French Development Agency to provide Tk1.24b grant for power sector

The French Development Agency (AFD) recently signed an agreement with the Government of Bangladesh to develop the power and energy sector of the country.

Under the agreement, the AFD will provide a grant of €12 million (Tk1.24 billion) to Bangladesh to facilitate advanced digital solutions in the power and energy sector, says a press release.

This agreement is part of a larger multi donor project involving the joint commitment of AFD and the European Union (EU), for a total investment of €112 million.

The project, 'Power Factor Improvement and Smart Grid under Dhaka Power Development Company (DPDC),' is the first ever smart grid project in Bangladesh, and will be implemented over the next five years.

With this project, 11,41,000 people will benefit from a significant improvement in the quality of electricity service. It will also prevent some 104,000 tons of CO2 emissions every year, thereby contributing to Bangladesh's climate goals.

The project will provide advanced digital solutions to distribution stations and medium voltage grids. Improved grid performance will consequently eliminate the pollution caused by diesel generators used as back up during grid outages.

The project is expected to facilitate Bangladesh's overall economic development as the core aspect of the country's economic development strategy is an improved performance of the power sector in terms of generation, transmission, and distribution.

EU Ambassador Rensje Teerink said "the European Union is committed to supporting Bangladesh in adopting advanced digital solutions in power distribution. This project is also relevant for the Team Europe Initiative on Green Energy Transition, which involves the EU, its member states, and like-minded partners. It aims to support Bangladesh in its transformative, low carbon development, through an increased use of renewable energy and energy efficiency enhancement."

Benoit Chassatte, AFD country director said, "For AFD in Bangladesh, 2020 was an opportunity to amplify existing commitments to modernise Dhaka's power grid. This is the first ever initiative in Bangladesh to equip the existing grid with reliable, cutting-edge new technology, allowing DPDC to optimise energy distribution without making an unnecessary additional heavy network capital investment."