Bangladesh Receives $78.4 Million to Install an Additional 480,000 Solar Home Systems

June 30, 2014

DHAKA, June 30, 2014 — The Government of Bangladesh today signed a $78.4 million additional financing to further scale-up support for the successful solar home systems (SHS) program of Bangladesh.

The credit for the additional financing to the Bangladesh Rural Electrification and Renewable Energy Development II (RERED II) Project is from the International Development Association (IDA), the World Bank Group’s soft loan arm. The project will help install an additional 480,000 solar home systems that has emerged as a viable electrification option for areas without grid access to electricity.

Implemented as a public-private partnership, the SHS program is currently installing over 70,000 solar home systems every month, making it the fastest growing SHS program in the world. In Bangladesh 3 million systems have already been installed with support from World Bank and other development partners.

“Together, the Government of Bangladesh and the World Bank is scaling up a program that delivered development results for millions of rural Bangladeshis,said Christine E. Kimes, Acting Head, World Bank Bangladesh. “This is a proven model that works. Investing in electricity in rural areas empowers both men and women, leading to increased income and growth opportunities and reducing poverty.”

Currently, only 42% of the people in rural Bangladesh have access to electricity, and reliance on the grid alone will not achieve the Government’s vision of universal access by 2021. Furthermore, the dispersed nature of rural settlements and the numerous rivers that crisscross the country make grid electrification in many areas difficult and expensive. Off-grid renewable energy, like solar home system, has thus become the only option for electrification for millions living in the remote rural areas of Bangladesh.

Building on the successful implementation of the predecessor RERED project approved in 2002, the RERED II project has so far provided clean energy access to over 414,000 households benefiting over 2 million people through installation of solar home systems in remote villages. Over 1,450 biogas plants and 40 solar irrigation pumps have already been supported under the project. 

“This repeater project is building up on our efforts to support the government’s vision of providing universal access to electricity,” said Arastoo Khan, Additional Secretary, Economic Relations Division, Government of Bangladesh. “The benefits of using solar homes systems include increased study time for children, empowerment of women through knowledge from TV viewing, income generation from mobile phone recharging services, as well as contribution to emissions reduction as a result of kerosene replacement.”

The project has also started dissemination of improved cook stoves with a target to provide clean cooking solutions to over 1 million rural households. Access to clean cooking benefits women and children in particular, reducing respiratory diseases.

Khan and Kimes signed on behalf of the Government of Bangladesh and the World Bank respectively at the Economic Relations Division premises.

The IDA credit has 40 years to maturity, including a 10-year grace period; and carries a service charge of 0.75 percent.

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