The World Bank (WB) signed an agreement to fund $330 million for the first Vietnamese hydropower project to be built with their funding in the last decade.
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| Victoria Kwakwa and Nguyen Van Giau at the signing ceremony. |
The agreement was signed by the Governor of the State Bank of Vietnam Nguyen Van Giau and World Bank Country Director for Vietnam Victoria Kwakwa in Hanoi yesterday, Jun 28.
Funding for the Trung Son project had already been approved by the WB Board of Directors on April 26.
The first turbine is scheduled to be operational in November 2016, while the entire project to be online in May 2017.
The 260-MW hydropower project is meant to help meet growing domestic demand for electricity, while at the same time bringing flood and irrigation control to rural communities in the central province of Thanh Hoa, where the plant is located.
This also marks the Bank’s commitment to funding energy generation in Vietnam.
The WB will also provide technical support to Vietnam Electricity (EVN) to improve the efficiency of its hydropower projects and dam safety, as well as adopting international standards for social and environmental practices.
“Trung Son will help improve the balance and security of Vietnam\'s energy sources at a low cost. Furthermore, it will contribute to the long-term environmental goals of the nation, which are aimed at minimising the impacts of climate change. It should reduce CO2 emissions by1 million tonnes per year," said Victoria Kwakwa, World Bank Country Director for Vietnam.
The financing for the project is being provided through the WB’s International Bank for Reconstruction and Development lending window, with 27 years maturity and a 6-year grace period.
Recently, the WB pledged to provide loans and four credits, totalling USD620 million, for development in Vietnam. It also approved a USD350-million loan for a project to increase public investment in the country.
