Bangladesh and World Bank Sign a $515 Million Loan Agreement for Rural Electrification

The agreement seeks to add 150 MW of rooftop solar capacity to the grid


The Bangladesh government and the World Bank have signed a $515 million financing agreement for the country’s Electricity Distribution Modernization Program that will support the digitization and modernization of 25 rural electric cooperatives or Palli Bidyut Samitis in Dhaka and Mymensingh Division.

The financing is aimed at increasing the Bangladesh Rural Electrification Board’s (BREB) delivery of electricity by 6,790 GWh while improving the climate resilience of the electricity system.

The program, aligned with the government’s Integrated Energy and Power Sector Masterplan, will help establish a low-carbon energy system. The objectives are to support solar metering connections for over 100 customers, bring in 150 MW of new rooftop solar capacity onto the grid, construct 31,000 km of distribution lines, and deploy 200,000 advanced meters.

Strengthening Battery Energy Storage Systems (BESS) and distributed renewable energy through the preparation of roadmaps will also be scheduled for deployment under the program.

“Through this program, new and emerging technologies will further strengthen the efficiency and reliability of electric supply in the country to meet the need for faster economic growth,” said Dandan Chen, Acting World Bank Country Director for Bangladesh and Bhutan.

The agreement comes with a 35-year term, including a five-year grace period. Bangladesh has the bank’s largest ongoing International Development Association IDA program totaling $14.7 billion.

Chen said Bangladesh had prioritized access to electricity in the last decade, and now the entire population has access to electricity. The installed generation capacity had increased five-fold to 25 GW in the same period.

Bangladesh had a target to install 2.47 GW of renewable energy projects in 2021, and a large part of the capacity to come from solar and wind energy sources. Rural Power Company, the state-owned rural electrification company, had invited proposals for the feasibility study to develop a 100 MW solar project in Jamalpur. The project was to be implemented under the Indian Line of Credit (LoC-III).

In 2020, the Asian Development Bank invested $17.7 Million in a 35 MW solar project, Bangladesh’s first private sector solar project.


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