The Asian Development Bank (ADB) has sanctioned a $200m loan to modernise Pakistan’s power distribution infrastructure.

The initiative aims to enhance the efficiency of distribution companies and ensure the reliable delivery of electricity.

The focus is on reducing energy losses and boosting infrastructure resilience against climate change and disaster-related risks.

ADB’s power distribution strengthening project targets the modernisation of distribution systems to accommodate Pakistan’s increasing electricity demand.

The project will initially support the Lahore Electric Supply Company (LESCO), the Multan Electric Power Company (MEPCO), and the Sukkur Electric Power Company (SEPCO) to facilitate efficient and sustainable energy delivery.

The project includes the installation of 332,000 advanced metering infrastructures, data management and communication systems, and 15,800 online transformer performance monitoring systems by LESCO, MEPCO and SEPCO, enhancing their operational efficiency.

ADB director general for Central and West Asia Yevgeniy Zhukov stated: “This project is part of ADB’s ongoing efforts to address challenges in Pakistan’s power sector. Reliable grid-connected electricity improves the quality of life.

“The loss reduction and revenue protection measures supported by this project will also help reduce the power sector’s financial losses – alleviating at least one source of strain on the country’s economy.”

Four grid stations in SEPCO will see their voltage upgraded from 66 kilovolts (kV) to 132kV. This enhancement is crucial for mitigating transmission losses and meeting the rising electricity demand.

25 LESCO grid stations will be constructed and modernised with essential equipment.

The project will also replace high-loss 11kV feeder lines with aerial bundled conductor cables, and feeder line configurations will be upgraded.

ADB principal energy specialist Seung Duck Kim stated: “These upgrades will reduce losses, enhance revenue collection and provide distribution companies with real-time data on electricity consumption and grid performance.

“In the event of extreme weather, they can help identify and isolate faults quickly, reducing the time required for recovery and minimising outages.”

The project will also explore reform actions and policy recommendations to boost the operational efficiency and performance of the three distribution companies.

Pakistan, a founding member of ADB, has received $52bn in loans, grants and other financing since 1966.

These funds aim to promote inclusive economic growth and improve infrastructure, energy, food security, transport networks and social services in the country.