The Asian Development Bank (ADB) has approved a $175 million concessional loan to modernise Bangladesh’s electricity distribution network in the Chattogram Hill Tracts (CHT), with the project expected to improve livelihoods, create employment opportunities and strengthen essential public services.

The Sustainable Energy Development and Community Empowerment in the Chattogram Hill Tracts Project will expand and upgrade power distribution systems in 26 remote upazilas across Khagrachari, Rangamati and Bandarban.

The initiative is expected to provide electricity access to at least 88,000 additional households, including around 35,000 households belonging to small ethnic communities.

The project will involve the construction of six 33/11-kilovolt substations with a combined capacity of 80 megavolt-amperes. It will also install 5,032 kilometres of new distribution lines using low-loss conductors and rehabilitate 1,874 kilometres of existing lines.

Four substations, a switching station and a zonal repair workshop will also be upgraded under the project.

According to the ADB, the upgrades will help reduce power system losses and operating costs, improve grid efficiency and increase the network’s ability to withstand disasters. The project is also expected to avoid at least 19,300 tonnes of carbon dioxide equivalent emissions annually.

“Reliable electricity is a powerful driver of jobs, enterprise, education, health care, and community resilience,” said ADB Country Director for Bangladesh Qingfeng Zhang.

He said the project would help remote communities gain safer and more dependable access to electricity while creating livelihood opportunities, encouraging women’s participation and supporting Bangladesh’s shift towards a resilient and low-carbon energy system.

The CHT has a population of around 1.84 million, with small ethnic communities accounting for more than half of the region’s residents. Despite Bangladesh achieving about 99% national electrification, grid access in the three hill districts remains comparatively low, at 49% in Khagrachari, 43% in Rangamati and 41% in Bandarban.

The project targets increasing grid access in the region to 68% by 2032 and will help prepare the network for the integration of renewable energy sources such as solar and pico-hydropower.

Beyond electricity infrastructure, the project will establish at least 30 solar-powered drinking water facilities. Community organisations will manage the facilities, with women expected to hold at least 30% of leadership positions.

Solar backup systems will also be installed at a minimum of 20 facilities serving small ethnic communities, including schools, hospitals, temples and clinics, enabling them to maintain essential services during power outages.

The project will promote income generation through livelihood training for at least 1,000 people and business incubation support for more than 200 entrepreneurs. Around 300 students will receive orientation on energy-sector careers and disaster-resilient energy systems.

To improve customer services, three complaint centres and three childcare facilities with digital monitoring systems will be established. BPDB personnel will also receive training in customer service, distribution operations and maintenance, safeguards and climate- and disaster-resilient technologies.

The project will be supported by additional financing, including a $2.72 million grant from the Japan Fund for Prosperous and Resilient Asia and the Pacific, funded by the Government of Japan through ADB.

The Government of Bangladesh will contribute $36.54 million, while the Bangladesh Power Development Board (BPDB), which will execute and implement the project, will provide $45.65 million.