.pdf 62 Private Sector Participation in Electricity Transmission http://www.adb.org/Projects/project.asp?id=32508 63 Power Transmission Improvement I (Sector) http://www.adb.org/Documents/PCRs/IND/pcr-ind-24273.pdf 64 Energy Efficiency Enhancement in the Power Generation Sector http://www.adb.org/Projects/project.asp?id=41139 65 State Power Reform Project http://www.adb.org/projects/project.asp?id=31324; Support to Power Finance Corporation http://www.adb.org/projects/project.asp?id=31394

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66 Power Sector Efficiency Project ADB Project Completion Report (Aug 2001) http://www.adb.org/Documents/PCRs/IND/pcr_ind23013.pdf 67 PPP for Renewable Energy c/o NTPC http://www.adb.org/Projects/project.asp?id=42922; “ADB Signs Joint Venture Agreement to Develop Renewable Energy in India,” 24 November 2010 http://beta.adb.org/news/adb-signs-joint-venture-agreement-develop-renewable-energy-india 68 NTPC (National Thermal Power Corporation Ltd.) Capacity Expansion Financing II http://www.adb.org/Projects/project.asp?id=41904 69 NTPC Capacity Expansion Financing Facility I http://www.adb.org/Projects/project.asp?id=39916 70 Hydropower Development http://www.adb.org/projects/project.asp?id=38010 71 Dahanu Solar Power Project http://www.adb.org/Projects/project.asp?id=45915 72 Gujarat Paguthan Energy Corporation Private Limited (GPEC) http://www.adb.org/Projects/project.asp?id=42902 73 Mundra Ultra Mega Power Project http://www.adb.org/Projects/project.asp?id=41946; Tata Power Wind Energy Financing Facility http://www.adb.org/Projects/project.asp?id=41900; Tata-Delhi Power Transmission (TDTL) http://www.adb.org/projects/project.asp?id=36915 74 ADB's Mundra Mega Power Project Wins Two Key International Finance Awards 3 March 2009 http://www.adb.org/Media/Articles/2009/12812-indian-electricities-projects/ 75 Torrent Power Generation Ltd http://www.adb.org/projects/project.asp?id=38907 76 Balagarh Power Co. Ltd. (BPCL) ADB News release: ADB Finances Private Sector Power Project in India For Calcutta (Dec 1996) 77 Second CESC http://www.adb.org/Projects/project.asp?id=24721 First CESC http://www.adb.org/Projects/project.asp?id=23706 78 Solicitation of Private Sector Implementation of Chhara Combined Cycle Power http://www.adb.org/projects/project.asp?id=29464 79 Integrated Renewable Energy Development (Facility Concept) http://www.adb.org/Projects/project.asp?id=41613 80 Rural Electrification Corp of India http://www.adb.org/Projects/project.asp?id=42915 81 National Hydropower Development Corporation (NHDC) Capacity Development http://www.adb.org/Projects/project.asp?id=39654 82 Capacity Building For Clean Development Mechanism in India http://www.adb.org/Projects/project.asp?id=38496 83 Rayalaseema Thermal Power http://www.adb.org/Projects/project.asp?id=22344 84 Unchahar Thermal Power Extension http://www.adb.org/Projects/project.asp?id=20165