Announcement of East China's Power Capacity to be Expanded on May 19, 1993

FOR IMMEDIATE RELEASE World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. *Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 93/94 EAP Contact: P.B. Sison (202) 458-0344 EAST CHINA'S POWER CAPACITY TO BE EXPANDED WASHINGTON, May 19, 1993--A World_Bank loan of $300 million, approved yesterday, will support construction of the largest pumped-storage hydroelectric plant in China. The project is located about 57 kilometers from Hangzhou, the capital city of Zhejiang province. It is designed to increase peak-power generation capability and improve the quality of the power supply in the East China power grid. The hydroelectric plant will have an installed capacity of 1,800 megawatts (MW), and will be built with upper and lower reservoirs, a water conveyance system, an underground powerhouse and a switchyard. Six 300-MW reversible pump-turbine units and associated equipment will be installed. In addition, about 250 kilometers of 500 kilovolt (kV) transmission lines will be built. The existing transmission network will be reinforced. Improving the quality of the power supply and enhancing socioeconomic conditions in the densely populated East China region are expected to advance economic reform, as well as promote private investment and private sector development. Besides contributing to an improved power utility regulatory framework, the project will also support institutional strengthening of the East China Electric Power United Corporation (ECEPUC), the loan beneficiary, through an advanced management and staff training program. ECEPUC is responsible for coordinating development and operation of the East China power system, and will implement the project. The pumped storage project will have most of its structures located underground; structures above ground comprise only the upper reservoir and the lower reservoir, which are relatively small in area. The project does not involve resettlement of people. The living standards of the local population are expected to improve by provision of better roads, communications, water and power supply, as well as job opportunities. Several small and old coal-fired power plants, now in use for peaking power purposes, will be retired after the project is commissioned. The total cost of the project is estimated at $547.3 million. This is the first time that more than one province will be involved in financing and implementing a power project in China. Provincial power companies in zhejiang, Jiangsu, and Anhui, as well as the Shanghai municipal power company and the State Energy Investment Corporation (SEIC) will contribute to project costs. The Bank loan is for a term of 20 years, including five years of grace, and is at the Bank's standard variable interest rate, currently 7.43 percent. NOTE: Money figures are expressed in U.S. dollar equivalent.