The Asian Development Bank (ADB) has approved a $175 million loan to Bangladesh to modernise and expand the electricity distribution network in the Chattogram Hill Tracts.
The concessional loan will be used to expand the power distribution network across 26 remote upazilas in Khagrachhari, Rangamati and Bandarban, the ADB said in a press release on Tuesday.
Once implemented, the project is expected to bring at least 88,000 more households in the hill districts under electricity coverage, including 35,000 households from ethnic minority communities. Alongside expanding electricity access, the project will support initiatives aimed at creating jobs, promoting entrepreneurship, and improving education and healthcare.
Under the Sustainable Energy Development and Community Empowerment in the Chattogram Hill Tracts project, six 33/11-kilovolt substations will be constructed, increasing power distribution capacity by 80 megavolt-amperes (MVA). In addition, 5,032 kilometres of new distribution lines will be installed using low-loss conductors.
Another 1,874 kilometres of old and deteriorated distribution lines will be rehabilitated. Four substations, one switching station and one zonal maintenance centre will also be modernised.
According to the ADB, the infrastructure upgrades will improve the efficiency of the electricity distribution system, while reducing system losses and operating costs and strengthening the resilience of power supply during disasters. The project aims to reduce annual emissions by at least 19,300 tonnes of carbon dioxide equivalent.
Although Bangladesh’s overall electricity access rate has reached 99%, access to grid electricity remains relatively low in the Chattogram Hill Tracts. According to ADB data, 49% of people in Khagrachhari have access to grid electricity, compared with 43% in Rangamati and 41% in Bandarban.
The ADB expects the project to increase grid electricity access in the hill tracts to 68% by 2032. The upgraded network will also be designed to facilitate the future integration of renewable energy sources, including solar power and small-scale hydropower.
ADB Country Director for Bangladesh Qingfeng Zhang said reliable electricity plays an important role in creating jobs, supporting businesses, improving education and healthcare, and strengthening local communities.
The project will help ensure safe and reliable electricity for people in remote areas, while expanding livelihood opportunities and increasing women’s participation, he said.
Alongside improvements to the electricity distribution network, the project will include several initiatives to expand social services. At least 30 solar-powered safe drinking water systems will be installed, which will be operated by local community organisations. At least 30% of the leadership positions in these organisations will be reserved for women.
To ensure essential services continue during power outages, solar-powered backup systems will be installed at least 20 institutions serving ethnic minority communities. These will include schools, hospitals, temples and clinics.
At least 1,000 people will receive livelihood-related training under the project, while more than 200 entrepreneurs will receive support to start or expand businesses.
Another 300 students will be trained on employment opportunities in the energy sector and disaster-resilient power systems.
Three grievance centres will be established to improve customer services. Three childcare centres equipped with digital monitoring systems will also be set up.
Officials and employees of the Bangladesh Power Development Board (BPDB) will receive training in customer service, operation and maintenance of electricity distribution systems, environmental and social safeguards, and disaster-resilient technologies.
In addition to the ADB’s $175 million loan, the project will receive a $2.72 million grant from the Japan Fund for Prosperous and Resilient Asia and the Pacific, administered by the ADB with funding from the Japanese government.
The Government of Bangladesh will contribute $36.54 million to the project, while the Bangladesh Power Development Board will provide $45.65 million. BPDB will serve as the project’s executing and implementing agency.
According to the ADB, around 1.84 million people live in the Chattogram Hill Tracts, more than half of whom belong to ethnic minority communities. The region’s remote and mountainous terrain has long posed significant challenges to expanding electricity networks.
The new project aims not only to address gaps in electricity infrastructure but also to strengthen the local economy and improve living standards in the hill tracts.
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