[🇧🇩] Energy Security of Bangladesh

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[🇧🇩] Energy Security of Bangladesh
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Govt to set up land-based LNG terminal soon: Alam
BSS
Published :
Apr 25, 2025 16:28
Updated :
Apr 25, 2025 16:28

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The interim government has decided to set up a land-based LNG terminal to ensure a smooth gas supply to the country’s factories.

“Many are saying that they are unable to set up factories due to a lack of gas. So, we want to set up a land-based LNG terminal as quickly as possible so that enough gas can be brought (from abroad),” Chief Adviser’s Press Secretary Shafiqul Alam told reporters in Doha on Thursday.

In this regard, he said, a plan was shared with Qatar Energy during Chief Adviser Professor Muhammad Yunus’s tour to Doha.

The land-based LNG terminal will be set up soon to expand the gas supply to factories in Bangladesh, the press secretary said.

Regarding the chief adviser’s Doha tour, he said it was a very successful and fruitful visit.

“I would say it is one of the most successful and very engaging visits,” he said.

Due to this tour, Alam hoped, the reputation of Bangladesh would spread across the world and many foreign investors would come forward to invest in Bangladesh.

Highlighting the bounce-back of the country’s economy, he said there were outstanding debts of US$ 3.2 billion during the ousted regime, but the interim government has reduced it to US$ 600 million.

The remaining debt will be paid within a few months, the press secretary said, adding, “It sends a positive signal to the outside world that we are ready for business.”

Wrapping up his four-day tour, Prof Yunus is scheduled to leave Doha today for Rome, Italy, to join the funeral of Pope Francis.​
 

Grid failure plunges 21 southern districts into darkness
Published :
Apr 26, 2025 22:17
Updated :
Apr 26, 2025 22:36

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Around 21 districts in the southern region of the country, including the entire Barishal Division and parts of Khulna Division, were plunged into darkness on Saturday evening following a major power grid failure.

According to officials at Power Grid Company of Bangladesh (PGCB), the grid collapse began at 5:45 pm in one district and then gradually spread across the 21 districts, UNB reports.

However, the power transmission was restored within 45 minutes to one hour in all the affected areas, they said.

“A good number of districts had their power supply restored within 15 to 20 minutes due to the prompt measures taken by PGCB,” said the transmission entity in an official statement.

It added that the transmission system is currently operating normally following the restoration across the Barishal and Khulna regions.

The reason behind the massive grid failure could not be confirmed immediately, as no PGCB official could determine the exact cause as of filing this report.

So far, no committee has been formed to investigate the incident, an official said.​
 

Bangladesh’s energy crossroads
Musharraf Tansen 27 April, 2025, 00:00

BANGLADESH’S energy sector stands at a critical inflection point, caught between the urgent need to meet growing demand and the imperative to transition towards sustainable solutions. The country has made impressive strides in electricity coverage, expanding access to over 96 per cent today. Yet this remarkable achievement rests on increasingly shaky foundations — an overreliance on imported fossil fuels that drains foreign reserves, exposes the economy to volatile global markets, and contributes significantly to environmental degradation. With peak electricity demand projected to reach 40,000 MW by 2041 and climate change intensifying vulnerabilities across the country, Bangladesh faces a defining challenge: how to power its economic ambitions while ensuring energy security and environmental sustainability.

The cost of fossil fuel dependence

BANGLADESH’S current energy model has become economically unsustainable. The country spends approximately $2.5 billion annually on fossil fuel subsidies — equivalent to 15 per cent of its total import bill — while simultaneously grappling with a dollar shortage crisis. The much-touted shift to liquefied natural gas (LNG) as a bridge fuel has backfired spectacularly, with import prices soaring 300 per cent since 2021 and forcing painful cuts to power generation. Meanwhile, the coal power expansion strategy, which envisioned 22,000 MW of new capacity, has left the country with underutilised white elephants like the 1,320 MW Payra plant that operates at just 40 per cent capacity due to fuel affordability issues. This overreliance on imported energy has not only created fiscal strain but also environmental consequences, with air pollution from fossil fuel combustion estimated to cause 80,000 premature deaths annually.

