[🇧🇩] Energy Security of Bangladesh

[Saif]

Power sector managers need to ensure quality control

THE absence of a quality control mechanism in the power sector has led to extra fuel costs in power generation. A recent Power Development Board analysis shows that some plants consume up to 90 per cent more fuel than others do. The finding indicates an overall power management failure in...

www.newagebd.net

Power sector managers need to ensure quality control
01 May, 2025, 00:00

THE absence of a quality control mechanism in the power sector has led to extra fuel costs in power generation. A recent Power Development Board analysis shows that some plants consume up to 90 per cent more fuel than others do. The finding indicates an overall power management failure in stopping the leak of the already scanty supplies of imported fuels. Experts say that factors such as the import and transport cost, the dollar exchange rate, plant factor and, especially, the quality of machines that contribute to varying degrees of fuel consumption, exist in the power sector. During the Awami League regime, when the power sector experienced a lopsided development, driven by an abnormally high overcapacity and an absurd capacity charge system, many party loyalists were rewarded with power projects without tender under the now-repealed indemnity law, with the power sector investors choosing their machines while quality control mechanisms did not exist. Independent power plants exploited the situation and brought used machines that led to the over-consumption of fuels and frequent shutdown of plants. The public power plants also used more fuels as they were poorly maintained. The scenario has not yet changed.

The frequent shutdowns of power plants, not only the old ones but also new ones, because of technical glitches show the absence of quality checks. For example, the first unit of the 1,320MW coal-fired Rampal plant, a Bangladesh-India joint venture, shut down eight times in the first nine months after it started running in December 2022. The plant, where per-unit fuel cost is 28 per cent higher than a similar power plant, was available for only 18 per cent of the time this January, according to the power board. Frequent shutdowns and resumptions of the plants require extra fuel. The fuel cost in the Tongi Power Plant is 47 per cent higher compared with the average cost of fuel in similar plants. Many other plants have continued to operate at a little fraction of their capacity. Among gas-based plants, as the power board analysis shows, the average fuel costs of public plants are about 20 per cent higher than that of independent power plants, largely because of old machines that have served out their economic life. So is the case with oil- and coal-based public power plants. Some independent power plants, including Adani and Summit’s, also have high fuel costs riding on unequal power deals.​

 

[Saif]

Bangladesh substantially reduces its outstanding dues to Adani

Bangladesh has substantially reduced its outstanding dues to India's Adani Power related to a power-supply deal, and the company is confident of recovering the roughly $900 million still remaining, its chief financial officer said. According to Reuters, Bangladesh has struggled to pay its dues per

thefinancialexpress.com.bd

Bangladesh substantially reduces its outstanding dues to Adani
Dilip Jha, chief financial officer of the India-based company, tells Reuters
FE ONLINE DESK
Published :
May 02, 2025 18:13
Updated :
May 02, 2025 18:17

Bangladesh has substantially reduced its outstanding dues to India's Adani Power related to a power-supply deal, and the company is confident of recovering the roughly $900 million still remaining, its chief financial officer said.

According to Reuters, Bangladesh has struggled to pay its dues per the deal, signed in 2017, as imports got costly since the Russia-Ukraine conflict in 2022 and amid the domestic political turmoil last August that led to the ouster of the country's prime minister.

As a result, Adani had halved supply last year but CFO Dilip Jha said the company has resumed full supply since as the country's monthly payments started covering some of the dues.

"We are supplying full power to Bangladesh ... the payment we are receiving now is more than the monthly billing," Jha said in a post-earnings call with analysts on Thursday.

"We are hopeful that not only will we continue to receive payments equivalent to the current month's billing, but that the old outstanding dues will also be liquidated."

The company said Bangladesh has paid nearly $1.2 billion of the roughly $2 billion totally billed to the country.​

 

[Saif]

Gas crisis in industries as supply increased in power sector

The supply of gas has been increased in the electricity sector cutting down on the supply of that to the industrial and residential sectors.

en.prothomalo.com

Gas crisis in industries as supply increased in power sector
The supply of gas is lower than the demand. On top of that supply of gas to the power plants has been increased to cut down on load shedding.

Mohiuddin Dhaka
Published: 29 Apr 2025, 08: 41

Machineries at a dye factory remain idle due to gas crisis. Photo taken in BCIC Industrial Estate in Fatullah, Narayanganj. Prothom Alo

The demand for electricity is at its highest during summer. When production of electricity cannot meet the demand, there has to be power load shedding. The government this time, however, has been trying to limit the load shedding.

So, the electricity generation has been increased to keep the supply of electricity uninterrupted. To maintain this production, the supply of gas has been increased in the electricity sector, cutting down on the supply of that to the industrial and residential sectors.

Bangladesh Oil, Gas and Mineral Corporation (Petrobangla) sources say that the daily demand of gas in the country stands at 3.8 billion (380 crore) cubic feet. The demand can somewhat be met when there’s a supply of 3 billion (300 crore) cubic feet. Then the situation is managed by rationing (by reducing the supply in one sector and increasing in another).

At present there is a supply of 2.7 billion (270 crore) cubic feet. Of that, 1.05 billion (105 crore) cubic feet is being supplied to the power plants.

The power sector is now considered with highest priority. As a result, the gas crisis has widened for the residential and industrial clients.

The largest gas distribution company, Titas Gas Transmission and Distribution, supplies gas to Dhaka, Gazipur, Mymensingh and Narayanganj regions.

Officials of this company say that their daily demand is 1.9 billion (190 crore) cubic feet. Currently, they are receiving about 1.52 to 1.53 billion (152 to 153 crore) cubic feet.

During times of such supply before, they could provide a maximum of 230 million (23 crore) cubic feet to the power sector. Now they have to provide 360 to 370 million (36 to 37 crore) cubic feet in this sector. This has created a shortage of 130 to 140 million (13 to 14 crore) cubic feet in the industrial and residential sectors. There is a shortage of gas in the industry even during the normal times. Now it has increased even more.

Even though the industrial customers pay higher prices, the power sector has to be prioritised in gas supply. Two more cargoes of LNG ships would have to be imported to meet the demand.
Director of operations and mines at the Petrobangla, Md Rafiqul Islam told Prothom Alo that the supply of gas to the power sector has been increased and this has created a bit of shortage. Local gas production might increase a bit within a day or two.

The idea of increasing LNG (Liquefied Natural Gas) import is also being pondered upon, he added.

The country once produced 2.7 billion (270 crore) cubic feet of gas every day. Then the LNG import started in 2018 when the production started declining. The daily production has now dropped to 1.84 billion (184 crore) cubic feet.

Though the LNG import has increased than before, it is still not sufficient. About 800 to 850 million (80 to 85 crore) cubic feet of gas is supplied daily from the imported LNG.

A Petrobangla official stated that the company earns Tk 22.87 from selling per unit of gas while they are now spending an average of more than Tk 27 on the same unit.

Although gas is sold to the industry sector for Tk 30 per unit, the price of gas in the power sector is Tk 14.75.

Even though the industrial customers pay higher prices, the power sector has to be prioritised in gas supply. Two more cargoes of LNG ships would have to be imported to meet the demand.

This will increase the amount of losses for Petrobangla. However, more cargoes can be imported if the Power Development Board (PDB) pays a price of Tk 27.

Narayanganj and Gazipur, the two districts next to Dhaka, are mainly known as industrial zones. Most of the export-oriented readymade garment factories are located here. Production in these factories has been disrupted for a long time due to the gas crisis. It has turned even worse in the last two weeks.

Manager (transmission and distribution) of Titas Gas in Gazipur Md Redwan told Prothom Alo that the demand of gas in Gazipur stands now at 600 million (60 crore) cubic feet but only 350 million (35 crore) cubic feet is supplied.

According to industrial police data, there are a total of 2,176 factories in Gazipur district. Out of them, 1,187 are garment factories.

The number of small and large factories there would increase to about 5,000 if the unlicensed ones are counted in. Most of these factories are gas-powered.

Sohel Rana, Director of Sadma Group located in Mouchak area of Gazipur, told Prothom Alo that the gas pressure needs to be between 10 to 15 PSI (pound per square inch) for the factory to be running. But, there has not been more than two to three PSI of gas pressure in the last 15 days. Our production has been slashed by 30 to 40 per cent from this.

Deputy General Manager at Titas Gas’ Narayanganj office, Mamunur Rashid told Prothom Alo that the industrial and residential clients are receiving less amount of gas in some parts due to low supply.

MS Dyeing Printing and Finishing Limited, situated in BSCIC Industrial Estate in Fatullah of Narayanganj, has a production capacity of 40 tonnes. However, their production has dropped to 10 tonnes.

The company sent a letter to Titas on 23 April mentioning the matter of commercial losses caused from the low gas pressure.

While visiting the factory Sunday afternoon, the boiler was found shut and the gas pressure reading showed zero PSI. Another factory in BSCIC Industrial Estate, Fare Apparels Limited was out of production since morning and the workers were found sitting idle.

Research director at non-government research organisation, Centre for Policy Dialogue (CPD), Khondaker Golam Moazzem told Prothom Alo that managing the energy supply crisis is a major challenge for the government.

They have to take the social, economic and political aspects into consideration, he advised.

According to him, the government must not go for increased LNG import to strike a balance in gas supply. “We need to emphasise on exploring and producing gas domestically.”

[Prothom Alo correspondents in Gazipur and Narayanganj have helped prepare this report.]

* The report, originally published in the print and online edition of Prothom Alo, has been rewritten in English by Nourin Ahmed Monisha​

 

[Saif]

Matarbari power as expensive as peers

The power tariff of the coal-fired 1,200-megawatt Matarbari power plant is going to be as high as its peers, observed energy experts, saying that the government-approved power tariff made it appear as if the tariff was lower than that of the electricity purchased from...

www.newagebd.net

Matarbari power as expensive as peers
Tariff could exceed Tk 13 a unit
Emran Hossain 03 May, 2025, 00:45

The power tariff of the coal-fired 1,200-megawatt Matarbari power plant is going to be as high as its peers, observed energy experts, saying that the government-approved power tariff made it appear as if the tariff was lower than that of the electricity purchased from similar power plants.

On April 29, the advisory committee on government purchase approved the public power plant’s power tariff at Tk 8.44 a kilowatt-hour or 7.6621 US cents a kWh, with Tk 5.84 a kWh spent as fuel cost and Tk 2.60 a kWh given as capacity charge.

An official document showed that the rates of fuel use and capacity charge were determined considering that the power plant operated at 85 per cent of its capacity.

The document also showed that the calculation considered the dollar exchange rate to be Tk 110.25.

The dollar exchange rate is crucial in determining the tariff since power plants depend on fuel import for their production and their capacity charge is paid mostly in the dollar. The current dollar rate, according to the Bangladesh Bank, is Tk 122.

‘Considering the dollar rate at such a low level in the calculation is misleading,’ said Hasan Mehedi, member secretary of the Bangladesh Working Group on Ecology and Development, a forum of rights activists and organisations.

‘The tariff of coal-based power plant is tough to determine for it involves so many issues and uncertainties,’ he said.

An analysis done past year by the Bangladesh Power Development Board revealed that the average fuel cost among all coal-fired power plants in the country was Tk 7.02, more than 16 per cent higher than what the newly approved Matarbari tariff allowed.

The fuel cost varied greatly depending mainly on machine quality, coal quality and the operational period of power plants. For instance, the fuel cost in a unit of the Barapukuriya power plant was Tk 12.30, the PDB analysis showed.

In joint venture coal-based power plants, the fuel cost ranged between Tk 6.67 and Tk 7.84. The coal-fired independent power plants’ fuel cost ranged between Tk 6.26 and Tk 6.75.

For an ultra-supercritical coal power plant, the technology of which is also used in Matarbari, the BPDB’s fuel cost stood at Tk 6.77.

The fuel cost could vary greatly due to the high vulnerability of the international fuel market. During the Covid pandemic, the price of a tonne of coal reached $400. The current price of coal is below $100 a tonne.

The BPDB analysis also revealed that the average government-set cost stood at Tk 4.63 past year, nearly 45 per cent higher than what the Matarbari was allowed to get.

‘The plant availability factor could influence the power tariff,’ said Shafiqul Alam, lead energy analyst at the Institute for Energy Economics and Financial Analysis, a research organisation.

Power tariff goes up if the plant’s capacity remains unutilised, energy analysts said, given that the capacity charge is paid anyway. Increased utilisation contributes greatly to decreasing tariff, they said.

In 2023-24, according to the BPDB, the average plant availability among the coal-based power plants was 35.25 per cent.

The plant factor of the Adani coal power plant, which is supplying electricity from India, was 62.32 per cent, which was the second highest plant factor after import with 85 per cent plant factor.

Power plants in Bangladesh have never run at 85 per cent of their capacity in recent time.

The ongoing dollar crisis is a major reason for keeping power plants idle due to lack of fuel supply.

The BWGED estimated that the Matarbari power plant would actually get Tk 2,565 crore a year at the current dollar exchange rate.

If the plant availability dropped to 60 per cent, the BWGED said that at the newly announced tariff per unit of production cost at the Matarbari power plant would stand at Tk 10.55.

