PSRC allows high voltage electric networks to attract two loans worth 85.2 million euros and another loan worth $23.4 million

YEREVAN, May 6. / ARKA /. Armenia’s Public Services Regulatory Commission (PSRC) has allowed today the High Voltage Electric Networks company to attract two loans worth 85.2 million euros and another loan worth $23.4 million.

Abgar Budaghyan, head of a PSRC unit in charge of licensed activities and investment programs, said the 82 million euro loans to be provided by German government-owned KfW bank will be used to finance the construction of the Caucasian Power Lines.

The first KfW loan worth 75 million euros repayable in 15 years is with a five-year grace period and 1.85% interest rate, while the second loan worth 10.2 million euros is repayable in 40 years with a 10 year grace. The interest rate is 0.75% per annum.

This program will be implemented in three phases -the first was launched in 2014 and will end in 2018, the second phase will end in 2021 and the third in 2026. In the first phase Armenian and Georgian energy systems will be united through a high-voltage direct current (HVDC) line to be built in Armenian Ayrum on the border with Georgia. The new substation and the transmission line will enable Armenian and Georgian power grids to work in the same mode and make electricity swaps. The total cost of the first phase of the project is 105.2 million euros. 

Under the second agreement the High Voltage Electric Networks company will get a $23.4 million loan from the Asian Development Bank for reconstruction of electricity networks. This loan is repayable in 25 years with a 5-year grace period and 2% interest rate. This project will help reduce losses in the transmission lines, increase the capacity of substations and improve the quality and reliability of power supply in urban and rural communities.

Budaghyan said the loans are expected to affect the current electricity prices. On August 1, 2014, prices for electricity in Armenia were raised from 38 drams to 41.85 drams per one KWh for daytime consumption and from 28 drams to 31.85 drams for nighttime consumption. - ($1 – 474.95 drams).  -0-