World Bank (WB) yesterday approved an additional US$177m financing to increase reliable, low-cost electricity supply in Bangladesh.
The additional financing will enable the completion of construction of a 335 megawatt (mw) combined cycle power plant at Siddhirganj, near Dhaka, said the bank in a statement issued yesterday.
The combined cycle technology allows the plant to produce higher energy with lower gas consumption.
This cleaner technology reduces carbon emission while ensuring higher thermal efficiency. The plant will deliver at least 2.49bn kwh annually, which accounts for 6% of the total electricity delivered to the national grid.
“Despite increased power generation capacity, Bangladesh still faces significant outages during the peak demand hours. Inadequate power supply is affecting families, undermining competitiveness and hindering growth,” said Martin Rama, acting World Bank country director for Bangladesh.
“This additional financing will add new power generation capacity for Bangladesh and increase efficient use of its scarce domestic gas supplies.”
In 2008, the bank provided $350m to construct a 300 mw gas turbine power plant in Siddhirganj. In the face of increasing power demand and gas shortages, the government had decided to convert the peaking power plant to an energy-efficient 335mw combined cycle power plant.
The additional financing will fill the financing gap for constructing the power plant. The plant is expected to start commercial operation in 2016.
The credit is from the International Development Association, the WB’s concessional lending arm. The terms are based on 38 years maturity with a 6-year grace period and a service charge of 0.75%.