[🇧🇩] Energy Security of Bangladesh

[Saif]

BIPPA warns of potential power disruptions in summer amid unpaid dues

The Bangladesh Independent Power Producers’ Association, or BIPPA, has called on the government to pay outstanding dues to private power plants, warning of severe electricity shortages in the upcoming summer if immediate action is not taken. KM Rezaul Hasanat, the newly elected president of

thefinancialexpress.com.bd

BIPPA warns of potential power disruptions in summer amid unpaid dues
Published :
Jan 24, 2025 00:10
Updated :
Jan 24, 2025 00:10

The Bangladesh Independent Power Producers’ Association, or BIPPA, has called on the government to pay outstanding dues to private power plants, warning of severe electricity shortages in the upcoming summer if immediate action is not taken.

KM Rezaul Hasanat, the newly elected president of BIPPA, urged swift action during a discussion with journalists at the Sonargaon Hotel in Dhaka on Thursday, reports bdnes24.com.

In a brief presentation, former BIPPA president Imran Karim, disclosed that private power producers are owed Tk 160 billion in arrears over the past four months. He noted that a significant portion of the debt—more than Tk 100 billion of this amount is owed to liquid fuel-based plants.

The power plants have faced prolonged arrears with the government since the onset of the Covid-19 pandemic in 2020. Despite contracts stipulating a maximum payment delay of 30 days, the Power Development Board, or PDB, has reportedly been defaulting on payments for 120 to 180 days, with delays extending to as long as 200 days in some cases.

During this protracted period of arrears, the BIPPA claimed to have suffered substantial financial setbacks. The association reported a loss of Tk 55 billion due to the depreciation of the taka against the dollar, alongside an additional loss of Tk 32 billion in interest on working capital.

Imran emphasised the urgency of opening letters of credit, or LCs, immediately to ensure the operation of oil-based power plants in the upcoming summer.

He noted that any delay in this process could jeopardise the country's power supply during the peak demand season.

“If the LC is opened today, the oil will reach the plants after 45 days,” he explained, underscoring the tight timeline.

“It is not possible for the companies to open LCs if the dues are not received,” he added.

Currently, Bangladesh is generating between 9,000 and 10,000 megawatts (MW) of electricity, with only 400 to 600 MW coming from liquid fuel-based power plants. However, as the summer season approaches, the demand from this sector is expected to surge, requiring at least 4,000 MW of electricity to be supplied from these plants.

Speakers at the event warned that the summer season could begin as early as March, underscoring the need for immediate action. They stressed that initiatives must be taken now to ensure liquid fuel-based power plants are fully operational in time to meet the increased demand.

“We have met with the government three times since December to convey our concerns,” Hasanat said.

“Now, I am informing journalists so the public understands the challenges we face and no blame is misplaced later.”​

 

[Saif]

Renegotiating power tariffs

The government's decision to set up a six-member expert panel to renegotiate power tariffs signals a potential shift to redesign what has long been perceived as a lucrative domain for private power plant owners. The initiative aims to reduce power purchase costs and ease the state's debt burden. Th

thefinancialexpress.com.bd

Renegotiating power tariffs
Published :
Jan 24, 2025 00:01
Updated :
Jan 24, 2025 00:01

The government's decision to set up a six-member expert panel to renegotiate power tariffs signals a potential shift to redesign what has long been perceived as a lucrative domain for private power plant owners. The initiative aims to reduce power purchase costs and ease the state's debt burden. The panel will renegotiate tariffs with power plant owners who secured projects under the now-defunct Quick Enhancement of Electricity and Energy Supply Act 2010 that previously indemnified actions taken under its provisions. Initially enacted to address acute power shortages, the Act facilitated the approval of over 100 power projects during the Awami League government's tenure since 2009. This helped increase power generation capacity to 28GW. The capacity far exceeds the country's demand estimated at 17GW. However, the actual generation has rarely exceeded 13GW. The annulment of this indemnity law paves the way for more accountability in the sector. The Power and Energy Adviser of the interim government informed the FE that the formation of the expert panel aligns with the recommendations of the national body tasked with reviewing power and energy deals. After months of scrutiny, the national committee found that costs associated with most power plants --- whether established through tenders or unsolicited arrangements --- were exorbitantly high.

In addition to the high priced power tariff, a very contentious issue is the government's deal with the power plant owners on capacity charges that has been straining the state coffer for well over a decade. Under the agreements, private investors are guaranteed returns based on their investments rather than actual services rendered. Energy experts, citing Power Development Board analyses, argue that this mechanism has channelled public funds into private coffers. Some plants, approved without competitive bidding, continue to receive unreasonably high monthly capacity charges regardless of whether they produce electricity or not. These plants also benefit from subsidised fuel, while the government purchases electricity at inflated rates.

The new committee is expected to scrutinise these irregularities and recommend necessary reforms, including reassessment of the rationale behind capacity charges and potentially phasing them out. Such measures could significantly reduce the financial burden on the state. Additionally, the committee is expected to address challenges associated with high-sulfur fuel oil (HSFO)-based power plants and propose solutions to improve sector efficiency.

For years, media reports and energy experts have been criticising the government's practices, particularly the high tariffs paid to private power producers and the mandatory capacity payments to idle plants. The repeated calls for reform fell on deaf years. Now, with the committee tasked to revisit these deals, there is hope for tangible changes that will benefit citizens and alleviate the government's fiscal load. The renegotiation effort underscores the need for greater accountability and transparency in the power sector. By addressing inflated tariffs and capacity charges, the government has an opportunity to restore public trust and create a more equitable energy framework. If successful, this initiative could mark the beginning of long-overdue reforms, ensuring that public resources are used efficiently and sustainably.​

 

[Saif]

Don't push renewable energy transition into the distant future

Refrain from decisions that deter transition to renewable energy

www.thedailystar.net

Don't push renewable energy transition into the distant future
Refrain from decisions that deter transition to renewable energy

VISUAL: STAR

It is unfortunate that Bangladesh's power generation from renewable sources pales in comparison to its neighbours, despite our role as a climate change champion on the global stage. According to a recent report, only 0.8 percent of total power in Bangladesh comes from renewables—mainly wind and solar—whereas India, Pakistan, Sri Lanka, and Vietnam generate 11.5 percent, 3.7 percent, 10.8 percent, and 13.6 percent, respectively, from those two sustainable sources.

Bangladesh's transition to renewable energy has been slow, complicated, and hindered by contradictory policy decisions. Corruption and inefficiency plagued the country's entire energy sector during the last regime, and renewables were no exception. To partially fulfil her government's commitment to producing 6,000MW-16,000MW from renewable sources by 2030, former Prime Minister Sheikh Hasina approved 37 renewable plants, without following due process, under the controversial Quick Enhancement of Electricity and Energy Supply (Special Provision) Act, 2010. The law was repealed after the interim government took power in August, and the Bangladesh Power Development Board (PDB) floated tenders for 22 solar plants in various areas of the country with a total capacity of 853MW.

Unfortunately, the interim government, unlike previous administrations, has decided not to underwrite bills of power-generating companies if the PDB defaults. Ironically, PDB, which sells power at prices lower than its production or purchase cost, has a record of defaulting on payments. While the interim government's decision could be seen as an attempt to incentivise institutions to operate more efficiently and profitably by not bailing them out, it risks discouraging businesses from investing in renewables.

Given that Chief Adviser Prof Muhammad Yunus has long advocated for actions to mitigate climate change, we would expect his administration's policy decisions to reflect a commitment to transitioning to renewables. Decisions that contradict this aim should therefore be avoided. Also, a mechanism should be put in place to hold future political governments accountable if they fail to accelerate the transition to renewables. Moreover, reform of relevant public institutions is essential to ensure that Bangladesh does not fall behind in renewable power generation. Reducing our dependence on fossil fuel-generated power is not just necessary to cut costs and reduce reliance on foreign power supply sources, but because renewables may soon be the only viable options left for us to generate power.​

 

[Saif]

Bangladesh has entered into an agreement with America for the supply of 5 million metric tons of LNG.

 

[Saif]

Power subsidies may rise 83% this fiscal year

Subsidies for the power sector are likely to balloon 83 percent this fiscal year as the interim government is planning to clear all arrears owed to private power producers.

www.thedailystar.net

Power subsidies may rise 83% this fiscal year

Subsidies for the power sector are likely to balloon 83 percent this fiscal year as the interim government is planning to clear all arrears owed to private power producers.

An additional Tk 25,000- Tk 30,000 crore may be kept in the revised budget to pay off arrears, which will be added to the allocation for subsidies, according to the finance ministry's initial plans.

As a result, overall subsidies for the power sector are expected to rise to around Tk 66,000 crore at the end of FY25, up from an initial budgetary allocation of Tk 36,000 crore.

The allocation is likely to go up in the revised budget for FY25 and the amount will be finalised by March, finance ministry officials said.

As the government is a long way off from its revenue collection target, the funds may be diverted from the budgetary allocation for the Annual Development Plan (ADP).

The budget for FY25 had allocated Tk 265,000 crore for the ADP, but that figure may fall by around Tk 50,000 crore in the revised budget, a top official of the ministry said.

"If we can allocate the amount to the power sector, the arrears will be cleared by this fiscal year. As a result, the subsidy burden in the power sector will be reduced next fiscal," the official added.

The official also said that the government has taken initiatives to reduce power production costs in order to ensure that arrears do not pile up and that there is some room for flexibility in the future.

In December, a mission from the International Monetary Fund told the government to clear arrears to the power sector by June of 2025. They also proposed increasing electricity prices to help reduce subsidy expenditures.

However, the government refused to increase prices and formed several committees to investigate how they could reduce costs.

Muhammad Fouzul Kabir Khan, adviser to the Ministry of Power, Energy and Mineral Resources, said on Saturday that they are under tremendous pressure to increase electricity and gas prices.

Although the interim government has been in office for six months, electricity prices have not yet increased, he said, adding: "But I don't know how long it will last."

The pressure of piling arrears is akin to having a gun held to their head, according to Khan.

Currently, the Bangladesh Power Development Board (PDB) has arrears amounting to Tk 21,000 crore.

Of the amount, Tk 9,000 crore is owed to the Bangladesh Independent Power Producers' Association, whose members have said they will be unable to produce electricity in the summer -- which starts around March -- if the government fails to clear arrears immediately.

India's Adani power plant also started pressing hard for arrears amounting to around $850 million since the interim government took office.

Additionally, local coal-fired power plants are facing hassles in importing coal to operate smoothly due to a lack of funds.

The interim government has formed separate committees to identify loopholes in contracts signed during the ousted Awami League government's tenure, which increased the burden of subsidies, and to renegotiate power purchase prices.

Zahid Hussain, a former lead economist of the World Bank's Dhaka office, told The Daily Star that the government should focus on reducing power production costs.

"The immediate solution is to phase out inefficient power plants and renegotiate prices, which are excessive," he said.

According to Zahid, some power plants' contracts were unfair to Bangladesh, giving producers the leverage to overcharge.​

 

[Saif]

Govt should renegotiate power deals early to save economy

THE capacity charge, which the government pays independent and rental power plants when they sit idle as a guarantee of returns on investment coupled with profits, is set to reach Tk 380 billion in the 2025 financial year. This is a 46 per cent, or Tk 120 billion, increase on the capacity...

www.newagebd.net

Govt should renegotiate power deals early to save economy
27 January, 2025, 00:00

THE capacity charge, which the government pays independent and rental power plants when they sit idle as a guarantee of returns on investment coupled with profits, is set to reach Tk 380 billion in the 2025 financial year. This is a 46 per cent, or Tk 120 billion, increase on the capacity charge of Tk 260 billion that the government paid the power producers in the 2024 financial year, which was also Tk 90 billion more than what was paid in capacity charge the preceding financial year. The increase by Tk 88.93 billion in the capacity charge that the government is estimated to be paying this financial year is because of the addition of five power plants — two gas-based and three coal-based systems — in the 2024 financial year. The plants were not paid the charge in the past year as they had a dry run then. The addition of three other plants, with a combined capacity of 1.98GW, in the 2025 financial year would put an additional burden of Tk 24.84 billion every year. The continued increase in capacity payment remains a burden on the struggling economy where the government is trying to shore up revenue with regressive, discriminatory, indirect taxes, which is also burdensome for the people.

Whist the amount of payment to producers increases with an increase in the installed generation capacity for the power that the government does not use, the demand for power, however, remains static. The Awami League government, toppled on August 5, 2024, allowed more than a hundred power projects after its assumption of office in 2009 which scaled up the installed power generation capacity to close to 28GW, excluding 2.8GW of captive power, this January from about 5GW in 2009 whilst the peak summer demand is roughly 17GW — the demand this winter was estimated largely at 10GW — and the generation is hardly 13GW. The power overcapacity, thus, exceeded by 50 per cent by 2024. In the 40 years after the Awami League’s assumption of office in 2009, the government paid Tk 1,000 billion to 82 independent power producers and 32 rental power plants in capacity charge. The situation has left the government in a dilemma as it cannot increase the demand to use at least a portion of the overcapacity but it is forced to pay the capacity charge. Experts believe that the government should work out plans for an early expansion of renewable energy, which accounts for only 4 per cent of the installed power generation capacity, to do away with the capacity charge as far as it can.

The government is, therefore, left with two tasks to carry out simultaneously. It should try to increase the demand for power, geared for an optimal use of power in industrialisation, so as to lessen the overcapacity as far as it can. It should also renegotiate all the independent and rental power deals to minimise the burden of the capacity charge on the economy. It should, yet then, retire the old plants that have served out their useful economic life, step up efforts on renewable sources and not take up fresh independent and rental power projects.​

 

[Saif]

TIB demands immediate cancellation of fossil fuel-centric energy master plan

Transparency International Bangladesh (TIB) has demanded the immediate cancellation of the Integrated Energy and Power Master Plan (IEPMP)-2023, terming it a fossil fuel-centric energy master plan. The corruption watchdog made this call from a human chain organised in front of the Jatiya Sangsad B

thefinancialexpress.com.bd

TIB demands immediate cancellation of fossil fuel-centric energy master plan
UNB
Published :
Jan 27, 2025 19:56
Updated :
Jan 27, 2025 19:56

Transparency International Bangladesh (TIB) has demanded the immediate cancellation of the Integrated Energy and Power Master Plan (IEPMP)-2023, terming it a fossil fuel-centric energy master plan.

