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Power Sector

World Bank to lend Bangladesh $500m

  • Staff Correspondent
  • 23 December, 2021 12:00 AM
  • Print news

World Bank has approved $500 million credit for Bangladesh to help the country expand and modernise its electricity distribution system.

The Electricity Distribution Modernisation Programme will deliver improved electricity services to about 40 million people in Dhaka and Mymensingh Division.

It will upgrade and construct more than 31,000 km of distribution lines, 157 distribution substations, and related infrastructure.

It will also incorporate measures to increase climate resilience of network infrastructure in 25 Palli Bidyut Samities (rural electricity cooperatives) under the Bangladesh Rural Electrification Board.

The investment in power network will be paired with new and advanced technologies to help moderniseand transform the country’s power system.

The Word Bank approved the loan at its headquarters in Washington DC on Tuesday local time, said its Dhaka office in a statement. 

“In the last decade, Bangladesh achieved a more than fourfold increase in electricity generation capacity and delivered electricity connections to more than 99 percent of its population, But the electricity distribution network could not keep pace with the remarkable increase in electricity generation,” said World Bank’s acting country director Dandan Chen.

“This programme will help modernise and ensure climate resilience of the distribution network, which is the backbone of a secure and reliable power system,” he added.

The programme will introduce a modern grid system that can support the two-way flow of electricity and information, minimising and recovering quickly from climate and cyber risks, including natural disasters and extreme weather events.

It will introduce state-of-the-art technologies such as Supervisory Control and Data Acquisition System and install Advanced Metering Infrastructure.

It will support the decarbonisation of the power sector by facilitating the integration of renewable energy and Battery Energy Storage Systems in the electricity distribution network.

All these will lead to a sustainable transformation of the electricity system.

“Since 2009, Bangladesh Rural Electrification Board (BREB) has implemented one of the largest rural electrification programmes in the world, delivering access to more than 90 million people,” said Bipul Singh, World Bank’s senior energy specialist and Task Team Leader of the programme.

“With the access agenda nearing completion, this programme will strengthen BREB’s ability to deliver reliable electricity supply and support the energy transition in Bangladesh,” he said.

The credit is from the World Bank’s International Development Association (IDA), which provides concessional financing, has a 30-year term, including a five-year grace period.

In addition, the programme also includes a $15 million grant from the Clean Technology Fund (CTF).

Including the programme, the multilateral lender has over $1.8 billion ongoing support in Bangladesh’s energy sector, covering generation, transmission, and distribution of power, including from renewable energy sources.

Since 1981, the World Bank has partnered with the BREB to support the government’s electrification and access programmes.

Bangladesh currently has the largest ongoing IDA programme totaling over $14 billion in support.