[🇧🇩] Energy Security of Bangladesh

[Saif]

13-hr gas outage to hit parts of Dhaka on Thursday

A 13-hour gas outage is set to hit several parts of Dhaka from Thursday afternoon to Friday morning, according to the Titas Gas authorities. The outage will affect the Kurmitola Hospital, Hotel Radisson, RPGCL, Dhaka Regency, Khilkhet, Concord City (until the river side), the Le Meridien Dhaka hot

thefinancialexpress.com.bd

13-hr gas outage to hit parts of Dhaka on Thursday
Published :
Feb 12, 2025 12:03
Updated :
Feb 12, 2025 12:03

A 13-hour gas outage is set to hit several parts of Dhaka from Thursday afternoon to Friday morning, according to the Titas Gas authorities.

The outage will affect the Kurmitola Hospital, Hotel Radisson, RPGCL, Dhaka Regency, Khilkhet, Concord City (until the river side), the Le Meridien Dhaka hotel, Balaka Bhaban, Haji Camp, Kawla's Airport Catering House, Civil Aviation Quarters, and surrounding areas from 1:00 pm on Thursday to 2:00 am on Friday, according to a statement on Wednesday, reports bdnews24.com.

The Titas Gas authorities say that the gas supply will be suspended due to the transfer and readjustment of a gas pipeline for the underground sections of the Dhaka Mass Transit Company Limited metro rail MRT Line-1’s Airport and Khilkhet stations.

“In addition, the gas pressure may remain low near Joar Sahara, Nikunja and nearby areas,” the statement said.

Titas Gas has apologised to its customers for the temporary inconvenience caused by the outage.​

 

[Saif]

Rampal power plant shuts down

The 1320-MW Rampal power plant, a joint venture between state-owned power companies of India and Bangladesh, shut down early Friday, drawing on the force majeure clause of the power purchase agreement between the parties.

www.newagebd.net

Rampal power plant shuts down
Staff Correspondent 16 February, 2025, 00:35

Rampal power plant | File photo

The 1320-MW Rampal power plant, a joint venture between state-owned power companies of India and Bangladesh, shut down early Friday, drawing on the force majeure clause of the power purchase agreement between the parties.

Ziaur Rahman, the chief procurement officer of the Bangladesh India Friendship Company Limited which owns the power plant, confirmed the closure due to the coal shortage linked to the ongoing dollar crisis.

‘We are trying an alternate way to bring in fresh supply of coal as soon as possible,’ said Zia.

The full operation of each of the two units – 660MW – of the power plant requires around 6,000 tonnes of coal daily. The power plant exhausted its coal supply completely.

A new coal import deal might take over a month to complete, raising the ominous prospect of the power plant remaining out of operation through the second half of March when days would start getting hotter.

The power plant officials, however, are confident about bringing the power plant back to operation in about a week.

The state-owned Janata Bank, responsible for transactions on behalf of the BIFCL, was failing to release enough dollar for coal purchase, officials at the power plant claimed.

The exchange rate of the dollar fixed by the Bangladesh Bank is lower than the rate at which the JB can buy it from the market, they said.

The closure of the plant occurred amid another base-load 1,496-MW coal power plant, owned by India’s Adani group,

operating at half the capacity, reporting machine problems.

The Godda-based Adani power plant has been supplying around 700MW since September 2024, threatening to stop supplying power unless its due worth $800 million was paid.

Frequent closures have accompanied the Rampal power plant ever since it rolled into operation with its first unit in December 2022. By September 2023, the plant was shut down eight times, including five times for technical problems.

Electrical engineers highlighted the plant’s inability to burn the minimum amount of fuel that a base-load power plant must keep for running smoothly as one of the causes leading to the closures.

They also called for testing the plant’s machinery and the quality of coal burnt there.

Restarting a base-load power plant frequently means burning additional fuel, which is particularly harmful to countries such as Bangladesh, particularly when in the midst of the dollar crisis.

Bharat Heavy Electricals Ltd, India’s largest government-owned power generation equipment manufacturer, built the power plant at a cost of $2 billion, including $1.6 billion provided as loans by the Exim Bank of India.

This is, however, the first time the Rampal power plant is closed drawing on the force majeure clause, which relieves parties in the deal of the requirement of compensating each other because of a disruption in daily business activity.

‘The clause generally refers to a situation beyond the control of any of the parties in the deal disrupting daily business,’ said Bangladesh Working Group on Ecology and Development member secretary Hasan Mehedi.

The previous closures were always attributed to fuel shortages or technical problems, implying the power plant’s eligibility to receive capacity charge.

With the force majeure clause in effect, the Rampal power plant will not get capacity charge. The clause, theoretically, can remain in effect for six months.

Widespread violations of environmental regulation recently steered the media spotlight on the Rampal power plant, especially for the power plant for months not using effluent treatment plant and releasing used water directly into nearby rivers.

Bangladesh’s current installed power generation capacity is 27884.7MW. But the inability to generate about 11,500MW resulted in frequent power cuts even during winter.

The power demand is expected to exceed 17,500MW in summer.​

 

[Saif]

Govt urged to follow SL to get rid of Adani power

The South Asia Just Transition Alliance, a platform of green activists in South Asia, called on the Bangladesh government to be inspired by Sri Lanka to exit from the discriminatory power purchase deal with the Adani Power.

www.newagebd.net

Govt urged to follow SL to get rid of Adani power
Staff Correspondent 16 February, 2025, 01:35

The South Asia Just Transition Alliance, a platform of green activists in South Asia, called on the Bangladesh government to be inspired by Sri Lanka to exit from the discriminatory power purchase deal with the Adani Power.

They made the call in a press release issued on February 14, expressing their satisfaction and thanking the Sri Lankan government for taking strict measures leading the Adani Group to cancel its 482MW controversial wind power project in the Northern Province of Sri Lanka.

Adani Green Energy Limited, a subsidiary of Adani Group, had signed a Power Purchase Agreement in May 2024 to build and operate the wind power project for 20 years.

The project was approved opposing vehement opposition from local people and environmental activists due to its potential adverse environmental and social impacts.

The Centre for Environmental Justice and the Wildlife and Nature Protection Society, and two other groups of environmental experts filed separate cases with the Supreme Court of Sri Lanka challenging the Environmental Impact Assessment and expressing concerns about the energy sovereignty and its severe impact on migratory birds.

According to a study, ‘Neither Clean Nor Green’, jointly conducted by the South Asia Just Transition Alliance and CEJ, 15 million migratory birds take refuge in Sri Lanka’s coastal zones.

The study also found that faulty power plant design might increase floods and affect the 72,000 inhabitants of Mannar Island.

The project might also affect the economy of Sri Lanka.

According to the PPA, Adani was to supply electricity at $0.0826 per kWh, 192 per cent higher than the tariff for Indian wind power ($0.043).

The Sri Lankan government started reviewing the project in response to criticism, protests and a court case.

Finally, the Ministry of Energy revoked the agreement and formed a committee to review the entire project again.

On February 12, 2025, the AGEL informed the Sri Lankan Board of Investment that it would withdraw the project.

Hemantha Withanage, Chairperson of the Centre for Environmental Justice, stated that this was a significant achievement for environmentally concerned citizens of the country.

Hasan Mehedi, member secretary of SAJTA, said, ‘The Bangladesh Government should take similar actions on Adani’s Godda coal power plant as the unsolicited agreement signed by the previous government contained many flaws.’

He mentioned that Adani had already violated the agreement by hiding the tax exemption information in India.​

 

[Saif]

Diesel transfer underway via Dhaka-Ctg fuel pipeline

Godnail depot to receive diesel by Tuesday; project expected to save around Tk 250 crores annually

www.thedailystar.net

Diesel transfer underway via Dhaka-Ctg fuel pipeline
Godnail depot to receive diesel by Tuesday; project expected to save around Tk 250 crores annually

The initial process of supplying fuel oil through a pipeline from Chattogram to the Dhaka region has begun.

Already, 20 million litres of diesel have been pumped from the Eastern Refinery in Chattogram. Experts refer to this process as "line packing."

The diesel is expected to reach Godnail on Tuesday. Later, it will be transported to the Fatullah depot.

Project director of the pipeline project, Md Aminul Haque, told The Daily Star, "The transfer of diesel from the Chattogram end started on February 11. It has already crossed Cumilla. A total of 31.7 million litres of diesel will be required to fill the entire pipeline."

He further stated that after the line packing is completed, fuel oil will be officially supplied to the Godnail and Fatullah depots via the pipeline in March.

He remarked that with this project, the Bangladesh Petroleum Corporation has entered a new era of fuel oil supply.

BPC officials said in addition to preventing fuel wastage and theft, the pipeline, which has a capacity of supplying 27 million litres of fuel oil, will save BPC around Tk 250 crores annually.

The BPC undertook this project in 2018.