The corruption watchdog made this call from a human chain organised in front of the Jatiya Sangsad Bhaban on Manik Mia Avenue in the capital on Sunday to mark the International Clean Energy Day 2025.

It also has called for the formulation of a new renewable energy-based master plan free from the influence of the fossil fuel lobby.

TIB Executive Director Dr Iftekharuzzaman said at the human chain, "One of the foundations and beneficiaries of the power structure of the fallen authoritarian and thuggish government was the domestic and foreign lobbies, who were held hostage by the policy framework."

"As a result, the energy master plan purposefully maintains fossil fuel dependence due to their conflict of interest," he said, adding that through this, the possibility of transitioning to renewable energy has been trampled on.

In order to build a country that relies on renewable and clean energy while respecting national and international commitments, the policy framework must be freed from the influence of fossil fuel advocates, he added.

He said: "We call on the interim government to immediately take the initiative to formulate a master plan for 100 percent renewable energy-based power generation in phases by 2050 and a time-bound roadmap for its implementation, involving experts and stakeholders free from conflict of interest."

This is the first time that TIB has celebrated International Clean Energy Day in Bangladesh to raise awareness about the transformation of renewable energy.

Keeping in mind the theme “Clean Energy: Sustainable Future,” TIB has organised multifaceted programs at the local and national levels to celebrate the day.

At the local level, awareness campaigns including human chains, rallies and discussion, public meetings, street meetings on increasing the production and use of renewable energy were organised with the active participation of members of the Aware Citizens Committee (ACC), Active Citizens Group (ACG), and Youth Engagement and Support (YES) groups formed under the inspiration of TIB in 45 districts and upazilas.

In addition, TIB's proposals were highlighted in the human chains organised in Dhaka to highlight the importance of renewable energy and ensure good governance in the energy sector.

The human chain organised by TIB was attended by organizations such as Water Keepers Bangladesh, Working Women, Dharitri Rakhaye Amara, ActionAid Bangladesh, and ETI Bangladesh.

On the occasion of International Clean Energy Day 2025, TIB placed a number of recommendations to ensure good governance in the energy sector and take effective steps to transition to renewable energy.

These include preparing a new master plan based on the principles of reducing the use of fossil fuels and increasing the amount of renewable energy in the energy mix.

To prevent policy manipulation in the energy sector and prevent conflicts of interest, forming an independent monitoring and control authority consisting of relevant experts and representatives of civil society to ensure accountability in the decision-making process related to this sector are among the recommendations.

The TIB urged the government to ensure monitoring and verification of flawless environmental impact assessment activities for all types of energy and power projects by regulating them under the Environment Act and to follow transparent and appropriate procedures in issuing environmental clearances and monitoring pollution and environmental issues.

It also called for providing leadership in the transition to renewable energy, and giving the Sustainable and Renewable Energy Development Authority (SREDA) the status of an autonomous institution, along with enhancing its technical, human resources and infrastructure capacity.​

 

[Saif]

Renovation of 31 wells to increase gas production

The production of local gas is consistently declining, leading to the need to import liquefied natural gas (LNG) at high prices to fill the gap. This has been putting pressure on the country's foreign currency reserves. If production continues to decrease, imports will increase further. To...

en.prothomalo.com

Renovation of 31 wells to increase gas production
Mohiuddin
Dhaka
Published: 30 Jan 2025, 08: 27

The production of local gas is consistently declining, leading to the need to import liquefied natural gas (LNG) at high prices to meet the shortfall.

This has been putting pressure on the country's foreign currency reserves. If production continues to decrease, imports will increase further. To manage this situation, the government is prioritising the renovation of 31 wells to increase local gas production.

According to sources at the ministry of energy, the government has planned the implementation of a project involving the renovation, exploration, and development of 100 wells.

Exploration wells are drilled to discover new gas reserves, development wells are drilled to increase production from old gas fields, and renovation work is carried out on old or non-functional wells to boost production. Given the current situation of gas production, renovation work is being prioritised.


Bangladesh Oil, Gas, and Mineral Resources Corporation (Petrobangla) has stated that according to earlier plans, if 50 wells are drilled by 2025, the national grid will add nearly 650 million cubic feet of gas per day. Currently, 18.4 million cubic feet of gas are being extracted daily, with 7.2 million cubic feet being supplied to the national grid.

On 22 January, the energy and mineral resources ministry held a meeting regarding well drilling. The meeting minutes show that energy adviser Muhammad Fouzul Kabir Khan emphasised the importance of well drilling.

He stated that the country’s gas reserves are steadily depleting while demand continues to rise, leading to significant foreign currency expenditure on importing fuel.

During the meeting, the energy advisor provided several directives. To avoid delays, he recommended conducting feasibility studies for multiple projects as a cluster for new initiatives. Priority should be given to exploration activities where there is a higher chance of discovering large gas reserves.

It is also essential to explore large gas reserves using BAPEX’s existing rigs and initiate efforts to increase reserves through deep well drilling. Additionally, a 5-member expert subcommittee has been formed to oversee the renovation of 31 wells.

Earlier, on 21 January, Petrobangla formed a committee to prepare a specific timetable and work plan for the renovation of the 31 wells. The committee consists of 15 members, chaired by Istiaque Ahmed, Chairman of the BAPEX Board of Directors.

The committee includes officials from the energy, Petrobangla, Bangladesh University of Engineering and Technology (BUET), and gas production companies.

The committee’s scope of work includes reviewing the schedule for the renovation of 16 wells under the 50-well exploration project and 31 wells under the 100-well project, assessing the likelihood of gas extraction, determining the feasibility of connecting the wells to the pipeline quickly, and identifying the benefits and potential of well renovation.

Additionally, priority will be given to the exploration and development of 34 and 69 wells, respectively, in two plans. The committee will submit a report to Petrobangla within 30 days.

Petrobangla’s chairman Mohammad Rezanur Rahman told Prothom Alo that the focus on well renovation is aimed at bringing the demand and supply of gas to a manageable level.

Renovation work has already begun on 16 wells, and as a result, the supply to the national grid has slightly increased with the completion of work on seven wells.

Once all the work is completed, production will further increase. The energy ministry is now expediting the approval of development project proposals (DPPs) for well drilling.

The daily demand for gas in the country is 380 million cubic feet. For several years, supply of around 300 million cubic feet has generally been sufficient, with 220 million cubic feet coming from domestic gas sources, and the remaining being met through LNG imports.

The ousted Awami League government focused more on LNG imports instead of increasing domestic gas exploration and production, which led to a steady decline in local gas production. Now, domestic production has fallen below 200 million cubic feet.

Moreover, due to high prices, the required amount of LNG could not be imported. Faced with a severe crisis, a plan to drill 50 wells was proposed in mid-2022, but it was not implemented with priority.

After assuming office, the interim government has focused on gas exploration and production and has initiated well drilling. Plans for an additional 100 wells to be drilled next year have also been outlined.

Experts believe that increasing domestic gas production is the only alternative to solving the gas crisis. With proper renovation and technological advancements, it is possible to increase production in old gas fields. Simultaneously, both onshore and offshore gas exploration activities must be ramped up.​

 

[Saif]

AL REGIME ENERGY PRICING: Local coal far costlier than imported one

Bangladesh’s own coal, extracted from its lone coal mine in Dinajpur, is costlier than the imported one, up to 77 per cent in some cases, due to arbitrary energy pricing by the past Awami League regime, which was...

www.newagebd.net

AL REGIME ENERGY PRICING: Local coal far costlier than imported one
Emran Hossain 31 January, 2025, 23:43

Bangladesh’s own coal, extracted from its lone coal mine in Dinajpur, is costlier than the imported one, up to 77 per cent in some cases, due to arbitrary energy pricing by the past Awami League regime, which was ousted amid a mass uprising in July-August in the past year.

The current price of the locally extracted coal, $176 a tonne, excluding value-added tax and the taxes, was set on January 5, 2023 with retrospective effect from exactly a year ago.

The coal is used for power generation by the government. Power price increased more than a dozen times during 15 years of the AL regime due largely to increased fuel costs.

People were struggling hard to cope with soaring living costs when the coal price was raised by more than 35 per cent compared with the previous price of $130 which had been in force since 2015, citing the fuel’s production cost increase and the need for investing in exploratory activities and land acquisition purposes.

Though the coal price exceeded $400 a tonne in early 2022 on the international market, it has been about a year the price dropped to about $150 a tonne.

The current price of a tonne of the best quality coal bought from Indonesia is $127.72. Bangladesh imports most of its coal for power production from Indonesia. The coal Bangladesh usually imports is currently in the price range of $72.24 to $92.87, excluding transport and handling costs.

‘The predatory local coal price is the upshot of monopolistic energy administration,’ said professor M Shamsul Alam, energy adviser at the Consumers Association of Bangladesh.

The coal price increase was proposed by state-owned Barapukuria Coal Mining Company Limited. The proposal was invariably found correct in a verification done by another state-owned company Bangladesh Power Development Board, the buyer of local coal. Finally, the proposal was approved with slight changes by an executive order by the Ministry of Power, Energy and Mineral Resources.

While ordinary people continued to bleed financially, the coal price hike immediately increased the profits of the BCMCL, winning its employees hefty annual bonus and the government increased income.

‘There was no real verification of the proposal. There is no way of knowing if the price hike was actually needed,’ said Shamsul.

The BCMCL had initially sought a 62 per cent rise in the coal price, setting the price at $210 a tonne.

With the costs of production estimated at $138 a tonne, the BCMCL incorporated in the proposed price almost $50 as the costs of future land acquisition and exploration. The proposed price also included 15 per cent profits after paying VAT and the other taxes. The approved price considered all the expenses.

Bangladesh Energy Regulatory Commission officials observed that land acquisition and exploration expenses should have covered by the company’s profits.

It was typical of the past AL government to frequently raise energy prices, necessitated by a flawed energy policy that energy experts found excessively beneficial to the private investors, all of them being AL favourites. Soon after assuming power, the AL had enacted an indemnity law to award power and energy projects without tender and being challenged in court.

The interim government led by Muhammad Yunus scrapped the law after taking office on August 8, 2024.

The power sector had undergone an aggressive expansion throughout the AL regime between 2009 and 2024, leading to a massive overcapacity problem. The BPDB’s comprehensive losses stood at Tk 8,764 crore at the end of the past financial year.

The BPDB buys the entire production at the coal mine to generate electricity at the Barapukuria thermal power plant, which is often partially used due to lack of fuel supply.

Shaiful Islam Sarkar, managing director of the BCMCL, justified the price hike with the need to increase profits to pay taxes and dividend to the government and incentivise the BCMCL officials and workers, who are risking their lives by choosing to work in a coal mine.

‘Our coal, with the calorific value of 6,137 kcal/kg and 0.53 per cent sulphur content, is still undervalued. We can easily sell it for $230 a tonne should export be allowed,’ he said.

Shaiful justified the price increase with its increased expense in a number of sectors — repair and maintenance, spare parts import and employing a foreign workforce of 300 people, including 40 officers.

The BCMCL has a workforce of 250 people, who mostly do not work inside the mine. The 1,100 mine workers are on the CMC’s payroll. The main work of the coal mine, from designing the coal extraction plan to supervising workers, are done by Chinese workers under contract with the China National Machinery Import and Export Company.

After the coal field was discovered in 1985, the BCMCL extended its contract with the CMC to develop the mine and then extract coal through 2027.

The BCMCL started extracting coal in 2005, lifting 13.02 million tonnes by June 2022. Of the extracted coal, 9.54 million tonnes were used in the 525MW coal power plant while 3.35 million tonnes were supplied to the local industry.

Coal sales to local buyers have remained suspended since 2018 after the discovery that over 1.43 lakh tonnes of coal went missing between 2006 and 2018.

The BCMCL had profited over Tk 144 crore in 2021-22. In the year, when the price hike benefit was partially enjoyed, the BCMCL workers’ profit participation fund received over Tk 7.6 crore. In VAT and taxes, over Tk 233 crore was paid in the same year.

In the following financial year of 2022-23, enjoying full price hike benefits, the payment to the government exchequer in the VAT and other taxes rose to over Tk 422 crore. The profits of BCMCL more than doubled to Tk 300 crore compared with those in the previous year, while the contribution to the WPPF almost tripled to over Tk 22.21 crore.

At the end of the past financial year, the BCMCL profits soared to Tk 418 crore with the WPPF contribution rising to Tk 29 crore. The payment to the government exchequer rose to nearly Tk 709 crore.

‘People always feel proud about a profitable public company,’ said BCMCL managing director Md Shaiful Islam Sarkar.

BCMCL officials said that over 62 per cent of the production costs was gone to pay the CMC. The BCMCL was supposed to develop mining capacity working with the CMC, eventually overtaking the full responsibility of the operation of the mine. But that has not happened in 20 years since the extraction of coal began.

‘Coal mining is not rocket science. Neighbouring India operates its own coal mines,’ said energy expert Badrul Imam, who is an honorary professor of geology at the Dhaka University.

‘Operating the coal mine on our own could have reduced the coal price,’ said Badrul, also a director on the board of directors of the BCMCL.​

 

[Saif]

Capacity payment terms must be renegotiated

The interim government must suspend the inefficient and costly power plants and renegotiate the capacity payment terms with the private power producers as the structure incentivises inefficiency, according to the report of the task force.

www.thedailystar.net

Capacity payment terms must be renegotiated
Proposes task force on power sector

File photo

The interim government must suspend the inefficient and costly power plants and renegotiate the capacity payment terms with the private power producers as the structure incentivises inefficiency, according to the report of the task force.

"The current capacity payment structures incentivise inefficiency and impose unnecessary costs on the government," said the task force report on re-strategising the economy and mobilising resources for equitable and sustainable development.