Structural barriers to clean energy transition

SEVERAL entrenched obstacles stand in the way of Bangladesh’s renewable energy potential. Policy inconsistency remains a fundamental challenge — the 2008 Renewable Energy Policy’s target of 10 per cent renewables by 2020 was missed by a staggering 65 per cent, even as contradictory support for coal power continued. Financial constraints compound these issues, with dollar shortages limiting clean technology imports and risk-averse local banks preferring to finance conventional fossil projects. The grid itself presents technical barriers, lacking the flexibility to handle variable renewable output and constrained by land scarcity that complicates large-scale solar and wind deployment. These challenges are exacerbated by institutional fragmentation, where overlapping mandates between the Bangladesh Energy Regulatory Commission, Power Division, and Sustainable and Renewable Energy Development Authority often lead to conflicting priorities and stalled progress.

Overdependence on imported fossil fuels: Bangladesh’s energy security is compromised by its heavy reliance on imported fossil fuels. The volatility of global fuel prices, as evidenced during the Russia-Ukraine conflict, has led to increased electricity generation costs and significant subsidy burdens. In the fiscal year 2021–22, the power sector’s subsidy burden escalated to approximately $2.82 billion. This financial strain limits the government’s capacity to invest in renewable energy infrastructure and technologies.

Limited land availability: As one of the most densely populated countries, Bangladesh faces acute land scarcity, posing a significant challenge for large-scale renewable energy projects. The competition for land use between agriculture, habitation, and energy infrastructure necessitates innovative solutions, such as rooftop solar installations and floating solar systems, to optimize space utilization.

Grid infrastructure constraints: The existing electricity grid infrastructure is ill-equipped to handle the variability and intermittency associated with renewable energy sources. The lack of modern grid management systems, energy storage solutions, and smart grid technologies hampers the integration of renewables into the national grid, leading to inefficiencies and potential reliability issues.

Policy and regulatory challenges: While the government has introduced policies to promote renewable energy, such as net metering guidelines, the overall policy framework lacks coherence and long-term vision. The absence of a comprehensive, integrated energy and power master plan has resulted in fragmented efforts and limited investor confidence. Additionally, bureaucratic hurdles and inconsistent regulatory practices deter private sector participation and investment in the renewable energy sector.

Financial and investment barriers: The high upfront costs associated with renewable energy projects, coupled with limited access to affordable financing, pose significant challenges. Despite the Bangladesh Bank’s directive for financial institutions to allocate at least 5 per cent of their loan portfolios to green financing, actual disbursements remain below target. Furthermore, the lack of risk mitigation instruments and incentives for investors impedes the mobilization of private capital.

Untapped renewable potential

BENEATH these challenges lies extraordinary untapped potential. Bangladesh’s solar energy capacity alone could theoretically generate 3,000 MW from rooftops — equivalent to six mid-sized coal plants — yet current installations total just 329 MW. The country’s extensive coastline holds an estimated 5,000 MW of wind power potential, while agricultural residues could produce 500 MW of bioenergy. The success of Bangladesh’s pioneering solar home system programme, which brought electricity to 20 million people, demonstrates the viability of distributed renewable solutions. Coastal areas could host hybrid offshore wind and solar farms, while Kaptai Lake’s 3,000 MW floating solar potential remains virtually unexploited. Emerging technologies like green hydrogen could eventually decarbonize hard-to-abate industries like fertiliser production by leveraging existing gas infrastructure.

Policy priorities for accelerated transition

Reforming the financial architecture: The transition requires fundamental financial restructuring. Bangladesh must move from blanket fossil fuel subsidies to targeted incentives for renewables, establishing a 500 million green bond market to attract institutional investors. Partnering with multilateral development banks on currency hedging instruments could mitigate forex risks for renewable projects, while development partners could help capitalise a renewable energy development fund. The recent 4.5 billion IMF bailout, partially necessitated by energy sector strains, underscores the urgency of these financial reforms.

