The European Bank for Reconstruction and Development (EBRD) and the Asian Development Bank (ADB) will provide a $105mn loan to the Electric Networks of Armenia (ENA) company for the implementation of the second phase of its 10-year investment program. A total of $70 million will be provided by the EBRD and $35 million—by the ADB.
The loans will be used to modernize Armenia's electricity distribution infrastructure, both in the provinces and in major cities. It should be noted that Yerevan and Gyumri are included in the EBRD "Green Cities" program. And in this regard, ENA will solve specific environmental issues within the framework of the Green City Action Plan (GCAP), such as reducing greenhouse gas emissions, integrating renewable energy plants into the energy system. The funding will support Armenia's transition to digital technologies through the large-scale introduction of intelligent automation and accounting systems, increasing the reliability and flexibility of the power grid and significantly improving system performance.
“After the acquisition of the ‘Electric Networks of Armenia’ company by the Tashir Group of Companies, we started the work aimed at the recovery of the Company, including through the implementation of an investment program. And the success we have achieved today is also the result of collaboration, long-term and effective work with the Asian Development Bank and the European Bank for Reconstruction and Development and other international financial institutions. ENA has grown from a loss-making company to a profit-generating company, reducing electricity losses from 13.5% to 6.9%. We have introduced international management standards, opened modern customer service centers. We attach great importance to ecological and social programs, which are among the priorities of our company's development," said Karen Darbinyan, Chairman of the ENA Board of Directors.
Loans provided by international financial institutions will also help ENA mitigate climate change challenges by ensuring the widespread application of management, environmental, social, and technical standards. ENA will focus also on protecting gender rights by promoting gender equality and increasing inclusion in its business activities.
"The multi-stage program for the modernization of energy infrastructure includes several key elements: digitalization of the system, improvement of electricity use, and ensuring the reliability of energy supply. The project is important in the context of the work being done to develop the capacity of clean energy production in Armenia, including solar energy production for domestic consumption," said Dimitri Gvindadze, Head of the EBRD Armenia Office.
"The basis of energy efficiency and security is to invest in building a strong infrastructure. ADB continues to support Armenia in achieving this goal by providing long-term private sector financing that is not always available," said Shantanu Chakraborty, Director of Infrastructure Finance, South Asia, Central Asia, and West Asia, Private Sector Operations at ADB. "The program will finance the second phase of ENA's long-term investment program, which aims to expand access to electricity supply in the regions of Armenia."
The implementation of the investment program of ENA started in 2016. The total cost of the project is about $726 million, and 41 percent of the project has been completed so far.
“The effective implementation of the investment program of ‘Electric Networks of Armenia company—aimed at improving the quality of customer service—is a priority for us. I am glad that we continue to work with the Asian Development Bank, the European Bank for Reconstruction, and Development and other international financial institutions in the second phase of the program. I want to thank our teams for their efficient work. The key to our success, of course, is our teamwork. I am confident that the signing of this agreement will give a new impetus to our cooperation," said the general director of the company, Karen Harutyunyan.