Revising the terms will align payments with actual energy production, ensuring better value for public spending, it said.

Over the years, maximum power generation has consistently fallen short of installed capacity.

Surplus capacity reached 11,680 megawatts (MW) in fiscal 2023-24. Nearly 43.5 percent of the power plants' capacity remained underutilised last fiscal year compared to the installed capacity of 26,844 MW.

As a result of capacity payments, irregularities and various inefficiencies, the Bangladesh Power Development Board's operating losses surged to Tk 44,291 crore last fiscal year. In fiscal 2017-18, PDB's losses stood at Tk 6,208 crore.

This fiscal year, capacity charges would take up about 80 percent of the Tk 40,000 crore subsidy allocation for the power sector, the report said.

This disproportionately large share directed towards capacity payments raises concerns about the influence of vested interest groups within the sector.

Powerful business entities and political elites are benefitting from these contracts, often secured under non-competitive arrangements, the report said.

"Such practices not only burden public finances but also limit resources available for investing in sustainable energy solutions and infrastructure improvements."

Quoting the data of capacity payments released in the parliament in 2023, the report said 82 independent power plants and 32 rental power plants have received more than Tk 1 lakh crore in capacity charges over the previous 14 years. Of the amount, the top 10 plants had received one-third of the payments.

"Giving tenders to the same few companies over and over again has made the country dependent on them to the extent that the country has to accept their technical failures even during spans of high demand."

The problems and challenges in the power and energy sector include poor regulatory quality; lack of institutional capacity; and lack of strategies to address the PDB's growing revenue shortfall in the Integrated Energy and Power Master Plan 2023.

The government's monopoly market structure in power procurement, transmission and distribution systems; the lack of transparency and accountability; and the pricing and subsidy policies are the other problems and challenges for the sector.

Subsequently, the task force suggested that the interim government prepare a short-term strategy consisting of revising the master plan, adjusting the energy prices and subsidies, leveraging regional energy trade, ensuring transparency in the international contracts, eradicating tax mismatches for renewable energy adoption, strengthening the capacity of the Sustainable and Renewable Energy Development Authority.

The task force also emphasised ensuring uninterrupted energy supplies to export-oriented and export-supporting firms as the critical first step to maintaining operational efficiency and reducing production costs.

"Unreliable power supply is a particularly serious problem for the light engineering industry where many manufacturing processes require an uninterrupted power supply. Frequent power cuts, especially during the summer, lead to high wastage rates and raise energy costs," the report said.

KAS Murshid, the former director general of the Bangladesh Institute of Development Studies, headed the task force, which submitted its report to Chief Adviser Muhammad Yunus last week.​

 

[Saif]

A repeal that retains impunity

Why is the interim government taking this seemingly anti-public stance?

www.thedailystar.net

Quick Enhancement of Electricity and Energy Supply Act
A repeal that retains impunity

FILE VISUAL: ALIZA RAHMAN

During Sheikh Hasina's rule, the power and energy sector enjoyed the ultimate lack of accountability. This is the first sector where the fascist regime established an ideal model for political and economic corruption, and later implemented it in other sectors, including education, health, and transportation.

The basis of this structure was a black law, the Quick Enhancement of Electricity and Energy Supply (Special Provisions) Act, 2010, which contradicted the constitution's basic principles, undermined public interests, and destroyed the country's economic capacity. After the fascist regime's fall and during the interim government's tenure, the demand to repeal this law quickly took shape. In the meantime, the validity of two of its sections, which were most detrimental to public interests, were challenged in the High Court followed by their annulment. Eventually, the government issued an ordinance to repeal the entire law. But two articles were added in that ordinance that are potentially more dangerous than the repealed law. They not only undermine public interests, but also degrade the spirit and aspirations of the July uprising.

But why is the interim government taking this seemingly anti-public stance? Before we look for the answer, let's see what this law actually contained and what became of it after the repeal.

The black law's history and evolution

Often termed the "Impunity Act," the Quick Enhancement of Electricity and Energy Supply (Special Provisions) Act was supposed to be in force for a period of two years from 2010, but was later extended for a total of 16 years in four phases, with the implementation period being till 2026.

Under the sub-heading "Publicity of the plans or proposal," Section 6(2) states, "Notwithstanding anything contained in sub-section (1), the Processing Committee mentioned in section 5 shall consult and bargain with a single or limited number of organizations about any purchase, investment plan or proposal and, with approval of the Minister, Ministry of Power, Energy & Mineral Resources, select an organization for the said work..."

That is, work can be awarded, with the consent of the minister, through communication and negotiation with a single or limited number of organisations, ignoring competitive tenders or bids.

Under the sub-heading "Bar to jurisdiction of Court, etc," Section 9 states, "No question regarding the validity of any act done or purported to be done, any action taken or any order issued or direction given under this Act, shall be raised in any court."

After Hasina's fall, Supreme Court lawyers Dr Shahdeen Malik and Tayeb-Ul-Islam Showrov filed a writ with the High Court, challenging the validity of sections 6(2) and 9. On November 14, 2024, the High Court bench of Justice Farah Mahbub and Justice Debashish Roy Chowdhury declared the provisions illegal. Then on November 28, 2024, the interim government repealed the law by promulgating the Quick Enhancement of Electricity and Energy (Special Provisions) (Repeal) Ordinance, 2024.

New 'impunity' in the ordinance

In the repeal ordinance itself, the government has added new provisions for impunity in sections (2)(a) and (b) under Article 2.

Section (2)(a) states, "Any contract entered into or any action taken under a contract entered into under the said act immediately before such repeal shall be deemed to have been validly entered into or taken."

Section (2)(b) goes on to say, "Any proceeding under a contract entered into or taken under the said act shall continue or be carried out as if the said act had not been repealed."

That is, all projects taken under the law till the repeal have been considered valid, and can continue. That means the government has repealed the law but considers all the previous sins as virtues. This is against the constitution's fundamental rights, the consumer's fair rights, and a violation of energy justice. This ordinance has set a terrible precedent by hindering fair energy transition.

So, is the repeal ordinance an attempt to protect the interests of the corrupt oligarchic class in the power and energy sector? Or is there a subversive attempt to make this government unpopular and lead it astray? Let us explore the possible reasons.

First, the power and energy ministry was known as a hotbed of corruption and misrule during Hasina's rule. An anti-national nexus of dishonest bureaucrats, businesspeople, and politicians was the driving force behind this misrule. They have created an oligarchic class and looted the sector by establishing a legal framework. This class has thrown away the people's rights by making plunderous expenses, and in turn, profits.

Because of them, the cost of generating electricity per unit grew from around Tk 2 in 2009-2010 to above Tk 11 in 2023-2024. Because of them, Bangladesh's power and energy sector has lost its domestic capacity and has become an import market.

This oligarchic class has gradually weakened the sector's public branch and enriched privatisation in the name of reform. They have created opportunities to loot thousands of crores in the name of capacity charges by keeping private power plants idle for years. To continue this looting and shield criminals of the fascist era, they have imposed these provisions.

Second, the current energy adviser, who is the former energy secretary, is not keen on breaking the cycle of privatisation. That is why, although the new government formed reform commissions on 11 issues, none has been formed for the power and energy sector as yet. Such anti-people decisions indicate towards his new position not being free from conflict of interest.

Third, the main spirit of the student-mass uprising was to eliminate discrimination. But discriminatory provisions have been left in place to stop all competition in the energy sector.

Fourth, the nexus of corrupt bureaucrats, businesspeople, and politicians—who are allies of autocracy and are trying to prevent progress—has re-emerged. These looters of public wealth are determined to protect laundered money and have facilitated these new provisions.

By providing new legal protection for these crimes, the government has shown that the ghost of tyranny is still present, and instead of chasing it away, it may very well be protecting it.

Shuvo Kibria is a senior journalist and engineer.​

 

[Saif]

LNG deal with US co raises energy security risk

The deal that Bangladesh has recently signed with the Louisiana-based Argent LNG to import liquefied natural gas is set to increase energy risks and unreliability, energy experts have warned.

www.newagebd.net

LNG deal with US co raises energy security risk
Emran Hossain 04 February, 2025, 23:28

The deal that Bangladesh has recently signed with the Louisiana-based Argent LNG to import liquefied natural gas is set to increase energy risks and unreliability, energy experts have warned.

They believe that the American company will emerge as the main beneficiary of the non-binding deal, using Bangladesh’s reputation as a potential buyer to secure finance needed to launch its business.

On January 24, the Bangladesh Investment Development Authority signed a non-binding deal with the Argent LNG to purchase five million tonnes of LNG annually.

Identifying the Argent LNG project highly uncertain as it, with a deadline of becoming operational by 2030, could not yet start constructing necessary infrastructure, the US-based Institute for Energy Economics and Financial Analysis warned that buying LNG from the USA market would expose Bangladesh to even more external shocks.

‘Argent LNG still has a long way to go in securing binding deals with customers before it can secure financing and proceed to construction,’ said Sam Reynolds, LNG and gas research lead for Asia at the Institute for Energy Economics and Financial Analysis, wrote in an email communication with New Age over the LNG deal.

Argent LNG is facing serious challenges in securing finance and binding contracts from creditworthy buyers amidst a rush of such projects being implemented worldwide, including in Qatar and the USA, according to the institute.

On its website, the Argent LNG speaks about its ambitious plans to supply fuel to power generation assets across Japan, Southeast Asia, Europe, South America, the Caribbean, the Middle East and North Africa.

The amount of LNG that Bangladesh agreed to import will represent half the capacity that the Argent LNG plans to have at its initial stage. Eventually, the company plans to increase its capacity to 25 Million Tonnes Per Annum (mtpa).

‘The deal is unacceptable, replete with irregularities and flaws,’ said prominent economist Anu Muhammad, also a former member secretary of the National Committee to Protect Oil, Gas, Mineral Resources, Power and Ports.

Bangladesh’s national fuel, gas and minerals company Petrobangla, which signs such power and energy deal, expressed its ignorance after the deal with the American company was signed in Washington by the BIDA.

The interim government had promised that the days of having power and energy deals without tender were over with the ouster of the Sheikh Hasina-led regime amid a student-mass uprising in last July-August. As part of its pledge, the interim government even scrapped the indemnity law allowing deals sans tender.

Energy division secretary and Petrobangla chairman did not answer New Age calls made for comments.

BIDA executive chairman Chowdhury Ashik Mahmud Bin Harun on January 26 defended the signing of the deal as the opening step in a process that would complete after many negotiations.

He said that any future binding agreement would adhere to Bangladesh’s legal framework.

‘The deal signifies the incumbent government’s lack of respect for what people need,’ said Anu Muhammad.

LNG as a source of energy proved unreliable during the past Awami League regime, which introduced it in 2018, leading to serious economic consequences.

Bangladesh descended into its worst energy crisis, accompanied by a prolonged spell of unprecedented inflation, within years of the start of LNG import that was done through long-term contracts and spot market purchases.

The dollar crisis that hit in 2022 was largely due to import of energy, mainly LNG.

Bangladesh spent Tk 1.73 lakh crore on LNG import until September last year since 2018. The outstanding LNG bill stood at Tk 1,787 crore in September.

Consumers experienced frequent price hikes since the LNG import started with household consumers seeing their energy bill inflate by as high as 35 per cent, hotels and restaurants by 79 per cent and industries by about 200 per cent so far.

Still, Bangladesh was far from witnessing an end to its energy crisis, supplying about 2,700mmcfd in best case scenario against the demand of 4,000mmcfd, about a fourth of which was LNG.

‘Bangladesh actually needed to move away from LNG,’ said Hasan Mehedi, member secretary, Bangladesh Working Group on Ecology and Development, a platform of green activists.

Money was not the only problem, Hasan Mehedi said, infrastructure challenges emerged as important as financial factor in disaster-prone Bangladesh.

Last year, one of the two floating storage and regasification units remained out of operation for six months between January and September after the cyclonic storm Remal hit, said a report of the Institute for Energy Economics and Financial Analysis.

Such incidents recurred since 2018, showed the report, affecting both the regasification units, prompting authorities to cancel LNG cargoes one after another.

Equipment issues also prompted suspension of operations at the units.

‘What is frightening is the government trying to pass the deal as a big one as well as a big strategic move,’ said Hasan Mehedi.

The non-binding deal has no indication of the potential LNG price. The IEEFA, however, predicted that the product would be expensive, given that the cheapest LNG supplier in the world is Qatar.

The US gas market has been rather stable lately but is likely to hike prices in future due to increase in demands, the IEEFA observed.

Bangladesh would also need to spend more on transporting LNG from the Gulf of Mexico, about 15,000km away, double the distance current LNG supplies arrive from.

‘The price that Bangladesh pays for LNG would depend on gas market fundamentals in the United States, leaving the country highly exposed to factors beyond its control,’ said Sam Reynolds.

More viable options could have been signing long-term deals with nearby LNG suppliers given many new LNG projects are under construction, energy experts further observe.

‘Bangladesh stepped into a trap by signing the LNG deal,’ said Hasan Mehedi.

Energy expert Badrul Imam described the deal as a frustrating development.

‘More LNG expense means fewer resources for exploration,’ he said.

‘It does not end the energy crisis, rather threatens to increase it,’ said Badrul.

Having admitted that he was informed before signing of the deal, Energy adviser Muhammad Fouzul Kabir Khan, however, told New Age that the deal carried very little significance.

Asked about the potential benefits and risks of the deal, he asked the reporter to get the answers from the BIDA, while adding that they found some of the questions too hypothetical to be answered.

‘Can energy prices be predicted five years in advance? The cost of transportation might not always depend on the distance,’ he said.

‘Above all, the company (Argent) does not have any gas in its reserve. There is no question of buying at the moment,’ he added.