Modernizing grid infrastructure: Grid modernization represents another critical frontier. Deploying smart meters and AI-driven demand forecasting could better manage variable renewable supply, while creating dedicated renewable energy zones with streamlined land allocation would accelerate project development. Pilot battery storage installations at 50 strategic substations could demonstrate the viability of energy storage for grid stability. These technical upgrades must be paired with regulatory reforms that properly value distributed generation and encourage private investment in grid flexibility solutions.

Strengthening institutions and human capital: Institutional strengthening is equally vital. Elevating Sustainable and Renewable Energy Development Authority to a statutory authority with real enforcement power would give renewables policy more teeth, while implementing renewable purchase obligations for large industrial consumers could create guaranteed demand. Launching a ‘Clean Energy Corps’ fellowship programme could build the technical capacity needed across government and utilities, ensuring the workforce keeps pace with technological change.

Economic imperative of transition

THE case for energy transition is fundamentally economic. Every 1,000 MW of added solar capacity could save $300 million annually in avoided fuel imports while creating three times more jobs per megawatt than fossil fuel projects. Renewable energy offers insulation from commodity price shocks — during the 2022 global energy crisis, solar-powered factories maintained operations while gas-dependent industries faltered. Moreover, positioning Bangladesh as a regional leader in offshore wind and green hydrogen could attract significant foreign investment in coming decades.

A just transition road map

THE path forward must balance urgency with equity. In the short term (2025–2026), Bangladesh should impose a moratorium on new coal and LNG plants while launching a 500 MW rooftop solar initiative and reforming tariff structures to favour renewables. The medium-term (2027–2030) should focus on achieving 15 per cent renewable penetration through offshore wind and waste-to-energy projects, coupled with retraining programmes for 50,000 fossil sector workers. Long-term planning (2031–2041) should envision Bangladesh as a regional clean energy leader, with 40 per cent renewable generation supported by green hydrogen backup and potential electricity exports to neighbouring countries.

Seizing the moment

BANGLADESH’S energy choices in the coming years will determine whether it becomes trapped in a cycle of fossil fuel dependency or emerges as a solar-powered pioneer. With coordinated policy action, financial innovation and technological adaptation, the country can build an energy system that powers inclusive growth while meeting climate commitments. The alternative — continued reliance on expensive, unreliable fossil imports — risks economic stagnation and ecological harm. For a nation that has already shown remarkable ingenuity in expanding energy access, the renewable energy transition represents the next great challenge — and opportunity — in its development journey.

Musharraf Tansen is a development analyst and former Country Representative of Malala Fund.​
 

18,000MW power production planned for summer
Load shedding to stay tolerable, says energy adviser

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Photo: Freepik

Load shedding during the summer days will be kept at a tolerable level, Power and Energy Adviser Fouzul Kabir Khan said yesterday.

"I won't say there will be no power outage during the summer, but the load shedding will remain within a tolerable level. And there will be no difference between urban and rural areas," he said at a seminar, titled "Energy Crisis: Way Forward," organised by the Forum for Energy Reporters Bangladesh (FERB) at Bidyut Bhaban in the capital.

He said plans are in place to produce 18,000 megawatts (MW) during peak demand in summer, up from the current 16,000 MW. Additional demand will be met through coal and LNG imports.

Kabir added that when the interim government took charge, the power sector was in a disastrous state. "We have paid most overdue and late payments to companies."

The overdue bill, originally around US $3.2 billion, has been reduced to US $600 million and is expected to hit zero by the end of the fiscal year in June, he added.

To clear the payments, the government cut allocations from unnecessary projects. Kabir noted that late payments had also raised power production costs.

On gas exploration, Kabir said the government only took steps it could complete within its tenure.

Regarding electricity prices, Kabir said negotiations are ongoing with coal-based power plants, setting the Matarbari plant's rate of Tk 8.44 per kilowatt-hour (kWh) as a benchmark. "We are asking them why their prices differ by Tk 3-4 instead of Tk 0.30-0.40," he said.

Activities to reduce system loss will be visible by next June, he added.

Addressing the recent gas price hike for new industries, Kabir said it was set based on the marginal cost.

In the keynote paper, energy expert Ijaz Hossain said Bangladesh's energy crisis began in 2019 when gas production declined and oil replaced gas, increasing the government's energy subsidy burden.

