The World Bank will provide Bangladesh $515 million to help 9 million people get access to reliable electric supply while transitioning to clean energy.
The government of Bangladesh and the World Bank signed an agreement in this regard on Wednesday, reads a press release.
The Electricity Distribution Modernisation Programme will support the digitisation and modernisation of 25 rural electric cooperatives or Palli Bidyut Samitis in Dhaka and Mymensingh Division and reduce electricity system losses by over 2%.
The programme will increase Bangladesh Rural Electrification Board's (BREB) delivery of electricity by 6,790 GWh while improving climate resilience of the electricity system.
"The government of Bangladesh has prioritised access to electricity in the last decade and now the entire population have access to electricity. The installed generation capacity increased five-fold to 25 GW in the same period," said Dandan Chen, acting World Bank Country Director for Bangladesh and Bhutan.
"Through this programme, 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," he added.
Through the BREB, the programme will support solar metering connections for over 100 customers, bringing 150 MW of new rooftop solar capacity onto the grid. It will improve and construct 31,000 km of distribution lines and deploy 200,000 advanced meters.
In addition, the program will help strengthen Battery Energy Storage Systems (BESS) and distributed renewable energy through preparation of roadmaps for deployment. This will lead to an annual reduction of carbon emissions by 41,400 metric tons.
"The programme is aligned with the government's Integrated Energy and Power Sector Masterplan, currently under preparation, which will help establish a low carbon energy system," said Fatima Yasmin, secretary of Economic Relations Division.
"Generating clean and reliable electricity can help rural communities to increase productivity and cope with events brought on by climate change," she said.
The agreement was signed by Fatima Yasmin and Dandan Chen on behalf of the government and the World Bank, respectively.
The agreement includes a $15 million grant from the Clean Technology Fund to support BESS. The credit is from the World Bank's International Development Association (IDA), and has a 35-year term, including a five-year grace period.
Bangladesh currently has the largest ongoing IDA programme totaling $14.7 billion. The World Bank was among the first development partners to support Bangladesh and has committed more than $37 billion in grants, interest-free and concessional credits to the country since its Independence.