Rural electrification is a Constitutional commitment of Bangladesh Government. Till 1977 the Bangladesh Power Development Board was responsible for generation, transmission and distribution of electric power in Bangladesh and its main operational area was in suburban load centres.  About 90% of the population in vast rural areas were practically without electricity.

A comprehensive feasibility study of rural electrification was carried out jointly by two Americans firms viz., Gilbert Commonwealth Association and National Rural Electric Cooperative Asson (NREC). The study revealed that rural electrification had bright   economic potentialities in Bangladesh. As the task is gigantic the report recommended (1) the programme should be carried out in phases over a period of approximately 25 years and to implement it in 5 phases; (2) the programme should be carried out on area coverage basis; (3) to ensure direct participation of the beneficiaries, potential consumers of each selected area should be organized to form a Rural Electric Co-operative/Pally Bidyut Samiti (PBS); (4) to organize, finance and administer the PBSs a central agency called the Rural electrification Board should be established.

According to the above recommendation, REB was established through Ordnance promulgated on 29^th October 1977 and the Board started its operation from January 1, 1978.  Functions of the Rural Electrification Board, as mentioned in the Ordnance, was to organise the prospective consumers of electricity into formal groups such as Pally Bidyut Samity (PBS) for the purpose of execution and management of schemes and providing related services.  On the basis of the above Article, the REB organised prospective consumers of electricity of a selected area to form a Rural Electric Co-operative called Pally Bidyut Samity (PBS).

The profile of an average size of Pally Bidyut Samity is given below:

Geographical area                                          : Around 2000 Sq.Kms

No. of P-S                                                        : 5-8

No.of households (approx)                               : 60000 – 1,00,000

No.of 33/11 KV Substation                                : 3-4 No.s

Length of power distribution lines                   : 2000 KMs (around)

Consumer connection for first 5 years                         : Around 10,000

On the 20^th year                                                           : Around 65,000

Each PBS has a local Board consisting not more than 15 directors, each elected from a designated Elaka.  Being an electricity distribution unit each PBS has its organisation where the General Manger is the Chief Executive. To manage its requirement there are different departments like, engineering, finance and administration, construction, operation & maintenance, general service department, zonal office, area office and complaint centres.  These departments are normally headed by A.G.M. under G.M.

Regarding qualification to become PBS Board directors, he/she must be a Member of the Samity, must have passed at least SSC or equivalent examination.  He should be a bonafide resident of  the Elaka and should not be an office bearer of any political party or political organisation.  The PBS Board of Directors nominate and appoint some lady advisors selected among the female population of the PBS.

The rural electrification programme started functioning being funded by donors as well as the Government of Bangladesh.  Funds from donors comes to govt. Of Bangladesh as loans and grants which are passed on to Rural Electrification Board.  Initially all foreign exchange cost of RE Programme was financed by foreign donors and the Govt. of Bangladesh has been financing the remaining local construction cost.  Recently besides the matching fund Govt. Of Bangladesh has started contributing foreign exchange component also. 

             The foreign currency component and recently some  local currency component of construction cost, the cost of consultancy, has been funded by foreign donors.  These funds have been provided to government of Bangladesh on a variety of terms and conditions. Funding by Govt. Of  Bangladesh.

             Government of Bangladesh passes this foreign fund to REB for construction of assets under subsidiary loan agreement between Government of Bangladesh and REB.  Both foreign and Govt. Of Bangladesh funds are given to REB under uniform lending terms. The terms of the foreign grants/funds passed on to REB donors are : Grace period is 8 years from the date of first disbursement.  Interest rate is 0.75% p.a. during the grace period, capitalised and added to the principal and then 2% p.a. during the principle repayment period.  Repayment is in 50 equal semi-annual installments after the grace period.  Exchange risk is borne by Govt. of Bangladesh.  It should be noted that technical assistance received in foreign currency is outright grant both to REB and Rural Electric Co-operatives.  Local costs of construction is funded by Govt. of Bangladesh and is given to REB as grants.  On completion of construction by REB, assets are handed over to rural electric  co-operatives in exchange for a loan in kind covered by local mortgage by each rural electric co-operative to REB for these assets.  Both the portions of finance by foreign donors  and Govt. of Bangladesh grants are covered by this loan.  The lending terms between REB and rural electric cooperatives is as follows:

Grace period   -           5 years from the date a rural cooperative starts commercial operation.

Interest            -           0.7% p.a during the grace period capitalised and added to the principal  and then 3% p.a during the repayment period. Repayment – 50 equal semi-annual payment after the grace period.

 During initial 5/6 years  of operation of the RE Co-operatives it may not be possible to meet the operational expenses from the revenue generated and Govt. OF Bangladesh provides financial assistance in cash to cover this deficit. 

 Each of these co-operatives (PBS) purchase electricity from BPDC or DESA at 33KV level and the present bulk rate is Taka 1.77 per unit. Each PBS sets its own tariff with the approval of REB.  There are different tariffs for different categories of consumers viz., domestic, commercial, irrigation, Industries etc. The retailed rate vary from one PBS to another and the average selling rate per unit is Taka 2.48 per unit.  The minimum rate for domestic consumers is Taka 2.20 and the irrigation rate is higher than the domestic rate. Some of the work of PBS was done on contract basis such as meter reading, delivery of bills etc.  Every meter reader is to read 2000 meters in a month and apart from meter reading they are also assigned to report any abnormality in meters and service connection observed by them while performing their routine duty.

