Bangladesh signed a $217 million deal with the World Bank on Thursday to help increase the country’s electric power generation.
The financing from the World Bank’s International Development Association (IDA) will transform a gas-fired steam unit that is currently generating 170 megawatts (MW) into an energy efficient 409 MW plant, the World Bank said in a statement.
The project will also reduce the specific fuel consumption per gigawatt hour by 44 percent and lower greenhouse gas emissions, it added.
“Bangladesh can grow its economy much faster and reduce poverty significantly if its energy infrastructure can meet the demand for reliable, low-cost electricity,” said Rajashree Paralkar, World Bank Acting Country Director for Bangladesh, in the statement.
The credit from IDA has a 38-year term, including a six-year grace period, and a service charge of 0.75 percent.
With this new credit, the World Bank’s total support to the country’s power sector has passed $1.7 billion.
A shortfall in natural gas supplies has forced the South Asian country of 160 million to turn to costly oil-fired power plants.
“The government has prioritised improving the efficiency of gas-based power plants, given the shortages in natural gas production,” said Kazi Shofiqul Azam, additional secretary of the Economic Relations Division of the Bangladesh government.