ADB may lend $140m to KL, RI

ADB may lend $140m to KL, RI

Grace Nirang, Bloomberg/Jakarta

The Asian Development Bank may lend US$140 million to Malaysia
and Indonesia for the construction of electricity transmission
grids linking the two countries, said an official of Indonesian
state utility PT Perusahaan Listrik Negara.

The Manila-based bank wants to fund electricity grids linking
Indonesia's Sumatra island with Peninsular Malaysia, and
Indonesia's West Kalimantan province with Malaysia's Sarawak
state, said Eddie Widiono, Perusahaan Listrik's president
director. The loan agreement may be signed next month, he said.

"The Sumatra-Peninsular Malaysia grid will cost about $100
million, while the Kalimantan-Sarawak one needs about $40
million," Eddie told reporters in Gandul, a district south of
Indonesia's capital Jakarta.

The two grids are part of a plan by Southeast Asian nations to
link 14 electricity transmission grids in the region to reduce
the need to build more power plants. The lines will allow the
countries to tap power from each other as they have different
periods of peak demand.

So far, only two of the 14 proposed transmission links have
been built, linking Peninsular Malaysia with Singapore and
Malaysia with Thailand.

Southeast Asian nations would save $2.5 billion from 2008 to
2020 by building the grid as it would allow sharing of power
instead of building new plants, Eddie said.