Asian Development Bank (ADB) will arrange a loan of US$121.55 million for a local private company to set up a 100-megawatt solar power plant in Pabna.
The Manila-based lender signed an agreement with Dynamic Sun Energy (DSE) Private Limited here on Monday, said a press release Tuesday.
DSE, owned by Paramount Textile PLC (PT), is one of the largest woven textile manufacturers in Bangladesh, and also operates several power plants in the country.
The power plant is the country's first private sector utility-scale solar facility to secure support from the global financiers.
ADB arranged, structured, and syndicated the debt package as the sole mandated lead arranger and book runner, according to the statement.
The financing package comprises a $46.75 million loan from ADB, a syndicated B-loan of $28.05 million from ILX Fund I, an Amsterdam-based emerging market private credit fund focused on supporting the Sustainable Development Goals with ADB as lender of record, and a syndicated parallel loan of $46.75 million from the Japan International Cooperation Agency.
"As Asia's climate bank, ADB welcomes the opportunity to support renewable energy in Bangladesh, where obtaining long-term financing for such projects is a challenge," said ADB Private Sector Operations Department Director General Suzanne Gaboury.
This partnership exemplifies our lead role in mobilising financing for clean energy facilities and stimulating further investment in sectors where it is needed the most, he added.
The solar power plant will generate 193.5 gigawatt-hours of electricity annually and avoid 93,654 tonnes of carbon dioxide emissions annually.
"We are delighted to secure financing for one of the largest private sector solar projects in Bangladesh to date, with the support of international lenders led by ADB," said PT Managing Director Shakhawat Hossain.
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