Although the project was initially scheduled for completion by June 30, 2020, delays caused by the Covid-19 pandemic and other complexities postponed the work until 2022.​

 

[Saif]

Weak-kneed power deal

It could be learnt from the media that the Adani Power Limited (APL), an Indian private power company, with which the ousted previous government of Sheikh Hasina signed a 25-year deal in November 2017 to purchase power on behalf of Bangladesh Power Development Board (BPDB) from the company's Gadda

thefinancialexpress.com.bd

Weak-kneed power deal
SYED FATTAHUL ALIM
Published :
Feb 16, 2025 22:52
Updated :
Feb 16, 2025 22:52

It could be learnt from the media that the Adani Power Limited (APL), an Indian private power company, with which the ousted previous government of Sheikh Hasina signed a 25-year deal in November 2017 to purchase power on behalf of Bangladesh Power Development Board (BPDB) from the company's Gadda power plant situated in that country's Jharkhand state, has agreed to resume full supply of 1,600 MW electricity within a short time. Notably, APL unilaterally cut supply of power by half by shutting down one of the two units of the Gadda power plants from October 31 last year on the pretext of Bangladesh's delay in repaying its dues. It may be recalled that at that time the interim government was in office for only about 11 weeks since assuming power on August 8 of last year following ouster of the former regime and was yet to settle down. The arrear of power bills in question did not evidently build up during the time the interim government had been in office.

Clearly, it was an unfriendly move when the country was facing acute shortage of foreign currency, a legacy of the past authoritarian regime. Still, APL took undue advantage of the sticky situation the interim government was in. Meanwhile, as the winter set in, the BPDB requested Adani power to continue with the ongoing truncated power supply from one unit of the Gadda power plants citing the reduced demand for power in Bangladesh during the winter season. Now, with the advent of summer, after three months of the curtailed supply, reports say, APL, upon request from BPDB, has agreed to restore full supply of electricity. But under what conditions has APL agreed to resume power supply to Bangladesh? As reported, though APL has agreed to resume power supply, it rejected all other requests of BPDB including power price discounts, tax benefits, etc.

In this connection, the BPDB is reported to have informed that though Bangladesh side wanted to settle contentious issues regarding the power deal, the other side, APL, was only sticking to the original conditions of the power purchase agreement. Adani power's strong stance was not surprising, if only because Bangladesh side proved to be too docile before the party supplying power. It is worthwhile to note that from the very beginning the power deal was controversial and unequal on various grounds. For example, the APL is charging Bangladesh for power at a rate that is 55 per cent higher than the current rate of power tariff in India. Also, for the coal that fires the Gadda power plants, APL is charging higher than its existing price in Bangladesh. Due to Bangladesh side's failure to realise the concessions it asked from APL, the loss the BPDB is going to incur will amount to millions of US dollars.

Even so, going by the BPDB chairman's assurance, it appears, everything is hunky dory with the APL. He assures, there is a committee on either side to resolve any issues that might arise between them. All this only reminds one of the policy of capitulation that former regime pursued regarding any agreement with India and the power purchase contract with Adani is one such deal of acquiescence. Ironically, the Adani side was not ready to spare even US$1.0 million against the asked for discounts, sources in the power body admitted to the media. Despite all these, those in charge of the said government agency for power development in Bangladesh want to increase the monthly repayment of dues to APL. It is worth mentioning that at the moment Bangladesh is paying APL at the rate of US$85 million per month. Last December, an APL spokesperson reportedly told BPDB that the latter owed it (APL) to the tune of US$900 million. On the contrary, the BPD said the amount (in dues) was US$650 million. In that case, one wonders why earlier the head of BPDB did tell a foreign news agency that there were no issues remaining with APL.

It is incomprehensible that the Bangladesh side is kowtowing to APL, when the latter's parent company, Adani Group, is facing charges of bribery and fraudulence in the USA. Kenya's president in November last year scrapped the US$736 million 30-year energy deal with Adani Group. Adani Green Energy is learnt to have withdrawn from the proposed US$4442 million green power projects on the issue of the new Sri Lanka government's decision to renegotiate tariff.

When all other countries have put their foot down regarding their power deals with Adani group, Bangladesh, to all intents and purposes, has chosen to bow down before the Indian power company no matter how insensitive that company is to Bangladesh's genuine demands. It is exactly against this backdrop that the adviser to the Ministry of power, energy and mineral resources, Muhammad Fouzul Kabir Khan of the interim government reportedly visited Delhi to attend the 'India Energy Week-2025', a global energy platform. No wonder the nation will be waiting anxiously to know what was the energy adviser's achievement from his India tour, the first of such visit by any member of the incumbent interim government since it came to power last year. That too when there is still no credible sign of any breakthrough in thawing of relations between the two next-door neighbours following the ouster of the erstwhile regime of Bangladesh. But if it was purely a foreign tour to attend an international conference, then the question of its usefulness vis-à-vis addressing the acute power crisis the country at the moment is going through would naturally arise.

As could be gathered, there was no prospect of any renegotiation with APL during this tour by the energy adviser. The interim government cannot simply afford to be weak-kneed in dealing with any entity, local or foreign, when it comes to a subject as sensitive as power. Compromising national interest on such issues is the last thing the government can allow.​

 

[Saif]

Quality gas and electricity supply for industries

The Financial Express reports (February 11, 2025) that the 'final economic growth for the last fiscal year was lowered by 1.60 percentage points to only 4.22 per cent as the real export earnings were much lower than the projected statistics of Bangladesh Bureau of Statistics (BBS) data showed. The

thefinancialexpress.com.bd

Quality gas and electricity supply for industries
Mushfiqur Rahman
Published :
Feb 16, 2025 21:57
Updated :
Feb 16, 2025 21:57

The Financial Express reports (February 11, 2025) that the 'final economic growth for the last fiscal year was lowered by 1.60 percentage points to only 4.22 per cent as the real export earnings were much lower than the projected statistics of Bangladesh Bureau of Statistics (BBS) data showed. The BBS preliminary estimation put the FY 24 Gross Domestic Product (GDP) growth at 5.82 per cent'

BBS data further confirm that the fall of industrial production and exports are the key reasons for the downward GDP growth rate. Published data indicate that the industrial sector growth of the country was reduced to 3.51 per cent in the final GDP data (estimates published a few months ago was 6.66 per cent) in the preliminary report). Different research groups and experts have attributed the poor industrial growth to political turmoil in 2024, lack of investors' confidence and absence of congenial business climate.

The readymade garments (RMG) manufacturing industries have been securing the country's major share of export earnings. With the growth of the RMG sector, textile (spinning and weaving) segments have flourished as a backward linkage of the garments sector in the country. The garments industry leaders have been raising concerns that the backward linkage industries have been losing competitiveness due to primary energy (natural gas) supply shortages and its higher cost. As a result, the RMG sector operators now prefer imported raw materials from India and China for their productions.

Various published reports based on studies by business chambers and trade bodies claim that industrial productions in Bangladesh suffer about 30-40 per cent losses due to gas and electricity supply shortages. Cost of industrial productions have increased due to high cost of energy. Poor quality supply of gas and electricity has been systematically harming the equipment and machinery, adding increased repairing and maintenance costs for industries. As the costs for energy has been increasing steadily, unreliable supply of gas and electricity put the industries in a disadvantaged situation. As the RMG sector is increasingly relying on imported raw materials, value addition is declining in the sector.

Business leader and President of Bangladesh Chamber of Industries Anwar-ul Alam Chowdhury in a recent interview with Energy & Power Magazine stated that 'the spinning and weaving industries had lost competitiveness despite increased productivity and enhanced fuel efficiency'. He further informed that the gas price had been increasing systematically for last couple of years and the industry owners had agreed to pay Taka 30 per MSCF on condition of quality gas supply. The gas price has been increased but the supply quality did not improve. The governmnet claims that the import LNG and its processing cost for gas supply involve more than double the price of gas the industry owners pay for per unit of supplied gas. Petrobangla sources inform that its losses reached approximately Taka 16,000 crores in the current fiscal and the dependence of Petrobangla has increased on the government subsidies. Generally, Petrobangla losses are linked with low sales prices (subsidised prices) of natural gas to different sectors of consumers. On the contrary, Energy Adviser of the present interim government Dr. Muhammad Fauzul Kabir Khan informed the media that the government spends Taka 72 per unit for importing gas and supply at Taka 30 per unit.

Reports on daily gas & condensate production and distribution of Petrobangla suggest that the total gas production in the country including imported LNG was 2,689.8 mmcfd. Imported LNG had only 781.6 mmcfd share. The share of LNG in the supplied gas is less than 30 per cent. Therefore, the import and processing costs for re-gasified LNG should not be fully transferred to industrial consumers.

Domestic gas productions from the existing 29 gas fields in Bangladesh have been steadily declining (approximately at a rate of 200 mmcfd per annum) since 2018 and reliance on imported LNG has been increasing. At the same time Petrobangla can not speed up LNG import as the existing LNG storage and processing facilities have maximum installed capacity of 1,000 mmcf per day. The proven gas reserve of the country has been declining fast (it is estimated that the country has 7.6 trillion cubic feet (Tcf) of gas reserve). The annual consumption if restricted within 1 Tcf gas from the domestic reserve sources, the domestic reserve may last maximum 7-8 years (if no more major viable gas reserve will be added). Thus the consumers have to increasingly rely on imported LNG (subject to availability and expansion of LNG storage and processing facilities).

Necessary initiatives are needed to accelerate the government organisations to explore all possible commercially viable energy resources in the country. Considering the limitations of rapid increment of quality gas supply for industries, businesses demand urgent initiatives for improvements in national electricity grid infrastructure and distribution systems for securing quality power supply for industries.

