World Bank approves $100 million loan for Uzbekistan to upgrade power grids

The "Electricity Distribution Modernization" program will be implemented by the National Electric Grid of Uzbekistan. The funds will be used to upgrade and digitalize 60 key substations across various parts of the country to reduce electricity losses and improve the reliability of supply. Part of the funding will go toward institutional strengthening of the company itself: financial management, cybersecurity, compliance with environmental and social standards, and gender equality in employment.

According to the bank's estimates, by 2031, losses at the modernized substations should decrease by 20,000 MWh per year, and at least 3.3 GW of renewable energy capacity can be connected to the grid. The program is also expected to prevent greenhouse gas emissions equivalent to nearly 23,000 tons of carbon dioxide annually. About 11,700 additional jobs are expected to be created within five years of the facilities entering service.

The World Bank is co-financing the program with the Asian Development Bank under a Full Mutual Reliance Framework (FMRF), with both institutions preparing it and monitoring implementation using a unified approach. The ADB approved a $200 million loan on September 30, and another $71 million will be allocated by the government from the state budget. In total, $371 million is allocated for the program.

The bank's statement notes that Uzbekistan aims to bring renewable energy capacity to 25 GW by 2030, while a significant portion of the distribution networks was built decades ago. "By teaming up with the ADB, we're not just helping Uzbekistan upgrade the backbone of its power grid — we're doing it more efficiently," said World Bank Country Director for Central Asia Naji Benhassine.