From the adviser’s explanation it is apparent that the energy ministry within its legal framework has no option to go ahead with the non-binding agreement as deals can be achieved by three means—open tender, government-to-government and public-private partnerships. While public-private partnership often faces question over the selection of private partner, competition remains the most transparent way of buying the products.​

 

[Saif]

No load shedding expected in Ramadan: Adviser

Power, Energy and Mineral Resources Adviser Muhammad Fouzul Kabir Khan on Wednesday hoped that there would be a power outage during the month of Ramadan. “A plan was taken to keep the country free from load shedding during the Ramadan. But some areas of the country might experience load shed

thefinancialexpress.com.bd

No load shedding expected in Ramadan: Adviser
BSS
Published :
Feb 05, 2025 19:28
Updated :
Feb 05, 2025 19:28

Advisor Muhammad Fouzul Kabir Khan addressed an inter-ministerial meeting at Bidyut Bhawan on Wednesday. Photo : BSS

Power, Energy and Mineral Resources Adviser Muhammad Fouzul Kabir Khan on Wednesday hoped that there would be a power outage during the month of Ramadan.

“A plan was taken to keep the country free from load shedding during the Ramadan. But some areas of the country might experience load shedding during the summer,” he said.

Addressing an inter-ministerial meeting on power and energy supply during the upcoming Ramadan and irrigation season at Bidyut Bhaban, he said load shedding occurs due to various reasons.

“We have given instructions to avoid load shedding except for technical reasons,” the adviser said.

He said that the electricity demand during the summer and irrigation season has been estimated at 18,000 MW, out of which 6,000 MW is required for the cooling (AC) system.

“Around 900 million cubic feet per day (mmcfd) gas is now being supplied for electricity generation, which will be 1200 mmcfd during Ramadan to produce additional electricity, Fouzul Kabir said.

The adviser said that the gas supply will be 1100 mmcfd from April to September (Summer Season). During the Ramadan, the electricity demand will be 15000 MW. But we have made preparations for an uninterrupted power supply.

If we can keep the AC temperature up to 25 or 26 degrees Celsius level, the demand will be reduced by 2000 to 3000 MW. And then there will be no need for load shedding, he said.

Fouzul Kabir said that load shedding happens due to a shortage of primary energy supply and technical reasons.

Meetings with concerned departments were held to ensure sure availability of funds and got assurance to procure necessary fuels for power generation during Ramadan.​

 

[Saif]

Industries reeling from persistent gas crisis

Industry insiders have said that due to years of interruption in gas supply, export-oriented industries and other manufacturing units were facing an acute crisis...

www.newagebd.net

Industries reeling from persistent gas crisis
Saddam Hossain 06 February, 2025, 22:47

A file photo shows a man working in a cotton textile mill. Industry insiders have said that due to years of interruption in gas supply, export-oriented industries and other manufacturing units were facing an acute crisis. | New Age photo

Industry insiders have said that due to years of interruption in gas supply, export-oriented industries and other manufacturing units were facing an acute crisis.

They also said that the country’s major industries, such as textiles, ceramics and the captive power plants of the readymade garment industry, require a gas pressure of 15 per square inch, but they usually get 2 or 3 PSI, even sometimes zero.

Factory units located at industrial hubs like Dhaka, Narayanganj, Gazipur, Narsingdi, Manikganj and Mymensingh are facing acute interruptions in the gas supply.

Moreover, the country cannot import sufficient LNG due to a reserve crunch, said the industry people.

The country requires around 4,000 million cubic feet per day (MMcfd) of gas, including imported energy. The current supply is under 3,000 MMcfd, leaving a supply deficit exceeding 1,000 MMcfd.

Talking to New Age, Showkat Aziz Russell, president of the Bangladesh Textile Mills Association, said that 50 per cent of the textile mills had been closed due to a gas shortage.

‘Our loan is becoming classified as overdue in the bank is increasing. We yet to receive any instructions from Petrobangla or any other government authority,’ he added.

The government did not import fertiliser on time, and now it diverts gas to fertiliser factories, further worsening the situation.

The BTMA president urged the government to review contract signed under the previous regime according to the price index.

He also said that if the government does not take immediate action, the workers of the closed factories might take to the streets.

The ceramic industry is a fully gas-dependent process industry. Gas is considered a raw material and there is no alternative fuel to gas in this sector.

According to industry insiders, ceramic factories need a pressure of 15 PSI, but they experienced drops to as low as 2 or 3 PSI or even zero.

Talking to New Age, Moynul Islam, acting president of the Bangladesh Ceramic Manufacturers and Exporters Association, said that most of their factories run at 50 per cent of their total capacity.

‘Due to acute gas crisis, our sector is incurring loss of nearly Tk 300 crore per month. Even Petrobangla couldn’t share any measures or future prospects about the improvement of the situation,’ he added.

Petrobangla told them that the situation may improve soon only if adequate LNG was imported or if they can explore new gas fields.

‘In the last 9 years from 2015 to 2023, the authority hiked the gas price by about 345 per cent and in 2023, they increased the price by about 150 per cent and promised us to supply uninterrupted gas, but they can’t,’ Moynul said.

He also said that more than 50 registered ceramic companies had suspended their reinvestments due to the gas crisis alone, including five newly established factories that could not start production.

The readymade garment sector uses gas mainly to generate captive power. Due to the interruption in the gas supply, the industry is also facing multifaceted challenges.

Md Abul Kalam, managing director of Chaity Group and panel leader of Shammilita Parishad of the Bangladesh Garment Manufacturers and Exporters Association, told New Age that due to the gas crisis, the sector’s production had decreased by about 25 per cent.

Moreover, as the textile sector has been affected, the RMG sector is also facing problems getting raw materials.

‘Since we generate power through gas in our sector, disruption in gas supply is also damaging our machinery, reducing its lifespan, increasing maintenance costs and damaging sensitive components,’ he added.

He also said that despite increasing the price of gas by almost twofold in 2023, the authorities were not able to supply gas uninterruptedly, as they promised.

In the last week of January, the apex trade bodies of the country’s major four industrial sectors, BGMEA, BKMEA, BTMA and BTTLMEA, sent a joint letter to Muhammad Fouzul Kabir Khan, adviser to the Ministry of Power, Energy and Mineral Resources.

In the letter, the manufacturers said that the factories were operating on insufficient gas pressure and uncertainty and were suffering substantial financial losses.

The letter also stated that production in the industry-dense area had decreased by 50-60 per cent due to gas shortage, which has disrupted the supply chain and factories’ production.

Moreover, the timely supply of raw materials to the RMG sector cannot be ensured, which disrupts timely shipments.

Recently at an event at the ERF, the energy adviser Muhammad Fouzul Kabir Khan said that the situation was unlikely to improve until new gas fields were developed in the country.

Despite repeated attempts, Petrobangla chairman Md Rezanur Rahman could not be reached for a comment regarding the situation.​

 

[Saif]

Interim govt’s energy policy echoes AL-era essence

THE interim government appears to be missing out on the chance to walk away from the power and energy policy that the previous Awami League government had continued since 2009 to offer predatory profits to independent and rental power producers. An absence of effective initiatives on part of the...

www.newagebd.net

Interim govt’s energy policy echoes AL-era essence
07 February, 2025, 00:00

THE interim government appears to be missing out on the chance to walk away from the power and energy policy that the previous Awami League government had continued since 2009 to offer predatory profits to independent and rental power producers. An absence of effective initiatives on part of the interim government, which has been in office for about six months, to rein in profiteers that the Awami League government had placed in the power and energy sector has already come to be criticised. Whilst the power plants set up then by profiteers continue to bleed the economy, at a time when the government is trying to bring about economic and other reforms, experts say that there are laws and ways to stop the profiteers from being unjustly benefited. But the interim government has maintained that the cancellation of the agreements is difficult. The signing of a non-binding agreement by the Investment Development Authority on January 24 with the Louisiana-based Argent LNG on the import of five million tonnes of liquefied natural gas a year only comes as the expression of the interim government’s continuing with the Awami League-like power and energy policy.

Whilst experts say that the Argent agreement, replete with irregularities and flaws, could very well increase energy risks and unreliability, speakers at a seminar in Dhaka on February 5 said that the deal on liquefied natural gas import is nothing short of a reflection of how the Awami League government managed the sector that could perpetuate the reign of the syndicate of looters and the corrupt. The speakers have said that in the changed political context, the Argent agreement is a precursor to the continuation of what the Awami League did by allowing more than a hundred power projects under an energy indemnity law, sidestepping competitive processes. No tangible legal action against the Awami League-era power projects has so far been taken after the energy indemnity law was repealed in November 2024. The interim government could have had an exit from the flawed energy policy, but it took up a gas import project the way the Awami League did, which experts say is a surprise. The economic, environmental and public health consequences of the Awami League’s harmful power and energy projects appear to be getting a lease of life during the interim government.

The interim government should, therefore, review the agreement already signed and stop making such agreements in future.​

 

[Saif]

Govt must fish renewable energy sector out of ills

PROGRESS in the renewable energy sector, which has even failed to take off in 16 years since the adoption of the renewable energy policy in 2008, has been mired...

www.newagebd.net

Govt must fish renewable energy sector out of ills
03 April, 2024, 00:00

PROGRESS in the renewable energy sector, which has even failed to take off in 16 years since the adoption of the renewable energy policy in 2008, has been mired in inexperience and mismanagement, which has over the years let in a group of entities largely composed of owners of poultry business, feed mill, real estate trade, infrastructure development and construction, apparel factories, a medical college hospital and a human resources export agency. Experts, who blame the situation for a slow expansion of the renewable energy market and costs far higher than the global average, say that this has happened because of lucrative tariffs that promise high profits, mostly effected in an intransparent manner, holding off well-meaning companies that could meaningfully take the sector forward. Experts say that a solar power project should ideally take 13 months for completion, but because of what the sector is mired in, it takes years to begin the construction after the signing of the power purchase agreement with the Power Development Board. The whole process, as experts say, often involve hidden costs and much of lobbying which stops reputed entities from investing in renewable energy. There are only 10 solar power plants with a combined capacity of 459.3MW in operation while the government had plans for a 10 per cent of its power from renewable sources by 2020.

The renewable energy sector in Bangladesh, as experts say, is too lucrative and it could attract investors of all kinds. This is why some investors in renewable energy are local giants that are also involved in the business of fossil fuel, which accounts for about 97 per cent of the installed power generation capacity of about 26.85GW. They are said to have earned millions of dollars in capacity payment, for the power not produced, and in other costs since 2008, as fossil fuel-based generation capacity has jumped more than five times since then. In such a situation, energy experts fear that the inordinate delay in the implementation of renewable energy projects, which spans up to eight years as is observed in Bangladesh projects, is deliberate as delayed renewable projects mean more use of fossil fuel and more profits. Renewable power tariff is also high keeping to global standards. The International Renewable Energy Agency in 2022 estimated the global average cost of solar power at Tk 5.42 a unit while tariff in Bangladesh ranges from Tk 7.68 to Tk 20.87, averaging more than Tk 10 a unit. An Institute for Energy Economics and Financial Analysis expert says that reasonable solar power tariff in Bangladesh should be Tk 8.5 a unit, which can be reduced to Tk 6.5 with some government initiatives. Because of all such problems, not a single quality renewable power project has been implemented in more than a decade and a half.

The renewable energy sector, thus, appears to be another handle of the government to transfer public money to private pockets riding on ill designs and mismanagement. The government must, therefore, purge the energy sector of all ills without delay.​

 

[Saif]

Problem of gas shortage that govt should look into

INDUSTRIES, mainly export-oriented textile, ceramic, knitting and apparel, are reported to be in a difficult situation so much so that insiders say that production in most of the factories has almost...

www.newagebd.net

Problem of gas shortage that govt should look into
08 February, 2025, 00:18

INDUSTRIES, mainly export-oriented textile, ceramic, knitting and apparel, are reported to be in a difficult situation so much so that insiders say that production in most of the factories has almost halved because of continued gas shortage. About 4,000mmcfd of gas is required, but the current supply remains below 3,000mmcfd, leaving both government and industry authorities struggling. Factories located in industrial hubs of Dhaka, Narayanganj, Gazipur, Narsingdi, Manikganj and Mymensingh do not receive uninterrupted gas supply. Many of the industries, especially ceramic industries, which require a supply with the pressure of 15 pounds per square inch, usually receive supply with the pressure of two to three pounds per square inch. Industry owners allege that the pressure sometimes declines to zero. The Textile Mills’ Association says that persistent gas shortage has already forced the closure of a half of the textile mills, noting that with no early action on part of the government, the situation would worsen in no time that could prompt the workers to take to the streets. Most of the industries say that they have been forced to run to half their capacity because of the gas shortage.

Owners further say that gas prices increased by about 345 per cent in nine years since 2015, with promises for an adequate supply, but it has not happened. Apparel factories which run on captive power plants say that the gas shortage has caused a 25 per cent decline in the sectoral production. Ceramic product manufacturers and exporters say that they count Tk 3 billion in losses every month because of the problem. The situation does not only affect production, harming product export, but also puts owners in distress in repaying bank loans, running the risk of becoming non-performing, damages machines and reduces their useful economic life, and increases maintenance costs. Four industry associations in January wrote to the government, seeking a resolution of the problem and describing the uncertainty and problems that the gas shortage has caused to the industries. Industry owners say that the government is diverting gas to fertiliser factories as it did not import fertiliser on time. This remains an issue for the government to look into. Petrobangla is reported to have envisaged no early improvement without adequate import of liquefied natural gas or gas extraction from new fields. The energy adviser has recently said that the situation at hand is unlikely to improve until new gas fields are developed.

A reserve crunch is holding back an adequate import of gas and no hydrocarbon exploration for long has only compounded the matter. The government should, therefore, tie loose ends here and there to improve the supply situation in the short run and earnestly get down to hydrocarbon exploration in the long run.​

 

[Saif]

India’s adani plant: Bangladesh asks for full power supply

Bangladesh has asked Adani Power to fully resume supplies from its 1,600-megawatt plant in India, a Bangladesh official said, after more than three months of reduced sales with supplies halved due to low winter demand and payment disputes.

www.thedailystar.net

India’s adani plant: Bangladesh asks for full power supply

The logo of the Adani group is seen on the facade of one of its buildings on the outskirts of Ahmedabad, India, April 13, 2021. File photo: Reuters

Bangladesh has asked Adani Power to fully resume supplies from its 1,600-megawatt plant in India, a Bangladesh official said, after more than three months of reduced sales with supplies halved due to low winter demand and payment disputes.