Mushfiqur Rahman is a mining engineer. He writes on energy and environment issues.​

 

[Saif]

Power cuts for long hours feared in summer

Bangladesh braces for a difficult summer, feared to be hotter than ever before, faced with the prospect of long hours of power cuts due to outstanding energy bills.

www.newagebd.net

Power cuts for long hours feared in summer
Emran Hossain 17 February, 2025, 23:39

File photo

Unpaid bills exceed Tk 38,373cr in 6 months

Bangladesh braces for a difficult summer, feared to be hotter than ever before, faced with the prospect of long hours of power cuts due to outstanding energy bills.

The overall outstanding bill to 121 power plants stood at Tk 38,373 crore until January 7, 2025 with almost half of the ongoing fiscal remaining ahead, mostly lurking with humid summer days.

At the end of the last fiscal, barely a month before a student-led uprising that toppled the Sheikh Hasina regime, the outstanding bill had totaled at Tk 44,338 crore.

‘Massive dues to power producers against the likelihood of electricity demand rising by at least 5 per cent present frightening scenario,’ said Shafiqul Alam, lead energy analyst, Bangladesh, the Institute for Energy Economics and Financial Analysis.

‘Even a meticulous plan may not save the day,’ he said

The day temperature reached 32.4 degrees Celsius on February 16, almost two weeks before winter is supposed to be officially over. Load shedding occurred almost every hour on Monday despite the power demand hovering between 10,000MW and 11,000MW. Bangladesh’s overall installed power generation capacity is over 27,884MW.

In less than a month, the power demand is forecasted to surge by 6,000MW to 7,000MW, potentially catching the Muslim-majority nation in a serious predicament in the month of Ramadan.

An estimated 5,000MW is considered summer cooling demand. Irrigation during summer also requires a supply of about 2,000MW.

Power, energy and mineral resources adviser Muhammad Fouzul Kabir Khan on Monday urged all not to lower AC temperature below 25C during summer in a bid to save up to 3,000MW to minimise the gap between demand and supply.

He said that power cuts would be equally distributed in villages and cities.

Frequent power cuts can bear serious food security consequences as the cultivation of Boro, the country’s main rice crop, overwhelmingly depends on lifting groundwater for irrigation.

Inability to release enough dollars rendered the 1,320MW coal-based Rampal power plant to shut down on February 14 while getting full supply from the 1,347MW Adani power plant remained uncertain due to non-payment of bills.

Bangladesh Power Development Board’s account of power plant-wise outstanding bills revealed that over 61 per cent of the outstanding bill or Tk 23,613 crore was owed as unpaid fuel bills.

Power purchase agreements require the BPDB, the sole buyer of all electricity generated, to supply energy, after entitling almost all power plants to capacity charge.

Coal-based power plants, however, import their fuel mostly on own arrangement and get paid by the BPDB.

In fuel bills, the BPDB owes more than TK 5,235 crore to coal-fired power plants, over Tk 5,942.86 crore to furnace oil-based power plants and Tk 12,023 crore to gas-based power plants.

Of the fuel bill dues to coal power plants, Tk 2,825 crore is owed to Adani Power, representing the highest amount of outstanding payment.

Adani halved its power generation in November last year citing non-payment of bills, months after it changed the law to exclusively supply power to Bangladesh after

Hasina had fled to India on August 5. Adani can now sell power in India. It reported machine problem after Bangladesh’s request to resume full power supply.

Gas, on the other hand, is entirely supplied under the government arrangement – 75 per cent from local gas fields and the rest imported as liquefied natural gas.

About 40 per cent of the import capacity remained unused ever since LNG was introduced in mid-2018 mainly because of its high expenses. The AL regime frequently hiked retail gas prices but did not help much amid a rapid depletion in the foreign currency reserve because of the import.

Bangladesh can supply close to 3,000MMCFD of gas in the best case scenario against the demand of 4,000MMCFD, facing the tough task of who to get the supply – power generation or industries.

Energy experts said that Bangladesh was in no position to increase its fuel supply to gas-based power plants, about half of which remain idle.

Furnace oil is imported by both the government and private power plants.

Of the overall power sector dues of nearly Tk 38,500 crore, Tk 23,283 crore was owed to privately owned power plants.

‘Our energy future could not be gloomier,’ Bangladesh Working Group on Ecology and Development member secretary Hasan Mehedi said.

Bangladesh loaned $2.1 billion from Jeddah-based International Islamic Trade Finance Corporation to meet its energy import needs in the current fiscal year.

In the previous fiscal year, Bangladesh took $1.4 billion from the same lender. The money was spent for oil imports.

Bangladesh also released bond worth Tk 12,000 crore to minimize its power sector debt.

The combined outstanding payment to Indian companies stood at Tk 6,823 crore.

Of the local power producers, Tk 3,120 crore was owed to the Summit Group, about TK 1,000 crore each to the United Group and the Orion Group, and Tk 841 crore to the Confidence Group.

Of the major base-load power plants, Tk 1,353 crore was owed to Payra power plant, Tk 576 crore to Rampal power

plant, Tk 160 crore to SS Power, Tk 216 crore to Matarbari power plant, Tk 477crore to Unique Meghnaghat Power and Tk 790 crore to Bhola power plant.

The overall outstanding bill also included Tk 545 crore owed to transmission authorities in Bangladesh and India.

At the end of last fiscal year, the BPDB could pay half of its dues with 78 per cent of the payment ending up in the pockets of 24 companies – all AL favorites.

During the Awami League regime for over 15 years, Bangladesh was steered on the path of aggressive expansion of fossil fuels, leading to the building of around 100 power plants, almost all of which were built without competitive bidding.

Frequent energy price hikes over the AL regime triggered the worst inflation in decades, turning Bangladesh to the International Monetary Fund for a $4.97 billion loan.​

 

[Saif]

Power to be disconnected if AC runs below 25C: adviser

Power, energy and mineral resources adviser Muhammad Fouzul Kabir Khan on Monday urged the country’s people to run their air conditioners at 25 degrees Celsius or above during the upcoming month of Ramadan and summer season.

www.newagebd.net

Power to be disconnected if AC runs below 25C: adviser
Staff Correspondent 18 February, 2025, 00:13

Power, energy and mineral resources adviser Muhammad Fouzul Kabir Khan on Monday urged the country’s people to run their air conditioners at 25 degrees Celsius or above during the upcoming month of Ramadan and summer season.

If otherwise, the government will take legal action or disconnect the electricity connection, he warned at a press briefing on the second day of the three-day annual conference of the deputy commissioners at the Osmani Memorial Auditorium in the capital.

The adviser’s warning came Bangladesh braces for a difficult summer, feared to be hotter than ever before, faced with the prospect of long hours of power cuts.

The adviser said that they had started to send letters to the members of the advisory council and already sent a letter to the adviser to the religious affairs ministry to inform the imams to follow the direction during the tarabi namaz during the month of Ramadan.

‘I will request the business organisations through the commerce adviser and all banks through the Bangladesh Bank to keep the AC’s temperature at 25 degrees Celsius or above,’ he said, adding, ‘I will send a letter to the cabinet secretary.’

Fouzul Kabir mentioned that the power demand in winter was 9,000 megawatts and the demand would increase to 17,000MW to 18,000MW in summer.

This gap of 8,000MW to 9,000MW is caused mainly for two major reasons, one of which is irrigation that required 2,000MW, he said.

‘Irrigation is mandatory for food production so this is our highest priority,’ he said.

‘Another reason for increased power demand is cooling loads by the ACs which requires 5,000MW to 6,000MW,’ he said.

‘If we run the ACs at 25 degrees Celsius or above, we can save 2,000MW to 3,000MW,’ the adviser said.

He said that special teams of the Power Division would work to monitor the situation.

‘I hope that power cuts will not take place. But, if it happens, it will be equally distributed in rural and urban areas, except the key point installations and hospitals,’ he said.

Fouzul, also the adviser to the ministries of road transports and bridges and railways, said that they also discussed the issue of reducing the number of road crashes and marked it as the highest priority issue.

He also said that the DCs discussed the issue of the construction of different roads and rail tracks and the repair of different roads.

‘I told the DCs about the limitations of our resources,’ he said and added that the government was facing difficulties in paying prices for fuels and electricity for this reason.​

 

[Saif]

Funding shortfall threatens renewable energy goals

Despite Bangladesh’s lofty aim of generating 40 percent of its energy from renewable sources by 2040, the country faces a significant funding gap, as only 3.6 percent of the required funds were allocated to the sector in 2023, according to a study.

www.thedailystar.net

Funding shortfall threatens renewable energy goals
Banks, NBFIs provided only 3.6% of required funds in 2023

Despite Bangladesh's lofty aim of generating 40 percent of its energy from renewable sources by 2040, the country faces a significant funding gap, as only 3.6 percent of the required funds were allocated to the sector in 2023, according to a study.

Despite the growing need for sustainable energy solutions, banks and financial institutions are providing minimal financing to this sector, said Khondkar Morshed Millat, a faculty member of the Bangladesh Institute of Bank Management.

In 2023, banks and non-banking financial institutions (NBFIs) financed Tk 742 crore for renewable energy projects, up by 62 percent from 2021, the study said.

However, quoting the BIBM's research, Millat said Bangladesh required funding of around Tk 20,500 crore in 2023 to stay on course to provide 40 percent of its energy from renewable sources by 2040.

He added that the annual requirement was likely to increase to Tk 49,400 crore in 2041.

