Overview of the Project
Sustainable and Renewable Energy Development Authority (SREDA)’s “Energy Efficiency & Conservation (EE&C) Master Plan up to 2030” sets a long-term EE&C national target to improve the country’s energy intensity (energy consumption per GDP) by 20% by FY 2029-30, in comparison with FY 2013-14. To support the government to attain this goal, in 2016, the Japanese Government provided a concessionary loan of 11,988 million Japanese Yen (equivalent to about USD 100 million) for a period of 40 years under the Loan Agreement No. BD-P90. The Energy Efficiency & Conservation Financing Project (EECPFP) utilises a two-step loan (or financial intermediate lending) instrument as an instrument of policy financing.
The low interest loan is channelled through two Implementing Financial Institutions (Infrastructure Development Company Limited, IDCOL and Bangladesh Infrastructure Financing Fund Limited, BIFFL), for industries who are introducing energy efficient equipment which are generally more expensive than the conventional ones. Low cost finance of this Project encourages the investors to select energy efficient equipment. SREDA, as the administrative authority for the Project, provides policy and manuals for the operation, and collects data on energy saving achievements.
As of December2022, 43 companies are awarded the loan, amounting to BDT 21 billion. The borrowers range from textile, RMG, cement, glass, electronics, pharmaceutical, university, real estate, and other sectors. With the normal operation of the equipment installed using the loan, total annual energy saving is calculated as approximately 76 ktoe or 270 GWh. There are many more companies who have expressed their keen interest to be using the Project fund. By utilising the entire budget for the Project, it is expected to contribute to creating an energy saving potential to save more than double of the amount that has been achieved so far.
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