Adani, which signed a 25-year contract under former prime minister Sheikh Hasina in 2017, has been supplying power from its $2 billion plant in India's Jharkhand state. The plant, with two units each of 800 megawatts capacity, sells exclusively to Bangladesh.

The Indian company halved supply to Bangladesh on October 31 due to payment delays as the country battled a foreign exchange shortage. This led to the shutdown of one unit on November 1, resulting in the plant operating at about 42 percent capacity.

Subsequently, Bangladesh told Adani to keep supplying only half the power.

The state-run Bangladesh Power Development Board (BPDB) said it had been paying $85 million a month to Adani to clear outstanding dues and has now told the company to resume supply from the second unit.

"As per our requirement today, they have planned to synchronise the second unit, but due to the high vibration, it didn't happen," BPDB Chairperson Md Rezaul Karim told Reuters, referring to some technical problems that stopped the unit from restarting on Monday.

"Right now, we are making a payment of $85 million per month. We are trying to pay more, and our intention is to reduce the overdue. Now there is no big issue with Adani."

BPDB and Adani officials were due to meet virtually yesterday following another meeting recently to work out various issues between them, said a source with direct knowledge of the matter who did not want to be named as he was not authorised to talk to the media.

An Adani Power spokesperson did not immediately respond to a request for comment. In December, an Adani source said BPDB owed the company about $900 million, while Karim said at the time the amount was only about $650 million.

The pricing dispute revolves around how power tariffs are calculated, with the 2017 agreement pricing off an average of two indexes. Adani's power costs Bangladesh about 55 percent more than the average of all Indian power sold to Dhaka, Reuters has reported.

A Bangladesh court has ordered an examination of the contract with Adani by a committee of experts, with results expected this month. This could potentially lead to contract renegotiations.

Last year, Bangladesh's interim government accused Adani of breaching the power-purchase agreement by withholding tax benefits that the Jharkhand plant received from New Delhi, Reuters reported in December citing documents. Bangladesh officials also said they were reviewing the contract.

A spokesperson for Adani told Reuters at the time that it had upheld all contractual obligations with Bangladesh and had no indication Dhaka was reviewing the contract.

Karim has not replied to Reuters' questions on whether the two sides have resolved their differences.

In November, US prosecutors indicted Adani Group founder Gautam Adani and seven other executives for their alleged role in a $265 million bribery scheme in India. Adani Group has called the US allegations "baseless".

In September, the Bangladesh government appointed a panel of experts to examine major energy deals signed by Hasina, who fled to New Delhi in August after deadly student-led protests.​

 

[Saif]

SPECIAL ENERGY FUNDS: Most of Tk 53,000cr misused by AL govt

Most of the special energy funds worth Tk 53,000 crore was misused by the Sheikh Hasina government, ousted in August past year amid a mass uprising, through breaching policies and guidelines during its 15 years of authoritarian regime.

www.newagebd.net

SPECIAL ENERGY FUNDS: Most of Tk 53,000cr misused by AL govt
Emran Hossain 11 February, 2025, 23:31

Most of the special energy funds worth Tk 53,000 crore was misused by the Sheikh Hasina government, ousted in August past year amid a mass uprising, through breaching policies and guidelines during its 15 years of authoritarian regime.

The funds — power sector development fund, gas development fund and energy security fund — were created with money kept aside from gas and electricity sales every month.

Reducing power and energy sector expenses by investing in least-cost power production, natural gas exploration and production and energy efficiency was the main target of creating the funds.

Until June past year, except for the amounts stuck in different stages of transaction and money deducted as tax, the aggregate size of the three funds was Tk 47,700 crore.

Of the amount, 97 per cent was used by the ousted AL government, showed Bangladesh Energy Regulatory Commission data, and about three-fourths of it was spent breaking the policies and guidelines stipulating the use of the funds.

Only Tk 1,500 crore was found with the funds operated by the Bangladesh Power Development Board, Petrobangla and BERC at the end of past financial year.

The use of the funds featured huge imports of liquefied natural gas with 44 per cent of the money or Tk 21,000 crore spent for the purpose. LNG import is blamed for plunging Bangladesh, to a great extent, into the dollar crisis and unprecedented inflation that have been around for over two years.

‘The past government did not care for any rules or laws in conducting its affairs. People never enjoyed the benefits of creating the funds,’ said M Shamasul Alam, energy adviser at the Consumers Association of Bangladesh.

The oldest of the funds, Gas Development Fund, was created on August 1, 2009, immediately after the past government had assumed power and increased the gas price by 11.22 per cent. The fund was created by keeping aside Tk 0.42 from the proceeds of selling a cubic metre of gas.

A good portion of the GDF, which was Tk 20,000 crore, was used for paying tax, though the fund was originally created under the condition of not being taxable.

Highlighting the trend of a rapid depletion in the reserve of gas, accounting for 73 per cent of commercial energy consumption, the GDF policy primarily focused on enhancing natural gas exploration and production.

Exploration projects used Tk 6,800 crore from the fund managed by the Petrobgangla.

In complete violation of the GDF policy, Tk 6,000 crore was taken as loan by the government from the fund for importing LNG.

Petrobangla data showed that past year the import of LNG to meet about a third of the gas demand raised the overall cost of gas by five folds.

Past year Petrobangla bought a unit of gas from state-owned oil companies at Tk 1.5 while the cost of buying the same amount of gas from international oil companies lifting gas from local fields stood at Tk 4.5. The import cost of a unit of LNG, on the other hand, was Tk 62. Imported LNG is blended with local natural gas for supply through the national grid.

‘Spending the GDF for LNG import despite frequent gas price increases was against all logic,’ said Shafiqul Alam, lead energy analyst, Bangladesh at the Institute for Energy Economics and Financial Analysis.

Since the beginning of LNG import in 2018, household consumers have seen their gas bills rise up to 35 per cent while hotels and restaurants have observed a 79 per cent rise in their prices. Industries, however, saw a 179 per cent increase in the gas prices in one go past year. The price hikes were always justified with increased expenses for LNG import.

‘A careful assessment is needed to find out what necessitated the use of the GDF for LNG import,’ said Shafiqul.

Energy experts have long expressed their frustration over the government’s reluctance to explore its own resources, particularly gas reserve, which is believed to be in abundance in the offshore. The reluctance is often linked to strong influence by global fossil fuel lobby, dictating Bangladesh’s power and energy policy over the past two decades.

Petrobangla even transferred Tk 3,000 crore from the GDF to the national exchequer under the controversial special law allowing the government to take away fund sitting idle with state-owned entities. The law, surplus fund act, came into force in 2022 when the past government was battling with a severe economic crisis.

The requirement of taking BERC permission to invest the GDF fund was never fulfilled.

The power sector development fund was created on February 1, 2011 by channelling Tk 0.15 on each unit of bulk electricity sales. The amount that the fund had available for use was Tk 15,700 crore until June past year.

Created with the objective to be invested in low-cost power generation projects, Tk 5,060 crore from the fund was used in five power generation projects, including Tk 1,184 crore going to the project of the coal-based 1,320MW Payra power plant.

A key condition of using the PSDF was that it ensures low-cost power generation. But projects taken under the fund added to the BPDB’s financial burden, particularly due to capacity charge entitlement of the power plants that were not needed in the first place. The past government even could not match the construction of the Payra power plant with required transmission network, keeping it idle for over one year.

The BPDB also took Tk 10,257 crore as loan from the PSDF.

‘Taking loan from the PSDF was the most outrageous move,’ said Shamasul Alam.

‘First, state-owned BPDB took a loan illegally from a fund created with money taken directly from the people’s pocket, and then it passed the responsibility of paying back the loan onto the shoulder of people,’ he observed.

He said that the use of the fund in coal-based power plants went against the spirit that led to the formation of the fund. The fund was primarily meant to be used for gas-based and renewable power generation.

No significant renewable energy investment was made under the PSDF.

Created on September 1, 2015, Tk 15,200 crore was deposited with the energy security fund until June past year. The fund received Tk 0.40 from per cubic metre of gas sales. Almost the entire fund — Tk 15,000 crore — was used for importing LNG on loans.

Established on April 10, 2018, the ESF guidelines said that its main goal was to protect future generation from potential energy crisis arising from using up natural gas reserve. The fund permitted LNG import, but said that it could also be used for the purpose of exploration, extraction, purification, transmission and distribution of natural gas.

The fund, also operated by the Petrobangla, could be used for achieving energy efficiency.

BERC officials said that interests on loans taken from the funds remained largely unpaid, without the authorities even caring to explain their decision of not paying back loans.

‘Energy funds’ administration is a microcosm of how things were done in the power and energy sector during AL’s regime,’ said Hasan Mehedi, member secretary of the Bangladesh Working Group on Ecology and Development, a platform of green activists.​

 

[Saif]

Adani reports machine trouble after Dhaka seeks full supply

The 1,346MW coal-based Adani power plant reported encountering technical trouble in starting its second unit following Bangladesh’s request to run the power plant in India’s Jharkhand at its full capacity.

www.newagebd.net

Adani reports machine trouble after Dhaka seeks full supply
Staff Correspondent 11 February, 2025, 23:34

The 1,346MW coal-based Adani power plant reported encountering technical trouble in starting its second unit following Bangladesh’s request to run the power plant in India’s Jharkhand at its full capacity.

The Adani power plant shut down one of its two units in early November after Bangladesh failed to clear its dues, the amount of which is debated by the two parties.

Bangladesh is expecting a surge in its power demand soon with the last month of the winter season passing amid forecast of the temperature soon going up.

‘There was a technical problem after Adani had started full operation on February 10, a day after we made the request to increase their supply,’ Bangladesh Power Development Board’s chairman Rezaul Karim told New Age.

A special team of engineers is expected to examine the problem today, he said, adding that the starting of full operation depended on fixing the technical glitch.

Bangladesh owes $550 million to Adani, the boss of the state-owned BPDB said.

A request sent to the company responsible for Adani’s public relations for a comment over the matter was not answered.

Earlier in September, last year the group’s chairman Gautam Adani wrote to interim government chief adviser Muhammad Yunus to clear his $800 million outstanding bills.

On Tuesday, Adani supplied about 740MW of electricity, maintaining the level of supply since it reduced its supply citing non-payment of dues in early November last year.

The BPDB officials said that they were making regular payments but there were some controversies that they expected to resolve through negotiations.

Bangladesh expressed its surprise and shock after Adani gave a fresh deadline to get a road map on the payment of its dues by November 7 or face complete suspension in power supply.

This was the second deadline given by the company. The earlier deadline expired on October 31, leading to the suspension of one of the two units.

Experts said that Bangladesh could have managed its power demand without receiving any supply from the Adani power plant had it provided enough supply of fuel for other plants.

The dollar crisis is standing in the way of providing uninterrupted energy supply to power plants.

While issuing the second deadline, Adani claimed that its outstanding bill amounted to $850million, Indian media reported.

Bangladesh at the time said that the actual amount was over $600 million.

Power deal signed with Adani has been described as hugely discriminatory by energy experts.

Bangladesh would have to buy 34 per cent of electricity of the plant’s capacity or would have to face fines under the deal with Adani.

Even if Bangladesh had bought the required amount, the country would have to pay capacity charge.

The agreement has also deprived Bangladesh of taking any action if Adani abruptly suspends its operation.

The power development board has already accused Adani of inflating its bill by about a third taking advantage of the power purchase agreement signed under the direct supervision of then prime minister Sheikh Hasina, ousted on August 5 amid a student-led mass uprising, and her Indian counterpart Narendra Modi.

The agreement, which allowed Adani to greatly manipulate coal prices also made headlines in the national and international media for clauses highly discriminatory to Bangladesh. Under the PPA, the plant was established with a $2 billion investment to earn Adani $12 billion in its lifetime of 25 years.

Bangladesh’s current installed capacity is 27,884MW.

The current maximum demand is around 11,500MW. The demand is set to rapidly rise by March, when the Muslim fasting month of Ramadan is set to begin.

Even with the demand remaining so low, nearly 100MW of load shedding was recorded on Tuesday.

Immediately after Hasina fled to India after the overthrow of her government, India changed its power export rules allowing Adani, which set up the power plant exclusively for producing power for Bangladesh, to sell electricity domestically.​

 

[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.

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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...

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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.

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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).​

 

[Saif]

Bangladesh can attract big investments in renewables

A delegation of development and renewable energy experts, led by a former Norwegian minister, called on Professor Muhammad Yunus, chief adviser to the interim government in Bangladesh, at a state guest house in Dhaka yesterday.

www.thedailystar.net

Bangladesh can attract big investments in renewables
Experts tell CA

Photo: CA's press wing

A delegation of development and renewable energy experts, led by a former Norwegian minister, called on Professor Muhammad Yunus, chief adviser to the interim government in Bangladesh, at a state guest house in Dhaka yesterday.

The team expressed their keen interest in investing in small-scale solar plants, the carbon market, and agroforestry in the country, as Bangladesh focuses more on moving away from fossil fuels in the coming years.

Professor Yunus welcomed the move, saying the interim government was now ready to attract foreign direct investment in these rapidly evolving sectors.

"All these are very serious issues for us. Bangladesh wants big investments in renewable energy and the carbon market," the chief adviser said.

Professor Yunus said Dhaka had already initiated talks to import hydroelectricity from Nepal and Bhutan, and his government was eager to explore opportunities to set up a South Asian grid to bring the power to Bangladesh via a narrow corridor in India.

"This (hydroelectricity in Nepal) is a treasure waiting to be explored.

But delivery is a problem," the chief adviser said.

The Norwegian minister for development and environment, Erik Solheim, also a former UN under-secretary-general, said Bangladesh lacks enough unused space for the construction of large-scale solar plants like those in China and other Asian countries.

However, he said the country could be a perfect place to set up small-scale solar plants.

Professor Yunus said his government has put special emphasis on solar plants and has already invited Chinese investors to relocate solar panel manufacturing plants to Bangladesh.