"If this trend continues, domestic banks and financial institutions will contribute only 4 to 9 percent of the required annual funding by 2041, jeopardising the country's renewable energy goals," he added.

He raised these concerns while presenting a study titled "Renewable Energy Financing Trends in Bangladesh" during an event organised by Unnayan Shamannay, a think tank, at the Bishwo Shahitto Kendro in the capital's Banglamotor.

Currently, less than 1 percent of term loans from the banking sector go to renewable energy, he added.

The study further mentioned that, as per the central bank's annual report for FY23, total renewable finance by banks and NBFIs accounted for only 0.3 percent of total disbursed term loans.

Millat, also a former director of the Bangladesh Bank's Sustainable Finance Department, added that some policy challenges, including high import duties imposed on inputs and a lack of tax incentives for entrepreneurs, were major barriers to this sector.

He highlighted central bank initiatives, including policies on sustainable finance and refinancing schemes, but emphasised the need for further fiscal, budgetary, and monetary reforms to expand renewable energy financing.

Tashmeem Muntazir Chowdhury, head of sustainable finance at BRAC Bank, pointed out that domestic banks struggle to fund large-scale renewable projects, urging greater involvement from international development partners.

Mostafa Al Mahmud, president of the Bangladesh Sustainable and Renewable Energy Association, stressed Bangladesh's vast potential for small-scale renewable initiatives like rooftop solar set-ups.

However, he lamented the financial constraints that pose a major hurdle to progress. "In some cases, we have to pay 72 percent tax on imported items, which is a major barrier for the renewable energy sector," said Mahmud.

Ragib Ibnul Asif, deputy director of the central bank's Sustainable Finance Department, underscored the importance of raising awareness among bank officials about the benefits of renewable energy to encourage increased funding.

He also highlighted the need to find other financial sources, such as the bond market.

The seminar was moderated by Zahid Rahman, senior project coordinator of Unnayan Shamannay, and featured open discussions with representatives of banks and NBFIs, renewable energy entrepreneurs, researchers, and university students.​

 

[Saif]

BARAPUKURIA: Coal stacks smoulder as power plant shuts down

Coal stacks three times the usual height, rising up to 15 meters, smouldered at the Barapukuria coal mine as the 525MW coal-fired Barapukuria power plant shut down its last two units since February 15 due to technical glitches triggered by years of lack of maintenance...

www.newagebd.net

BARAPUKURIA: Coal stacks smoulder as power plant shuts down
Emran Hossain 19 February, 2025, 23:51

Coal stacks three times the usual height, rising up to 15 meters, smouldered at the Barapukuria coal mine as the 525MW coal-fired Barapukuria power plant shut down its last two units since February 15 due to technical glitches triggered by years of lack of maintenance.

On Wednesday, power generation from the lone local coal-fired power plant plummeted to zero with chances of not resuming operation in at least two weeks.

The power plant is supposed to consume the mine’s production entirely.

A total of 2.80 lakh tonnes of coal was sitting in the coal stacks with its size growing by around 4,000 tonnes every day, barely leaving any room in the designated coal yards of the mine and the power plant authorities.

‘The standard practice is to keep coal stack height at maximum 6 meters,’ said Shaiful Islam Sarkar, managing director, Barapukuria Coal Mining Company Limited.

Coal stacks are susceptible to self-combustion the chances of which occurring grow with the growth in the height of the stack, he explained.

‘We already spotted smokes on several occasions at the stacks while a flame was also seen once,’ said Shaiful.

Disrupted production at the coal-fired power plant led to the massive stacks over the last month, he said, adding that lately the power plant had been using on average 2,000 tonnes of coal daily because of its reduced generation capacity.

Both the BCPCL and the Bangladesh Power Development Board, the owner of the coal plant, were busy spraying water on their coal stacks continuously as the dry season of winter presumably facilitated self-combustion.

The coal mine has been exclusively supplying fuel to the power plant, the main source of electricity for many areas in the northern region.

‘The power plant has been a patchwork for a while now since there has been no maintenance after it started operating in 2018,’ said Mohammad Abu Bakar Siddique, the chief engineer of the plant.

The plant’s first unit, which originally had the capacity to generate 125MW but could now produce about 75MW due to lack of maintenance, was the last to close down at 2:43pm on Tuesday.

Leak in the boiler’s super heater tube led to the closure, Abu Bakar said.

Repairs of the first unit have to wait for two weeks because of the closure, leaving the plant extremely heated at around 1,000C.

Leaks were also behind the closure of the third and the biggest unit of the plant worth 275MW on February 15. Pipe connecting the boiler with the turbine developed the leaks.

‘The pipe has been leaking slightly for a long time. It suddenly just went out of control,’ said Abu Bakar.

Heater for heating up air also malfunctioned besides a bearing that broke down while four out of the five coal mills at the 3rd unit were barely operational.

A two-week deadline has been fixed to repair the 3rd unit.

The second unit of the plant with 125MW capacity, which has been out of operation since 2020, badly needed an overhauling.

The company responsible for the plant’s maintenance never performed its duty during the past Awami League regime, overthrown by a student-led uprising in July-August last year.

‘Sudden closure will keep haunting the power plant even if it returns to operation for the time being,’ said Abu Bakar.

He said that the BPDB asked the BCPCL to sell its coal outside after keeping a certain stock.

With the crisis at Barapukuria, the power sector witnessed yet another grim development, barely days after the 1,320MW imported coal-based Rampal power plant shut down due to fuel shortage triggered by the dollar crisis.

Bangladesh has also not seen any progress regarding its request to the 1,347.54MW Adani power plant to run at its full capacity. The power plant has been running at its half capacity since November last year due to outstanding bills.

After the request, the Adani power said that it could not start full operation due to a technical glitch.

The BCPCL authorities warned that they would not be able to suspend coal mining as the move would have serious consequences.

Suspending operations at the coal mine mean paying demurrage to the Chinese company running the mine with 1,100 local and 250 Chinese staff.

After a phase of mining begins, its abandonment halfway through means leaving the coal exposed to self-combustion, the plant authorities said.

‘The entire phase has to be sealed off,’ said Shaiful Islam.

The current phase under mining at the Barapukuria contains nearly 5 lakh tonnes.

Time is running out fast for Bangladesh to ensure measures to take its current production of 11,000–18,000MW by the time the coming summer peaks in. Bangladesh’s current installed power generation capacity is 27,884.7MW. But load shedding persisted even during winter, when the electricity demand remained around 10,000MW.

The temperature already started rising. In 200km of Barapukuria in Dinajpur, the day temperature reached 32C on Wednesday, placing the area as the hottest place in the country on the day.

At 6:00pm on Wednesday, the Bangladesh Meteorological Department said that the Dhaka air contained 49 per cent humidity.​

 

[Saif]

Driving Bangladesh Bank’s low-cost green refinance schemes

With the utilisation rates of green funds remaining stubbornly low, Bangladesh Bank can evaluate the scope of prefinancing green projects.

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Driving Bangladesh Bank’s low-cost green refinance schemes

Industries reeling from previous energy price spikes would need to utilise low-cost green refinancing schemes for clean energy projects to offset increasing costs. FILE VISUAL: COLLECTED

Clean energy solutions require a significant commitment of capital from the private sector. Bangladesh Bank's low-cost green refinance schemes, offered at interest rates of up to five percent, can enable the private sector to channel this capital towards clean energy projects. These low-cost schemes increase the viability of clean energy projects as opposed to loans offered at market rates. However, information asymmetry, lack of awareness and lengthy disbursement processes prevent the proper utilisation of these schemes.

With the Bangladesh government mulling a hike in gas prices and industries reeling from previous energy price spikes, the latter would need to utilise low-cost green refinancing schemes for clean energy projects to offset increasing costs. This would necessitate addressing prevailing barriers.

The government may raise gas tariffs for industrial processes and captive power generation by 151 percent and 145 percent, respectively, owing to expensive liquefied natural gas imports. New industrial and captive connections will have to pay Tk 75.72 per cubic metre across the board, while currently they pay Tk 30 per cubic metre for industrial processes and Tk 30.75 per cubic metre for captive power. If approved, existing industries will pay the revised tariff for consuming gas beyond the sanctioned loads, while new industries will pay the revised tariff for total consumption. Moreover, the persistent revenue shortfall in the power sector may compel the government to raise power tariffs.

Burdened by the challenge of rising costs while trying to remain competitive in the market, operational industries will shift their focus to energy efficiency and rooftop solar. Besides, new industries will consider a "whole-system-design" approach to minimise their energy consumption by installing the most efficient technologies and harnessing natural light.

As higher energy tariffs send a strong signal for the rapid implementation of energy efficiency and renewable energy measures, the demand for low-cost green finance will soar in the country.

Bangladesh Bank launched a refinancing scheme for green products in 2009, initially known as the green refinance scheme for solar energy, biogas and Effluent Treatment Plant (ETP), with a modest funding size of Tk 200 crore. Later on, it enlarged the funding base to Tk 1000 crore and fixed the highest interest rate at five percent down from the previous 10 percent. It widened the ambit of eligible projects, including energy efficiency, green building, green industry and different renewable energy technologies.

The central bank also offers a low-cost Green Transformation Fund (GTF) of Tk 5,000 crore, which export and manufacturing oriented industries can obtain at up to five percent interest for green projects. The refinancing scheme for Islamic banks and financial institutions of Tk 125 crore is also suitable for clean energy projects.