The tariff would increase to Tk 13.14 if the plant availability dropped to 37 per cent, which was the average plant availability of Barapukuria and Payra power plants between the financial years of 2020-21 and 2023-24.

The average coal power tariff in 2023-24 was Tk 12.74.

ANM Obaidullah, member of the BPDB, said that the government-approved tariff was determined based on the dollar exchange rate the day the plant rolled into commercial operation.

‘This is the base price,’ said Obaidullah.

‘Depending on situations, the tariff could be changed,’ he said, saying that power tariffs were paid after evaluation based on the actual situation.

Unlike the other power plants, the Matarbari power plant started its operation without having signed a power purchase agreement.

The first unit of the Matarbari power plant started commercial operation in December 2023 and the second unit started operation in August 2024.

So far the plant has received only the fuel cost for running its operation.​

 

[Saif]

Bangladesh to buy six spot LNG cargoes in May

The government is eyeing importing a total of six spot liquefied natural gas (LNG) cargoes in May, the highest number in a single month, to meet mounting summer demand. State-run Rupantarita Prakritik Gas Company Ltd (RPGCL) already bought five spot LNG cargoes for May delivery windows, a senior R

thefinancialexpress.com.bd

Bangladesh to buy six spot LNG cargoes in May
FE ONLINE REPORT
Published :
May 03, 2025 19:11
Updated :
May 03, 2025 19:11

The government is eyeing importing a total of six spot liquefied natural gas (LNG) cargoes in May, the highest number in a single month, to meet mounting summer demand.

State-run Rupantarita Prakritik Gas Company Ltd (RPGCL) already bought five spot LNG cargoes for May delivery windows, a senior RPGCL official told The Financial Express on Saturday.

He said the RPGCL’s tender to buy one more spot LNG cargo in the May 30-31 delivery window is also open, along with two more spot LNG cargo tenders for the June 26-27 and July 2-3 delivery windows.

The country’s energy demand has gone up since early April with the advent of summer, which is expected to grow further with the rise of mercury.

Bangladesh bought four spot LNG cargoes for the deliveries in the past two months – March and April.

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 regasification 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 British thermal units (MMBtu).

Bangladesh previously awarded its latest spot LNG cargo to Gunvor Singapore Pte Ltd. for the May 25-26 delivery window at $11.83 per 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, having 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.​

 

[Saif]

Tackling renewable energy's critical dimensions

Renewable energy, also called green energy, is made from renewable natural resources that are replenished on a human timescale. Some also consider nuclear power a renewable power source, although this is controversial, as nuclear energy requires mining uranium, a nonrenewable resource. Renewable en

thefinancialexpress.com.bd

Tackling renewable energy's critical dimensions
Muhammad Zamir
Published :
May 04, 2025 23:53
Updated :
May 04, 2025 23:53

Renewable energy, also called green energy, is made from renewable natural resources that are replenished on a human timescale. Some also consider nuclear power a renewable power source, although this is controversial, as nuclear energy requires mining uranium, a nonrenewable resource. Renewable energy installations can be large or small and are suited for both urban and rural areas.

Renewable energy systems have rapidly become more efficient and cheaper over the past 30 years. A large majority of worldwide newly installed electricity capacity is now renewable. Renewable energy sources, such as solar and wind power, have seen significant cost reductions over the past decade, making them more competitive with traditional fossil fuels. From 2011 to 2021, renewable energy has grown from 20 per cent to 28 per cent of global electricity supply. Power from the Sun and wind accounts for most of this increase, growing from a combined 2 per cent to 10 per cent. Use of fossil energy has also shrunk from 68 per cent to 62 per cent. In 2024, renewables accounted for over 30 per cent of global electricity generation and are projected to reach over 45 per cent by 2030. Many countries already have renewables contributing more than 20 per cent to their total energy supply, with some generating over half or even all their electricity from renewable sources.

Renewable energy is usually understood as energy harnessed from continuously occurring natural phenomena. The International Energy Agency defines it as "energy derived from natural processes that are replenished at a faster rate than they are consumed". Solar power, wind power, hydroelectricity, geothermal energy and biomass are widely agreed to be the main types of renewable energy. Renewable energy often displaces conventional fuels in three particular areas-- electricity generation, heating water and transportation. It is also useful for providing rural (off-grid) energy services.

Solar power produced around 1.3 terrawatt-hours (TWh) worldwide in 2022, representing 4.6 per cent of the world's electricity. Almost all of this growth has happened since 2010. Solar energy can be harnessed anywhere that receives sunlight; however, the amount of solar energy that can be harnessed for electricity generation is influenced by weather conditions, geographic location and time of day.

At this point one also needs to recognise that renewable energy has a critical role in addressing climate change. As part of the global effort to limit climate change, most countries have committed to net-zero greenhouse gas emissions. In practice, this means phasing out fossil fuels and replacing them with low-emissions energy sources. This much needed process, coined as "low-carbon substitutions" in contrast to other transition processes including energy additions, needs to be accelerated multiple times in order to successfully mitigate climate change. It may be recalled that at the 2023 United Nations Climate Change Conference, around three-quarters of the world's countries set a goal of tripling renewable energy capacity by 2030.

The European Union aims to generate 40 per cent of its electricity from renewables by the same year. The European Union has pledged Euro 1.3 billion, urging Bangladesh to increase renewable energy use by over 3 per cent and reform its energy structure. Recently, an event--"Renewable Energy Fest 2025" in Bangladesh focused on a green energy transition through policy reform, innovation and youth participation. Dr. Michal Krejza of the EU Delegation in Bangladesh, emphasised regional energy connectivity and said, "The EU has pledged Euro 1.3 billion to increase Bangladesh's renewable energy use by more than 3 per cent and reform its energy structure. This is being considered as vital if Bangladesh is to reach its electricity demand of 58,410 MW by 2041.

It would be pertinent to understand that renewable energy is more evenly distributed around the world than fossil fuels, which are concentrated in a limited number of countries. It also brings health benefits by reducing air pollution caused by the burning of fossil fuels.

Solar power produced around 1.3 terawatt-hours (TWh) worldwide in 2022, representing 4.6 per cent of the world's electricity. Almost all of this growth has happened since 2010. Solar energy can be harnessed anywhere that receives sunlight; however, the amount of solar energy that can be harnessed for electricity generation is influenced by weather conditions, geographic location and time of day.

Eco-scientists have observed that humans have harnessed wind energy for more than 2200 years. Until the 20th century, it was primarily used to power ships, windmills and water pumps. Today, the vast majority of wind power is used to generate electricity using wind turbines. Modern utility-scale wind turbines range from around 600 kW to 9 MW of rated power. The power available from the wind is a function of the cube of the wind speed, so as wind speed increases, power output increases up to the maximum output for the particular turbine. Areas where winds are stronger and more constant, such as offshore and high-altitude sites, are preferred locations for wind farms.

Wind-generated electricity met nearly 4 per cent of global electricity demand in 2015, with nearly 63 GW of new wind power capacity installed. Wind energy was the leading source of new capacity in Europe, the US and Canada, and the second largest in China. In Denmark, wind energy met more than 40 per cent of its electricity demand while Ireland, Portugal and Spain each met nearly 20 per cent.

Globally, the long-term technical potential of wind energy is believed to be five times total current global energy production, or 40 times current electricity demand, assuming all practical barriers needed were overcome. This would require wind turbines to be installed over large areas, particularly in areas of higher wind resources, such as offshore and likely also industrial use of new types of VAWT turbines in addition to the horizontal axis units currently in use. As offshore wind speeds average ~90 per cent greater than that of land, offshore resources can contribute substantially more energy than land-stationed turbines.

Investments in wind technologies reached US Dollar 161 billion in 2020, with onshore wind dominating at 80 per cent of total investments from 2013 to 2022. Offshore wind investments nearly doubled to US Dollar 41 billion between 2019 and 2020, primarily due to policy incentives in China and expansion in Europe.

It needs to be noted here that technological research is continuing at a serious and comprehensive manner with regard to the improvement of renewable energy technologies. There are also other renewable energy technologies that are still under development, including enhanced geothermal systems, concentrated solar power, cellulosic ethanol and marine energy.

The International Renewable Energy Agency (IRENA) has stated that ~86 per cent (187 GW) of renewable capacity added in 2022 had lower costs than electricity generated from fossil fuels. IRENA also stated that the capacity added since 2000 reduced electricity bills in 2022 by at least US Dollar 520 billion, and that in non-OECD countries, the lifetime savings of 2022 capacity additions will reduce costs by up to US Dollar 580 billion.

Solar power, also known as solar electricity, is the conversion of energy from sunlight into electricity, either directly using photovoltaics (PV) or indirectly using concentrated solar power. Solar panels use the photovoltaic effect to convert light into an electric current. Concentrated solar power systems use lenses or mirrors and solar tracking systems to focus a large area of sunlight to a hot spot, often to drive a steam turbine.

Photovoltaics (PV) were initially solely used as a source of electricity for small and medium-sized applications, from the calculator powered by a single solar cell to remote homes powered by an off-grid rooftop PV system. Commercial concentrated solar power plants were first developed in the 1980s. Since then, as the cost of solar panels has fallen, grid-connected solar PV systems' capacity and production has doubled about every three years. Three-quarters of new generation capacity is solar, with both millions of rooftop installations and gigawatt-scale photovoltaic power stations continuing to be built.

By 2024, solar power was generating 6.9 per cent (2,132 TWh) of global electricity and over 1 per cent of primary energy, adding twice as much new electricity as coal. Along with onshore wind power, utility-scale solar has become the source for new installations in most countries. As of 2023, 33 countries generated more than a tenth of their electricity from solar, with China making up more than half of solar growth. Almost half the solar power installed in 2022 was mounted on rooftops.

It would be worthwhile to point out here that solar-cell efficiencies of laboratory-scale devices using pertinent materials have increased from 3.8 per cent in 2009 to 25.7 per cent in 2021 in single-junction architectures, and, in silicon-based tandem cells, to 29.8 per cent, exceeding the maximum efficiency achieved in single-junction silicon solar cells. Perovskite solar cells have, therefore, been the fastest advancing solar technology as of 2016. With the potential of achieving even higher efficiencies and very low production costs, perovskite solar cells have become commercially attractive. Core problems and research subjects include their short and long-term stability.

Recently experts have suggested that Bangladesh urgently needs a long-term financing roadmap to promote renewable-energy projects and reach the country's target of net-zero carbon emission by 2050. They have also observed that to achieve the goal, the country that is extremely vulnerable to global warming, also requires the framing of the monetary policy in such a way that the commercial lenders-- both state-owned commercial Banks (SCBs) and private commercial Banks (PCBs)-- can feel encouraged to support proliferation of renewable energy.

In this context, it was good to know that the Islamic Development Bank (IsDB) has agreed to provide US Dollar 167 million in loans -- roughly Tk 20.10 billion -- to develop a 220MW solar power plant in the Sonagazi area of Feni district, a facility with the highest solar capacity in the country to date. The Power Division proposed the project with an estimated cost of Tk 21.35 billion, with the combined contribution of the government and Electricity Generation Company of Bangladesh Limited (EGCB) amounting to Tk 1.25 billion, according to Planning Commission sources. The project seeks to reduce dependence on fossil fuels, lower carbon emissions, and contribute to economic development and improved living standards.

Muhammad Zamir, a former Ambassador, is an analyst specialised in foreign affairs, right to information and good governance.​

 

[Saif]

Govt to buy 4 more LNG cargoes over next 4 months to supply more gas to industries

The government has moved to buy four additional liquefied natural gas (LNG) cargoes during the next four months from May to August at the cost of around Tk 28 billion to allocate more gas to industrial consumers. State-run Petrobangla will also reduce natural gas allocations for gas-fired power pl

thefinancialexpress.com.bd

Govt to buy 4 more LNG cargoes over next 4 months to supply more gas to industries
FE Online Report
Published :
May 07, 2025 20:14
Updated :
May 07, 2025 20:14

The government has moved to buy four additional liquefied natural gas (LNG) cargoes during the next four months from May to August at the cost of around Tk 28 billion to allocate more gas to industrial consumers.

State-run Petrobangla will also reduce natural gas allocations for gas-fired power plants to 1,050 million cubic feet per day (mmcfd) from existing 1,200 mmcfd to ramp up gas supply to industries by 150 mmcfd.

Adviser of the Ministry of Power, Energy and Mineral Resources Muhammad Fouzul Kabir Khan drew up the plan to ramp up natural gas supplies to industries during a meeting with businesspersons at the Secretariat Wednesday.

Some 100 mmcfd of additional gas from additional LNG cargoes and some 150 mmcfd from divertion will ensure around 250 mmcfd of additional gas in total for industries during the next four months, said Mr Khan.

The government will have to spend an additional Tk110 billion to supply this additional gas to the industry, he added.