Representatives of several Chinese solar manufacturing firms have since visited Bangladesh to explore opportunities to set up factories here, with a view to using them to export much of their products to Western nations.

Kavin Kumar Kandasamy, chief executive officer of ProClime, a carbon trade and climate investment firm, said Bangladesh could easily earn tens of millions of dollars through carbon trading, as South Asian nations like Sri Lanka have done.

Professor Yunus said Bangladesh was very interested in exploring the carbon market, as it would help the country earn millions while also supporting efforts to protect the Sundarbans, the world's largest mangrove forest.

During the talks, the chief adviser and the Solheim-led delegation also discussed the Rohingya crisis and recent developments in the western Myanmar state of Rakhine, where a rebel group now controls most of the territory.​

 

[Saif]

Coal power generation up as temp rises

Bangladesh has substantially increased coal-fired power generation over the last several days as temperature starts rising with the arrival of warmest time of the year—three-month-long pre-monsoon season.

www.newagebd.net

Coal power generation up as temp rises
Staff Correspondent 03 March, 2025, 23:33

Adani 2nd unit back after 4 months

Bangladesh has substantially increased coal-fired power generation over the last several days as temperature starts rising with the arrival of warmest time of the year—three-month-long pre-monsoon season.

The Godda-based coal-fired 1,347MW power plant in India, owned by the Adani Power, resumed operation on Saturday at its second unit which was closed for four months due to the non-payment of bills.

The 1,200MW coal-based Matarbari power plant is also available with its full capacity to generate power for the first time since December.

‘The coal-based Rampal power plant is also set to start operation in a day or two,’ said Zahurul Islam, member of the Bangladesh Power Development Board and responsible for its power generation.

The 1,320MW Rampal power plant remained out of operation since February 14 due to fuel shortage triggered by a dollar crisis.

Sources in the PDB said that coal supplies reached Rampal from the Payra power plant in Patuakhali district.

‘We are trying to generate as much as it is possible from coal to keep generation cost low,’ said Zahurul.

The daily peak electricity demand surged by more than 2,000MW over the last several days with the peak power generation already exceeding 13,500MW.

At the moment, gas-fueled plants are generating 4,500–5,000MW of electricity, followed by coal-fired plants producing 3,500–4,000MW, and liquid fuel-based ones producing 2,000–2,500MW, depending on the demand at the peak hour.

Bangladesh’s current power generation capacity is 27,790MW with natural gas accounting for almost 12,000MW, furnace oil 6,500MW, and coal 5,683MW.

The overall outstanding bill incurred by 121 power plants stood at Tk 38,373 crore until January 7, 2025. Over 60 per cent of the unpaid bills was owed to fuel suppliers.

The BPDB owes more than Tk 5,235 crore of the bills 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.

The outstanding fuel bill to the Adani power was Tk 2,825 crore, the highest amount among all coal-based power plants.

At the end of the last fiscal, per unit electricity generation cost using gas was Tk 6.31, while the generation cost from local coal-based plants was Tk 12.74. Diesel-based power generation was the costliest at Tk 47.12 per unit, followed by Tk 25.70 for furnace oil-based power generation. The generation cost at the Adani power plant was Tk 14.87. Imported power cost Tk 8.40 per unit, followed by hydro electricity generation at Tk 2.32, and solar at Tk 16.60.

On Monday, country’s highest maximum day temperature of 34C was recorded in Rajshahi. The maximum day temperature in Dhaka was recorded 32.6C.

The Bangladesh Meteorological Department warned that the temperature could top 40C this month, which also coincided with the Muslim’s fasting month of Ramadan.

It remains to see how long the government can keep its coal plants operational.

The Matarbari coal-fired power plant has one lakh tonnes of coal in store which will enable the plant to keep running for just 10 days. Another 20 days’ worth of coal is on the way, the plant authority said.​

 

[Saif]

Disinclination to renewable energy deplorable

THE transition to renewable energy in Bangladesh has been suffering due to an unfavourable investment environment. The Bangladesh Power Development Board has recently extended its deadline for the...

www.newagebd.net

Disinclination to renewable energy deplorable
04 March, 2025, 00:00

THE transition to renewable energy in Bangladesh has been suffering due to an unfavourable investment environment. The Bangladesh Power Development Board has recently extended its deadline for the submission of proposals to tender calls for solar power plants because no investor has submitted any proposal. The BPDB floated three tenders for solar power plants with the capacity to produce 10-100 MW in phases starting from December 2024 but received no response from the investors so far. The BPDB officials are now planning to relax the eligibility criterion to encourage investors to take on the government’s renewable energy projects. Energy experts, however, do not think that flexible eligibility criteria are enough; there are other structural concerns. They believe that the interim government’s decision to cancel the projects, which were just a step away from signing the power purchase agreement, eroded investors’ trust. In August 2024, all 31 renewable energy projects worth over 2,600 MW were cancelled as they were unsolicited. It is true that a purchase agreement based on an unsolicited proposal carries risks of corruption, but the hasty decision to cancel the agreement also negatively influences the investment climate.

Energy experts and investors initially described that the tenders were designed to favour past Awami-era investors, big companies and foreign investors with their discriminatory eligibility criteria. However, the amendment to the eligibility criterion for the tender applicant made under the interim government is not friendly towards local investors. There are other policy concerns that discourage local and foreign investors from taking on renewable energy projects in Bangladesh. The main factor that the interested investors mention is the exorbitant import duty on imported items for renewable infrastructure. Import duty on solar panels was increased to 26 per cent from 11 per cent in the financial year 2021–22. Local renewable investors struggle to mobilise capital as banks and non-bank financial institutions are reluctant to lend to the renewable sector. The major renewable capital source has been the government-owned Infrastructure Development Company Limited, but it lends at a high rate and operates mostly with profit-seeking interest.

The interim government has repeatedly announced their commitment to environmentally friendly energy policy, but the country’s energy policy is still heavily dependent on fossil fuels. Two main power plants, the Rampal Power Plant and Roopoor Nuclear Power Plant taken under the deposed Awami Legaue regime and faced public opposition for environmental risks, has not been reviewed. The government must strategically and financially incentivise small renewable projects. In doing so, it must review existing financing schemes and its loan provisions for the renewable sector. Import duties must also be reviewed for steady growth of the sectors and to encourage investors.​

 

[Saif]

Bangladesh's energy security and sustainability

The government has been in a dilemma regarding the energy security of the country. At one hand it has a large amount pending dues in the middle eastern markets for energy which we had secured earlier while we are struggling to pay local Independent Power Providers and local gas supplier, i.e., Chev

thefinancialexpress.com.bd

Bangladesh's energy security and sustainability
A bubble waiting to burst
Zaved Akhtar
Published :
Mar 05, 2025 22:44
Updated :
Mar 05, 2025 22:44

The government has been in a dilemma regarding the energy security of the country. At one hand it has a large amount pending dues in the middle eastern markets for energy which we had secured earlier while we are struggling to pay local Independent Power Providers and local gas supplier, i.e., Chevron. Today our energy tenders are not being responded as this require a sovereign guarantee or we need to pay significant risk premium for anyone to touch it with a pole. At the same time, we have the warm season impending summer coming back when local demands will peak while we struggle to supply the gas guzzling manufacturing industries. Such catch-22 situation (a dilemma or difficult circumstance from which there is no escape because of mutually conflicting or dependent conditions) which makes it very difficult for the power regulators to manage. This is leading to regulators contemplating unprecedentedgas price hikes.

The new gas pricing proposed by Petrobangla aims to reflect the actual cost of imported LNG with price proposal set at Tk 75.72 per cubic meter, an increase of over 150 per cent (current rate of Tk 30.75 per cubic meter). The intent is to reduce the significant fiscal burden on the Government estimated to be Tk 160b in FY 2025. However, the new price will not be effective for all connections in the same manner. For new connections, the companies would have to pay the full proposed price while for existing connections, companies would continue to pay the current rate up to their sanctioned load and any usage beyond this limit would be charged at the new rate of Tk 75.72 per cubic meter. For companies receiving primary approval, old prices up to 50 per cent of their demand will be charged while the remaining will be charged at the proposed rate of Tk 75.72 per cubic meter.

Implication Of the New Proposed Pricing: While one may have significant empathyabout the predicament,I believe one would have truly little sympathy. The way we have managed energy security and sustainability has been very amateurish. We have neither leveraged any forecasting tools, nor have we used any means of hedging or lookingat energy financing. These gross misdeeds of the past are now leading to a grave predicament for current regulators, people, and businesses. Should we progress with the energy price escalation we are likely to face the following headwinds: (1) Increased production costs for energy-intensive industries, such as textiles, construction, heavy industries, and manufacturing, leading to increased prices for end products, potentially reducing competitiveness in both domestic and international markets. With loss of preferential duty benefits from LDC graduation, exports are likely to face further setbacks due to higher costs. (2) Deter new investments (new investors to pay at new price, much higher price than existing ones) as well as existing industries likely to delay expansion plans. (3) Increase the risk of operations closure, particularly in the textile sector due to higher operational cost.

Challenges for Bangladesh Energy Security& Sustainability: The situation dire and merits us to step back and reflect on why we landed where we landed, and how does the decisions we take today have implications on tomorrow. Let us first start with the challenges that we are standing on:

Aging Infrastructure. A sizable portion of Bangladesh’s power generation infrastructure is outdated, leading to frequent breakdowns and inefficiencies. Many power plants operate below their capacity due to maintenance issues and technological obsolescence.

High System Losses. Bangladesh experiences high transmission and distribution (T&D) losses, often exceeding 10-15 per cent. These losses are due to technical issues like poor grid infrastructure and non-technical issues such as theft and inefficient billing systems.

Over-reliance on Natural Gas. Around 60-70 per cent of Bangladesh’s electricity is generated from natural gas. This over-reliance makes the power sector vulnerable to supply shortages and price volatility. Additionally, domestic gas reserves are depleting, leading to increased reliance on imported liquefied natural gas (LNG), which is more expensive and is exposed to currency fluctuations.

Underutilisation of Renewable Energy. Despite having significant potential for renewable energy (solar, wind, and hydropower), Bangladesh has been slow to adopt these technologies. Renewable energy accounts for a small fraction of the total energy mix, missing opportunities for sustainable and cost-effective power generation.

Inefficient Power Plants. Many of the power plants, especially the older ones, have low thermal efficiency. Combined-cycle plants, which are more efficient, are not as prevalent as they could be.

Fuel Diversification Issues. While there has been some diversification into coal and oil-based power generation, these sources come with their own set of challenges, including environmental concerns and higher operational costs.

Regulatory and Bureaucratic Hurdles. The power sector in Bangladesh faces regulatory and bureaucratic inefficiencies, which can delay project approvals, increase costs, and reduce overall sector efficiency.
Comparative Costs of Power Generation in Bangladesh: We also need to contextualize the cost of power generation as this will have significant impact to the affordability for consumers and sustainability of businesses. Below is the comparison:

Natural Gas. Historically, natural gas has been the cheapest source of power generation in Bangladesh, with costs ranging from $0.03 to $0.05 per kWh. However, as domestic reserves dwindle and reliance on imported LNG increases, these costs are rising.

Coal. Coal-based power generation costs are higher than natural gas but are still competitive, ranging from $0.05 to $0.08 per kWh. The Payra Power Plant, one of the largest coal-based plants, has been a significant addition to the grid. Unfortunately, this is not a green energy solution.

Heavy Fuel Oil (HFO). Power generation from HFO is more expensive, with costs ranging from $0.10 to $0.15 per kWh. This method is used as a stop-gap measure during peak demand or gas shortages.

Renewable Energy. The cost of solar power has been decreasing globally and is now competitive with traditional sources. In Bangladesh, the cost of solar power is around $0.07 to $0.10 per kWh. Wind and hydropower costs can vary but fall within a similar range. Our endeavor should be to maximise this as much as possible.

Imported LNG. With the shift towards imported LNG, the cost of power generation has increased. LNG-based power generation costs can range from $0.08 to $0.12 per kWh, depending on global LNG prices and given the currency volatility reliance on LNG can be detrimental for us.

Diesel. Diesel-based power generation is the most expensive, often exceeding $0.20 per kWh. It is typically used only in emergencies or in remote areas where other sources are not available.

Comparative Costs and Mix of Power across Similar Economies: Bangladesh’s power generation costs are heavily influenced by its reliance on natural gas and imported LNG, which are becoming more expensive. The country also faces prohibitive costs for oil-based generation during shortages.Pakistan’s power generation costs are comparable to Bangladesh’s, but it benefits from a larger share of hydropower, which is cheaper. However, Pakistan also faces challenges with reliance on imported fuels (coal and LNG), which increase costs.

Kenya has a significantly different energy mix, with a strong focus on renewable energy (geothermal, hydro, and wind). This has led to lower average power generation costs compared to Bangladesh. Kenya’s reliance on renewables has also made its energy sector more sustainable and less vulnerable to fuel price fluctuations.Vietnam has a more diversified energy mix, with significant contributions from coal and hydropower. The country has also made strides in renewable energy, particularly solar and wind, which are cost competitive. Vietnam’s power generation costs are lower than Bangladesh’s, especially due to its abundant hydropower resources.

Key Observations: Bangladesh’s power generation sector faces several inefficiencies, including aging infrastructure, high system losses, over-reliance on natural gas, and underutilisation of renewable energy. The comparative costs of power generation vary significantly across various sources, with natural gas being the cheapest but increasingly expensive due to reliance on imports. Coal and renewable energy offer competitive alternatives, while oil-based generation remains costly. Addressing these inefficiencies and diversifying the energy mix could lead to a more sustainable and cost-effective power sector in Bangladesh.

Dependence on Fossil Fuels. Bangladesh and Pakistan share similar challenges due to their reliance on natural gas and imported fuels (LNG, coal), which increases costs. In contrast, Vietnam and Kenya have diversified their energy mix, reducing dependence on expensive imported fuels.

Renewable Energy Potential. Kenya and Vietnam have capitalized on their renewable energy potential (hydropower, geothermal, and solar), leading to lower generation costs. Bangladesh has significant solar potential but has been slow to adopt it at scale.