However, data shows that between January 2018 and September 2024, entrepreneurs had a tepid response to green refinance schemes. The highest disbursement rate of the refinance scheme for green products reached 41.6 percent during the first three quarters of 2024 while the GTF's disbursement rate was only 19.05 percent. The refinancing scheme for Islamic banks and financial institutions registered zero disbursements during January 2022-September 2024 (see Figure 1).

Sources: Bangladesh Bank; IEEFA’s Analysis. *Technology Development Fund is excluded.

Given the funding sizes of Tk 1000 crore and Tk 5000 crore, respectively, the refinance scheme for green products and GTF can serve the growing need for clean energy projects, excluding grid-scale renewable energy plants. As the interest rate on traditional loans in the country is around 14-15 percent, these two schemes offering green finance at 5 percent interest are highly lucrative.

Accelerating the flow of green finance

There is information asymmetry among industries that refinance schemes are costly, and the loan tenure is not appropriate for clean energy projects. They find the central bank's refinancing process lengthy, with a requirement for many documents. Industries have other concerns too. They first apply to financial institutions for loans at market rates and then financial institutions proceed to Bangladesh Bank for refinance schemes. If the central bank does not approve applications for refinance schemes, industries would need to bear the high interest rates that may render their projects unviable. Additionally, capacity development of financial institutions is necessary to accelerate the flow of green refinancing schemes.

The central bank should periodically organise awareness-raising events for major stakeholders to address their concerns by ensuring that the interest rate for clean energy projects is up to five percent with a flexible loan tenure (up to 10 years). It should also debunk misinformation regarding the documents and lengthy process.

The Sustainable and Renewable Energy Development Authority (SREDA)–the nodal agency responsible for advancing clean energy in Bangladesh–should bridge the information gap that affects the use of low-cost green funds. The Bangladesh Solar and Renewable Energy Association (BSREA) can publish periodicals with updated terms and conditions of green refinance schemes for its members and stakeholders.

With the utilisation rates of green funds remaining stubbornly low, Bangladesh Bank can evaluate the scope of prefinancing green projects. Together with financial institutions, it can assess project proposals at an early stage and eliminate any uncertainty industries experience with the schemes.

Financial institutions should have sufficient capacity to understand different clean energy projects as financing a new industry and financing an old industry for retrofitting with energy-efficient equipment requires different appraisal processes. The latter necessitates an understanding of energy audit reports and making decisions based on energy-saving potential. Similarly, bankers should know the net-metering guidelines for rooftop solar.

Bangladesh Bank, SREDA and BSREA can work together to strengthen the capacity of bankers for clean energy project evaluation and financing. This capacity development should include ways of comparing different technologies, their energy-saving potential and quantifying their financial returns.

Soaring energy and power costs are expected to drive the demand for green finance at a faster rate than before. This demand, if met by optimally utilising existing schemes, will deliver double dividends. Not only can industries reduce their energy bills, but the country will also save money, which otherwise would be spent on fossil fuel imports.

Shafiqul Alam is lead energy analyst for Bangladesh at the Institute for Energy Economics and Financial Analysis (IEEFA).​

 

[Saif]

Is this the right time to hike gas prices?

The Bangladesh Energy Regulatory Commission (BERC) is going to hold a public hearing tomorrow on the proposed hike in gas prices for industrial use.

www.thedailystar.net

Is this the right time to hike gas prices?

The Bangladesh Energy Regulatory Commission (BERC) is going to hold a public hearing tomorrow on the proposed hike in gas prices for industrial use.

In a proposal submitted in January this year, gas suppliers suggested the government, through the BERC, hike gas prices by 150 percent for new gas connections and 50 percent for expansion of existing industrial units to Tk 75.72 per unit.

Businesses have expressed concern on different occasions over the issue, saying such an increase would kill industries by doubling the cost of production at a critical time.

The government's reason for hiking gas prices is to minimise subsidies to the energy sector and to cover the import price of liquified natural gas at higher prices.

Industry insiders say the country is becoming increasingly reliant on expensive imported energy -- with estimates suggesting the country will have more than 90 percent dependence on imported energy sources by 2030 -- instead of exploring domestic gas reserves.

Industry owners, especially entrepreneurs in the primary textile sector, which has investment amounting to around $23 billion, said that they are already overburdened by the abnormal hike in gas prices in February 2023, which caused prices to double from Tk 16 to Tk 32 per unit with a commitment to providing an adequate supply of gas.

However, industry owners complain that the gas supply did not increase, forcing them to run units at half of their capacity.

At the same time, around Tk 10,000 crore worth of unsold yarn has been stockpiled at different mills due to an influx of cheap Indian yarn, which is cheaper due to the subsidies provided by its government.

In case of Bangladesh, the government reduced the subsidy to 1 percent and Indian government gives more than 3 percent subsidy.

Of total gas consumption, captive power plants, including those in the primary textile sector and other industries, use 37 percent, according to data from the Bangladesh Textile Mills Association (BTMA), which added that gas prices were hiked by 256.5 percent over the past five years.

So, industry people and economists say that this is not the proper time to increase gas prices as it would not improve gas supply to industries.

Alongside the perennial gas crisis, the industrial sector has been struggling to survive in the face of the severe fallout of the Covid-19 pandemic, Russia-Ukraine war, high inflationary pressure and nationwide political upheaval last year.

A good number of work orders of the garment sector were shifted to neighbouring countries because of the political and labour unrest in Bangladesh last year.

The export-oriented textile and garment sectors are also facing a working capital shortfall owing to the devaluation of the taka against the US dollar and a shortage of US dollars in the banking system.

Moreover, the bank interest rate varies between 15 percent to 16 percent, making capital harder to access.

Anwar ul Alam Chowdhury, president of the Bangladesh Chamber of Industries, said if there is no growth in industries, they ultimately fall sick. The proposed price hike will not be viable now as the industries are going through a tough time, he added.

Khondaker Golam Moazzem, research director at the Centre for Policy Dialogue, echoed Chowdhury's views.

Moazzem said incidents of gas leaks are also higher in Bangladesh, which indicates that the sector lacks governance.

The gas price hike may not increase the gas supply, he said adding that even hiking prices may not be enough to end the crisis. So, it is a lame excuse that LNG supply will be increased by hiking the gas price, he said.

Masrur Reaz, chairman of the Policy Exchange of Bangladesh said the textile, garment and steel sectors will be hit hardest by the price hike.

He also believed the gas supply may not increase even prices are hiked.

Razeeb Haider, managing director of Outpace Spinning Mills Ltd, urged the government to explore gas in order to reduce the dependence on expensive imported LNG.

In the upcoming fiscal year, which begins on July 1, the subsidy allocation is likely to be Tk 112,000 crore, up from Tk 100,174 crore in the outgoing fiscal year.

The power sector is likely to get Tk 42,000 crore in FY25. The government had earmarked Tk 35,000 crore in FY24. Before FY22, the subsidy allocation for the power sector was between Tk 7,000 crore and Tk 9,000 crore.​

 

[Saif]

Expedite gas exploration, shift to renewables to reduce expenditure

Bangladesh should expedite gas exploration and place emphasis on renewable energy to reduce excessive expenditure on the energy and power sector, speakers said at an event yesterday.

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Expedite gas exploration, shift to renewables to reduce expenditure
Speakers say at CPD conference

Ilisha gas field in Bhola. File photo

Bangladesh should expedite gas exploration and place emphasis on renewable energy to reduce excessive expenditure on the energy and power sector, speakers said at an event yesterday.

To lower energy bills, they suggested the government ensure primary energy before setting up new power plants and renegotiate electricity prices with private power producers.

At the same time, analysts suggested the government strengthen the Bangladesh Energy Regulatory Commission and shape it as the supreme authority in power and energy supply.

These remarks came during a discussion session titled "Building Sustainable Futures: Connectivity and Energy" during a conference on "Recommendations by the Task Force on Re-Strategising the Economy" at the capital's BRAC Centre Inn yesterday.

Presiding over the session, Prof M Tamim, vice-chancellor of Independent University of Bangladesh, said there would be hard times ahead. He added that trouble might start sooner if the production at the Bibiyana gas field reduces.

"We are paying around $13 billion a year to import all types of energy sources and it may stand at $20 billion by 2030, by when estimates say Bangladesh will have more than 90 percent dependence on imported energy sources. Given the way the local gas production is going down, we will be in big trouble," he said.

"If even two or three wells in Bibiyana somehow fail to produce, what is the backup?" he asked, adding that though Bangladesh has committed to an energy transition, there are around 15,000 megawatts (MW) of fossil fuel-based power generation contracts.

He added that the previous Awami League government's aim of generating 40 percent of total power from renewable sources was made without doing any homework.

"We need a comprehensive plan engaging all stakeholders, including engineers of power grid companies. This would help us set a realistic target," he added.

Muhammad Fouzul Kabir Khan, adviser to the Ministry of Power, Energy and Mineral Resources, said the government is trying to reduce power generation costs to minimise the huge subsidy burden in this sector.

"We have set up a benchmark tariff with the Matarbari coal-based power plant and will try to renegotiate other coal-based plants accordingly. In the same way, we will renegotiate prices with the gas-fired power plants," he said.

