ADB approves $175m loan to expand power access in Ctg Hill Tracts

The Asian Development Bank (ADB) has approved a $175 million concessional loan to expand reliable and affordable electricity access in Bangladesh's Chittagong Hill Tracts, with the project expected to benefit at least 88,000 additional households.

The Sustainable Energy Development and Community Empowerment in the Chittagong Hill Tracts Project will modernise power distribution networks across 26 remote upazilas in Khagrachari, Rangamati and Bandarban.

Of the households expected to benefit, around 35,000 are from small ethnic communities, according to a ADB press release.

The project will construct six 33/11 kilovolt substations, adding 80 megavolt-amperes of capacity, and build 5,032 kilometres of distribution lines using low-loss conductors.

It will also upgrade 1,874 kilometres of ageing distribution lines, four substations, a switching station and a zonal repair workshop.

The improvements are expected to reduce system losses and operating costs, improve grid efficiency and strengthen the power system's resilience to disasters.

The project is also expected to avoid at least 19,300 tonnes of carbon dioxide equivalent emissions annually.

"Reliable electricity is a powerful driver of jobs, enterprise, education, health care, and community resilience," said ADB Country Director for Bangladesh Qingfeng Zhang.

The CHT is home to around 1.84 million people, more than half of whom belong to small ethnic communities.

While Bangladesh's national electrification rate has reached 99%, grid access remains much lower in the three hill districts, at 49% in Khagrachari, 43% in Rangamati and 41% in Bandarban.

The project is expected to raise grid access in the region to 68% by 2032 and prepare the network for future renewable energy use, including solar and pico-hydropower.

Beyond power infrastructure, the project will establish at least 30 solar-powered drinking water facilities and provide solar backup systems to at least 20 facilities serving small ethnic communities, including schools, hospitals, temples and clinics.

It will also provide livelihood training to at least 1,000 people, business incubation support to more than 200 entrepreneurs and energy-sector career orientation to 300 students.

The project will receive an additional $2.72 million grant from the Japan Fund for Prosperous and Resilient Asia and the Pacific, financed by the Japanese government through ADB.

The government of Bangladesh will contribute $36.54 million, while the Bangladesh Power Development Board (BPDB), the project's executing and implementing agency, will provide $45.65 million.