Bangladesh: Power System Expansion and Efficiency Improvement Investment Program - Tranche 2

Sovereign Project | 42378-016 Status: Active


ADB is helping Bangladesh boost power supply by enhancing its transmission and distribution network. The second tranche of the program will enable increased energy transfer from Ghorasal to Tongi and improve transmission capacity to meet growing power demand in the capital Dhaka, Chittagong, and Sylhet areas.  It will also expand the capacity of the north and south Dhaka distribution network.

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Procurement Documents

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Project Name Power System Expansion and Efficiency Improvement Investment Program - Tranche 2
Project Number 42378-016
Country Bangladesh
Project Status Active
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan 3087-BAN: Power System Expansion and Efficiency Improvement Investment Program - Tranche 2
Ordinary capital resources US$ 310.00 million
Loan: Power System Expansion and Efficiency Improvement Investment Program - Tranche 2
Islamic Development Bank US$ 220.00 million
Agence Francaise de Developpement US$ 125.00 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Partnerships
Sector / Subsector

Energy - Electricity transmission and distribution

Gender Equity and Mainstreaming Some gender elements
Description The proposed Tranche 2 will contribute to the overall impact of the MFF on increased energy sector contribution to low-carbon economic growth in Bangladesh. The specific impact of the Tranche 2 will be increased access to reliable supply of electricity. The outcome of Tranche 2 is increased transmission and distribution capability in the power system. This will allow increased power transfer from Ghorasal to Tongi and to increased transmission capability to satisfy the increasing demand in Dhaka, Chittagong and Sylhet areas. Also the investments will allow improved distribution networks in the Dhaka region to supply increasing demand in the system to ensure no load-shedding due to network constraints by 2018.
Project Rationale and Linkage to Country/Regional Strategy A framework financing agreement (FFA) for the Bangladesh Power System Expansion and Efficiency Improvement Investment Program (BPSEEIP, the facility ), has been signed by the Asian Development Bank (ADB) and the Government of Bangladesh (the Government) and ADB's Board of Directors approved this multi tranche financing facility (MFF) on 28 Nov 2012. This MFF funds power sector investments in generation, transmission and distribution systems in Bangladesh to improve efficiency in these systems and add capacity for increased and reliable energy access to the population. The MFF consisted of three tranches to undertake these investments in a staggered manner. The proposed tranche 2 meets the selection criteria set forth in the Schedule 4 of the FFA. It will undertake investments in transmission and distribution network strengthening. Thus the Tranche 2 helps achieving the outcome of the MFF, increased access to clean and reliable supply of electricity in Bangladesh.
Impact Increased access to reliable supply of electricity

Project Outcome

Description of Outcome Increased Transmission and Distribution capability in the power system
Progress Toward Outcome N/A
Implementation Progress
Description of Project Outputs

Increased Transmission Capacity

Increased south Dhaka distribution network capacity

Increased north Dhaka distribution network capacity

Efficiently managed project

Status of Implementation Progress (Outputs, Activities, and Issues)

1. All contracts were awarded and implementation progress is 45%.

2. All contracts were awarded and 20% civil works for substation component completed and 60% of distribution network component completed.

3. All contracts have been awarded and materials delivered except Lot-3, Package C1 and Lot-6, Package C2.

4. Not yet due.

Geographical Location Dhaka

Safeguard Categories

Environment B
Involuntary Resettlement A
Indigenous Peoples C

Summary of Environmental and Social Aspects

Environmental Aspects

An environmental assessment and review framework (EARF) for the MFF was prepared in September 2012 to ensure that project components in succeeding tranches comply with SPS 2009. Tranche 2 is classified as Category B according to SPS 2009 requiring an initial environmental examination (IEE). Following SPS 2009 and EARF, an IEE was prepared and was publicly disclosed to ADB website in August 2013.

No major environmental issue, nonetheless EA submits environmental monitoring reports semi-annually.

Subproject selection for Tranche 2 was guided by the environmental criteria outlined in the EARF and Schedule 4 of the FFA. Components of Tranche 2 are not expected to cause significant adverse environmental impacts. Transmission line routes will traverse mainly agricultural lands and no forest, sanctuaries or protected areas will be affected. Environmental management plans have been prepared with adequate resources for implementation. PGCB, DPDC and DESCO will obtain all the required environmental clearances from the DOE prior to construction and copies submitted to ADB. A project brief in Bangla will be prepared by PGCB, DPDC, and DESCO and will be made available to the public at their field offices.

Involuntary Resettlement

In line with ADB Safeguard Policy Statement 2009 (SPS 2009), Tranche 2 is classified as A for involuntary resettlement impacts. Three resettlement plans have been prepared for Part A, Part B and Part C respectively, in accordance with the resettlement framework based on national laws and policies and the Safeguard Policy Statement of ADB.