President of Bangladesh Knitwear Manufacturers and Exporters’ Association (BKMEA) Md Hatem, Hamim Group Director AK Azad, Meghna Group managing director Mostafa Kamal, Pran Group Chairman Ahsan Khan Chowdhury, Bangladesh Chamber of Industries (BCI) president Anwar Ul Alam Chowdhury Parvez, energy secretary Saiful Islam, Petrolbangla Chairman Md Rezanur Rahman and Chief Advisor's press secretary Shafiqul Alam were among others attended the meeting.​

 

[Saif]

Govt floats tender to buy one more spot LNG cargo in June

The government has reissued a tender to purchase one spot LNG cargo for the June 26–27 delivery window to meet growing summer demand from industries and power plants. State-run Rupantarita Prakritik Gas Company Ltd (RPGCL) reissued the tender last week to procure the cargo, which will have a

thefinancialexpress.com.bd

Govt floats tender to buy one more spot LNG cargo in June
FE Online Report
Published :
May 11, 2025 19:20
Updated :
May 11, 2025 19:31

The government has reissued a tender to purchase one spot LNG cargo for the June 26–27 delivery window to meet growing summer demand from industries and power plants.

State-run Rupantarita Prakritik Gas Company Ltd (RPGCL) reissued the tender last week to procure the cargo, which will have a volume of around 3.36 million British thermal units (MMBtu).

The winning bidder will deliver the LNG cargo to Moheshkhali Island in the Bay of Bengal, with the option to discharge it at either of the country’s two floating storage and regasification units (FSRUs) located on the island.

RPGCL reissued the tender after cancelling the previous one because of receiving higher-than-expected price proposals from suppliers, said a senior RPGCL official.

If this tender succeeds, the country’s total spot LNG purchases for June will be three cargoes -- half the number purchased in May, he said.

Bangladesh bought six spot LNG cargoes for May deliveries, the highest in a single month so far this year.

The country expects lower LNG demand in June due to cooler temperatures and monsoon rainfall, which is likely to result in fewer spot LNG purchases, the RPGCL official added.

RPGCL, a wholly owned subsidiary of state-run Petrobangla, oversees LNG trading in Bangladesh.

Recently, Bangladesh awarded two spot LNG cargo tenders to Vitol Asia Pte Ltd for the May 30–31 and July 2–3 delivery windows at \$11.44 per MMBtu and \$11.57 per MMBtu, respectively.

In addition to spot cargoes, Bangladesh has been importing LNG from its two long-term suppliers --QatarEnergy LNG (formerly Qatargas) and OQ Trading International -- for regasification at its two operational FSRUs.​

 

[Saif]

Watt’s going on? A renewable dream stuck in load-shedding

Renewable energy accounts for only about 4.5 percent of total installed capacity in Bangladesh.

www.thedailystar.net

Watt’s going on? A renewable dream stuck in load-shedding

Renewable Energy Policy (REP) 2025 needs a serious rewrite. Targets must be based on sound projections, not fantasies. FILE ILLUSTRATION: REHNUMA PROSHOON

Renewable energy in Bangladesh is a bit like your overly ambitious cousin who swears they'll start waking up at 6:00 am, run 10 kilometres, and read Tolstoy before breakfast—grand promises, minimal follow-through, and inevitably back to square one by the weekend. Every now and then, we're treated to a flashy announcement: a new solar megaproject here, a bold wind energy target there, all wrapped in glossy government statements and hashtags like #GreenBangladesh. We are now in 2025, and despite years of courtship with solar panels and flirtation with wind turbines, we're still stuck in a toxic relationship with fossil fuels—cuddling up to imported coal and whispering sweet nothings to liquefied natural gas (LNG).

Let's look at the reality behind the ribbon cuttings. Despite years of lofty commitments and climate conference pledges, renewable energy in Bangladesh accounts for only about 4.5 percent of total installed capacity, and more than 80 percent of that comes from solar. But even that number flatters to deceive. Most of it is from small, decentralised systems—rooftop solar, solar home systems in villages—not large-scale, grid-connected solar farms. The sun might shine relentlessly here, but our solar energy ambitions collapse faster than a flimsy Dhaka umbrella in July rain.

Why is the picture so bleak in a country that quite literally bakes under the sun and gets enough wind along the coast to power an Atif Aslam concert? Because our approach to renewable energy is equal parts chaotic and comical. Think of it as a gym subscription, enthusiastically bought, barely used, and always waiting for "the first of next month." One minute we're promising 6,000 megawatts of renewable energy by 2025, and the next, we're cutting the power sector budget by 15 percent and quietly stalling the very policy reforms that would make those targets remotely achievable.

Let's dissect the big announcement. The long-awaited draft of the Renewable Energy Policy (REP) 2025 was finally published in February, heralding the same old excitement, now with bigger numbers. It promises that by 2030, Bangladesh will generate 20 percent of its electricity—6,145 megawatts—from renewables. By 2041, this will leap to 30 percent. It sounds impressive until you realise the whole projection is based on an inflated electricity demand estimate from the Integrated Energy and Power Master Plan (IEPMP). According to the Centre for Policy Dialogue (CPD), a more realistic figure for 20 percent renewable electricity by 2030 would be around 5,600 megawatts, and just 10,500 megawatts for 30 percent by 2041. In other words, the government has taken some creative liberties with its math.

Let's not forget that back in 2008, Bangladesh set a modest goal of reaching 10 percent renewable electricity by 2020. That deadline ghosted us like a flaky Hinge match. Fast forward to today, and we're barely scraping five percent. Yet we are now expected to believe we'll quadruple that number in just six years. To put things in perspective, even China, the undisputed heavyweight champion of renewables, is targeting 25 percent non-fossil energy by 2030. Bangladesh, which has neither China's resources, infrastructure, nor investment climate, thinks it can match that. Bold. Delusional, but bold.

What really makes the draft policy shine, in the same way cheap plastic does under bad lighting, is its complete avoidance of any fossil fuel phase-out plan. Countries like the United Kingdom and Germany have legally committed to phasing out coal. Bangladesh? We're still busy signing new fossil fuel deals like it's 1999. The draft throws around the phrase "green energy" with such abandon you'd think it means anything remotely not-black—bioenergy, waste-to-energy, and other vaguely greenish things. Meanwhile, natural gas and nuclear power continue to dominate the IEPMP, making the entire renewable section of the policy feel like a reluctant afterthought, written at 2:00am before a donor meeting.

It gets better—or worse, depending on your appetite for bureaucratic chaos. The draft assigns oversight of renewable energy projects to the Sustainable and Renewable Energy Development Authority (SREDA ), while giving licensing power to the Bangladesh Energy Regulatory Commission. So now, we're left with a classic two-headed administrative monster. One body to dream up ideas, another to sign them off, and both to blame each other when nothing gets done.

Financing? That part is written in invisible ink. The policy mumbles about a Sustainable Energy Development Fund but uses delightful hedging language like "may be implemented" and "could be considered." Which is a bit like a marriage proposal that goes, "I might, perhaps, love you… in theory." It name-drops Bangladesh Bank and the Infrastructure Development Company Limited but forgets to outline how any of this will translate into real money. There's not a single concrete strategy to generate the billions of dollars necessary for this transition. And foreign investors? The policy greets them with all the warmth of a Dhaka traffic jam. No incentives, no guarantees, just a polite shrug and a vague mention of possible stamp duty waivers.

Industries, which consume most of the electricity in the country, don't fare much better. The draft policy gives a casual nod to rooftop solar for factories but offers no real blueprint for integrating solar energy into the energy-hungry manufacturing sector. It dangles carrots like "production-linked incentives may be provided" and "waivers may be considered for EVs," without saying anything. The entire policy reads like a horoscope—generously vague, suspiciously optimistic, and completely open to interpretation.

And what of our national grid? Ah, yes, that antique piece of electrical infrastructure, about as ready for a renewable revolution as a tea kettle is for launching satellites. Our solar projects sit idle because the grid can't handle the load. Wind projects are stuck in limbo. Meanwhile, someone from the ministry insists it was all "working fine yesterday."

Meanwhile, ministers cruise around in fossil-fuel-guzzling sports utility vehicles (SUVs), giving speeches about green energy in front of billboards that read "Go Green" in fonts large enough to be visible from outer space. It's satire that writes itself.

So, what can actually be done? For starters, REP 2025 needs a serious rewrite. Targets must be based on sound projections, not fantasies. A proper fossil fuel phase-out timeline must be included. Financial incentives should be made real, not theoretical. Off-grid and rooftop solar should be given a central role in industrial zones. SREDA needs to be empowered with full licensing authority, so at least someone is clearly in charge. And above all, we need to swap out all those "may"s and "could"s for "shall"s and "will"s—because climate change doesn't respond to passive voice.

Right now, Bangladesh's renewable energy policy looks like it was written to impress donors and confuse citizens. And as we fumble forward with candles during load-shedding, fanning ourselves with expired optimism, it's worth remembering potential means nothing without action.

Thus, here's hoping we graduate from glossy dreams to gritty implementation. Because sunlight may be free, but stupidity is proving to be very, very expensive.

Barrister Noshin Nawal is an activist, feminist, and a columnist for The Daily Star.​

 

[Saif]

Govt set to nearly halve power subsidies in FY 2026

The government is set to halve the power subsidy for the next fiscal year (FY2025-26) to reduce the financial burden on the exchequer. A substantial payment already made to clear the outstanding bills accumulated over the last couple of years for purchasing electricity from the independent

thefinancialexpress.com.bd

Govt set to nearly halve power subsidies in FY 2026
FHM Humayan Kabir
Published :
May 14, 2025 00:55
Updated :
May 14, 2025 00:55

The government is set to halve the power subsidy for the next fiscal year (FY2025-26) to reduce the financial burden on the exchequer.

A substantial payment already made to clear the outstanding bills accumulated over the last couple of years for purchasing electricity from the independent power producers and an efficient power-sector- management plan apparently helped the government to go for the cutback.

Analysts, however, suggested maintaining a balance between the subsidy reduction and electricity tariffs so that the consumers, particularly households, do not have to bear the brunt.

In the national budget for FY 2025-26, scheduled to be placed in parliament on June 2, the allocation for power subsidy would be Tk 350 billion, about 56.5 per cent of Tk 620 billion revised allocation for the outgoing fiscal year, officials said on Tuesday.

The original allocation for power subsidy was Tk 360 billion for FY 2024-25.

The plan to cut Tk 270 billion or nearly 43.5 per cent signals a major shift in the government's approach to managing the financial burden of the power sector, analysts said.

The current fiscal year witnessed a considerable increase in power subsidies due to huge payment obligations of outstanding bills, accumulated over the last couple of years on account of mainly capacity charges and other bills of power producers.

"We have a plan to cut the subsidy in the upcoming FY as we have already paid a major portion of the dues in the current FY," said a senior official at the Ministry of Finance (MoF).

He said the power sector is likely to get an allocation of Tk 350 billion as the subsidy aimed at paying the arrears and bills of the Independent Power Producers (IPPs) like Indian Adani Power, Summit Power, and Aggreko Intl.

Bangladesh needs to provide huge subsidies every year mainly to pay outstanding bills to the IPPs against the purchase of electricity at higher rate from the producers and sell it to the consumers at lower prices.

An MoF official told the FE that they had already released Tk 460 billion out of Tk 620 billion subsidies, kept aside at the revised national budget for FY2025, to pay the arrears.

The remaining amount of subsidies would be released based on the demand by the Bangladesh Power Development Board (BPDB) in the coming days, he added.

The interim government augmented budgetary subsidy to Tk 620 billion in the current FY2025 budget as it wishes to pay the accumulated arrears by the next fiscal year.

The government owed the IPPs and the private-sector rental- power plants nearly Tk 130 billion until last month (April), as per data collected by the FE from the Power Division and the MoF documents on the payment obligations.

Indian Adani Power, Bangladesh-China Power Company Plant (Payra power plant), Meghnaghat 450MW Power Ltd, 210MW Rural Power Co Ltd, 335MW Summit-Meghnaghat Power Ltd and 414MW Sembcorp NWPC Ltd, 145MW Aggreko International Projects, United Power and Doreen Power are the major IPPs working in Bangladesh.

Another MoF official said that they are going to allocate a comparatively lesser amount of funds for the next FY as the power subsidy in the upcoming national budget amid expectations of a potential easing of global fuel prices in the coming fiscal year.

Moreover, the government has been emphasising on efficiency improvements within the power generation and distribution companies to reduce operational costs.

Additionally, there would be a push towards gradual adjustments of electricity tariffs to better reflect the actual cost of generation, the MoF official said, with a reference to the IMF's suggestion to this effect.

While the move towards reducing subsidies is seen by some economists as a positive step towards fiscal consolidation and promoting a more sustainable energy sector, concerns remain about its potential impact on consumers.

Any significant upward adjustment in electricity tariffs could put a strain on household budgets and potentially affect industrial competitiveness.

"The reduction in subsidies is a double-edged sword," said Dr Fahmida Khatun, a leading economist and Executive Director at the Centre for Policy Dialogue (CPD).

"While it's crucial for the long-term financial health, the government must carefully manage the transition to avoid sharp price hikes that could negatively impact the economy and the general public."

Stakeholders in the power sector, including generation companies, distribution entities, and consumer groups, will be closely watching the developments and their potential implications.

