During the credit extension period, the project will use the undisbursed balance of SDR 24.2 million and approximately SDR 1.7 million in the designated account from the IDA credit.
The government has asked the World Bank to extend the credit closing date for the Tarbela Fourth Hydropower Project for the fifth time. This is the fifth extension of the IDA Credit, which originally had a December 31, 2018 closing date and now has a December 31, 2022 closing date.
It is intended to allow the Water and Power Development Authority (WAPDA) to finance remaining payments on ongoing contracts, complete activities to support the project’s long-term operation, and address corrective measures for issues identified at the intake of the project’s power tunnels.
According to official documents, the restructuring for the extension of the IDA credit to June 30, 2023, is in response to the request received from WAPDA, via the Ministry of Economic Affairs on December 13, 2022.
During the credit extension period, the project will use the undisbursed balance of SDR 24.2 million and approximately SDR 1.7 million in the designated account from the IDA credit. Payments to civil works contractors, E&M contractors, and construction supervision consultants are expected to total around $30 million.
The remaining funds will be used for: installing instruments to monitor Tarbela Dam, flow and sedimentation in Tarbela Reservoir, survey equipment, and laboratory upgrades; activities to strengthen WAPDA’s capacity, such as information technology systems and equipment, as well as training; and environmental and social activities.
A parent project entailed the construction of a 1,410 megawatt (MW) power plant, T4HP, on Tunnel 4 of the Tarbela Dam, as well as a dam safety and monitoring program, a social action plan, an environmental management plan, project and construction management and supervision, and an evaluation of project impacts.
This is funded by $400 million in IBRD financing (IBRD-81440), which has been fully disbursed and closed, as well as SDR 283.7 million in IDA credit, which was approved by the World Bank on March 20, 2012. Technical assistance, training, and strategic project preparation are also funded by the IBRD Loan (81140) and the IDA Credit. SDR 81.9 million were cancelled from IDA Credit on July 12, 2016, and SDR 22.86 million were cancelled as of July 4, 2022, due to savings in the key contracts. The current closing date of the IDA credit is December 31, 2022.
On September 20, 2016, the World Bank approved an additional $390 million in IBRD Loan-86460 for the development of another 1,530 MW power plant on Tunnel 5 of Tarbela Dam, known as the Tarbela Fifth Extension Hydropower Project (T5HP). T5HP received US$ 300 million in co-financing from the Asian Infrastructure Investment Bank on September 27, 2016.
IBRD Loan: funds a 500 kV transmission line from T5HP to Islamabad West Substation, as well as social and environmental management plans, project and construction management and supervision, and project impact evaluation; technical assistance; future project preparation, and a pilot project with a floating solar plant in Tarbela Reservoir. The IBRD Loan 86460 Closing Date has been Extended to May 31, 2024, and the AIIB Loan Closing Date has been Extended to June 30, 2025.
According to the documents, the project’s progress toward meeting the Project Development Objective (PDO) and overall implementation progress is satisfactory.
T4HP was installed in 2018 and has since produced over 18,200 Giga Watt-hours (GWh) of renewable energy. The T4HP generation began on time.T4HP generates low-cost electricity from renewable hydropower, and its economic benefit has already surpassed US$ 2.3 billion.
T5HP funded from the Additional Financing is under implementation and progressing well. T5HP will be commissioned in 2025 with an installed capacity of 1530 MW. Key contractors for civil works and electro-mechanical (E&M) works have been mobilized.
The contract for the 500kV transmission line from Tarbela to Islamabad West grid station is effective. The contractor has been mobilized and must commission the transmission line by November 2024. National Transmission and Despatch Company (NTDC) issued advance payment to the contractor in October 2022. This work could not be completed by the current closing date of December 31, 2022, as required inspections can only be done by a team of divers.
According to preliminary findings, the trash racks on the raised intakes are partially damaged due to fatigue. Inspection findings are required for final acceptance of intake works, determination of remedial works by contractors (including trash rack replacement), and subsequent final payments to the civil works contractor.