World Bank allocates \$100 million loan to modernize Uzbekistan's energy infrastructure

The World Bank’s Board of Executive Directors has approved a concessional loan of \$100 million for Uzbekistan. The announcement was made in a press release published on the World Bank’s official website.

According to the report, the funds will be directed toward a program aimed at integrating renewable energy sources into the national electricity distribution network and enhancing the reliability of power supply in key regions.

To support the implementation of the program, the Regional Electric Networks Joint Stock Company will contribute an additional \$50 million from its own resources.

Notably, this marks the first time the World Bank is applying its "Program-for-Results" financing mechanism in Uzbekistan. This tool is typically used to support the World Bank’s most strategic national programs.

Despite ongoing reforms, the country’s electricity sector remains financially unviable due to outstanding service debts and other commercial losses, which continue to burden the state budget. In response, Territorial Electric Networks JSC is undertaking a series of financial and operational reforms.

Tatyana Proskuryakova, the World Bank’s Regional Director for Central Asia, emphasized the significance of the project for Uzbekistan’s development.

“Our financial assistance will contribute to the state program for the modernization and expansion of Uzbekistan’s distribution infrastructure through 2030. A total of \$3 billion in investment will be required under this program. We hope other international partners and private investors will follow our lead,” said Proskuryakova.

Over the next five years, the program aims to carry out the following key projects:

- Construction and modernization of 6,000 kilometers of low-voltage power transmission lines;
- Installation and upgrade of 1,200 transformers with a total capacity of 250 MVA;
- Deployment of 150,000 smart meters to help reduce commercial losses;
- Installation of 4,000 data collection devices to support digitization and automation of the power grid.

It is worth recalling that earlier, the World Bank approved an \$800 million concessional loan package to support Uzbekistan’s broader reform agenda.