World Bank approves $375.9m to strengthen Pakistan's power transmission network

The World Bank’s (WB) Board of Executive Directors has approved $375.9 million in financing for Pakistan’s Grid Stability Enhancement Project to strengthen the country’s national power transmission network.

According to a press release issued by the WB, the project is being implemented under the Boosting Energy Security through Transmission in Pakistan (BEST-PAK) Multiphase Programmatic Approach (MPA).

It said the project is the first phase of a 10-year programme aimed at helping Pakistan modernise its “electricity transmission network, reduce power outages and bring more clean energy to homes, businesses and industries”.

“Pakistan’s energy challenges are deeply interconnected with its broader economic stability,” WB Country Director Bolormaa Amgaabazar was quoted as saying.

“By investing in advanced technologies for more resilient transmission infrastructure, this project will contribute to reducing electricity costs, bring more renewable energy onto the grid, and lay the groundwork for a power sector that works better for households, businesses and industries, as well as overall Pakistan’s economy,” she added.

The statement said that Pakistan’s electricity network struggled with grid instability and transmission bottlenecks that limited the delivery of reliable power and left clean energy generation underutilised.

It added that these constraints affected millions of Pakistanis through frequent power outages, higher electricity costs and lost economic opportunities.

“The project will install advanced equipment to stabilise the transmission grid and improve the flow of electricity at key substations,” it said, adding that the upgrades would help bring 640MW of currently curtailed wind energy onto the grid, enabling the full use of 1,840MW of wind capacity in southern Pakistan by moving power to major demand centres.

It added that the upgrades would also support the integration of around 491MW of planned private sector-led renewable energy projects.

“Together, these improvements will help Pakistan move toward its national commitment of achieving 60pc renewable energy in its electricity mix by 2030, in line with the country’s Nationally Determined Contribution under the Paris Agreement,” the statement said.

It added that, over the project’s lifetime, it was expected to avoid around 832,500 tonnes of carbon dioxide emissions annually, or more than 20.8 million tonnes over 25 years.

“A reliable and modern transmission grid is essential for Pakistan’s energy future,” said Waleed Saleh Alsuraih, Lead Energy Specialist for the World Bank’s BEST-PAK programme in Pakistan.

“As the first phase of the BEST-PAK programme, it unlocks a pathway to large-scale clean energy deployment, stronger energy security, and a modern, commercially oriented transmission sector through targeted infrastructure investments and institutional reforms, creating the conditions for future private capital participation,” he said.

The statement said the project would also advance the government’s ongoing transmission-sector reform agenda, centred on restructuring the National Transmission and Dispatch Company (NTDC) into specialised successor entities.

“The project, drawing on relevant international experience adapted to Pakistan’s needs, would support faster implementation of reforms aimed at strengthening governance, accountability, operational performance and the long-term sustainability of the power sector,” it added.

The bank noted that “Pakistan is among the countries most exposed to climate-related risks, including river and urban flooding and extreme heat events”.

It added that the project’s design accounted for these risks by requiring all new installations to meet climate-resilient specifications, including elevated platforms to reduce flood exposure and equipment designed to operate in temperatures of up to 55 degrees Celsius.

“These measures will help ensure reliable performance during monsoon seasons and heatwaves,” the statement said. ...