The government is expected to outline its strategy for mitigating any adverse impact of reduced subsidies, which could include targeted support for vulnerable populations and industries, as well as continued efforts to improve the efficiency and sustainability of the power sector, said an official at the Bangladesh Power Development Board (BPDB).

The focus will likely be on striking a balance between fiscal responsibilities and ensuring affordable and reliable access to electricity for all, he said.

However, government officials maintained that the subsidy is a necessary measure in the short- to medium-term to ensure energy security and support the nation's development goals.

They emphasize that alongside the subsidies, the government is also actively pursuing strategies to diversify the energy mix, enhance efficiency in power generation and transmission, and explore renewable energy sources to achieve greater energy independence and reduce the financial burden in the long run.

Further details regarding the specific mechanisms for subsidy reduction and potential tariff adjustments are expected to be revealed during the budget presentation and subsequent discussions, officials said.​

 

[Saif]

Government's plan for increasing gas supply for industries

The government has decided to increase gas supply for the industry sector. Dr Fauzul Kabir Khan, Energy adviser of the interim government, informed that the initiative would be taken to increase LNG import (4 additional LNG cargo would be imported during May-August 2025) for additional gas supply i

thefinancialexpress.com.bd

Government's plan for increasing gas supply for industries
Mushfiqur Rahman

Published :
May 15, 2025 11:48
Updated :
May 15, 2025 11:48

The government has decided to increase gas supply for the industry sector. Dr Fauzul Kabir Khan, Energy adviser of the interim government, informed that the initiative would be taken to increase LNG import (4 additional LNG cargo would be imported during May-August 2025) for additional gas supply in the country. He further informed that natural gas supply would be reduced (from the existing 1,200 mmcfd to 1,050 mmcfd) for power sector and the industries would get more gas. The impact of gas supply shortages for the power plants would be minimised by increased use of liquid fuel-based power plants. Business and Industry leaders of the country have long been demanding unhindered gas and power supply for the industries.

Petrobangla struggles to maintain gas supply as the domestic productions for natural gas has been steadily declining in the country. Currently, Petrobangla has been supplying approximately 2,700 mmcfd (both from domestic productions and from imported LNG). Imported LNG, regasification of the same and transmission of the natural gas processed from LNG remain costly and importing more LNG results in increasing government subsidies. The Energy Adviser informed that the additional 4 cargo LNG import (each LNG cargo holds approximately 3,000 million cubic feet of gas equivalent after regasification) during May-August 2025 period would compel the government to balance Taka 11,000 crore (Tk. 110 billion) shortfall for Petrobangla.

Business leaders have been claiming that the shortages of natural gas supply and abrupt gas price hikes at a regular interval 'erodes Bangladesh's regional competiveness', hurting investment and industrial growth. Energy Regulatory Commission raised 33 per cent gas prices for new industries and captive power plants on 13 April 2025. As per published sources, manufacturing sector consumes approximately 19 per cent and captive power sector consumes 18 per cent gas from the total consumption in industry and power sector in the country. So far, imported LNG share of the country's total gas supply accounts about 30 per cent. The balance supply is ensured from domestic sources (Petrobangla and IOC productions). Bangladesh Investment Development Authority (BIDA) criticised the government's decision (for gas tariff hike) as 'discriminatory' and called for review of the decision.

Ministry of Finance sources inform that the government's revised budget for the current financial year included Taka 190 billion crore subsidies for power, LNG and fertiliser. As reported, subsidies for power sector for the fiscal year stood at Taka 62,000 crore, for LNG Taka 9,000 crore and fertiliser Taka 28,000 crore. Experts consider that the price escalation for energy commodities in the global market and a number of wrong policies introduced in the energy and power sector in Bangladesh are responsible for huge government subsidy requirements for energy and power sectors. Experts feel that policy interventions and consistent monitoring of their execution to reduce the capacity charges paid to the power plants, eliminating inefficiencies and wastage of resources are important for reducing the subsidy burden. At the same time, government initiatives are urgent for increasing investment for domestic primary energy development.

Analysts have been observing that efficient use of energy and power has been increasing in industry sectors, specially, in small industrial enterprises. Experts also observe that the published information on GDP growth rate and growth of electricity consumption in the country do not match. Reports suggest that during the last 15 years electricity generation capacity growth in the country has increased almost 4.75 times. On the contrary, electricity consumption capacity growth remains limited (within the limits of 16-17 thousand megawatts maximum). Published sources further inform that during 2016-2024 period, electricity consumption growth was on average 4 per cent. Sector analysts observe that the industrial electricity consumption rate in the country is not increasing as expected. Industry owners prefer not to rely on grid electricity due to its unreliability. They rely on captive power generation. Published reports indicate that captive power generation capacity installed in the country is approximately 3,000 MW. President of the Bangladesh Chamber of Industries (BCI) Mr. Anwarul Alam Chowdhury considers that the 'growth of electricity use in industry sector is not significant'. He further considers that the true information on the country's GDP growth, energy sector growth should be published for the benefit of all concerned.

It may be recalled, that the previous government prepared the 'Power System Master Plan 2010' and projected that the annual growth of electricity would reach 10 per cent. The document projected that the economic growth would increase significant demand for electricity in the country. Based on the projections, nearly 90 power plants projects had been approved during 2010-2024 period. In reality, a large numbers of the installed power plants have been sitting idle as electricity demand growth projections did not prove correct. As a result, the burden for payments of huge capacity charges for the idling power plants has been increasing.

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

 

[Saif]

Adani Power and high cost of its electricity

The cost of keeping the lights on in Bangladesh is drawing ever more intense scrutiny, especially over electricity imported under the agreement with Adani Power. In early May, Adani Power's Chief Financial Officer Dilip Jha disclosed that Bangladesh owes approximately $0.9 billion for electricity s

thefinancialexpress.com.bd

Adani Power and high cost of its electricity
SYED MUHAMMED SHOWAIB

Published :
May 17, 2025 00:52
Updated :
May 17, 2025 00:52

The cost of keeping the lights on in Bangladesh is drawing ever more intense scrutiny, especially over electricity imported under the agreement with Adani Power. In early May, Adani Power's Chief Financial Officer Dilip Jha disclosed that Bangladesh owes approximately $0.9 billion for electricity supplied from the 1,600 MW Godda Plant in India's Jharkhand state. This follows a $1.2 billion payment made to Adani just last November. By June, the outstanding amount is projected to reach $1.3 billion, once again placing considerable pressure on the country's foreign currency reserves and raising serious questions about the wisdom of the deal.

One reason why the dues are mounting so quickly is the steep late payment fee, which reportedly stood at $136 million as of May 2025, accruing at an interest rate of 2.0 per cent per month. That's nearly 27 per cent annually, making it a penalty five times higher than typical global borrowing costs. With reserves already depleted to just over $20 billion following recent international payments, it is getting increasingly difficult for Bangladesh to sustain such costly terms.

The core issue, however, lies in the inflated cost of electricity itself. In fiscal year 2023-24, Bangladesh Power Development Board (BPDB) paid an average of Tk 14.87 per kilowatt-hour (kWh) to Adani, totalling over Tk 121 billion or around $1.0 billion. In contrast, other Indian suppliers charged significantly lower prices. NVVN Ltd charged around Tk 8.07 per kWh, Sembcorp Energy India Ltd Tk 10.42 and PTC India Ltd Tk 9.28. This puts Adani's tariff at least 30 per cent higher than comparable suppliers. The discrepancy becomes even more pronounced when compared to domestic projects such as the 1,200 MW Matarbari Coal-Fired Power Plant in Cox's Bazar, which has agreed to sell power to BPDB at just Tk 8.45 per kWh.

In a country where public subsidies are required to keep retail electricity prices affordable, such inflated import prices are hard to justify. Subsidising overpriced electricity drains public funds and distorts budget priorities, yet the government has little choice if it wants to avoid public backlash over higher retail electricity prices. Amid these concerns, the High Court in November last year ordered the formation of a committee to review the terms and conditions of the power purchase agreement with Adani. A three-member committee was reportedly formed in response, but its findings are yet to be made public.

The over-reliance on imported electricity also raises strategic considerations. Energy is a strategic asset, and dependence on a single foreign supplier under restrictive and lopsided conditions leaves Bangladesh exposed to serious geopolitical and economic vulnerabilities. It is not hard to see how Europe paid a heavy price for its dependence on Russian gas after the invasion of Ukraine, for instance.

Bangladesh has relied heavily on energy imports in recent years, often out of necessity. But that necessity is quickly diminishing. A number of domestic energy projects including gas, coal, solar and the Rooppur Nuclear Power Plant is set to transform the country's energy mix. Rooppur alone will add 1,200 MW of nuclear capacity by late 2025. Several existing plants are also operating below capacity due to fuel supply or grid issues, not for a lack of infrastructure. This changing situation makes it both necessary and possible to revisit past deals signed under very different conditions.

The Adani agreement is particularly troubling not only because of high cost, but also for its lack of transparency. Under the PPA, Adani Power was required to disclose any tax exemptions granted by the Indian government. However, BPDB officials have reported that Adani failed to inform them about a key regulatory change. In February 2019, India amended its Special Economic Zone (SEZ) policy to grant tax-free status to Adani's Godda plant for electricity exports. This benefit was never passed on to Bangladesh which constituted a breach of contract and a serious lapse in disclosure. Had Bangladesh been informed, it could have pushed for a lower tariff to reflect Adani's reduced operating costs. Instead, the country not only overpaid for electricity but also ended up subsidising a foreign company's tax advantage.

Given the scenario, Bangladesh has a strong case for renegotiating its agreement with Adani Power. Although the contract reportedly contains strict conditions for termination, this only makes renegotiation more urgent. An unfavourable deal does not mean it is unchangeable. In international business, new information and changing circumstances, especially failures to disclose key terms, can provide legitimate grounds for reopening agreements. Doing so, however, requires political will and strategic foresight. The BPDB's approach to Adani Power should be that of a sovereign entity protecting its economic future, not merely a passive debtor. The renegotiation efforts should also prioritise all three demands: lowering per-unit cost, softening late payment penalty and adjusting tax-sharing terms in light of exemptions granted to Adani by the Indian government.

Bangladesh need not enter this process from a position of weakness. The Matarbari agreement with the Coal Power Generation Company of Bangladesh Ltd (CPGCBL) provides a clear and relevant benchmark. If a domestic plant using imported coal can offer electricity at Tk 8.45 per kWh, there is little justification for paying nearly twice that amount for similar energy from across the border. Furthermore, Bangladesh's growing domestic capacity means that the country will soon have the option to reduce its reliance on external suppliers. This shift in energy self-sufficiency strengthens its negotiating hand.

Globally, many countries are rethinking their energy strategies in the face of fossil fuel depletion. China, the UAE, the United States and even India are expanding their nuclear power infrastructure. Nuclear power offers long-term stability and low running costs, advantages Bangladesh must make the most of through Rooppur and future projects. A forward-looking energy policy should focus on building domestic and sustainable sources, not tie the country to expensive and rigid deals born of short-term need.

The deal with Adani Power does not have to remain a long-term burden. With a clear strategy, Bangladesh can push to revise the deal, protect its economy, and make better use of its public funds.​

 

[Saif]

Undoing power sector damage

The full scale of mismanagement, waste and arbitrary decisions that characterised Bangladesh's power sector under the authoritarian Awami League regime is increasingly becoming more apparent. One deal after another, struck by the state-run Bangladesh Power Development Board (BPDB), stands out for p

thefinancialexpress.com.bd

Undoing power sector damage
Published :
May 18, 2025 00:33
Updated :
May 18, 2025 00:33

The full scale of mismanagement, waste and arbitrary decisions that characterised Bangladesh's power sector under the authoritarian Awami League regime is increasingly becoming more apparent. One deal after another, struck by the state-run Bangladesh Power Development Board (BPDB), stands out for poor judgment and disregard for national interest. The 718MW JERA Meghnaghat plant stands as a prime example of these problematic deals. Despite the project's completion, it remains idle due to an acute gas shortage and transmission bottlenecks, yet the government is liable to pay millions in capacity charges. This arrangement, signed under a long-term power purchase agreement (PPA), is indicative of the imprudence that has defined energy planning in recent years where contracts were awarded without due diligence, tariffs were inflated and foreign interests were accommodated at the expense of public funds.

The JERA Meghnaghat plant is merely the tip of the iceberg in the power sector's crisis. Across the industry, the country is burdened with expensive electricity from unsolicited projects awarded under the now-defunct Speedy Supply of Power and Energy (Special Provision) Act 2010. These contracts often bypassed feasibility studies and were exempt from public scrutiny. This has led to an oversupply of generation capacity -- largely dependent on natural gas -- even though Petrobangla cannot provide even half of the required supply to keep existing plants running. Idle plants continue to collect capacity payments, bleeding the BPDB's finances dry without delivering electricity to the grid. At Meghnaghat alone, three large LNG-based plants sit underutilized due to gas shortages and delays in substation construction. Meanwhile, the government is forced to pay these idle power plant owners through capacity charges, wasting significant taxpayer funds just to meet the costly contractual obligations.