Responding to a query, he said they would monitor cooling demand during the summer season based on the load of feeders managed by distribution companies.

"If we find a feeder's load unjustifiably high, then we will go for load-shedding in that area," he said, urging people to follow the government's instruction to set air conditioners at 25 degrees Celsius or above.

Bangladesh Energy Regulatory Commission Chairman Md Jalal Ahmed criticised the keynote paper for focusing mainly on the power sector.

"We are short on primary energy only. The current situation has arisen due to focusing solely on power generation. We have increased power generation capacity but neglected transmission and distribution," he said.

He added that the state-owned gas exploration company BAPEX has surveyed only 5,000 square kilometres, although there were plans in 2007-09 to survey 20,000 square kilometres within a year.

"Offshore exploration was all set and a company won the tender, but they weren't awarded the work. Gas exploration was not a priority for the previous government and as a result, we don't know if we have gas reserves or not," he said.

Former professor of the Bangladesh University of Engineering and Technology (BUET) Ijaz Hossain said gas production has been declining since 2017.

"At least 10 drillings should be done every year," he said, adding that renewable energy should also be prioritised.

"It is ridiculous that we are using furnace oil to produce electricity, which costs Tk 25 per unit, when we could harness solar energy at the lowest cost while the sun is shining," Hossain commented.​

 

[Saif]

No logic behind hiking gas tariff

The demand made by the Consumer Association of Bangladesh (CAB) for suspension of the scheduled public hearing on the proposed gas tariff rise on Wednesday is sure to enjoy popular support. Essentially, the rights group is against any further hike in gas tariff. However, its argument that the move

thefinancialexpress.com.bd

No logic behind hiking gas tariff
Published :
Feb 25, 2025 00:03
Updated :
Feb 25, 2025 00:03

The demand made by the Consumer Association of Bangladesh (CAB) for suspension of the scheduled public hearing on the proposed gas tariff rise on Wednesday is sure to enjoy popular support. Essentially, the rights group is against any further hike in gas tariff. However, its argument that the move to increase tariff for new industries, extended units of existing ones and new captive power plants is not in conformity with the spirit of the July-August uprising may not hold much water. Economic reality hardly respects considerations other than sound reasoning based on available constituents in a given situation. Of course, a search for cheaper alternative to the proposed measure can be a viable option. One of the CAB's demands stands out for its logical argument. It has suggested slashing of tariffs and subsidy by arresting illegal and illogical spending.

There is no need to go for drastic measures like the ones US President Donald Trump has opted for cutting US federal spending but economising on different areas of the energy sector can make quite a difference. Pilferage through illegal connection of gas and the alleged tampering with gas meters at some industrial units are some of the areas that need addressing immediately. The problem has its origin in the overdependence on imported gas and fuel oils to the misuse of gas obtained in the country's wells and reluctance to further explore this cheap source of domestic energy onshore and offshore. Apart from the Sylhet region where from gas has been extracted to its near depletion, the Chittagong Hill Tracts, a part of the eastern fold belt of the Bengal Basin thought to be potentially rich in hydrocarbon were totally ignored. One of the reasons was the challenging nature of the exploration there. But drilling of four wells at the Sitakund structure by the Indian Prospecting Company between 1908 and 1914 at the maximum depth of 1047 metres reportedly found presence of oil and gas there.

When crony capitalism rules the roost, there is an easy option for economic measures in the interests of the few instead of the larger benefit of the country. The nation is now paying heavily for dependence on imported liquefied natural gas, liquid oil and coal. Under the dubious arrangement of power generation by quick rental power plants indemnified by the Quick Enhancement of Electricity and Energy Supply (Special Provision) Act 2010, billions of Taka were embezzled and wasted in the name of capacity charge. This money was added to the cost and hence the rise in gas and power tariff.

With the scrapping of the indemnity energy law, the extra cost on account of misuse, irregularity and capacity payment is no more involved. The government is no longer bound to supply gas to those quick rental power plants and pay even if they do not generate power and supply the same to the national grid. But making the gas costlier, as proposed, by 152.40 per cent for new industries and extended units of existing ones and 141.96 per cent for new captive power plants, will act as a serious disincentive to the country's industrial base. Notably, captive power plants are installed by power-intensive industries where continuity and quality of power supply are crucial. If gas supplied to industries becomes outrageously costly, operation of many manufacturing plants will be uneconomical or the extra costs will be passed onto the consumers, adding to their woes. The move may prove counterproductive.​

 

[Saif]

BERC to hold public hearing today on gas price hike

The hearing will take place at the capital’s BIAM auditorium from 10:00am to 5:00pm.

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BERC to hold public hearing today on gas price hike

The Bangladesh Energy Regulatory Commission (BERC) is set to hold a public hearing today on the proposals to increase gas prices for industrial users, according to a notice from the commission.

The hearing will take place at the capital's BIAM auditorium from 10:00am to 5:00pm.

According to the proposals from the distribution companies and Petrobangla, gas prices for new industrial and captive power users will be determined based on the actual cost of LNG imports.

Industries exceeding their sanctioned load will be charged according to the same method.

Currently, they pay a flat rate of Tk 30.75 per cubic metre of gas used. If they exceed their sanctioned load, they are still charged the same rate. Under the new proposal, these industries will be charged Tk 75.72 per cubic metre for any gas usage exceeding the sanctioned load.

In addition, new industrial and captive connections will have to pay Tk 75.72 per cubic metre consistently. Instead of a fixed rate, the new pricing structure will be based on the actual cost of imported liquefied natural gas (LNG).

According to the proposal, those who have received primary approval for new connections will have to pay 50 percent of their bills at the existing rate for their sanctioned load, and the rest at the new rate.

Under the proposed policy, the gas price will be determined by the cost of LNG imports, calculated based on the average expenditure of the previous three months' total costs. This will include operational, transmission, and distribution charges, as well as contributions to the gas development, energy security, and research funds. A 15 percent VAT will also be imposed.

Between July and September 2024, Petrobangla imported a total of 1,726 million cubic meters of LNG for Tk 10,979 crore. The per cubic meter cost of LNG during that period was Tk 63.58, and after including all additional charges, the final cost per unit reached Tk 75.72.

Meanwhile, the Consumer Association of Bangladesh (CAB) has protested the hearing. They plan to hold a human chain in front of the venue before the event.​

 

[Saif]

PUBLIC HEARING ON GAS PRICE HIKE: BERC blasted by consumers

Frequent booing and screams of the word ‘shame’ filled the air inside the indoor venue in Dhaka where the Bangladesh Energy Regulatory Commission on Wednesday held its public hearing on the gas price hike proposal of up to 152 per cent...

www.newagebd.net

PUBLIC HEARING ON GAS PRICE HIKE: BERC blasted by consumers
Staff Correspondent 27 February, 2025, 00:12

Frequent booing and screams of the word ‘shame’ filled the air inside the indoor venue in Dhaka where the Bangladesh Energy Regulatory Commission on Wednesday held its public hearing on the gas price hike proposal of up to 152 per cent.

The first public hearing in about two years and eight months, it attracted a huge gathering of consumers, who branded the BERC as a ‘public enemy’.

Consumers rallied in a human chain even before beginning the hearing in the morning. The first session of the hearing ended in complete chaos amidst slogans calling the hearing a ‘farce’ and ‘anti-people’ reverberating around the almost-packed venue.

On January 6, Petrobangla asked for the price hike, proposing that the per unit costs of gas used in industries and captive power plants be raised to Tk 75.72 from Tk 30 and Tk 31.50 respectively.

While energy experts found such a proposal unrealistic, consumers found the hearing reminiscent of the injustices and misrule of the Awami League, one of which was passing arbitrary energy prices onto consumers’ shoulders.

‘Those who presented the price hike proposal acted rather like a postman. Their presentations reflect no use of intelligence, conscience, and commitment to the country,’ said Consumers Association of Bangladesh’s energy adviser M Shamsul Alam.

‘This hearing cannot be held without righting the wrongs done to people during the past political regime,’ he said as he began his speech after completion of the presentations by Petrobangla, six distribution companies, and the BERC’s technical evaluation committee.

The presentations apparently left many in the venue outraged as they burst into booing, which eventually evolved into slogans just before the lunch break, demanding immediate cancellation of the hearing.

‘The price hike will destroy the country’s industry, turning it into a global export destination,’ said Shamsul Alam, likening the BERC to a public enemy.

‘We demand to know the identity of the people who came up with the idea of the price hike. Is this what freedom looks like?’ asked Shamsul Alam before leaving the venue after placing three demands, giving the commission three days to scrap the proposal.

In their proposals, the Petrobangla and its affiliated organisations argued that the gas price needs to be raised to increase gas supply by importing more liquefied natural gas to boost employment, business and industrial growth, echoing the justification invariably given by the past AL regime each time it raised energy prices.

The price hike is aimed at generating Tk 3,240 crore for LNG import.

AL raised energy prices frequently, often more than once a year, throughout its rule. The hikes that came since 2023 happened without public hearing after the AL curtailed BERC’s authority by amending its law.

Communist Party of Bangladesh general secretary Ruhin Hossain Prince surprised by the striking similarity in the price hike proposal with that of AL’s, lacking any forecast on its impact on the people and the economy.

‘I demand to stop this farce,’ he said.

‘This hearing should have been called to discuss the corruption of the ousted AL regime,’ the CPB leader said.

