European Investment Bank Sends $110 Million Loan to Bangladesh's Power Sector

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--The European Investment Bank (EIB) (Luxembourg) is providing a $110 million loan to Bangladesh to increase power generation, transmission and distribution capacity. The loan will finance the conversion of the Baghabari and Shagibacar gas-fired power plants into combined-cycle plants. This will boost generation efficiency and capacity, as well as reduce CO2 emissions.

The loan has been extended under the EIB's climate change mandate (2011-13) for non-EU countries. It will contribute to climate change mitigation, as well as social and economic infrastructure in Bangladesh. These aims are key priorities for the EU and the bank.

"Sustainable access to the energy supply will also help to avoid bottlenecks and will enable the more efficient and rational use of energy resources, thus reinforcing the positive effects in term of climate change mitigation and adaptation," said Magdalena Alvarez, vice president in charge of Asian operations for EIB.

Other institutions co-financing Bangladesh's $1.6 billion energy sector improvement plan include Asian Development Bank, Islamic Development Bank, Agence Francaise de Developpment and the Bangladesh government.

For related information, see July 23, 2013, article - Bangladesh Offers Major Tax Incentives for Coal-fired Power Projects, and February 18, 2013, article - Bangladesh Funds 1,675 Megawatts of New Power with Export Credits.

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