Hydropower Advantage. Countries like Vietnam and Pakistan benefit from cheaper hydropower, which Bangladesh lacks due to its geographical constraints.

System Inefficiencies: Bangladesh faces higher transmission and distribution losses compared to Vietnam and Kenya, which further increases the effective cost of power.

Recommendations for Bangladesh: Cost-Reflective Transparent Pricing Formula. Implement a transparent pricing formula that reflects the actual cost of energy production, including generation, transmission, and distribution costs. The price should be regularly reviewed and adjusted based on changes in input costs.

Invest in Renewables. Accelerate the adoption of solar and wind energy to reduce reliance on expensive imported fuels.Our investors have a target of becoming net zero, but our energy strategy does not facilitate this. We need to focus on what the customers, in this case the investors need.

Improve Grid Efficiency. Reduce transmission and distribution losses through infrastructure upgrades and better management.

Mandatory Energy Audits. Implement mandatory energy audits for industries to identify inefficiencies and recommend improvements.

Diversify Energy Mix. Explore alternative energy sources like hydropower (where feasible) and biomass to stabilize costs.

Regional Cooperation. Learn from countries like Vietnam and Kenya, which have successfully integrated renewables into their energy mix.

Create Sovereign Energy Bonds. Raise capital for energy-related projects, particularly those focused on renewable energy and sustainability. We can get our payment rescheduled against a sovereign bond. We could also create Clean Renewable Energy Bonds (CREBs), that are specifically issued to fund renewable energy projects. Many energy bonds offer tax credits or deductions to investors, which can reduce the overall cost of the investment and make it more appealing. We could also opt for Green Bonds to finance projects with positive environmental impacts, such as renewable energy, energy efficiency, conservation efforts, or forfunding projects that reduce carbon emissions and promote sustainable energy sources.

Privatise Power Supply. We could privatise power generation and supply. It would bring in significant improvement in efficiency as often private organisation will have a profit incentive to cut costs and operate more efficiently. This can lead to better management practices and reduced wastage. It will also attract private investment, which can be used to upgrade infrastructure and expand capacity. This is particularly important for developing countries that may lack the funds for such investments. Private companies may be more likely to invest in innovative technologies and innovative solutions to improve service delivery and reduce costs. Private companies are typically less subject to political pressures, which can lead to more stable and consistent management. Privatisation can lead to increased competition in the market, which can drive down prices and improve service quality for consumers.

Today power and energy sector needs disruptive leadership. We need a transformational leadership moment today to build the foundation for tomorrow’s energy security. By using the old playbook we will not land anywhere different, and hence I hope some of these perspectives helps in creating newer moats for energy security and sustainability. Today’s bold decision will build the competitive advantage for the country for tomorrow.

Zaved Akhtar is President, Foreign Investors’ Chamber of Commerce and Industry; and Chairman and Managing Director, Unilever Bangladesh.​

 

[Saif]

Aramco LNG import planned to cut reliance on spot buys

Bangladesh now looks to import liquefied natural gas (LNG) from Saudi oil- giant Aramco under an envisaged long-term deal to reduce reliance on volatile spot market for the must-have fuel. Market insiders say the country may import around 1.0-million-tonne-per-year (MTPA) of LNG, to begin wi

thefinancialexpress.com.bd

Aramco LNG import planned to cut reliance on spot buys
Dealmaking to bring 1.0m tonnes annually to start with
M AZIZUR RAHMA
Published :
Mar 07, 2025 00:17
Updated :
Mar 07, 2025 00:17

Bangladesh now looks to import liquefied natural gas (LNG) from Saudi oil- giant Aramco under an envisaged long-term deal to reduce reliance on volatile spot market for the must-have fuel.

Market insiders say the country may import around 1.0-million-tonne-per-year (MTPA) of LNG, to begin with, from this year once the deal is inked.

The Saudi energy pact is coming close on the heels of such a long-term deal a US firm has already clinched to supply the liquefied gas meant to ramp up the fuel supply to energy-starved economy, industries in particular.

"Aramco has sent a proposal to the Energy and Mineral Resources Division (EMRD) under the Ministry of Power, Energy and Mineral Resources (MPEMR) expressing its intention to deliver LNG to Bangladesh," adviser for the ministry Muhammad Fouzul Kabir Khan told The Financial Express Thursday.

The exact volume and price would be fixed during negotiations with Aramco, he said.

Khan said he had visited Saudi Arabia recently to take part in an international conference and had a meeting with top Saudi energy policymakers.

Another adviser of the interim government, Syeda Rizwana Hasan, who holds the environment ministry, said Tuesday that Aramco agreed to supply LNG to Bangladesh at a price below the current market rate.

Sources in the field say a long-term deal with Aramco would help reduce Bangladesh's dependence on the volatile spot LNG market where price fluctuates, mostly on an upturn.

Spot LNG prices remain high on the international market and Bangladesh's overdue payments to suppliers of spot LNG climb higher.

Platts JKM, the benchmark price reflecting LNG delivered to Northeast Asia, was assessed at $13.21 per million British thermal unit (MMBtu) on March 5.

But the government had to buy one spot LNG cargo for March 05-06 delivery at US$16.43 per MMBTu, which accounts for around 24.37-percent higher than the international market rate, as the country's payment to LNG suppliers got delayed.

Sources have said Aramco's trading arm Aramco Trading Co (ATC) has already been shortlisted by Rupantarita Prakritik Gas Company Ltd (RPGCL) to initiate supply of LNG from spot market.

A master sales and purchase agreement (MSPA) is expected to be inked with Aramco, along with a couple of dozen potential spot LNG suppliers, soon.

Separately, a couple of months back on January 25th US's Louisiana-based Argent LLC inked a non-binding transformative Heads of Agreement (HOA) with Bangladesh Investment Development Authority (BIDA) to supply up to 5.0MTPA LNG.

The deal was signed by BIDA Executive Chairman Ashik Chowdhury and Chairman and CEO of Argent LNG Jonathan Bass in a ceremony at the Bangladesh Embassy in Washington, evidently in the wake of unfolding developments in bilateral and multilateral relations of the new US government, and also a regime change in Bangladesh.

"Petrobangla has been seeking a long-term solution to the rising demand for energy in Bangladesh. This agreement not only ensures a reliable energy supply for Bangladesh's expanding industrial base but also strengthens our strategic partnership with the United States," Mr Chowdhury had said then after inking the deal.

"Argent LNG is pleased to announce the signing of a HOA with Bangladesh, marking a significant step in strengthening energy partnerships," said Bass after the deal-making.

"This agreement paves the way for the United States to supply reliable baseload energy to Bangladesh, enabling the country to expand its ability to grow. This partnership underscores our shared commitment to fostering bilateral and equitable trade, supporting supply-chain securitisation, and deepening ties between our two nations," he added.

It happens to be the first major American LNG-supply deal made since President Donald Trump took office in January for a second term and kicked off world-rattling policies and actions that include 'tariff war' and global aid freeze.

"Signing a non-binding HOA that outlines key terms but leaves room for negotiation is the first step in a process," the BIDA top brass said further about the deal with Argent Energy.

He said any subsequent binding agreement would adhere to Bangladesh's legal framework, including the Public Procurement Act 2006, the Public Procurement Rules 2008, and the Foreign Private Investment (Promotion and Protection) Act 1980.

Argent LNG is developing a 25-MTPA LNG facility in Louisiana, a southeastern US state on the Gulf of Mexico. The facility is slated to go into operation in early 2030.

If the Argent LNG project in Port Fourchon is completed, its cargoes could be sold to Petrobangla, the BIDA top executive said.

Bangladesh currently imports LNG from Qatar Energy and OQ Trading international under long-term deals and purchases the fuel also from spot market to re-gasify in its two operational FSRUs having the total capacity of 1.10 billion cubic feet per day (Bcfd).

The country has been reeling from an acute energy crisis as its natural gas output is depleting, as exploration has been neglected over the years while import-dependence grows.

Bangladesh has been rationing gas supply to industries, power plants and other gas-guzzling industries to cope with the mounting demand against dwindling supply.

The country's overall natural gas supply is currently hovering around 2.85 Bcfd, including 0.98 000 Bcfd of re-gasified LNG, against the demand for over 4.0 Bcfd, according to official data of Petrobangla as on March 5.​

 

[Saif]

Bangladesh to import 2 more spot LNG cargoes before Eid-ul-Fitr

Bangladesh’s state-run Rupantarita Prakritik Gas Company Ltd (RPGCL) intends to buy two more spot LNG cargoes during the second half of the current month before the ensuing Eid-ul-Fitr to meet mounting demand during Ramadan. The RPGCL has already floated tenders to purchase the spot liquefie

thefinancialexpress.com.bd

Bangladesh to import 2 more spot LNG cargoes before Eid-ul-Fitr
FE ONLINE REPORT
Published :
Mar 08, 2025 20:51
Updated :
Mar 08, 2025 20:51

Bangladesh’s state-run Rupantarita Prakritik Gas Company Ltd (RPGCL) intends to buy two more spot LNG cargoes during the second half of the current month before the ensuing Eid-ul-Fitr to meet mounting demand during Ramadan.

The RPGCL has already floated tenders to purchase the spot liquefied natural gas (LNG) cargoes for March 25-26 and March 30-31 delivery windows, said a senior RPGCL official.

If these two tenders become successful, Bangladesh will be able to bag five spot LNG cargoes for March deliveries, which would be the highest LNG purchase from spot market in a single month.

The country’s energy demand is expected to go up during Ramadan and subsequent months afterwards to meet growing demand for irrigation and summer.

According to the weather forecast of the Bangladesh Meteorological Department (BMD), a couple of heat waves are expected to hit over the western and southwestern parts of Bangladesh this month, and the temperature is set to reach around 40 degrees Celsius.

There would be a couple of mild, ranging 36-38 degrees Celsius, and moderate, ranging 38-40 degrees Celsius, heat waves during the later part of March, the BMD said.

There is a possibility of severe nor'westers this month.

The bid winners will deliver the LNG cargoes at Moheshkhali island in the Bay of Bengal, with options to discharge the cargo at either of the country’s two floating storage re-gasification units (FSRUs) located on Moheshkhali island.

The RPGCL, a wholly owned subsidiary of state-run Bangladesh Oil, Gas, and Mineral Corporation, or Petrobangla, looks into LNG trades in Bangladesh.

The volume of each of the spot LNG cargoes will also be around 3.36 million MMBtu.

Bangladesh previously awarded its latest spot LNG cargo tender to Gunvor Singapore Pte Ltd for the March 15-16 delivery window at US$15.47 per million British Thermal Unit (MMBtu).

Bangladesh currently imports LNG from Qatar Energy and OQ Trading International under long-term deals and purchases LNG also from the spot market to re-gasify LNG in its two operational FSRUs, which have a total capacity of 1.10 billion cubic feet per day (Bcfd).

The country has been reeling from an acute energy crisis as its natural gas output is depleting.

Bangladesh has been rationing gas supply to industries, power plants, and other gas-guzzling industries to cope with the mounting demand.

The country’s overall natural gas supply is currently hovering around 2,843 million cubic feet per day (mmcfd), including 952 mmcfd of re-gasified LNG against the demand for over 4,000 mmcfd, according to official data of Petrobangla as of March 8.​

 

[Saif]

Proposals for setting gas tariffs unconstitutional: BCI

The basis proposed for setting gas tariffs is unconstitutional, against the laws and against the principles of fairness, according to the Bangladesh Chamber of Industries (BCI) recently.

www.thedailystar.net

Proposals for setting gas tariffs unconstitutional: BCI

The basis proposed for setting gas tariffs is unconstitutional, against the laws and against the principles of fairness, according to the Bangladesh Chamber of Industries (BCI) recently.

The proposals were to set gas tariffs solely based on the liquefied natural gas (LNG) import price for new connections and excess gas usage than the sanctioned load for existing connections, it said.

The "unrealistic" and "one-sided" gas price hike during the previous government was the main reason behind the troubles being faced by industries, it added.

In a letter to Bangladesh Energy Regulatory Commission (BERC) on March 9 following a public hearing on price hike proposals, the BCI demanded to reduce gas prices through the curbing of system losses.

"Before the price hike, energy cost used to be 5 to 6 percent among the overall production cost, which now stands at 10-15 percent," wrote the chamber of the industrial community.

For example, the energy cost for producing one yard of fabric was Tk 18 in 2022, and it increased to Tk 26 in 2023, said the letter.

Besides, the cost per kilogramme (kg) for yarn production reached $2.45, whereas it is possible to import each kg of knit fabric from neighbouring countries at $2.18, it said.

As a result, in 2024, knitwear imports increased by 39 percent. "How will industries survive under these conditions?" asked the BCI.

"During the gas price hike in 2023, a promise was made to entrepreneurs for uninterrupted gas supply, but entrepreneurs are receiving only 30-40 percent of the required gas, and production is being hampered due to low pressure," it said.

The BCI said production of every industrial establishment has decreased by 30 percent to 40 percent.

This is due to the "one-sided" decision and the failure to provide uninterrupted gas supply, particularly in areas like Gazipur, Ashulia, Savar, Narayanganj, Munshiganj, Bhaluka, and Narsingdi, it said.

For some industries, such as ceramics and steel, production has decreased by 50 percent, it said.

Consequently, the contribution of industries to the GDP dropped from 8.37 percent in fiscal year 2022-2023 to 3.57 percent in the fiscal year 2023-24, the letter said.

The private sector loan growth increased, foreign direct investment decreased and other indicators also reflect the troubles faced by industries, it said.

The BCI argued that the articles 27 and 31 of the constitution guarantee equality for all and if the proposals were implemented, the same customers would be treated unequally.

Besides, the Gas Act 2010 and BERC Act 2003 clearly state that its goals were to create a competitive market through the participation of the private sector and individuals whereas the proposals were noncompetitive, it said.

"Regardless of the time of connection, all gas customers use a mix of gas supplied from the national grid and imported LNG," it said.

"Therefore, imposing a price nearly two and a half times higher for new customers than for those who were previously connected is contrary to the constitution, the law, and the principles of fairness," the letter concluded.