Industrialists recalled how the last public hearing, held in June, 2022, was used by the fallen AL regime to increase gas prices from over Tk 16 to Tk 30 per unit, without caring for any justification.

They recalled a meeting with the government in which the estimated justifiable price ranged between Tk 20 and Tk 22. But the government had raised the price to Tk 30 anyway.

‘I recall industrialists receiving a maximum 7psi of gas supply against their sanctioned load of up to 40psi,’ said Bangladesh Knitwear Manufacturers and Exporters Association president Mohammad Hatem.

‘Does the commission want us to pay even more though the gas supply was never improved?’ asked Hatem.

Deliberating on the losses caused by the arbitrary energy pricing that left scores of factories either sick or closed down, the industrialists warned that the new proposal sent out a single message – stop industrial expansion.

Under the proposal, any new gas connection seekers in industries and captive power plants will have to pay the new price for their entire supply.

Those who were promised gas connections but are yet to get it will have to pay the new price for half of its sanctioned load and the old price for the rest.

Existing gas consumers will have to pay the new price if their consumption surpasses the sanctioned load, the proposal said.

‘How dare you! In the changed situation that cost sacrifices of so many lives, you come up with such a discriminatory proposal!’ wondered Bangladesh Terry Towel & Linen Manufacturers & Exporters Association president M Shahadat while addressing the commission.

Holding back new investments, which is very likely because of the prospect of Chinese industries relocating to countries like Bangladesh, implies losing out business to India and favouring ‘old AL oligarchs’ by allowing them to enjoy the old gas price.

‘Some vested group is surely working against our economy,’ said Bangladesh Chamber of Industries president Anwar-Ul Alam Chowdhury.

The industrialists, repeatedly demanding to know the names of the brains behind the price hike proposal, said that what the price hike would achieve was so much opposite to what the July-August movement wanted to achieve.

Leaders of the Bangladesh Ceramic Manufacturers and Exporters Association, the Federation of Bangladesh Chambers of Commerce and Industry, the Bangladesh Steel Manufacturers Association, the Bangladesh Textile Mills Association, the Bangladesh Garment Manufacturers and Exporters Association, liquefied petroleum gas businessmen, CNG Refueling Pump Owners Association, Bangladesh Incense Manufacturers Association, and Ganosamhati Andolan chief coordinator Zonayed Saki also spoke.

BERC chairman Jalal Ahmed ended the hearing by saying that views expressed at the hearing would be seriously considered before a decision on the matter.

Bangladesh’s current gas demand is about 4,000mmcfd, but the supply remains below 3,000mmcfd. In 2023-24, the average gas supply was 2,493mmcfd.

The TEC of the BERC concluded in its evaluation of the proposal that Tk 7.34 could be saved per cubic meter of gas by adjusting tax, which energy experts call illegal and excessive.​

 

[Saif]

Energy key to economic efficiency, says CA’s Press Secretary

CA’s Press Secretary Shafiqul Alam said on Wednesday energy is the key to economic efficiency and no economy can function optimally without fixing the sector. Speaking at the ‘Development Journalist Forum of Bangladesh (DJFB) Talk’ at the NEC Conference Room in Sher-e-Bangla Naga

thefinancialexpress.com.bd

Energy key to economic efficiency, says CA’s Press Secretary
FE Online Desk
Published :
Feb 26, 2025 18:26
Updated :
Feb 26, 2025 18:26

CA’s Press Secretary Shafiqul Alam said on Wednesday energy is the key to economic efficiency and no economy can function optimally without fixing the sector.

Speaking at the ‘Development Journalist Forum of Bangladesh (DJFB) Talk’ at the NEC Conference Room in Sher-e-Bangla Nagar, he criticised the previous Awami League government for mishandling the energy sector, which he claimed led to large-scale corruption and mismanagement, UNB reports.

“The entire system, like the capacity charge, was an arrangement for organized looting,” Alam alleged.

Citing findings from the White Paper, the Press Secretary stated that around $234 billion was laundered abroad during the previous regime. “Had this money remained in the country, it could have been reinvested to create jobs and boost economic growth,” he said.

Shafiqul Alam highlighted the current government’s focus on restoring macroeconomic stability. “We are seeing positive results as inflation has been declining for two consecutive months. We expect it to fall to around 7 percent by June, bringing much-needed relief to the people.”

He said that commodity prices are coming down and a stable inflation rate is helping maintain a steady exchange rate, positively impacting the development budget.

Blaming the previous government for destabilising the economy, he criticised the 9 per cent cap on both deposit and lending rates, and described the banking sector’s condition under the former regime as “daylight robbery while everyone was asleep.”

Despite these challenges, Alam expressed optimism about the interim government’s reforms, including improvements in the labor sector, enhanced efficiency at Chattogram Port and efforts to attract more foreign investment.

“We are working to restore discipline in the energy sector, pursuing policies like ‘no electricity, no payment’ and increasing the focus on solar power and regional energy cooperation through the Bangladesh-India-Bhutan-Nepal (BIBN) SA Electricity Grid,” he explained.

The government is also prioritising faster gas exploration, digitalising administrative processes to curb corruption, and attracting more foreign direct investment (FDI).

Alam stressed the importance of FDI in tackling unemployment and said the current administration had addressed issues that previously hindered foreign companies from repatriating profits. “These initiatives send the right signal to foreign investors that Bangladesh is committed to efficiency and tackling corruption,” he said.

He expressed confidence that Bangladesh would become a top performer in the global economy with ongoing reforms in the labor sector, improved port efficiency and enhanced energy management.

On law and order, Alam said the government had already taken nine measures to improve the situation and expected significant progress soon.

He also assured that the central bank had been working to restore discipline in the banking sector and protect depositors in troubled banks.

Addressing agriculture, Alam said the interim government was taking farmer-friendly initiatives to ensure food self-sufficiency.​

 

[Saif]

Bangladesh's energy transition comes to halt

Bangladesh’s energy transition came to an abrupt stop with the country’s interim government struggling to find investors in renewable energy projects.

www.newagebd.net

Bangladesh's energy transition comes to halt
Emran Hossain 01 March, 2025, 00:02

RE tender gets poor response

Bangladesh’s energy transition came to an abrupt stop with the country’s interim government struggling to find investors in renewable energy projects.

After assuming power following the fall of the Awami League regime amid a mass uprising in July-August, the interim government cancelled all 31 renewable energy projects in the pipeline with a combined capacity of over 2,600MW.

Just a step behind signing the power purchase agreement, the cancelled renewable energy projects had been awarded without tender, under the protection of an indemnity law.

But new tenders, floated in three phases since December 2024, sparked debate over the eligibility criteria, which energy experts found to be facilitating AL-era power investors, big companies and foreign investors.

The response to the tenders, however, has been very poor so far, prompting authorities to extend deadlines.

Only four renewable energy projects are currently under construction, scheduled to come online this year, with a capacity of about 100MW.

‘That’s probably all about new renewable energy projects to be implemented through next year,’ said Shafiqul Alam, lead energy analyst, Bangladesh, the International Institute for Energy Economics and Financial Analysis.

‘Investors are apparently unwilling to invest in Bangladesh now,’ he said.

Cancellation of the previous renewable energy projects, some of which involved foreign investors such as Marubeni Corporation, Total Gas, and Engreen Limited, caused trust issues, highlighting uncertainties in doing business in Bangladesh, energy experts said.

The foreign investors had spent millions, some of them $200 million, and over half a decade of their time in advancing their projects that were eventually cancelled.

The foreign investors scrapped agreements with banks, a prerequisite for signing PPA following the receipt of the letter of intent from the government to get the investment.

‘New renewable energy projects would not be bankable,’ said a former employee of one of the foreign investors, confirming the shutdown of their Bangladesh office.

Government guarantee is what made previous projects bankable, he said, adding that no such guarantee is achievable in the current process.

‘Getting assurance from the financially strained Bangladesh Power Development Board does not sound exciting,’ he said.

Floated on December 5, 2024, the first tender invited proposals for setting up 12 solar power plants with capacity between 10MW and 45MW in nine locations.

The deadline for the first tender was extended once due to poor response, prompting authorities to relax its eligibility criteria. The next deadline is March 5.

Initially, applicants, who could be individual firm or joint venture or consortium or association, would have to have experience in successfully implementing two ground-mounted grid-tied solar projects, each with a minimum capacity of 20MW.

One of the solar projects would have to be implemented outside the tenderer’s country, showed the tender document.

BD Rahmatullah, a former director general of the Power Cell, described the condition as discouraging to local investors while opening the market to big foreign companies.

‘Local renewable energy enthusiasts are desperately looking to find foreign partners, often in vain,’ he said.

During the past 15 years of the AL regime, 12 countries got involved in 75 renewable energy projects, including those that rolled into operation, with a combined capacity of 5,489.6MW.

China topped the list becoming engaged in building 22 power plants with a capacity of 1,601MW.

Bangladesh was involved in building 1,258MW, followed by Singapore co-financing solar power projects with a capacity of 728MW, the United Arab Emirates co-financing 470MW, Japan 400MW, India 250MW and Germany, the Netherlands, the United Kingdom, and Korea co-financing 100MW or a bit more each.

Countries like Norway, France, and the United States also invested in solar power projects with capacities of only 50MW each.

The second tender invited proposals for building 10 solar power plants with 50MW capacity each in seven locations. The tender will expire on March 10.