Blame for this unsustainable mess rests squarely on the ousted Awami League government, which spent years pursuing power generation targets without securing fuel supply or transmission capacity. In many instances, contracts were awarded not on the basis of national demand forecasts or technical merit, but to serve political convenience, funnel money to individuals politically connected with Awami League, and cultivate foreign partnerships for short-term gain. This wilful neglect of prudent planning and financial discipline has saddled the nation with high-cost energy, undermined investor confidence and pushed public utilities like BPDB closer to insolvency. Experts have repeatedly cautioned against inflated demand projections and warned of the dangers of overcapacity, but such concerns were brushed aside. Instead of a stable, affordable energy system, the country has been left with one that is expensive, inefficient and shaped more by private interests than public need.

There is, however, a measure of hope that the current interim administration may begin to correct course. The initiative to renegotiate tariffs that started with the JERA plant is a step in the right direction. The incumbent adviser to the Ministry of Power, Energy and Mineral Resources Muhammad Fouzul Kabir Khan deserves a degree of appreciation for initiating this difficult and politically charged process. While his efforts cannot erase the consequences of a decade of misgovernance, they mark a crucial first step towards repairing the extensive damage inflicted upon the sector. To truly rectify the situation, the government must review all existing PPAs to assess fairness and economic viability one by one and phase out the unsustainable practice of capacity payments. Above all, long-term energy planning must be rooted in a reliable fuel supply chain and investment in transmission infrastructure. Bangladesh's energy future must not remain hostage to past mistakes. With a clear strategy and political will, the country can still build a power sector that truly serves its people.​

 

[Saif]

With cash in hand, US Co resurrects investment plan

With cash in hand, US energy giant Chevron assures state-run Petrobangla of resurrecting its held-back investment worth around US$65 million in Jalalabad compression project, insiders said, as the interim government cleared arrears in gas bill at one go. The Chevron Bangladesh company assurance ca

thefinancialexpress.com.bd

Govt pays off overdue Chevron gas bills
With cash in hand, US Co resurrects investment plan

M Azizur Rahman
Published :
May 18, 2025 00:10
Updated :
May 18, 2025 00:10

With cash in hand, US energy giant Chevron assures state-run Petrobangla of resurrecting its held-back investment worth around US$65 million in Jalalabad compression project, insiders said, as the interim government cleared arrears in gas bill at one go.

The Chevron Bangladesh company assurance came during a joint-management committee meeting recently following a request from Petrobangla to resume the multinational's stalled investment after clearing all overdue payments.

Chevron Bangladesh had put on hold the Jalalabad compression-project investment proposal through a letter to the state corporation on April 4, 2024.

In the letter, Chevron Bangladesh President Eric M walker wrote on deferment of the project until the overdue -payment balance was fully cleared by Petrobangla.

Prior to sending the letter, the arrears in payment to Chevron Bangladesh rose as high as to $280 million.

The international oil company (IOC) Bangladesh outfit had a plan to initiate the compression project in 2023 and it had then approved a budget worth $65 million to implement the project.

But Petrobangla was struggling to make payment to Chevron Bangladesh over the past several years following global economic turmoil caused by the ongoing war between Russia and Ukraine that led to deep currency devaluation.

According to information provided by Chevron a couple of years back, upon completion of the project, it will be possible to extract an additional 352 billion cubic feet (Bcf) of gas from the Jalalabad gas field, said one source.

"Hence, after the implementation of the project, it will arrest the declining production trend significantly," said a senior Petrobangla official.

The failure to complete the project in time will result in a significant reduction in gas production, which will undermine the main purpose of the second extension of production period for blocks 13 and 14, he said.

But sources fear that gas production from Jalalabad field wouldn't be as large as Chevron had projected a couple of years back as the field's reserves shrank from the previous level due to continuous sucking.

"Bangladesh has been facing a significant challenge in foreign -currency issue since June 2022. As a result, Petrobangla was unable to pay regular invoices despite its keenness," a recent Petrobangla letter to the Chevron Bangladesh president clarified the reason why such delay in payment.

Regardless of the constraints, Petrobangla shows its testament of good intention and commitment towards the repayment plan, the Petrobangla letter, issued by its Director (finance) AKM Mizanur Rahman, reads.

Due to the present government's fair, transparent, accountable, and effective policies and activities, the foreign-currency-availability situation has changed, it said.

In these circumstances, Petrobangla has cleared all outstanding arrear balance, including regular invoices, within the timeframe, it also said.

"It translates that Petrobangla always remains dedicated to its commitment. We further expect that it will continue in the future, too," the government side says in the letter.

Asked about the investment plan, Chevron Bangladesh Media and Communications Manager Shaikh Jahidur Rahman said, "As part of our ongoing efforts to support the government in maintaining uninterrupted gas supply, the team is always evaluating various opportunities."

He hastens to add: "As a matter of policy, we do not comment on specific commercial matters."

Mr Rahman, however, hails the government gesture in clearing all the arrears in payments. "We greatly appreciate the efforts of the interim government, energy ministry, and Petrobangla to resolve this issue."

Separately, another investment proposal of Chevron Bangladesh worth around $500 million to develop Bangladesh's onshore hydrocarbon block-11 and attain exploration rights over an extended area of block-12 in the Surma basin is currently pending with Petrobangla for approval.

Chevron plans to explore these blocks to discover fresh gas, a move that would augment supplies to meet the country's insatiate energy needs.

The gas-rich Surma basin is situated in the country's northeast, and the region contributes much of the natural gas in the national gas grid.

Chevron had previously invested around $500 million under its Bibiyana project during 2012-2015. It included a gas-plant expansion, new development wells, and an enhanced liquid-recovery unit, Platts reported previously.

If new gas is discovered, Chevron would be able to supply natural gas within the shortest possible time using the same processing plant it uses to process Bibiyana gas, sources familiar with the situation said.

The multinational could ramp up natural gas production by up to 1.35 billion cubic feet per day from Bibiyana gas field and the new areas using the currently operational Bibiyana process plant, they added.

Petrobangla officials have said the company has not yet made any decision on Chevron's hydrocarbon exploration and its investment plan.

Chevron Bangladesh is currently the largest producer of natural gas in Bangladesh with its output of around 1.08Bcf per day from three of its onshore fields - Bibiyana, Jalalabad, and Moulavi Bazar, which are in blocks 12, 13, and 14, respectively, according to official Petrobangla data as of Saturday.​

 

[Saif]

Bangladesh plans additional spot LNG import in early July amid energy crisis

The government is considering importing one more spot liquefied natural gas (LNG) cargo in early July to meet the country’s natural gas demand during the upcoming monsoon. State-run Rupantarita Prakritik Gas Company Ltd (RPGCL) aims to purchase the spot LNG cargo for delivery within the July

thefinancialexpress.com.bd

Bangladesh plans additional spot LNG import in early July amid energy crisis
FE ONLINE REPORT
Published :
May 19, 2025 18:54
Updated :
May 19, 2025 18:54

The government is considering importing one more spot liquefied natural gas (LNG) cargo in early July to meet the country’s natural gas demand during the upcoming monsoon.

State-run Rupantarita Prakritik Gas Company Ltd (RPGCL) aims to purchase the spot LNG cargo for delivery within the July 2-3 window, a senior RPGCL official told The Financial Express on Monday.

The volume of the spot LNG cargo is around 3.36 million British thermal units (MMBtu).

The successful bidder will deliver the LNG cargo at Moheshkhali Island in the Bay of Bengal, with options to discharge the cargo at either of the country’s two floating storage and regasification units located on Moheshkhali Island.

If this tender is successful, the country’s total procurement of spot LNG cargoes in early July will be two in total.

The country may also seek to purchase more spot LNG cargoes in late July, the official added.

Bangladesh has so far purchased three spot LNG cargoes for June deliveries.

RPGCL is a wholly owned subsidiary of state-run Petrobangla and handles LNG trading in Bangladesh.

Bangladesh recently awarded a spot LNG cargo in a buy tender to Gunvor Singapore Pte Ltd for the June 26-27 delivery window at $12.18 per MMBtu.

Previously, the country awarded a July 2-3 delivery window spot LNG cargo to Vitol Asia Pte Ltd at $11.57 per MMBtu.

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

The country has been facing an acute energy crisis as its natural gas output declines.

Bangladesh has been rationing gas supplies to industries, power plants, and other high-demand sectors to manage the rising demand.​

 

[Saif]

Petrobangla looks to go without subsidy

The state-run Petrobangla is upbeat about withdrawal of value-added tax (VAT) on the import of expensive liquefied natural gas (LNG) as it would help reduce overall LNG cost and free this state-entity from any subsidy from the government, said sources. Top officials of the Energy and Mineral

thefinancialexpress.com.bd

Possible withdrawal of VAT on LNG import
Petrobangla looks to go without subsidy
M Azizur Rahman

Published :
May 22, 2025 00:32
Updated :
May 22, 2025 00:32

The state-run Petrobangla is upbeat about withdrawal of value-added tax (VAT) on the import of expensive liquefied natural gas (LNG) as it would help reduce overall LNG cost and free this state-entity from any subsidy from the government, said sources.

Top officials of the Energy and Mineral Resources Division (EMRD) under the Ministry of Power, Energy and Mineral Resources (MPEMR) and Petrobangla already held several meetings with the officials of National Board of Revenue (NBR) over the issue, they said.

"We are expecting that the NBR will withdraw 15 per cent VAT on the import of LNG as the value of this imported fuel is not added, rather reduced, as it is blended with local gas," Petrobangla's director for finance AKM Mizanur Rahman told The Financial Express on Wednesday.

When it comes to the current market price and the volume of LNG imports, Petrobangla would be able to reduce the overall LNG import cost by around Tk 65-69 billion annually.

Petrobangla received state-subsidy worth around Tk 60.35 billion during the fiscal year 2023-2024.

Currently, Petrobangla's LNG import cost from spot market is around US$14 per million British thermal unit (MMBTu) and the cost of that from long-term LNG suppliers is around US$10.50 per MMBTu, said Mr Rahman.

Petrobangla has been importing around 98 LNG cargoes - 56 from long term LNG suppliers and 42 from spot market annually.

If the country imports an increased volume of LNG, the overall cost reduction would be higher, said the Petrobangla official.

Petrobangla would be able to increase import of more cargoes with the money saved from the current VAT, which will increase the country's overall natural gas supplies and reduce the gas crisis facing industries, power plants and other gas-guzzling consumers.

According to sources at the Ministry of Finance (MoF), the government paid subsidies worth around Tk 25 billion in FY '19, Tk 35 billion in FY '20, Tk 34.97 billion in FY '21, Tk 60 billion in FY '22, and Tk 63.32 billion in FY '23 as state subsidies on account of LNG imports to Petrobangla.

Currently, LNG import faces double taxation - 15 per cent VAT at the import stage and another 15 per cent at the consumer level without any actual value addition.

It violates the core principle of VAT, it has been alleged.

Besides, the NBR slaps an additional 2.0 per cent advance tax (AT) and a 5.0 per cent source tax, inflating further the overall LNG import costs.

Bangladesh blends imported LNG with local natural gas after its re-gasification.

According to Petrobangla, the cost of blended natural gas during FY '23 was Tk 19.09 per cubic metre (cm) and it soared to Tk 23.85 per cm in FY '24 and Tk 29.39 per cm in FY '25.

The weighted average sales price of gas, however, was Tk 11.91 per cm in FY '23, Tk 22.87 per cm in FY '24 and remained the same at Tk 22.87 per cm in FY '25.

The price gap between the cost of blended natural gas and its weighted average sales price was Tk 7.18 per cm in FY '23. It came down to only Tk 0.98 per cm in FY '24 following several rounds of hike in tariffs including the highest ever rate of 178.88 per cent.

Following the significant hikes, the price gap between the cost of blended natural gas and its weighted average sales price widened again to 6.52 per cm in FY '25, according to Petrobangla.

The overall costs of gas rose to Tk 75.72 per cm in the current FY, Petrobangla has estimated.​

 

[Saif]

Gas distributor gets lavish on borrowed money, receives PC rebuff

A gas-pipeline project is spurned by government planners for a lavish estimation of expenditures, including a fat consultancy cost, to be funded with local and foreign loans, insiders said Friday. Titas Gas Transmission and Distribution Company PLC proposed to spend Tk 3.085 billion for co

thefinancialexpress.com.bd

Gas distributor gets lavish on borrowed money, receives PC rebuff
FHM Humayan Kabir

Published :
May 24, 2025 00:58
Updated :
May 24, 2025 00:58

A gas-pipeline project is spurned by government planners for a lavish estimation of expenditures, including a fat consultancy cost, to be funded with local and foreign loans, insiders said Friday.

Titas Gas Transmission and Distribution Company PLC proposed to spend Tk 3.085 billion for consultancy service alone out of the Tk 81.61-billion pipeline-installation project, they said, only to be spurned by the Planning Commission (PC).

The state-run energy company also earmarked a massive Tk 32.187 billion worth of funds for road-restoration works which the PC noted as a "bloated cost", officials concerned told The Financial Express.

"The Commission has denied approval for the gas-pipeline project as Titas Gas has undertaken the scheme with some unnecessary expenditures taking huge amount of loans from internal and external sources," said officials involved with the approval process.