Private land acquisition of 22.0 acres for 3 subprojects of PGCB would potentially lead to permanent economic displacement of about 59 persons and temporary economic displacement for about 168 farmers. Land acquisition for 2 subprojects of DPDC will result in physical displacement of 15 households and 80 persons. One subproject of DESCO will result in economic displacement for 6 persons. The estimated total number of persons to be displaced by subprojects under Tranche 2 will be about 313.

Compensation rates for the loss of land and structures, shifting assistance, income restoration assistance, and additional support for vulnerable groups and indigenous groups are provided in the resettlement plans. The compensation entitlements are endorsed by the EA and adequate budget will be allocated. Meaningful consultation and information disclosure were undertaken with (i) project-displaced persons, (ii) the general public through the ADB website. If any changes or additional land requirements or involuntary resettlement impacts are identified, a new or updated resettlement plan will be prepared or modified according to the applicable laws referred to in the resettlement plan. ADB's approval will be obtained before further implementation of the subprojects. The EAs have set up PMUs which will be responsible for RP implementation, monitoring and reporting. The implementation of the resettlement plans will be monitored internally by the EA and externally by qualified and experienced external experts, who will undertake the overall monitoring of the safeguards and relevant social issues and submit semiannual monitoring reports to EA in turn to ADB.

No major resettlement issue, nonetheless EA submits resettlement monitoring reports semi-annually.

Indigenous Peoples Tranche 2 is classified as category C in accordance with the ADB's Safeguard Policy Statement (2009). None of the subprojects would impact communities of indigenous populations or interfere with the territories of the indigenous populations or ethnic minorities, their livelihood systems, customary properties or their natural or cultural resources. However, if there are any unanticipated impacts on indigenous people during project implementation an indigenous peoples plan will be prepared and submitted to ADB for review. EAs will obtain the approval of such a plan before award of related civil works contract and implemented before commencement of the civil works of the relevant subproject, as applicable.
Stakeholder Communication, Participation, and Consultation
During Project Design During project preparation the project team along with the consultants have conducted stakeholder meetings while finalising the intial environmental examinations and resettlement plans for the respective components.
During Project Implementation

Business Opportunities

Consulting Services Implementation support consultant for DPDC $1,000,000 as per GOB's guidelines for Q4/2013, National and financed by GOB

The following lists goods and works contracts for which procurement activity is either ongoing or expected to commence within the next 18 months.

Procurement Advertisement Comment

General Desciption Amount Method Bidders Date

Turnkey Contract for 132&230kV S/S and Lines-IDB 206.76 ICB N Q2/ 2014 Financed by IDB

Turnkey Contract for 132/230kV S/S and Lines-ADB 31.33 ICB N Q1/2014 Financed by ADB

Turnkey Contract of South Dhaka 132/33kV S/S

and Lines 93.36 ICB N Q1/2014 Financed by AfD and GOB

Turnkey Contract of South Dhaka 33/11 kV S/S - AfD 36.97 ICB N Q2/2014 Financed by AfD and GOB

Turnkey Contract of South Dhaka 33/11kV S/S -ADB 45.85 ICB N Q2/2014 Financed by ADB and GOB

Turnkey Contract of 11kV South Dhaka Distribution 47.28 ICB N Q2/2014 Financed by ADB and GOB

Turnkey Contract for 132/33/11 kV S/S 133.77 ICB N Q2/2014 Financed by ADB and GOB

Supply Contract of North Dhaka Distribution Equipment 79.85 ICB N Q1/2014 Financed by ADB

Responsible Staff

Responsible ADB Officer Ibrahim, Sherine
Responsible ADB Department South Asia Department
Responsible ADB Division Bangladesh Resident Mission
Executing Agencies
Dhaka Electric Supply Company Ltd. (DESCO)
[email protected]
Biddut Bhaban, 1 Abdul Gani Road
Dhaka 1000, Bangladesh
Dhaka Power Distribution Company Ltd. (DPDC)
SCADA Bhaban (2nd Floor)
Kataban, Sonargaon Road
Dhaka 1000
Power Grid Company of Bangladesh, Ltd. (PGCB)
[email protected];_WEBSITE:WWW.PGCB.ORG
IEB Bhaban (4th Floor)
Ramna,Dhaka, Bangladesh


Concept Clearance -
Fact Finding -
Approval 11 Dec 2013
Last Review Mission -
Last PDS Update 23 Mar 2017

Loan 3087-BAN

Approval Signing Date Effectivity Date Closing
Original Revised Actual
09 Dec 2013 11 Feb 2014 14 Mar 2014 30 Jun 2019 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 530.00 Cumulative Contract Awards
ADB 310.00 09 Dec 2013 247.77 0.00 80%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 220.00 09 Dec 2013 105.18 0.00 34%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory Satisfactory - Satisfactory - -

Safeguard Documents See also: Safeguards

Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

Evaluation Documents See also: Independent Evaluation

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Related Publications

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The Public Communications Policy (PCP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

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