 Regarding collection of bills, the consumers can pay their bills at the cash counter of the PBS office or they can pay through designated banks.  There are designated banks to collect electric bills of the consumers living in every 3 sq.miles of service area of a PBS .  Apart from other operations one thing requires special mention that the performance target agreement.  To improve the performance of these PBS regarding the quality of their services and to ensure the accountability of the officers and employees, a formal method of performance evaluation has been adopted by REB.  Under this method total activities of these PBSs are thoroughly analysed and the major key activity areas are identified. There is monthly monitoring of these PBSs by REB and if required implementation of corrective measurers to achieve target is ensured. There is a method of  evaluation of PBS and between REB and PBS and then annual review of the performance.

 Award of financial bonus to employees of co-operatives which show better results and imposition of penalty for failure.

 As mentioned earlier, to accomplish the task of rural electrification, the REB has adopted the concept of area coverage.  Under this concept when a PBs is formed consisting of geographical area of a number of P.B, distribution network is planned and designed covering the entire geographical area of that PBS.  This system help establishment of primary distribution backbones wherefrom each and every village could be supplied by gradual construction of laterals and sub-laterals.  The  priority of construction of latterals and sub-latterals are decided by an admixture of economic and social consideration.  The economic consideration is the cost benefit ratio of the latterals and sub latterals and the social consideration of equitable distribution of electoral facilities in all areas of PBS.

System Criteria

            The average system is normally designed to serve around 65,000 to 1,00,000 consumers with an average of approximately 2000 to 2500 Kms of distribution lines (11 KV & 400/230 Volts). The load served are both single phase and 3 phase in character. The approximate ratio is 40:60. The sub transmission source voltage of a PBS substation is 33 KV and the outgoing voltage for primary distribution is 11/6.3 KV. The distribution system is multi-grounded/design with the voltage being 6.35 KV phase to ground or 11 KV phase to phase.

            Each of the 33 KV substation has provision for six numbers of 3 phase, 11 KV feeders which extends from the substation up to a distance of around 15 to 20 Kms with 3 phase and single phase tap lines taking off from backbone to serve the consumers.  The secondary service voltage is 230/400 volts.  For domestic lines the secondary distribution is predominantly 2-wire, single phase, 230 volts supplied through 6.35 KV/240 volts,single phase distribution transformer of 5,15,25,37.5, 50 KVA capacity.  The length of the secondary line from a transformer is kept limited to reduce voltage drop, line loss and energy theft.  Three phase loads such as deep  tubewell or other industries concentrated in growth centres are served by installing 3 Nos. single phase distribution transformers in a bank close to the load.  As the grows selected single phase line can be converted to 3 phase lines to improve the additional load requirements. Initially this conversion process is done on the lines nearest to the source.  More remote lines and branch circuits usually remain single phase for the life of the line.

 REB has standardised all construction materials including hardware, tools, construction units and methods.  Use of non-standardised materials is very much restricted in REB.

 Major construction work of rural electric distribution is managed by REB.  On completion of construction energised lines and substations are handed over to PBS for operation and maintenance.

 For construction management  REB has six Superintending Engineers offices in different zones.  Executive engineers offices are responsible for construction management at the grass root level.  Each executive engineer’s office normally supervise construction work in two to three PBSs.  Superintending Engineers  select contractors for award of construction contracts.  Local engineering consultants make electrical and construction designs.  Executive engineers with the help of consultants co-ordinate and supervise the construction done by the contractors.  They also authorise issue of materials from REB store to the contractors.  It may be mentioned that REB supplies all materials for construction. Contractors are prequalified and their construction crews are trained on REB construction standard and materials. 

Consumers available during first energisation are served by the line construction  contractors but subsequently consumer connections and other works are done by PBS. 

            At least 25% of distribution lines are inspected every year and maintenance work done.  Maintenance work of the line, OCR, voltage regulator, distribution transformer etc., is also carried out including change of oil, if necessary.

Category-wise consumer connections  till May 1999 under the rural electrification programme.

Category                      No.of Consumers                                 Energy consumed (%)

Domestic                                  19,45,800                                              39.34               

Commercial                             2,25,995                                               5.88

Irrigation                                      72,765                                              17.04

Industrial                                     47,789                                              37.48

Others                                           7,285                                                  27

Bill collection percentage :

                                                Financial Year                               Percentage

                                                            1991-92                                     97

                                                            1992-93                                     101      

                                                            1996-97                                      95

1998-99                                      94

The foreign assistance so far received by REB is 850.16 million US dollars.

Operational statistics of Bansal PBS-2 which we visited.

 Date of commercial operation: September 22, 1985 : Area –837 Sq. Km: Thanas – 6

                                                     Villages – 527

                                                     No.of villages energised     - 335

                                                     No.of 33/11 KV S.Stn                       -     4

                                    Kilometers of line energised                             -1482 Km

                                    Consumers connected

                                                Domestic                                   - 28086

                                                Small commercial                         -   3874

                                                Industrial                                 -      440

                                                Irrigation                                  -     146

                                                Others                                      -     759

                                                System loss                              -     9.07%

Percent collection                        -    98.42%

MWH Consumed                  -   22502

MWH purchased                      -  24747

                           Amount billed(12 month average)                           - 4886,000 Taka