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Dhaka Tribune

AFD finances project on electricity grid digitization in Bangladesh

AFD's loan aims to equip existing infrastructure with these new, innovative and reliable technologies in order to ensure services are prepared for the future

Update : 11 Dec 2020, 10:19 AM

The French Development Agency (AFD) has agreed to provide a 100 million euro loan to the Bangladesh government to reinforce its role as an active participant in the search for and use of advanced digital solutions in power and energy sector in Bangladesh.  

This support comes via AFD's concessional sovereign loan and will go towards financing a project titled "Construction and Augmentation of Substation and Installation of the Capacitor Bank in Power System under DPDC."

The credit facility agreement from the AFD worth 100 million euro was signed recently, said the Embassy of France in a press release on Thursday.   

Finance Ministry's Economic Relations Division Secretary Fatima Yasmin and AFD Country Director for Bangladesh Benoit Chassatte signed the deal with Jean-Marin Schuh, ambassador of France to Bangladesh, as co-signatory.  


Also Read - EU grants 113m euros in Covid-19 aid for Bangladeshi garment workers


In addition to that a Grant Facility Agreement for a delegated grant from the EU-AIF worth 12 million euro would be signed in the beginning of 2021.

AFD's loan aims to equip existing infrastructure with these new, innovative and reliable technologies in order to ensure services are prepared for the future.

"Moreover, by integrating digital technology in our projects, we speed up the adoption of renewable energies and thus contribute towards achieving the country’s Sustainable Development Goals (SDGs)," the press statement said.

The additional 12 million euro grant will support for piloting the smart grid project in five substations in Dhaka. The smart grid gives shape to this transformation, by making the grid more effective and efficient.

A total of 1,141,000 people will benefit from a significant improvement in the quality of electricity service through the project and it helps fight climate change by preventing an accumulated 104,000 tons of CO2 emissions per year, it added.

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