"Gas reserves were depleting, but exploration was ignored, while LNG import was preferred at a time when the government should have gone for aggressive production," he said.

He noted that local production stood at 2,786 million cubic feet of gas a day (mmcfd) in 2019 but has now fallen to 1,800 mmcfd. Future governments should promise to keep production around 2,000 mmcfd by exploring at least 10 wells a year, he said.

Bangladesh will also need to import 2,600 mmcfd of LNG after 2030 and build two new floating storage and regasification units (FSRUs), he added.

Dr Shamsul Alam, energy adviser to the Consumers' Association of Bangladesh, said Bangladesh is shifting towards becoming an LNG-importing nation, with domestic gas's share expected to fall from 75 percent to 25 percent by 2030.

Dr Golam Moazzem, research director at the Centre for Policy Dialogue, called for a new energy policy with a clear transition plan.

He warned that ongoing LNG deals with Qatar and the US could impact the country's long-term renewable energy goals.​
 

Five per cent tax rebate for solar panel users under consideration: DNCC
UNB
Published :
Apr 28, 2025 22:16
Updated :
Apr 28, 2025 22:16

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Administrator of Dhaka North City Corporation (DNCC) Mohammad Azaz has said his administration is contemplating providing a 5.0 per cent tax rebate for city dwellers who will use solar panels as part of green energy promotion.

"The DNCC is thinking of considering a 5.0 per cent tax rebate for the city dwellers if they use the rooftop solar panel", he made the remarks at a policy dialogue titled "The Role of Renewable Energy for in Building a Just Urban".

The event was jointly organised by Dhaka North City Corporation (DNCC) and the Center for Atmospheric Pollution Studies (CAPS) at the auditorium of the DNCC Nagar Bhaban in Gulshan-2 on Monday.

With Professor Mohammad Ali Naqi, head of the Department of Architecture, State University of Bangladesh, in the chair, the seminar was also addressed by Prof Dr Ahmad Kamruzzaman Majumder, Chairman of CAPS, who made the keynote presentation.

The DNCC administrator also stressed the need for continued research in this area as to how the advantage of green energy could be utilised.

He emphasised the potential of installing solar panels on buildings in Dhaka's planned neighbourhoods, where rooftop solar clearance is adequate due to uniform building heights.

He noted that through the effective rooftop solar implementation, buildings can meet their own electricity demand and even contribute to the national grid-making the concept of a "just transition" more attainable.

Prof. Dr. Ahmad Kamruzzaman Majumder said that Dhaka ranks among the worst cities in terms of air quality, liveability, traffic congestion, and noise pollution.

Referring to Yale University's 2024 Environmental Performance Index, where Bangladesh ranks 175th out of 180 countries, he warned that unplanned urbanisation, industrialisation, and population growth have led to severe environmental degradation. Transitioning from fossil fuels to renewable energy is one of the key solutions to combat this crisis.

DNCC Chief Executive Officer Abu Sayed Md. Kamruzzaman pointed out that Dhaka is an unplanned city and achieving justice in such a context requires comprehensive planning and implementation.

Prof. Dr Adil Mohammed Khan, President of the Bangladesh Institute of Planners (BIP), noted that Bangladesh has significant potential for renewable energy. He emphasised the need to promote its use across sectors and raise awareness to build a greener and healthier future.

Professor Dr M. Shahidul Islam, Chairman of the Department of Geography and Environment at the University of Dhaka, advocated for reduced energy demand, increased use of public transport, and greater responsibility among polluters.

Mohammad Fazle Reza Sumon, Convenor of BIP's Advisory Board, proposed that rooftop management could be a major source of renewable energy and urged collective action at the individual level.

Professor Dr Ijaz Hossain, former Dean of the Faculty of Engineering at BUET, suggested identifying major polluters and taking strict control measures, including promoting electric vehicles charged by solar energy.

Roufa Khanam of the Center for Climate and Environmental Research (CCER) stressed the need for skilled technical management, effective monitoring, and incentives to implement renewable energy laws effectively.

Professor Naqi underscored the dual necessity of reducing energy consumption and increasing the use of renewable energy.​
 

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