The gas-supply company has also proposed some other costs that are higher than similar kind of ongoing projects, he added.

Raising question on the necessity of undertaking the gas-pipeline-installation project on borrowed money from costly loans amid the country's present economic condition, the PC has sent back the project proposal for a recast.

The project denial came when Titas Gas company sought approval for 'Replacement and improvement of the existing gas network in Dhaka and Narayanganj City Corporation areas, incorporating GIS mapping and SCADA system project' at the Project Evaluation Committee (PEC) meeting last week.

According to the development project proposal (DPP), the state entity has undertaken Tk 81.61- billion-cost project for installing the pipeline where 90 per cent of the funds would be borrowed from home and abroad.

The company planned to borrow Tk 33.53 billion, equivalent to nearly US$280 million, from the China-based New Development Bank (NDB) and Tk 39.87 billion from government exchequer. The remaining Tk 8.21 billion was to be invested from Titas coffers.

The NDB charges interest rate based on SOFR and a spread of 50 basis points. It also charges front-end fee, commitment fee and maturity premium.

The loan's maturity is 20 years which is shorter than that of other loans, like from the World Bank, the Asian Development Bank, and Japan. The 6-month SOFR rate was 4.42096 per cent on Thursday.

Titas Gas has also sought Tk 39.87 billion in loan from the Ministry of Finance (MoF). The MoF usually borrows from local banking system for fulfilling the gap financing in the country's development works.

According to the PEC-meeting sources, the attendees asked the Titas management whether this type of project with massive borrowing is the priority one of the government at this moment when the country's revenue collection and foreign-exchange reserves are in a poor state.

"Most of the funds (Tk 39.87 billion or 49 per cent) will be borrowed from internal resources. This fund will be very costly as it will be borrowed from the domestic banking system," says the official who attended the PEC meeting.

The remaining 41 per cent will be borrowed from the NDB which is also a costly, market-based loan, adds the official, requesting anonymity.

"Since the government stopped residential and some other gas connections to the consumers, so the existing pipeline may be enough for supplying gas for some few years. Besides, the MIS and SCADA system installation is an ambitious work at this moment when the Bangladesh economy is under stress," he quotes the PEC meeting as saying.

Additionally, Titas has proposed spending Tk 61.05 million for hiring cars, Tk 35.85 million for training, and Tk 1.81 billion for land acquisition, which are deemed unnecessary spending, another official says.

According to the officials, the project's net present value (NPV) is very negative, giving rise to a big question on returns.

Meanwhile, the company has sought five and a half years as project-execution period till December 2030, which is "a violation of government's project preparation, processing, approval and revision guidelines", says the official.

No responsible executives from Titas Gas PLC were available for immediate comment.​

 

[Saif]

Fresh tender floated to purchase one more spot LNG cargo

State-run Rupantarita Prakritik Gas Company Ltd (RPGCL) has floated a fresh tender to purchase one spot LNG cargo during the second week of July to feed growing demand in gas-guzzling power plants and industries. The RPGCL intends to buy the spot liquefied natural gas (LNG) cargo for the July 11-1

thefinancialexpress.com.bd

Fresh tender floated to purchase one more spot LNG cargo
FE REPORT
Published :
May 23, 2025 11:51
Updated :
May 23, 2025 11:51

State-run Rupantarita Prakritik Gas Company Ltd (RPGCL) has floated a fresh tender to purchase one spot LNG cargo during the second week of July to feed growing demand in gas-guzzling power plants and industries.

The RPGCL intends to buy the spot liquefied natural gas (LNG) cargo for the July 11-12 delivery window, a senior RPGCL official told The Financial Express Thursday.

The volume of the spot LNG cargo is around 3.36 million British thermal units (MMBtu).

The bid submission deadline is May 25.

The bid winner will deliver the LNG cargo 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 located on Moheshkhali island.

If this tender becomes successful, the country's total buying of spot LNG cargoes in early July will be three.

The country might seek to buy more spot LNG cargoes in late July, said the official. Bangladesh has purchased three spot LNG cargoes for June deliveries.

RPGCL is a wholly-owned subsidiary of state-run Petrobangla and looks into LNG trades in Bangladesh.

Bangladesh previously awarded one spot LNG cargo for July 2-3 delivery window to Vitol Asia Pte Ltd at $11.57 per 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 in its two operational floating, storage and re-gasification units (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.

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

 

[Saif]

Further delay likely as interim govt also moves slowly

Bangladesh's delay in constructing its first crude-oil refinery after independence is set to linger further as the interim government is also in the slow lane to implement the project like the previous ones. Bangladesh had "failed" to build any crude-oil refinery over the past half a century after

thefinancialexpress.com.bd

Country's first crude-oil refinery project
Further delay likely as interim govt also moves slowly

M Azizur Rahman
Published :
May 26, 2025 01:44
Updated :
May 26, 2025 01:44

Bangladesh's delay in constructing its first crude-oil refinery after independence is set to linger further as the interim government is also in the slow lane to implement the project like the previous ones.

Bangladesh had "failed" to build any crude-oil refinery over the past half a century after its independence, resulting in huge waste of foreign currencies that went into the import of refined oils from the international market, market insiders said.


Only "negligence" on the part of the authorities concerned is to blame, they added, in an indication of the dominance of rent-seeking import lobbies.

The country's currently operational maiden refinery - Eastern Refinery Ltd (ERL) - was built way back in 1968 by French company Technip, three years before the emergence of independent Bangladesh from the Pakistani rule.

The volume of petroleum oil imports increased around threefold over the past five decades to feed the growing consumption in transport, industries, and other commercial outlets with the expansion of the country's overall economy.

The feasibility study, conducted by Engineers India Limited (EIL), has confirmed that the entire investment will be recovered in less than seven years, banking on an internal rate of return (IRR) of 16 per cent, once a new crude-oil refinery having the capacity of around 3.0 million tonnes per annum is built.

The Front End Engineering Design (FEED) report, prepared by Technip, reveals that the new refinery will help save $19 per barrel of oil.

"We are searching for foreign funding to implement the project," Bangladesh Petroleum Corporation (BPC) Chairman Amin Ul Ahsan told The Financial Express Saturday.

"Once we get the funding, we shall float tenders to select an engineering, procurement and construction (EPC) contractor to implement the project," he said.

Market sources said the previous governments delayed implementing the project in the same fashion either for arranging funds or selecting the EPC contractor.

The Energy and Mineral Resources Division (EMRD) under the Ministry of Power, Energy and Mineral Resources (MPEMR) is trying to arrange funds from the Asian Development Bank (ADB), the Islamic Development Bank (IsDB), the Asian Infrastructure Investment Bank (AIIB), and the World Bank (WB).

As per the latest development project proposal (DPP), the project cost is estimated at Tk 364 billion. It has an annual refining capacity of 3.0 million tonnes.

The BPC is set to provide Tk 110 billion for the project, while the remaining Tk 254 billion is expected to be secured from foreign loans.

Sources said the MPEMR first decided to build a new crude-oil refinery at an estimated cost of Tk 130 billion in 2010 on the basis of a feasibility study funded by the IsDB.

The EMRD redesigned the DPP in 2023 with an estimated cost of Tk 237 billion through domestic financing due to the delay caused by the unavailability of foreign resources.

The proposal was later withdrawn from the Planning Commission to implement the project with funding from the controversial S Alam industrial group, and a memorandum of understanding (MoU) was inked with the acquisitive conglomerate - now in the wilderness following the fall of the past government through an uprising.

The current interim government cancelled the MoU with S Alam Group and decided to proceed with the new unit under a project of the Annual Development Programme (ADP).

The cost of the project increased by Tk 126 billion, or 53.40 per cent, over the past two years due to delays in the name of the PPP framework.

Compared to its 2010 estimate, the project cost increased 2.8 times, said sources.

The EMRD recently decided to implement the project titled "Modernisation and expansion of Eastern Refinery Limited (ERL)" with foreign financing and BPC's own financing.

State-owned ERL is currently capable of refining only 1.5 million tonnes of petroleum products against the country's annual fuel demand of about 7.0 million tonnes.

The ERL is meeting around 18.62 per cent to 23.92 per cent of the total petroleum-oil and -lubricant demand.

The project aims to boost refining capacity to 4.5 million tonnes per year by adding another 3.0 million tonnes.

The new plant will produce Euro-5-quality fuels, which include diesel, octane and petrol with a sulphur content of less than 10 parts per million (ppm), adhering to global environmental standards and promoting cleaner air for future generations.

Implementing this project would save foreign exchange by reducing dependence on imported refined petroleum.

In addition, the plant would help increase the income of BPC by processing various value-added by-products at affordable costs, alongside the production of liquid fuels from refining crude oils, reveals the project proposal.

Besides, the proposed refinery will serve as a "forward linkage" for the "Installation of Single-Point Mooring (SPM) with Double Pipe Line" project, which was built at a cost of around Tk 80 billion and is set to initiate commercial operations soon.

The SPM project has the capacity to transport 9.0 million tonnes of fuels annually, split equally between 4.5 million tonnes of refined fuels and 4.5 million tonnes of crude oils.

Until the new refinery is completed, two-thirds of the SPM's capacity regarding crude oil will remain idle.

The EMRD has projected that petroleum demand in the country will reach 11.45 million tonnes in the fiscal year 2023-31, with an average growth rate of 5.9 per cent in the next couple of years.

Once the second unit is commissioned, the ERL will be able to meet about 40 per cent of the national demand while its share will fall to just 13 per cent in the absence of the new plant.

"It is sheer negligence from the government high-ups as it could not build a new refinery even over the past 53 years," Energy Adviser of the Consumers Association of Bangladesh (CAB) Prof M Shamsul Alam told The Financial Express.

"A vested quarter having a nexus with government high-ups has been delaying the project's execution to earn money as commission," he said, in tune with usual quips over import preference.

"Consumers are the ultimate losers," he lamented.

Building the oil refinery through competitive bidding will ensure the execution of the project in a transparent and accountable manner, said energy expert Prof M Tamim, who was a special assistant of a previous caretaker government.​

 

[Saif]

Petrobangla refutes claims on industrial gas crisis

The state-run agency says industrial gas supply rose 21% in the Jan-Apr period

www.thedailystar.net

Petrobangla refutes claims on industrial gas crisis
The state-run agency says industrial gas supply rose 21% in the Jan-Apr period

Petrobangla has issued a clarification in response to what it described as "misleading and confusing" statements made by representatives of various associations regarding gas supply to industrial establishments.

The state-run oil, gas, and mineral corporation issued the statement a day after textile and garment industry owners claimed that many mills are on the verge of shutting down, as they are unable to operate even at minimum capacity due to an acute gas crisis.

Today, Petrobangla said the actual gas supply data contradict the claims circulated in the media.

Between January and April this year, the average daily gas supply to the industrial sector stood at 997 million cubic feet (mmcfd), up 21 percent from 823 mmcfd in the same period of 2024, it said.

In April alone, supply reached 1,088 mmcfd, a rise of around 50 percent year-on-year, the statement added.

To meet the growing industrial demand, Petrobangla has arranged the import of six additional liquefied natural gas (LNG) cargoes this year, it said.

The import cost of LNG is about Tk 65 per cubic metre, while industrial users pay Tk 30 and captive power producers Tk 31.50 per cubic metre.

The government is subsidising Tk 35 per cubic metre of gas supplied under the current pricing structure.

Citing additional LNG imports and adjustments in sector-wise distribution, Petrobangla said it plans to supply an extra 150 mmcfd from Wednesday.

"The government is actively working to ensure adequate gas supply to industries and has taken timely measures to that end. We hope this clarification will dispel any misunderstandings surrounding the issue," the statement said.​

 

[Saif]

Govt cancels land lease of Orion’s coal power project

The lease of the land awarded by the past Awami League government to the Orion Group to build a 635MW coal-based power plant in Cox’s Bazar’s Matarbari has been cancelled.

www.newagebd.net

Govt cancels land lease of Orion’s coal power project
Emran Hossain 27 May, 2025, 01:02

The lease of the land awarded by the past Awami League government to the Orion Group to build a 635MW coal-based power plant in Cox’s Bazar’s Matarbari has been cancelled.

‘Our board of directors recently cancelled the land lease given to the coal power project of the Orion Group,’ said Nazmul Haque, managing director, Coal Power Generation Company Bangladesh Limited.

The company on February 27, 2023 leased 225 acres of land to the Orion Group, one of the largest beneficiaries from controversial power deals awarded under the indemnity law adopted by the past Awami regime.

The decision to cancel the lease came amidst green activists organising protests demanding the cancellation of the Orion Group’s coal power project.

Approved on September 29, 2013, the coal power plant was initially permitted to be built in Munshiganj’s Gajaria. A power purchase agreement for 25 years was also signed between the Orion Group and the Bangladesh Power Development Board in April 2016.

The power purchase agreement required the plant to be operational in 45 months of its signing. But the Orion Group could not yet start the plant’s construction.

‘The cancellation of the land lease is reminiscent of the undue favours extended to the Orion Group by the past government desperately trying to implement the coal power project,’ said Hasan Mehedi, member secretary, Bangladesh Working Group on Ecology and Development.

