World Bank approves $15M grant to improve Rogun Hydropower Project in Tajikistan

The TA project would also improve the readiness of the Rogun HPP Project to increase the financing required for its completion.

The World Bank’s Board of Executive Directors approved today $15 million in grant financing from the International Development Association for the Technical Assistance for Financing Framework for Rogun Hydropower Project in Tajikistan (TA). This TA aims to support the Government of Tajikistan in improving the financial and commercial frameworks of the Rogun Hydropower Plant (HPP) Project and enhancing its technical, environmental and social sustainability.

The Rogun HPP Project, currently under construction, has the potential to generate significant economic, social, and environmental benefits for Tajikistan and other countries in the Central Asia region if it develops in a financially, environmentally, and socially sustainable manner. Once completed, the Rogun HPP Project will be critical in helping Tajikistan to meet its domestic energy demands, especially during wintertime, and to support neighboring countries through the export of surplus electricity. In addition, as a reliable source of clean and affordable electricity, the Rogun HPP Project can contribute to decarbonization of the Central Asia region.

The IDA grant will finance the hiring of experts on dam safety and environmental and social (E&S) frameworks to help with necessary improvements that will bring the project in line with current hydropower industry requirements and align with the World Bank’s Environmental and Social Framework. The TA project will also be instrumental in increasing Rogun HPP Project benefits to a larger number of people through a benefit-sharing mechanism whereby a portion of the project’s revenues would be channeled to various socio-economic programs and initiatives.

“Our technical support aims to improve the Rogun project’s development impact through greater sharing of the project’s revenues to benefit the people of Tajikistan, improvement of the project’s environmental and social performance, and expansion of clean electricity,” said Tatiana Proskuryakova, World Bank Country Director for Central Asia.“This support builds on our current investments in Tajikistan’s energy sector, which focus on improving electricity supply reliability for people and the economy, strengthening the governance of the sector, promoting financial sustainability, and increasing its transparency.”

The TA project would also improve the readiness of the Rogun HPP Project to increase the financing required for its completion. In particular, it would help to update the financing plan to ensure that annual spending on the project does not create macro-fiscal risks for the country and that the HPP has a reliable commercial framework for sale of electricity to domestic consumers and for exports.

The World Bank’s Board of Executive Directors also approved today $50 million in grant financing for a Development Policy Operation (DPO) to promote structural reforms to accelerate sustainable economic growth and mitigate economic vulnerabilities. The reforms supported by the DPO will also help improve the overall macroeconomic environment for the development of the Rogun HPP.

Currently, the World Bank is financing 22 projects in Tajikistan totaling $1.47 billion. Since 1996, the World Bank has provided over $2.65 billion in IDA grants, highly concessional credits, and trust funds for Tajikistan. The World Bank is committed to continuing its support as the country strives to improve lives and meet the aspirations of its young and growing population.