NEPCO gets $265-million loan to enhance renewable integration, reform corporate

AMMAN — The European Bank for Reconstruction and Development (EBRD) on Tuesday signed a multiyear $265-million loan agreement with the National Electric Power Company (NEPCO), seeking to enhance the integration of renewable sources into the national power network and advance corporate reforms within the company. 

Signed in the presence of Minister of Finance Ezzeddine Kanakrieh and Planning Minister Mary Kawar, the loan will be used to strengthen the company’s balance sheet by addressing its short-term debt, introducing investments aimed at enhancing the capability of the grid to absorb and manage renewable power.

On the sidelines of the agreement, a memorandum of understanding was also signed between the government and the bank to set an “ambitious programme” of reforms to NEPCO’s governance and operations, EBRD said in a statement, noting that the programme will be supported by grant-funded technical cooperation assignments.

During the signing ceremony, EBRD Director for Power and Energy Harry Boyd-Carpenter highlighted that the agreement is the largest to be signed with Jordan, expressing the bank’s “delight” to have the opportunity to support NEPCO in its central role in delivering energy to Jordanians. 

Deeming the agreement “a reform matrix that promotes good governance and development”, Kanakrieh pointed out that the most important feature of the deal is “the development of a plan of action that includes indicators of performance and measurement”, noting that the agreement comes in the context of the government’s efforts to develop the energy sector.

For her part, Kawar noted that the government’s commitment letter signed in the framework of the agreement “sets a roadmap” for reforming the Kingdom’s energy company. 

Seeking to boost the role of renewable sources in Jordan’s energy mix, the deal comes after the “successful” deployment of the first rounds of renewable energy in Jordan, the bank said in a statement on Tuesday. 

“NEPCO has been at the heart of Jordan’s remarkable renewable revolution, which leads the way in using private capital and skills to unlock the country’s great wind and solar resources,” the statement adding, indicating that “construction of new substations, automated grid management systems and transmission infrastructure will improve the integration of green energy into the national electricity network”.