The government has inked $205 million loan agreements with the Asian Development Bank (ADB) for increasing its access to reliable supply of electricity and improving efficiency and capacity of power systems in Bangladesh.
Senior Secretary of the Economic Relations Division (ERD) Mohammad Mejbahuddin and Country Director of ADB’s Resident Mission Kazuhiko Higuchi signed the agreements on behalf of their respective sides, at a ceremony at ERD in the capital on Tuesday.
The amount is the third tranche of the $700 million Power System Expansion and Efficiency Improvement Investment Program (PSEEIIP) approved by ADB in 2012, according to the ADB release.
ADB assistance under third tranche of the PSEEIIP will help replace aging steam and gas turbine power plants with more efficient 400MW gas-fired combined cycle power plant at Ashuganj Power Station complex.
It will also upgrade and construct 72 kilometers of transmission lines, and four substations. Existing analog billing meters will be replaced by 700,000 pre-payment meters in Dhaka Division.
“The project will generate 400MW of electricity, using the same amount of energy that previously produced 220MW, achieving more than 80% efficiency increase in energy use,” said Kazuhiko Higuchi.
“In addition to bringing more stable and reliable electricity supply to the users, the project also aims for higher operational and financial efficiency in the distribution utilities by bringing in prepaid meters in an operational scale,” the country director added.
The Islamic Development Bank is co-financing the third tranche of the overall program.