$500m cheap loans from WB to improve power supply system

The World Bank yesterday announced that it would provide Bangladesh a concessional loan of $500 million to improve electricity services for about 40 million people in Dhaka and Mymensingh divisions.

Coming from the International Development Association for an "Electricity Distribution Modernisation Programme", the credit has a 30-year term, including a five-year grace period, says a press release.

The programme includes a $15 million grant from the Clean Technology Fund, which provides new large-scale financial resources to invest in clean technology projects in developing countries.

The credit will be used to upgrade and construct over 31,000 kilometres of distribution lines, 157 distribution substations and related infrastructure with new and advanced technologies.

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

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 also introduce state-of-the-art technologies such as supervisory control and data acquisition systems and install advanced metering infrastructure.

Moreover, it will support the de-carbonisation of the power sector by facilitating the integration of renewable energy and battery energy storage systems in the electricity distribution network.

"In the last decade, Bangladesh achieved a more than fourfold increase in electricity generation capacity and delivered electricity connections to more than 99 per cent of its population," said Dandan Chen, World Bank's acting country director, in the press release.

"But the electricity distribution network could not keep pace with the remarkable increase in electricity generation," said Chen.

Since 2009, the BREB has implemented one of the largest rural electrification programmes in the world, reaching over 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 the BREB's ability to deliver reliable electricity supply and support the energy transition in Bangladesh," said Singh.