The European Bank for Reconstruction and Development (EBRD) announced last week that it is providing a $50 million loan to fund the first phase of the modernization of Tajikistan's Qairokkum hydropower plant.

The 57-year-old plant is the only electricity generating facility in the northern part of the country, supplying energy to more than 500,000 homes, according to an EBRD press release.

The project is expected to cost approximately $76 million, with the EBRD loan supplemented by $21 million in donor funds, including a $10 million loan and an $11 million grant from the Pilot Program for Climate Resilience under the Climate Investment Funds.

The remaining $4.7 million will come from additional donor financing from Austria and the UK as well as the EBRD's Shareholder Special Fund for consultancy services.

"We are very pleased to support the government of Tajikistan with the restructuring and rehabilitation of a key hydro asset," Aida Sitdikova, the EBRD director for energy and natural resources in Russia and Central Asia, said. "The Qairokkum hydropower plant is strategically important as it is the sole power generation facility in Sugd, the second largest industrial region in the country. The upgrade will significantly improve the supply situation, especially in the winter."

Tajikistan faces extreme shortages of electricity during the winter months, with demand exceeding supply by 24 percent.

"The collaboration between our country and the EBRD has been developing strongly over the past few years," Tajik Finance Minister Abdusalom Kurbonov said. EBRD support is very important for our economic development."