Initially, the project boasted of potential loans from the USA, Poland, Korea and China, though the loans never arrived. About two years after the project’s deadline expired, the BPDB in early 2022 extended the project’s deadline until 2026, while advising it to relocate to Matarbari.

Once again the Orion Group failed to start the plant’s construction. But the BPDB, instead of cancelling the PPA, extended the project deadline again, until 2027. Then again the deadline was extended until 2030 just before the student-led mass-uprising brought the authoritarian AL regime to an end.

After failing to complete the project in its initial deadline, the Orion Group in July 2020 proposed to construct the power plant taking loan from the national reserve, but the plan did not work out.

Bangladesh Bank eventually changed its provision of financing coal power plant in November 2022, allowing the Orion Group to secure declaration from three state-owned banks, namely Janata Bank, Agrani Bank and Rupali Bank, to receive Tk 10,579 crore to build the power plant. Janata Bank promised to give it half of the loan.

The construction cost of the 635MW power plant, according to an analysis revealed earlier this month, would be 70 per cent higher than the cost generally needed for setting up coal power plants with double its capacity, such as, the 1,320MW Payra power plant.

The estimated capacity charge to be given for the power plant could stand at Tk 6.47 per unit, as the analysis estimated, requiring the payment of Tk 76,478 crore in capacity charge over the lifetime of the power plant had it been built.

The analysis also put the estimated the loss in public health and agricultural production due to the power plant at over Tk 55,000 crore.

The analysis drew attention to the poorly-informed environmental impact assessment based on which the power plant was approved.

Currently, coal accounts for 21 per cent of the country’s total installed power generation capacity of 27,424MW.

Two more major coal-based power plants worth 1,244MW and 1,247MW are set to come online by 2030.​

 

[Saif]

Expediting operation of oil pipeline

Chattogram-Dhaka oil pipeline project has been encountering delays in multiple forms. First, its launching was delayed following its approval by the Executive Committee of the National Economic Council (ECNEC) in October 2018. Thus its original completion deadline by December 2020 was missed. The d

thefinancialexpress.com.bd

Expediting operation of oil pipeline

Published :
May 31, 2025 00:13
Updated :
May 31, 2025 00:13

Chattogram-Dhaka oil pipeline project has been encountering delays in multiple forms. First, its launching was delayed following its approval by the Executive Committee of the National Economic Council (ECNEC) in October 2018. Thus its original completion deadline by December 2020 was missed. The deadline was extended twice first, to December 2022 and then to December 2024. Consequently, the original project cost has soared from Tk28.61 billion to Tk 36.99 billion. On project completion, the operation, that is, transportation of the petroleum fuel through the pipeline was scheduled to begin early this month.

But it has not yet started due to non-completion of some pre-commissioning work. Whatever the nature of the pre-commissioning formalities may be, it must not cause inordinate delay to transportation of the fuel oil through the 237.71- kilometre pipeline from Padma oil installations in Patenga of Chattogram to Narayanganj's Godanail tank terminal. The more the delay in actual commissioning of the operational part of the project is the more the transportation of fuel oil by private tanker lorries and coastal tankers. The nexus pilfering oil during transportation will also share the loot. It is an entire chain of vested interests from transportation points to political high-ups that was engaged in stealing the state's precious fuel oils during the autocracy. The scale of operation gives some measure of profit with 200 tankers reportedly deployed to carry 90 per cent of oil by waterways.

Now that the autocracy has gone, what is then standing on the way of making the oil pipeline functional? If it is due to the usual bureaucratic tardiness, indecision or laxity on the part of BPC's administration, or, say, appointment of an operating company to run the pipeline, the delay should not be inordinate. That would call for bringing those responsible for the sloppiness in the administration to book. The main objective of installing the pipeline was to save about Tk2.30 billion annually in transportation cost. That objective is being defeated.

More than the money in the form of transportation cost, the time saved is the most critical part of the project. Once the pipeline begins to carry 2.62 million metric tonnes of petroleum products from Chittagong port to the capital city annually without all the hassles, risks, costs and lengthy time, the productivity of the national economic engine oil fires will increase manifold. It is not just the industries in the urban areas that the piped oil promises to serve, the 2.7 million tonnes of High Speed Diesel (HSD), the crucial fuel for agriculture in the northern districts to be transported through the pipeline would also help ensure the country's food security better. Notably, from Godanail and Fatullah in Narayanganj, tankers are used to carry the oil along the waterways to the depots in the northern districts such as Baghabari in Pabna, Chilmari in Kurigram and Sachnabazar of Sunamganj in the northeast. Obviously, after commissioning, the northern agricultural districts would also benefit greatly. In sum, every hour lost to commissioning delay of the pipeline would amount to huge loss in economic terms. This is the last thing expected of the current interim government.​

 

[Saif]

Power and energy crisis in Bangladesh

Bangladesh is currently facing one of the most disruptive energy crises in recent months. Extended load shedding, acute gas shortages, and high fuel price hikes have severely impacted daily life and economic activity across the country. According to the national dailies, the industrial production h

thefinancialexpress.com.bd

Power and energy crisis in Bangladesh
Gas, electricity, and transportation sectors
Fahmida Khatun, Mustafizur Rahman, Khondaker Golam Moazzem, Muntaseer Kamal and Syed Yusuf Saadat
Published :
May 31, 2025 00:01
Updated :
May 31, 2025 00:01

Bangladesh is currently facing one of the most disruptive energy crises in recent months. Extended load shedding, acute gas shortages, and high fuel price hikes have severely impacted daily life and economic activity across the country. According to the national dailies, the industrial production has slowed, transport services have been disrupted, and businesses—especially small and medium enterprises—have reported financial losses and operational downtime. This crisis has exposed systemic weaknesses in Bangladesh’s energy system, including its heavy dependence on imported fuels, ageing grid infrastructure, and inadequate investment in domestic energy production and renewables. As demand continues to rise—driven by urbanisation, industrial expansion, and agricultural mechanisation—the country’s limited and inefficient energy supply has struggled to keep up. This report analyses the current power and energy crisis in Bangladesh with a focus on natural gas, electricity, and transportation fuels such as diesel and petrol. Drawing from secondary data, in-depth interviews, and sector-specific trends, it identifies the scale of the supply-demand gap, pricing trends, and its impact across key user groups: households, industries, and the transport sector.

Energy supply-demand gap analysis: Bangladesh’s energy system relies heavily on three major energy sources: natural gas, electricity, and transportation fuels (diesel and petrol). This section analyses the trends in demand and supply for each of these energy types using national data, highlighting the scale of the deficits and their sectoral implications.

Natural gas. Natural gas remains vital to Bangladesh’s energy system, powering over half of the electricity generation and playing key roles in industry, domestic use, and fertiliser production. However, the sector is under severe strain due to falling domestic production and growing demand. Between FY2020 and FY2024, total gas production declined from 24,993 to 21,075 mmcf, while distribution remained steady. As a result, the production-distribution gap widened significantly from 3,492 to 6,479 mmcf.

There is limited effort even under the Interim Government regime to explore natural gas from the probable gas wells onshore and offshore. 34 wells were targeted to be explored in FY2025, whereas only 8 wells were being explored as of October 2024. A part of the gap is partially met by imported LNG. The share of LNG has increased from 7.3 per cent in FY2020 to 25 per cent in Fy2025 (till January). Such a rise in the import of LNG has significantly raised the expenses. Hence, the financial state of Petrobangla increasingly turned out to be negative.

The sectoral consumption patterns show power and industry as the largest gas users. While power has remained the dominant sector, industrial use has steadily increased. Domestic consumption, by contrast, has fallen from 158 BCF in FY2018 to 100 BCF in FY2024. Total national gas use peaked at 1,041 BCF in FY2019 but declined to 916 BCF in FY2024.

Also, the future demand is expected to grow sharply from 3,965 mmcfd in FY2025 to 4,762 mmcfd in FY2028, driven by the power and industrial sectors. Domestic and commercial demand is projected to decline slightly, reflecting lower allocation priorities.

In other words, unless alternate energy sources (including renewable energy) are managed for major economic activities, the gas crisis will be further acute in the coming years. Overdependence on LNG would further weaken the financial state of Petro Bangla as well as weaken the overall BoP of the country.

In the price trend analysis, it has been found that gas prices increased significantly for industries and captive power from BDT 30 to BDT 40–42 per cubic meter, while electricity generation retained the subsidised rate of BDT 14 in 2025. Rising gas prices along with lowering supply have heavily affected the gas dependent industries such as textiles, glass, ceramic and steel industries.

Together, these trends reveal a deepening gas crisis. Without new exploration, infrastructure upgrades, and pricing reform, Bangladesh’s energy security and industrial growth will remain at risk.

Electricity. Electricity demand in Bangladesh has risen steadily, driven by urbanisation, industrial growth, and agricultural electrification. Despite achieving over 95 per cent national electrification by 2021, supply has not kept pace with demand due to limited fuel availability, ageing infrastructure, and inefficiencies in generation and distribution.

From FY2011 to FY2024, installed capacity increased from 7,264 MW to 28,098 MW. However, actual demand only rose to 16,477 MW, significantly below the forecasted 17,830 MW. The gap has widened in recent years, with “energy not served” peaking at 3,818 MkWh in FY2023.

These shortfalls are especially severe during peak hours and irrigation seasons. Rural areas face daily outages, while urban users rely increasingly on diesel generators, raising energy costs. Industries adjust production schedules to cope with load shedding, and SMEs without backup power face financial strain. In agriculture, unreliable power forces a shift to diesel pumps, increasing irrigation costs and affecting food prices.

Although the generation mix has diversified, over 43 per cent still comes from gas-fired plants, which remain vulnerable to supply disruptions. Financial stress on utilities, stemming from high subsidies and low-cost recovery, further limits investment in system upgrades.

On the other hand, electricity tariffs have also risen. Between 2021 and 2024, annual average growth rates for residential users (0–50 kWh) rose by 13.6 per cent, while other categories like shops and small industries saw increases of 6.5 per cent. These hikes have impacted affordability, especially for low- and middle-income users. This rise in electricity tariff has been carried out to lessen the huge loss of the BPDB over the years owing to faulty pricing for purchasing electricity from IPPs, capacity payment, creating excess generation capacity, etc. The consumers have to take the burden of these faulty activities.

Despite capacity growth, Bangladesh’s electricity sector continues to face a growing gap between demand and reliable supply, underscoring the need for fuel diversification, pricing reform, and investment in transmission and distribution.

Petroleum fuels. Petroleum fuels such as diesel, petrol, octane, and kerosene are central to Bangladesh’s transport, agriculture, and energy backup needs. Unlike electricity or natural gas, these fuels are entirely imported, making their availability and affordability sensitive to global price volatility and exchange rate fluctuations. Since mid-2022, international market shocks combined with domestic price adjustments have significantly impacted fuel consumption patterns across sectors.

Over the last five years, fuel consumption initially increased across all four fuel types but saw a notable decline in FY2024. Diesel, the most consumed fuel, dropped by 14 per cent, from 4.94 million metric tons in FY2023 to 4.24 million metric tons in FY2024. Petrol and octane also declined by 5.2 per cent and 2.1 per cent, respectively, while kerosene consumption fell by nearly 10 per cent. This reversal reflects both high domestic prices and weakened purchasing power, especially among low-income and informal sector users.

These consumption drops occurred alongside persistently high fuel prices. Between June 2024 and May 2025, prices remained elevated, with diesel and kerosene fluctuating between BDT 104–108 per litre, petrol between BDT 121–127, and octane from BDT 125–131. Although these prices are marginally lower than the August 2022 peak, they remain high by historical standards, maintaining pressure on households, transport services, and farming operations (BPC, Local Selling Price of Petroleum Products, 2025). Although the BPC is supposed to follow automated pricing formula considering the global price, there is little reflection of it in retail pricing and consumers face the burden of a higher price.

The impacts of these high fuel prices have been felt across sectors. In transport, bus and freight services have reduced operations or raised fares, triggering public dissatisfaction and reduced mobility, especially in rural and peri-urban areas. Informal operators such as autorickshaws and motorbike ride-share drivers reported income losses due to low passenger demand and high fuel costs. In agriculture, diesel price increases raised irrigation costs by 20–30 per cent, particularly affecting boro season farmers reliant on shallow diesel pumps.

Industries have also suffered, especially during power outages, which forced many factories to switch to diesel-powered generators. This shift has significantly increased energy costs, particularly in energy-intensive sectors like textiles, steel, and ceramics. SMEs without captive or backup systems were hit harder, leading to production delays.
These underscore the vulnerability of Bangladesh’s petroleum fuel users to international market shocks. Without policy measures to improve fuel efficiency, stabilise prices, or protect lowincome users, such fuel price disruptions could continue to destabilise critical sectors in the future.

Inefficiencies and system loss: A core issue is inefficiency and mismanagement within the energy sector itself. Bangladesh suffers from gas system losses of 12–14 per cent, significantly higher than the international standard of 2 per cent. Each 1 per cent system loss is estimated to cost around Tk 800 billion. Despite this, institutional reforms have lagged, and there is little accountability or oversight to address wastage or corruption.