The consideration of such proposals from the regulatory body caused panic among business owners and entrepreneurs across the country, the letter said.

The BCI suggested to reduce the price from Tk 30 per unit to Tk 24.39 for industrial and business sectors.

It urged to improve the efficiency of the gas distribution companies and cited that reducing waste, particularly reducing the huge system loss of the Titas Gas Transmission and Distribution PLC (13.53 percent) to a minimum level, is necessary to increase gas supply.

Furthermore, it suggested that operating coal-fired power plants at full capacity, removing double VAT and source taxes on LNG imports, and reducing other charges imposed by Petrobangla and BERC, which could lower gas prices as well.

"Business leaders believe that this proposal to increase gas tariffs has thrown everyone concerned in the industrial and business sectors into a state of uncertainty," the letter added.​

 

[Saif]

Fusion energy: The holy grail of clean power

The Earth possesses virtually inexhaustible reserves of the raw materials—deuterium and tritium—essential for a fusion reactor.

www.thedailystar.net

Fusion energy: The holy grail of clean power

General view of the circular bioshield inside the construction site of the International Thermonuclear Experimental Reactor (ITER) in Saint-Paul-lez-Durance, southern France, on November 7, 2019. FILE PHOTO: REUTERS

In light of the escalating challenges associated with climate change, the pursuit of a sustainable, renewable, clean, and plentiful source of energy has reached unprecedented importance. Accordingly, physicists have been investigating the energy released during nuclear fusion reactions, but the challenge of converting it into a viable source of energy has proven to be persistently difficult.

However, the question persists regarding the potential of nuclear fusion to become a primary source of energy for our increasingly power-dependent world. If this possibility is indeed attainable, will it be achieved in time to prevent the catastrophic consequences of climate change?

Nuclear fusion replicates the mechanism that fuels the stars, presenting the prospect of a clean and nearly unlimited supply of energy. In contrast to fossil fuels, fusion does not emit greenhouse gases (GHGs). The fusion reaction, which involves the combination of light atomic nuclei—specifically, isotopes of hydrogen such as deuterium and tritium—offers the promise of generating energy with minimal carbon dioxide (CO2) emissions while avoiding the hazardous, long-lasting radioactive waste linked to current nuclear fission reactors that split heavy radioactive nuclei, uranium-235 or plutonium-239.

The Earth possesses virtually inexhaustible reserves of the raw materials—deuterium and tritium—essential for a fusion reactor. Deuterium is abundantly available in ocean water, with sufficient quantities to feed a reactor for billions of years, but naturally occurring tritium is exceedingly scarce. Nevertheless, it can be generated in a reactor through the neutron activation of lithium, which can be sourced from brines, minerals, and clays.

Despite notable advancements, many challenges remain in the development of a commercially viable fusion reactor. The major ones are: i) reaching the temperature (exceeding 100 million degrees Celsius) necessary to initiate a self-sustaining fusion reaction; ii) containing the extreme heat produced in the plasma, an ultra-hot mixture of gases where electrons are entirely separated from their atomic nuclei; and iii) maintaining the plasma at this superhot temperature for a sufficient duration so that the energy produced surpasses the input energy needed to sustain the process.

The International Thermonuclear Experimental Reactor (ITER), a collaborative project involving 35 nations and currently under construction in Cadarache, France, represents the world's largest fusion reactor. Once operational, it is expected to achieve continuous energy output at a power plant scale, approximately 500 megawatts. However, since its establishment in 2006, the ITER has experienced uneven progress, facing numerous technical setbacks, a complex decision-making framework, and a significant increase in cost projections, which have escalated from five billion euros to nearly 20 billion euros. Additionally, the planned operational start in 2035 may be pushed back to the 2040s.

One of the challenges the ITER faces is how to control the hot plasma at a temperature of around 100 million degrees and keep it away from the walls of the container. No known material can withstand such a high temperature; even extremely heat-resistant metals such as tungsten would melt instantly.

Physicists have developed two rival methods for managing the hot plasma and preventing it from contacting the walls of its containment vessel. These methods are known as magnetic confinement and inertial confinement. The procedures necessitate exceptional precision. Additionally, the intensely heated plasma is inherently unstable—it tends to form large temperature gradients, resulting in powerful convection currents that make the plasma turbulent and difficult to control.

Moreover, a sustained fusion reaction that produces substantially more energy than it consumes has never been achieved. The ITER, which uses magnetic confinement by employing a doughnut-shaped chamber in which magnetic fields keep the plasma in perpetually looping paths without touching the walls, still has not produced a sustained reaction. The longest fusion reaction achieved so far is 17 minutes and 46 seconds, set recently in China.

Attaining the sought-after goal of "net energy" in nuclear fusion has been the holy grail for scientists working in this domain. A net energy gain was notably demonstrated in December 2022 at the National Ignition Facility (NIF), a laser-based inertial confinement fusion research lab located at Lawrence Livermore National Laboratory in California. At the NIF, plasma is produced by directing intense lasers at a small pellet filled with deuterium and tritium.

The ratio of output energy to input energy at the NIF was 1.5. Although this accomplishment represents an important milestone, it is still far from establishing fusion as a practical source of energy. For fusion reactors to be deemed viable for commercial energy generation, they must attain a threshold ratio of 10. The challenges associated with inertial confinement are considerable as well, and at present, only a handful of facilities around the globe are dedicated to its research.

The widely reported success at the NIF elicited a typical range of responses: fervent endorsement from proponents of the technology and scepticism from detractors, who contend that scientists have consistently claimed that practical fusion energy is just two decades away—or three or five decades, depending on the viewpoint. Furthermore, energy production is not a primary objective of the NIF. The facility was primarily designed to initiate nuclear reactions for the purpose of studying and maintaining the US's nuclear arsenal.

As we look to the future, there are compelling reasons to believe that fusion energy will play a consequential role in the energy landscape, particularly as more developing and underdeveloped nations begin to demand levels of energy consumption comparable to those of Western countries. That being said, fusion is not a panacea for mitigating the devastating effects of climate change. Addressing climate change requires decarbonisation of the atmosphere using available technologies, including renewable sources such as solar and wind power, hydropower, geothermal energy, and potentially carbon capture methods.

As for the question of when nuclear fusion will become a reality, there is no clear answer. Nonetheless, experts generally agree that the likelihood of achieving large-scale energy production through nuclear fusion is unlikely before 2050, with some more cautious projections suggesting an even longer timeline. Given that the rise in global temperatures over the coming decades will likely be heavily influenced by our actions—or lack thereof—regarding GHG emissions during this period, it is evident that fusion cannot be considered a near-term solution.

Dr Quamrul Haider is professor emeritus at Fordham University in New York, US. He is one of the authors of the book 'Nuclear Fusion: One Noble Goal and a Variety of Scientific and Technological Challenges' (Intech Open, London, UK, 2019).​

 

[Saif]

Bangladesh govt weighs open-pit coal mining

The interim government is weighing the option of open-pit coal mining, reviving a controversy settled almost two decades ago with the sacrifice of three lives in a rare protest in Phulbari of Dinajpur.

www.newagebd.net

Bangladesh govt weighs open-pit coal mining
Emran Hossain 09 March, 2025, 00:07

$15b investment from unnamed mining co guaranteed

The interim government in Bangladesh is weighing the option of open-pit coal mining, reviving a controversy settled almost two decades ago with the sacrifice of three lives in a rare protest in Phulbari of Dinajpur.

The protest prompted the then government, led by Bangladesh Nationalist Party, to sign an agreement with the protesters, led by the National Committee to Protect Oil, Gas, Mineral Resources, Power and Port.

Scrapping the mining project and cancelling the work permit of Asia Energy, the UK-based company involved in the open-pit mining project, were two of the six points on which the agreement was reached in August 2006.

Asia Energy was later renamed—Global Coal Management Resources.

The Hydrocarbon Unit of the power and energy ministry on February 27 hosted a discussion attended by energy experts, geologists and consumer rights activists with a presentation that categorically promoted open-pit coal mining, particularly in Phulbari.

‘Open-pit mining is not possible in Bangladesh due to its high population density and land scarcity,’ said energy expert Badrul Imam who teaches geology at Dhaka University.

An area double the size of the mine must be there to dump dug-out earth, he explained, adding that the withdrawal of groundwater to facilitate mining will also create water crisis in the area.

The proposition made by the government in the presentation of the Hydrocarbon Unit about restoring land in the mine area with its fertility is also considered far-fetched and impossible by energy experts.

At least 15 villages near the Barapukuria coal mine, Bangladesh’s only active coal mine, where underground mining is in progress, lost their access to water.

The interim government is in favour of open-pit mining in Barapukuria as well.

In February 2012, concerned by a move by the past Awami League government in favour of open-pit coal mining at Phulbari, a group of experts from the United Nations noted that the move would displace an estimated 50,000–1,30,000 people and affect 2,20,000 others by drying up wells.

Awami League was in the opposition during the 2006 unrest and proactively supported the protesters, promising not to allow open-pit coal mining ever in Bangladesh.

The project would destroy some 12,000 hectares of productive agricultural land, waterways supporting 1,000 fisheries, and nearly 50,000 fruit trees, as the mine is located in Bangladesh’s most fertile agricultural land, the UN experts had noted.

The International Accountability Project earlier estimated that 800 million litres of groundwater would need to be lifted to maintain dry condition in the mine, which has deposits at the depth between 150 and 260 metres.

The International Accountability Project also cited the departure of the Australia-based mining giant BHP Billiton from the mine after concluding that the depth of the coal deposits would make mining activity so destructive that it would not be feasible to comply with Australia’s environmental standards or those of any country worldwide.

‘One thing we must remember is that the interim government does not have the authority to decide on an issue like open-pit extraction,’ said Kazi Matin Uddin Ahmed, who teaches geology at Dhaka University and attended the meeting.

The interim government, which replaced the autocratic rule of Sheikh Hasina, is in power to help organise the national election and lacks any mandate to consider doing something regarding the management of natural resources, energy experts observe.

‘The presentation could easily replace the one that the Asia Energy had presented decades ago,’ said professor M Shamsul Alam, energy adviser, Consumers Association of Bangladesh.

‘The government is favouring open-pit coal mining, saying that it intends to start the discussion, making things easier for the next government,’ said Shamsul Alam, who also attended the government discussion.

The Hydrocarbon Unit completed the presentation, made by its director Arup Kumar Biswas, in 17 slides concluding that open-pit coal mining is the only feasible way for coal extraction in Phulbari.

Starting with the recent rise in global coal consumption, particularly in Asia, the presentation argued that coal would remain a major energy source through 2040.

The presentation gave a wrong estimate of the country’s current coal-based installed power generation capacity, inflating the actual capacity by over 2,500MW, while saying that open-pit mining would meet an estimated annual demand of up to 30 million tonnes, saving $4 billion.

Stating that the country’s minable coal deposit is 834 million tonnes, the presentation listed the benefits of open-pit coal mining through comparisons with underground mining and boasted technological advances.

According to the presentation, open-pit mining lowers health risks, reduces mining time while ensuring maximum output, and results in the extraction of co-products.

The Hydrocarbon Unit assured in the presentation of partially refuelling the aquifer, restoring 5,192 hectares of land, half of it agricultural land, to its previous fertile condition and giving farmers their livelihood back within three to five years after the end of mining.

The presentation was also flooded with many economic benefits of open-pit mining in Phulbari, such as the extraction of coal worth $83 billion over 30 years, an income of $16 billion in royalty and taxes, and an extra income of $17 billion from co-products.

The presentation also guaranteed in the presentation a $15 billion investment in working capital and operation from the mining company. The Hydrocarbon Unit, however, did not say who the investor could be.

Power and energy adviser Muhammad Fouzul Kabir Khan could not be reached for comments over phone. Energy secretary Mohammad Saiful Islam did not answer his phone either.

A search online revealed that the GCM Resources was actively pursuing the Phulbari open-pit coal mine project.

The Global Energy Monitor Wiki, an online database of energy projects around the world, shows that Phulbari mine is still a property of the GCM Resources. It has also listed significant developments until 2022 regarding the GCM’s striking a deal with others, mainly from China, to develop the Phulbari coal mine.​

 

[Saif]

Russia seeks continuity of Gazprom’s work in Bangladesh

Russia has sought the cooperation of Chief Adviser (CA) Prof Muhammad Yunus to ensure the continued operations of the state-owned Russian company Gazprom International in gas exploration.

www.thedailystar.net

Russia seeks continuity of Gazprom’s work in Bangladesh

Russia has sought the cooperation of Chief Adviser (CA) Prof Muhammad Yunus to ensure the continued operations of the state-owned Russian company Gazprom International in gas exploration.

The request was made by Alexander G Khozin, the Russian ambassador to Bangladesh, during a meeting with the CA at the State Guest House Jamuna in Dhaka yesterday, according to a statement.

Gazprom has been active in Bangladesh since 2012, partnering in the exploration of gas reserves. In 2023, Gazprom International identified five new wells for further exploration in Bhola, an island off the southern coast.

Prof Yunus expressed gratitude to Gazprom for its efforts in preparing to drill the five wells in Bhola and highlighted that the power, energy, and mineral resources ministry is actively working on the matter.

He also conveyed openness to further collaboration in this regard.

During the meeting, the ambassador discussed a range of issues, including broader trade relations and cooperation between the two nations.

In 2024, the supply of Russian wheat to Bangladesh reached an all-time high, making Bangladesh the second-largest consumer of Russian grain, following Egypt.

From July 2024 to January 2025, approximately 2.3 million tonnes of Russian wheat were delivered to Bangladesh, including 623,000 tonnes (or 6.23 lakh tonnes) under government-to-government contracts.

Russia is also preparing to supply 30,000 tonnes of muriate of potash fertiliser to Bangladesh as a gesture of friendship, the ambassador noted.

He further highlighted a significant increase in the number of visas issued to Bangladeshis seeking employment in agriculture and shipbuilding in Russia.

The number of visas issued between January and March 2025 was four times higher than during the same period the previous year, according to the statement.​