ADB signs $200 million results-based loan for Uzbek power distribution
The $371 million programme, co-financed by the World Bank, ties disbursement to seven indicators including board oversight at the national grid company.
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The Asian Development Bank has signed a $200 million results-based loan agreement with Uzbekistan to modernise the country's electricity distribution system, the bank said on 15 October.
The ADB release calls the loan ADB's first energy operation under the ADB and World Bank Full Mutual Reliance Framework and the first results-based lending operation in Uzbekistan's energy sector. Under the framework, the two lenders can rely on each other's due diligence and implementation arrangements. ADB is the lead lender, and World Bank management is expected to seek board approval later in October for an additional $100 million, the release said. ADB President Masato Kanda signed the agreement in Bangkok with Jamshid Kuchkarov, Uzbekistan's deputy prime minister and minister of economy and finance.
How the money is released
The ADB project page describes a $371 million results-based programme, of which ADB's share is a $200 million loan from ordinary capital resources, alongside $650,000 of technical assistance. On those figures, the two development banks would provide $300 million of the total; the documents reviewed do not itemise the rest.
In a results-based loan, disbursements are linked to verified results. The programme has seven disbursement-linked indicators, the project page says, with allocations calibrated to the importance of each indicator and partial disbursement arrangements to be set in verification protocols. Outcomes will be measured through lower technical losses in renovated substations, a lower share of overloaded transformers, reduced carbon emissions and the renewable capacity the programme indirectly enables.
The physical work covers 60 critical distribution substations, which will be rehabilitated and fitted with digital systems for network management, the ADB said. The bank expects the investments to help enable at least 3.3 gigawatts of renewable capacity and cut greenhouse gas emissions by nearly 23,000 tonnes of carbon dioxide equivalent a year.
Governance conditions at the grid company
The second half of the programme is institutional. JSC National Electric Grid of Uzbekistan will be the executing and implementing agency, and the programme is designed to strengthen its corporate governance, board oversight, risk management, creditworthiness, fiduciary systems, safeguards, digitalisation and cybersecurity, the project page says. The ministries of economy and finance, of investment, industry and trade, and of energy will provide general coordination and help address implementation bottlenecks.
"A reliable power supply is one of the most basic promises a modern economy must keep to its people," Kanda said in the release. "This agreement will help Uzbekistan keep that promise as demand rises, with stronger networks that serve families, businesses, and public institutions and can carry more renewable energy."
Demand is outrunning the network
The project documents set out the pressure on the system. Electricity demand reached 86.7 terawatt-hours in 2025, growing at an average of 5 per cent a year, and peak load rose from 10.4 gigawatts in 2019 to 13.3 gigawatts in 2025, straining thermal plants used for balancing and causing nationwide power restrictions, the ADB project page shows. Uzbekistan is targeting 25 gigawatts of renewable energy by 2030.
The same document says the economy has grown by about 6 per cent a year on average since 2017 and that the population was 37.2 million in 2024. It describes reforms since 2019 to liberalise the power market and promote private investment, including laws on renewable energy and public-private partnerships, which it says created the basis for major investment in renewable generation. Distribution has lagged: the release cites ageing infrastructure, electricity losses and overloaded equipment as obstacles to reliable service and to connecting more renewable power.
The programme adds to more than $3.4 billion of ADB financing and guarantees for Uzbekistan's energy sector since 2010, the bank said. The project page lists the programme's status as proposed. The release does not give the loan's tenor or pricing, or the date by which the World Bank's $100 million is expected to be approved by its board.