ADB clears $451-m loan for power connectivity in Chennai-Kanyakumari Industrial Corridor

Our Bureau Chennai | Updated on November 04, 2019

Asian Development Bank (ADB) has approved a $451-million loan to strengthen power connectivity between the southern and northern parts of the Chennai–Kanyakumari Industrial Corridor (CKIC) in Tamil Nadu.

The ADB project will allow more power, including renewable energy, to be transferred from new generation facilities in the south CKIC to the north, where it is most in demand,” said ADB Principal Energy Specialist for South Asia Pradeep Perera. “This will help promote economic development by delivering a more reliable and competitive power supply for industry and services in the State, which will in turn spur jobs and improve livelihoods,” he said in press release.

The State is aiming to develop the northern Chennai–Tiruchirappalli area of CKIC as a manufacturing centre while targeting the relatively less developed southern Madurai–Thoothukudi portion for the development of renewable energy-based power generation because of the availability of wind and solar resources.

With 100 per cent electrification of households in the State, it is expected that industry and commercial enterprises will account for future growth in power demand. Installed generation capacity in March 2019 amounted to more than 30,000 MW. It is expected that with peak demand for electricity in Tamil Nadu rising, a capacity of 50,000 MW will be needed by 2025. The districts in southern CKIC are expected to contribute 9,000 MW of extra generation capacity during fiscal years 2019–2015 to help meet this demand, including 6,000 MW of renewable energy capacity, the release said.

The project will establish an extra-high voltage 765 kV transmission link to transfer the 9,000 MW of extra capacity from Virudhunagar in the southern CKIC northwards to Coimbatore and Chennai. The project includes construction of a 400-kV network to pool power generated at renewable and thermal power plants in Thoothukudi district to Virudhunagar.

It will also build the operational capacity of TANTRANSCO, the State-owned company responsible for transmission. This includes supporting a financial restructuring plan, better facilities and work environment for women workers, and improving its monitoring capacity for social and environmental impacts of power transmission projects. To help finance this capacity building, ADB has approved a complementary technical assistance grant of $650,000. The grant comes from ADB’s Technical Assistance Special Fund.

The total cost of the project is $653.5 million, of which the government will provide $202.5 million. The estimated completion date is the end of 2024, the release said.

Published on November 04, 2019

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