CHISINAU (Moldova), May 9 (SeeNews) – The World Bank said it has approved a $70 million (62.5 million euro) loan to Moldova, to be used to finance a project for increasing the capacity and improving the reliability of the country's power transmission system.
The Power System Development Project will also support Moldova's future power system interconnection with the European electricity grid through Romania, the World Bank said in a press release on Wednesday.
"This will be vital to helping diversify Moldova’s electricity supply sources, allowing for competitively and transparently priced electricity supply," the bank added.
The project will finance the construction of a new 400 kV high-voltage overhead line between Vulcanesti, in southern of Moldova, and the capital Chisinau. It will also finance the upgrading and expansion of the substations in Chisinau and Vulcanesti and will help strengthen the power dispatch and metering system.
"The Word Bank welcomes the launch of this crucially important project that will help the Moldovan authorities to strengthen and diversify the country’s energy infrastructure and guarantee stable and secure energy supply for Moldova," World Bank country manager for Moldova Anna Akhalkatsi said. "The project is part of a greater partnership with the European Union, the European Bank for Reconstruction and Development, and the European Investment Bank, who are financing the construction of a back-to-back converter station at Vulcanesti."
The project will support the interim objectives of Moldova’s 2030 Energy Strategy’s through 2025, namely the consolidation of Moldova’s role as an energy transit country, its access to European electricity markets, and the creation of an institutional framework for a modern and competitive electricity market.
With declining efficiency and capacity to generate, Moldova needs to import 80% of its electricity to meet domestic demand and relies on a limited number of sources, the international lender noted.
Since Moldova joined the World Bank Group in 1992, over $1 billion has been allocated to approximately 60 projects in the country. Currently, the World Bank portfolio includes 10 active projects with a total commitment of $391.3 million.
($=0.8927 euro)