The government has signed a $515 million financing agreement with the World Bank to ensure access to reliable power supply for 9 million people while transitioning to clean energy.

The credit is from the World Bank’s International Development Association (IDA), and has a 35-year term, including a five-year grace period, the global lender said in a statement on Thursday.

The Electricity Distribution Modernization Programme will support the digitisation and modernisation of 25 rural electric cooperatives in Dhaka and Mymensingh Division and reduce electricity system losses by over 2 percent, according to the World Bank,

It is also geared towards increasing the Bangladesh Rural Electrification Board’s (BREB) delivery of electricity by 6,790 GWh while improving the climate resilience of the electricity system.

“The government of Bangladesh has prioritised access to electricity in the last decade and now the entire population have access to electricity. The installed generation capacity increased five-fold to 25 GW in the same period,” said Dandan Chen, the agency's acting country director for Bangladesh and Bhutan.

“Through this programme, new and emerging technologies will further strengthen the efficiency and reliability of electric supply in the country to meet the need for faster economic growth.”

Through the BREB, the programme will support solar metering connections for over 100 customers, bringing 150 MW of new rooftop solar capacity onto the grid. It will improve and construct 31,000 km of distribution lines and deploy 200,000 advanced meters.

The initiative also aims to cut annual carbon emissions by 41,400 metric tons by strengthening Battery Energy Storage Systems (BESS) and distributing renewable energy.

The programme is aligned with the government’s Integrated Energy and Power Sector Masterplan, currently under preparation, which will help establish a low carbon energy system, said Fatima Yasmin, secretary to the Economic Relations Division.

“Generating clean and reliable electricity can help rural communities to increase productivity and cope with events brought on by climate change.”

The agreement also includes a $15 million grant from the Clean Technology Fund to support BESS.