Summit Power has signed deals with the Bangladesh Power Development Board (PDB) to build three power plants over the next three years, reports Reuters.
The three Summit projects, which will have a total generation capacity of total generation capacity of 1017 MW, represent the biggest private sector contracts so far in the country.
"We will be able to implement three projects with a cost of about $1.1 billion by the year 2014," said Muhammad Aziz Khan, chairman of Bangladeshi conglomerate Summit Group.
Summit Power, which is a joint venture between Summit Group and General Electric, will also operate the plants and supply electricity to the PDB over the next 22 years.
The government of Bangladesh plans to generate 9000 MW of electricity by 2015 to tackle its significant power shortages. According to Reuters, the impoverished country faces a daily shortfall of 2000 MW, with the gap widening.
To finance the projects, Summit Power will look to international lending agencies to provide debt financing and will also consider issuing shares on the stock market to raise equity financing, Aziz said.
Bangladesh’s economy has grown on average by 6 percent per year since 2003, has seen power demand sharply outstripping supply, resulting in frequent cuts and economic losses estimated at nearly $1 billion a year, says Reuters.