ADB supports Laos hydropower

The Asian Development Bank (ADB) has approved funding of US$ 217 million for a 290 MW hydropower project in Laos which will be built under a public-private partnership (PPP) arrangement.

The bulk of the electricity generated by Nam Ngiep 1 will be delivered to neighbouring Thailand. The project, which is due to start generating in 2019, will also supply users in Laos and is expected to increase the country’s household electrification rate.

The project will be constructed by the Nam Ngiep 1 Power Company (NNP1PC), jointly owned by Kansai Electric Power of Japan, EGAT International of Thailand, and the Government of Laos. Kansai is the second largest power utility in Japan, while EGAT International is an international arm of Electricity Generating Authority of Thailand, the buyer of the electricity.

The project will be constructed on the Nam Ngiep River in the provinces of Xaysomboun and Bolikhamxay. It consists of a main power station, a reservoir of 67 km2, a re-regulation power station, and a 125 km transmission line to connect the main power station to the Nabong substation near the capital Vientiane.

The financing comprises a US$ 50 million direct loan, a THB 3.04 billion (US$ 95 million) baht-denominated loan, separately funded B loan US$ 72 million. The B loan is funded by The Bank of Tokyo-Mitsubishi, Sumitomo Mitsui Banking Corporation and Mizuho Bank, with ADB acting as lender of record. The project will also be financed by Japan Bank for International Cooperation and four Thai banks.

According to the ADB, Laos has a hydropower potential of 20 GW from its river networks, and is strategically located to become the “battery” of the Greater Mekong region.