Azerbaijan, Baku, Dec. 4 / Trend V. Zhavoronkova /
The Kyrgyz parliament has ratified the agreement on financing the project 'Rehabilitation of the energy sector' signed between the Kyrgyz Republic and the Asian Development Bank in Bishkek on September 12, the Parliament said on Monday.
According to the Kyrgyz Ministry of Energy and Industry, taking into account the importance of the Toktogul hydroelectric power station for the Kyrgyz energy system in ensuring energy security for the Republic, providing the country's population with electric power, exporting electric power to neighbouring countries to purchase fuel for power stations in Bishkek and Osh, its reconstruction has been given the highest priority and will extend the use of the Toktogul hydroelectric power station by 30 to 40 years.
The purpose of the agreement is to rehabilitate the Toktogul hydroelectric power station and replace existing electrical and mechanical equipment with new parts. Around $40 million is planned to be spent on this project.
There has also been a directive to establish the Kyrgyz Energy Calculation Centre which will manage the distribution of financial flows in the sector transparently enabling those companies in this area to make prudent financial planning and budgeting. Around $3 million will be allocated from the budget.
According to the agreement, it is also planned to examine the condition and safety of the Naryn cascade dams of the hydroelectric power station by ensuring the necessary response measures and allocating $2 million for this work.
The agreement also aims to create a public information programme to raise public awareness about the development of the energy sector and the benefits of the reforms using a budget of $400,000.
The Asian Development Bank has approved the budget on this project to the sum of $55 million, with a credit hitting $15 million and a grant portion $40 million.
The total funding for the project will reach $62 million. Around $55 million, that is 89 per cent, will be provided by ADB and $7 million which is the remaining 11 per cent as a co-financing (in the form of exemption or paying taxes and fees) will be provided by the Kyrgyz Republic.
The credit part will be provided by the Asian Development Bank to the Kyrgyz government for a period of 32 years including a grace period of eight years with an annual interest rate of one per cent and 1.5 per cent after the grace period expires in 2020. The repayment deadline is Feb.15, 2044.