Disbursement of WB-funded Rural Energy Project in Vietnam Remains Slow

The disbursement of capital for Vietnam’s Second Rural Energy Project (SREP), which received roughly $220 million from the World Bank (WB), has been slow despite the closing date falling on June 30, 2014. Kicked off in 2004, the project costing total $324.3 million includes five components such as upgrading or expanding the low-voltage (LV) system in 1,200 communes; rehabilitating the operation of the medium-voltage (MV) systems; supporting the development of power companies; and improving authorities’ capacity in planning of rural electrification in 1,966 commune in 25 cities and provinces nationwide.Three power corporations namely the Northern Power Corporation (NPC), Central Power Corporation (CPC) and Southern Power Corp. (SPC) under the Vietnam Electricity Group (EVN), the country’s sole power distributor, have conducted the project.During the past years, the NPC disbursed only 40% of the total investment of VND2.54 trillion ($121.6 million) by upgrading and building MV lines and transformer stations in 1,057 communes of 16 cities and provinces.Meanwhile, the CPC disbursed 74% of total VND53 billion after it built and upgraded MV lines and transformer stations in 36 communes in Quang Binh and Binh Dinh provinces.Only the SPC fulfilled the task of disbursing total VND84 billion by building MV systems and upgrading transformer stations in seven communes in the southern province of Ca Mau.The SREP aims to improve access by rural inhabitants to good quality and affordable electricity services, so as to support Vietnam’s efforts towards socio-economic development. (Kinh Te Viet Nam & The Gioi Nov –Vietnam & World Economy  20 p8, www.worldbank.org)