Proposals for constructing 19 power plants with capacities ranging between 70MW and 100MW in 13 specific locations were floated on January 27 with a deadline of March 31.

‘All tender deadlines are likely to be extended, by up to three weeks,’ said Golam Mortuza, the BPDB official in charge of taking care of the tenders.

He said that the eligibility criteria would be relaxed to make the bidding even more competitive.

Despite making announcements about providing land and a transmission network to facilitate future renewable energy projects, the interim government has come up with no such measures in the ongoing bidding.

The locations specified in the tenders refer to sub-stations from where the BPDB will receive electricity supply from the solar power plants to be built, the PDB official said.

There are at least seven potential AL-era investors who have land near the locations mentioned in the last tender. PDB officials said that these AL-linked investors were likely to get the solar projects.

Bangladesh’s current installed power generation capacity is 27,884.7MW. Of the capacity, renewable energy accounts for only over 993MW.

Except for a wind and a hydroelectric plant, there are 14 solar power plants currently in operation, 11 of them owned by private companies known as AL favourites. The biggest solar power plant is of 200MW.

‘The ongoing bidding is likely to favour AL favourites in many ways,’ said Bangladesh Working Group on Ecology and Development member secretary Hasan Mehedi.

‘Bangladesh’s energy transition has never been so uncertain,’ he said.​

 

[Saif]

Energy division seeks Tk 22.25b for dev projects

The energy division has requested the government to earmark Tk 22.25 billion in the next fiscal year for drilling wells to enhance gas and oil production, conducting seismic surveys, and exploring mineral resources, officials have said. Energy and Mineral Resources Division Secretary Mohammad Sa

thefinancialexpress.com.bd

Energy division seeks Tk 22.25b for dev projects
Fund sought for dev projects in FY26, Finance Division scrutinising proposal
FE REPORT
Published :
Mar 01, 2025 00:40
Updated :
Mar 01, 2025 00:40

The energy division has requested the government to earmark Tk 22.25 billion in the next fiscal year for drilling wells to enhance gas and oil production, conducting seismic surveys, and exploring mineral resources, officials have said.

Energy and Mineral Resources Division Secretary Mohammad Saiful Islam in a recent letter to Finance Secretary Dr Md Khairuzzaman Mozumder made the plea.

Finance Division officials say they are now scrutinising the proposal based on the necessity of the projects.

A senior official of the division told The Financial Express, "The government is now facing a severe shortage of development funds. Allocating additional funds in the next fiscal year will be very tough."

In the fiscal year 2025-26, the energy division secretary sought an allocation of Tk 3.0 billion to install ERL unit-2, Tk 2.0 billion to construct the Bhola-Barishal-Khulna gas pipeline, Tk 1.0 billion to dig wells in five areas of Bhola district, and Tk 2.0 billion to conduct 3D seismic surveys in Charfesson, Monpura, and Hatia upazilas.

He also sought Tk 1.0 billion for capacity enhancement of well digging and seismic survey of Bangladesh Petroleum Exploration and Production Company Limited (BAPEX), Tk 6.0 billion to procure a new rig, Tk 1.0 billion to increase the capacity of Geological Survey of Bangladesh and implement seven more projects, Tk 500 million for capacity building and setting up new lab for the Department of Explosives, and Tk 500 million for enhancement of training capacity and constructing building for Bangladesh Petroleum Institute.

According to officials of the division, four projects got approval of the Executive Committee of the National Economic Council (ECNEC) in the fiscal year 2024-25.

Under one of those, the energy division will require Tk 100 million to make procurements and set up a gas processing plant with a capacity of 60 million standard cubic feet per day (MMSCFD).

Another approved project for 2D seismic surveys to explore blocks 7 and 9 will require Tk 200 million.

Moreover, the drilling of Rashidpur-11 well will require Tk 500 million, while some Tk 1.20 billion will be needed to dig Dupitila-1 and Kailashtila-9.

Finance Division officials say two more projects are awaiting ECNEC approval in the current fiscal year. One of those involves conducting 3D seismic surveys in Habiganj, Bakhrabad, and Meghna fields and will require Tk 750 million, while Tk 2.50 billion will be needed to dig two wells in Titas and Bakhrabad fields.​

 

[Saif]

Maximising energy efficiency is key to our industrial growth

The need to tackle climate change necessitates an increase in energy efficiency.

www.thedailystar.net

Maximising energy efficiency is key to our industrial growth

Although energy efficiency has many advantages, several obstacles hinder its widespread use in the industrial sector of Bangladesh. FILE VISUAL: ALIZA RAHMAN

The need to tackle climate change necessitates an increase in energy efficiency. Global energy intensity has been declining annually since 2015, with significant implications for businesses, governments, consumers, and the environment. Energy security, climate change, and economic stability are more pressing than ever, and both developed and developing countries must take action to address these issues amid rising concerns over energy price volatility and the worldwide focus on reducing carbon dioxide (CO2) emissions.

In developing countries, where energy consumption and the search for clean energy sources continue to grow, energy efficiency is becoming an increasingly important tool for both financial stability and energy security. Furthermore, in developing countries like Bangladesh, energy efficiency has emerged as a crucial component, owing to its commercial and industrial competitiveness and energy security advantages. In addition, the environmental benefits, such as lowering CO2 emissions, make it increasingly valuable.

In FY23, over 10.35 percent of Bangladesh's GDP was derived from its ready-made garment (RMG) industry. This sector employs millions of people and is the main driver of economic growth. Also, in terms of satisfying the increasing demand for environmental, social, and governance (ESG) standards for international clients, energy efficiency is essential for Bangladesh's industries. For example, Bangladeshi garment manufacturers need to meet foreign consumers' requirements to reduce greenhouse gas (GHG) emissions.

However, the pattern of energy use in Bangladesh indicates a significant reliance on non-renewable resources. Recent data shows that the industrial sector alone is responsible for a large amount of the overall energy consumption, with textiles, clothing, and chemicals being the main contributors. Collectively, the garment (15.4 percent), textile (12.4 percent), and chemical fertiliser (12.2 percent) sub-sectors account for over 40 percent of the total energy consumption of the industrial sector.

Given this high level of consumption, energy-saving strategies could significantly lower costs and improve these businesses' competitiveness globally. Limiting energy use in the industrial sector lowers operational costs, boosts economic efficiency, and frees up capital for growth and innovation. Reducing CO2 emissions and other pollutants also encourages environmental responsibility and helps the country meet its environmental commitments under international agreements. By lowering dependency on foreign fuels and increasing energy efficiency, national energy security and stability can be improved. Effective energy use also boosts Bangladeshi products' competitiveness in the global market, where sustainability is increasingly important for cooperation and trade.

Although energy efficiency has many advantages, several obstacles hinder its widespread use in the industrial sector of Bangladesh. Many industrial operators are unaware of the financial and environmental advantages of energy efficiency, and there is a lack of qualified workers to handle and deploy these technologies. Another major obstacle is the high upfront cost of energy-efficient technologies and the absence of financial incentives. Furthermore, energy performance requirements and incentive gaps persist, while enforcement of some laws to foster energy efficiency remains weak. Another barrier is the challenge for businesses to shift to modern energy-efficient systems without major investment and technical know-how, as many still cling to outdated equipment and manufacturing practices.

One of the key obstacles industries face is the high upfront costs associated with implementing energy-efficient technology. The swift development of energy-efficient technologies creates a knowledge gap since some industries do not have the expertise needed for successful deployment.

Existing infrastructures and legacy systems in industries may not readily integrate with newer, more energy-efficient technologies. Moreover, industries may be reluctant to comply with new laws or mandated guidelines meant to increase energy efficiency. In addition, a lack of knowledge about the advantages and opportunities accessible to organisations is a widespread obstacle to energy efficiency. A major gap still exists in the application of standardised frameworks for energy efficiency.

Governments worldwide understand the critical significance of energy-efficient technologies in combating climate change and decreasing industrial energy usage. Tax incentive schemes can encourage businesses to invest in energy-efficient equipment. Grants can fund projects that improve energy efficiency, encourage renewable energy integration, and develop novel technology with environmental benefits. Providing funding channels, incentives, and support systems helps reduce the initial investment burden. Mandatory energy efficiency targets encourage businesses to invest in technological upgrades, operational improvements, and environmentally friendly practices. International collaborations enable the exchange of knowledge and experiences, allowing countries to learn from one another's successes and failures in boosting energy efficiency.

Moreover, collaborative projects bring together experts from several countries, encouraging innovation and the development of cutting edge technology that improves energy efficiency and promotes waste reduction to help develop a more sustainable and environmentally conscious industrial landscape. Governments should foster a conducive environment for joint ventures, research collaborations, and knowledge-sharing. Also, increasing investment in research and development can address new technical problems and gaps, encourage innovation in energy-efficient technology, enhance existing solutions, and develop new techniques.

As Bangladesh aims to become a higher-middle-income country and be increasingly integrated into the global economy, maintaining growth and competitiveness will depend heavily on efficient energy use. To remove obstacles and realise the full potential of energy efficiency, government regulations, business dedication, and international assistance must come together. It's time to take action. For industries, the economy, and future generations, the risks are high, but so are the rewards.

Afia Mubasshira Tiasha is senior research associate at the South Asian Network on Economic Modeling (SANEM).​