The Asian Development Bank (ADB) on Wednesday approved a $200 million loan to help the Bangladesh Rural Electrification Board (BREB) modernise electricity distribution networks in 13 Palli Bidyut Samities (PBSs) around Dhaka.
It will help reduce outages, improve efficiency and support rising industrial and household demand, the lender said in a statement.
The Power Distribution Network Enhancement Project will upgrade overloaded substations, ageing distribution infrastructure and electricity networks facing increasing pressure from rapid urbanisation and industrial growth.
The project will add 1,150 megavolt-amperes (MVA) of transformer capacity across 52 substations, expand the capacity of 12 existing substations by 115 MVA and construct or upgrade more than 2,600 kilometres of overhead and underground distribution lines, according to ADB.
The initiative comes as Bangladesh’s electricity demand continues to rise after achieving universal electrification in 2022. ADB said stronger distribution infrastructure is needed to ensure reliable power supply for businesses and households in key growth areas.
“Modern power distribution networks will be essential to sustaining growth, creating more jobs and attracting investment,” ADB Country Director for Bangladesh Qingfeng Zhang said.
The project will also introduce technology-based improvements, including 900 fault locator sets for faster fault detection and service restoration, along with switching stations and river-crossing distribution structures.
ADB said the project would also support climate resilience and reduce power-sector emissions.
Its dedicated resilience financing of $146.52 million will support measures including environment-friendly gas-insulated switchgear technology, which is expected to help cut annual greenhouse gas emissions by around 203,751 tonnes of carbon dioxide equivalent through improved efficiency and reduced technical losses.
The financing package includes $107.95 million from the government of Bangladesh and $141.39 million from BREB.
A further $1 million technical assistance grant from the Republic of Korea’s e-Asia and Knowledge Partnership Fund, administered by ADB, will support institutional development, financial sustainability planning and the adoption of new technologies.
Beyond physical infrastructure, the project will strengthen the capacity of BREB and PBSs through training in digital system integration, cybersecurity, natural hazard resilience, environmental and social safeguards and financial management.
ADB said improving the financial sustainability of PBSs would help encourage greater private-sector participation and investment in the power sector.
The project will also include measures to increase women’s participation in the power sector and improve workplace conditions.