Fiscal planning has also been weak. In the current fiscal year, the Energy and Mineral Resources Division received a modest allocation of Tk 10.87 billion, of which only 10.4 per cent was spent in the first six months. While the government continues to prioritise imported LNG—having spent over Tk 1600 billion on imports from 2017 to 2023—investment in domestic gas exploration remains minimal. The state-owned BAPEX receives just Tk 10 billion annually. A recent tender for offshore oil and gas exploration failed to attract any foreign bidders, reflecting low investor confidence.

Meanwhile, energy subsidies remain substantial, approximately Tk 360 billion for electricity and Tk 200 billion for energy annually, in addition to Tk 60 billion spent on LNG imports. Yet these investments are undermined by systemic inefficiencies, poor governance, and a lack of competition in public procurement processes.
Bureaucratic inertia, political cronyism, and reliance on short-term import-based solutions are obstructing sustainable energy development.

Sectoral impacts of the energy crisis based on KIIs: The energy crisis in Bangladesh has had cascading effects across all layers of society and the economy. Beyond the macro-level gaps in supply and rising prices, the most critical disruptions are being experienced by end-users whose lives and livelihoods depend on affordable and stable access to electricity, gas, and fuel. The three most affected segments, households, industries, and the transportation sector, have undergone significant operational, behavioural, and financial adjustments to cope with the ongoing crisis. These user-level disruptions form the core of the current crisis and are expected to be further validated through the planned survey-based data collection.

Household sector. For households, the energy crisis has meant frequent and prolonged electricity outages, especially during peak hours and the summer season. In urban settings, families have experienced 1–4 hours of daily load shedding, while rural areas face even longer and less predictable outages. These interruptions have not only disrupted daily routines such as cooking, bathing, and studying but also created stress in maintaining access to digital services like mobile banking, online education, and remote work. In households with piped gas connections, low pressure has become a daily obstacle, especially during morning and evening hours. This has forced many families to shift to LPG cylinders as a substitute. However, LPG prices have surged, rising from Tk 900 to Tk 1,500 for a 12.5 kg cylinder between 2021 and 2023, causing an average monthly increase in cooking energy costs of Tk 500 to Tk 800 for many families.

The financial burden is further compounded by power outages, which have prompted middle and high-income families to invest in inverters, solar panels, or even diesel generators. However, these alternatives remain out of reach for poorer households, who are often left without any backup during outages. Consequently, low-income families have resorted to undercooking meals, using traditional fuels, or reducing energy use altogether. In addition to cooking and cooling, energy shortages have directly impacted education. Students are unable to charge devices, attend online classes, or study during evening hours due to power cuts. The energy crisis has also strained healthcare access, with refrigeration for medicines and the use of nebulisers or diagnostic equipment in homes being affected. Furthermore, inflation in transport and food prices—both driven by fuel costs has reduced household purchasing power, leading to a shift in consumption behaviour, where families are allocating more of their monthly budget to energy and less to education, nutrition, and healthcare.

Industrial sector. Loss in production and earning: Bangladesh’s industrial sector—particularly energy-intensive industries such as textiles, garments, cement, ceramics, and steel—has been severely affected by a prolonged and worsening energy crisis. These industries rely heavily on natural gas for process heating and captive power generation. However, due to declining domestic gas production and a policy preference to prioritise gas supply for power plants, industrial gas allocations have been frequently curtailed, often without sufficient notice. This has forced many factories to operate well below capacity or suspend operations altogether. Between 2021 and 2023, production in several key industrial zones dropped by an estimated 20–30 per cent during peak shortage periods. In recent months, the situation has further deteriorated, with many textile and garment factories operating at only 40–50 per cent capacity. Output in yarn, fabric, and garments has declined sharply, and nearly half of the textile factories have reportedly shut down. As a stopgap, large industries have turned to diesel generators, but with diesel prices exceeding Tk 104 per litre, the cost of self-generated power is three to four times higher than that of grid electricity.

This has significantly driven up production costs and negatively impacted their earnings. Small and medium enterprises (SMEs) have suffered even more. Lacking the capital to purchase backup generators or absorb price shocks, many SMEs, especially in plastics, agro-processing, and light engineering, have faced declining output, order cancellations, and missed delivery deadlines. Many have laid off contract workers or shifted to part-time operations.

Energy insecurity has also created hesitancy in new investments and delayed technology upgrades in manufacturing. In the garments and textiles sector, which accounts for over 80 per cent of Bangladesh’s exports, energy disruptions have led to shipment delays, resulting in financial penalties and reputational damage with international buyers. Even export processing zones (EPZs), once considered infrastructure reliable, have not been immune. Altogether, the unpredictability of energy supply is now considered one of the most pressing constraints to industrial productivity, expansion, and longterm competitiveness, especially when compared to regional competitors like Vietnam and India, who are offering more energy-secure environments for industrial investment.
Beyond the garments and SMEs, the broader industrial landscape has also suffered. Production in the steel industry has dropped by 25–30 per cent, while the ceramic industry has seen a decline of more than 50 per cent due to energy shortages.

Transportation sector. The transportation sector has experienced severe pressure due to fuel price volatility and shortages in compressed natural gas (CNG). Diesel, which powers most freight trucks, buses, and irrigation pumps, surged to Tk 108 per litre in 2024. This caused operating costs to increase by 15–25 per cent, leading logistics firms to reduce fleet use and pass costs to consumers through higher transport fares and commodity prices. Delays in goods delivery, particularly perishable agricultural product, have affected farm incomes and raised food prices in urban markets. Petrol prices, fluctuating between Tk 121 and 127 per litre, have likewise increased costs for private vehicle users and ride-sharing services, further reducing affordability for daily commuters CNG, once a cheaper and cleaner transport fuel, has faced erratic supply despite increased annual allocation. Long queues at CNG stations have become the norm, prompting many drivers to switch to petrol or diesel, thereby increasing their fuel costs by 25–30 per cent. Auto-rickshaw drivers and informal transport operators have reported a 30–40 per cent drop in daily earnings due to reduced trips, fuel switching, and rising costs. Public transport operators have raised fares, which disproportionately affect low-income commuters who rely on daily travel for work and education. App-based ride-hailing services have also seen driver dropout rates rise, with many citing poor fuel margins and reduced passenger demand as key reasons. These impacts have reduced transport availability, increased commuter costs, and introduced logistical inefficiencies that affect other sectors, including agriculture and retail distribution.
Policy recommendations: The energy situation in Bangladesh requires a comprehensive approach. First, it is important to diversify the energy sources. One method to overcome the domestic supply deficit is to expedite gas exploration, particularly offshore. On the other hand, promotion and scaling up of renewable energy sources, notably wind and solar, should be prioritised in order to reduce dependency on imports and fulfil at least 10 per cent of total electricity consumption by 2030.

Second, pricing adjustments should find a balance between fairness and efficiency. The establishment of an automated, transparent fuel pricing method will help with volatility management. Earlier, CPD investigated the pricing mechanism of BPC and BERC and found that the pricing could be reduced up to Tk15 per litre. MoEPMR should follow the scientific pricing mechanism in order to set the fuel and electricity prices.

Third, the infrastructure needs to be updated. Smart monitoring technology and grid upgrades are required to reduce transmission and distribution losses, which are now around 12 per cent.

To expedite the transition to clean transportation, the government should invest in EV charging infrastructure throughout the country, promoting concessional finance and public-private partnerships.

Industrial and business organisations are needed to ensure uninterrupted power and energy supply on a priority basis. In order to do this, the government should promote renewable energy as an alternative and provide fiscal incentives directly for adopting RE for using industrial sheds, rooftops, or fallow lands. Additionally, the MoEPMR must monitor this initiative and their billing amount for tracking usage records and provide incentives accordingly.
Finally, institutional reforms are needed. In order to manage fuel prices and tariffs independently, BERC needs to be strengthened. Petro Bangla, Power Division, and BPC need to collaborate to ensure integrated energy planning and rapid crisis response. Digitising energy data and making price and allocation more transparent will make policymaking more responsive.

Dr Fahmida Khatun, Executive Director, Centre for Policy Dialogue (CPD); Professor Mustafizur Rahman, Distinguished Fellow, CPD; Dr Khondaker Golam Moazzem, Research Director, CPD; Mr Muntaseer Kamal and Mr Syed Yusuf Saadat, Research Fellows, CPD.

[Abu Saleh Md Shamim Alam Shibly and Tamim Ahmed, Senior Research Associates; Afrin Mahbub, Preetilata Khondaker Huq, Anindita Islam, Md Mehadi Hasan Shamim, Nuzaira Zareen, Ayesha Suhaima Rab, Safrina Kamal, Khaled Al Faruque, Md. Imran Nazir, and Tanbin Alam Chowdhury, Programme Associates; and Syeda Safia Zahid, Research Intern of CPD provide research assistance.]​

 

[Saif]

Excessive dependence on LNG import is no solution

AN ACUTE gas crisis has severely affected industries and households in Dhaka and elsewhere. The supply of gas plummeted on May 29 after imported liquefied natural gas unloading had been suspended because of inclement weather. The power sector on May 27 received 941.3mmcfd of gas against the...

www.newagebd.net

Excessive dependence on LNG import is no solution
01 June, 2025, 00:00

AN ACUTE gas crisis has severely affected industries and households in Dhaka and elsewhere. The supply of gas plummeted on May 29 after imported liquefied natural gas unloading had been suspended because of inclement weather. The power sector on May 27 received 941.3mmcfd of gas against the demand for 2420.9mmcfd while the fertiliser sector received 119mmcfd against the demand for 329mmcfd. Recent Petrobangla data show a daily supply of around 2,692mmcfd against a demand for 4,000mmcfd. In the last quarter of 2024, the daily gas deficit was about 1.35 billion cubic feet, with industries receiving 30 per cent less gas than the demand. Four trade bodies in the apparel and ceramic sectors have recently said that operation in many factories has halved and that the situation could worsen after Eid-ul-Azha. Consumers are angered by the gas crisis because their energy bills soared, especially in the past few years, while the crisis worsened.

The current crisis is largely owed to flawed energy policy. Despite the potential of domestic gas reserves, the Awami League government prioritised liquefied natural gas import over exploration. Gas output has decreased, but the demand has grown, leading to the energy insecurity. An increased dependency on LNG import not only threatens the stability of the exchequer but also leaves Bangladesh at the mercy of other countries in a volatile geopolitical climate. In 2022, price increase on the LNG market led to a disastrous situation against the backdrop of the Russia-Ukraine war. Besides, LNG import has become difficult because of the dollar crisis. Only a third of the onshore area has, meanwhile, been explored for gas, making it one of the least explored nations although its success in gas discovery has been way above the world average. Energy experts fear that the situation will only worsen with increased demand for power in the high summer. While there is no quick-fix to the crisis, the government should consider scheduled, dedicated supply for different sectors and other short-term remedies.

The chronic dependence on liquefied natural gas import, coupled with depleting gas reserves, holds the economy hostage. The government should, therefore, urgently devise a solution to ensure adequate gas supply. For a long-term solution, it needs to revise the energy policy, prioritise domestic gas exploration and renewable options to stop further decline and to end people’s suffering.​

 

[Saif]

Govt to cut power generation cost by 10 pc

The interim government has planned to reduce the overall cost of power generation by 10 per cent. Finance adviser Salehuddin Ahmed unveiled the government’s plan in his recorded budget speech televised on Monday. “If this plan can be implemented, it is estimated that the cost of elect

thefinancialexpress.com.bd

Govt to cut power generation cost by 10 pc

FE ONLINE REPORT
Published :
Jun 02, 2025 19:40
Updated :
Jun 02, 2025 19:40

The interim government has planned to reduce the overall cost of power generation by 10 per cent.

Finance adviser Salehuddin Ahmed unveiled the government’s plan in his recorded budget speech televised on Monday.

“If this plan can be implemented, it is estimated that the cost of electricity subsidy of more than Tk 110 billion will be saved,” he said.

“In principle, we have decided not to increase the price of electricity for the time being in the context of the prevailing high inflation,” said Mr Ahmed.

At present, the amount of subsidies given in the power sector is about 1 per cent of gross domestic product (GDP), which is very high.

“We are reviewing the power purchase agreements and have taken the initiative to conduct energy audits to reduce the cost of power generation,” he elaborated in his speech.

A plan has been made to supply 648 million cubic feet per day (mmcfd) of gas from domestic sources within this year and to extract an additional 1500 mmcfd from local wells by 2028.

Keeping these targets in mind, emphasis has been laid on increasing the capacity of the local gas exploration company – Bangladesh Petroleum Exploration and Production Company Ltd (BAPEX) and necessary funds have been allocated for this, the finance adviser added.

It is very important to ensure an adequate supply of energy and at the same time keep it as affordable as possible to improve the quality of life of citizens and keep the economy running, he said.​

 

[Saif]

Govt commercialises power sector on WB, ADB prescriptions: CAB

The interim government appears to continue commercialising the country’s power and energy sector on the prescriptions of the World Bank and the Asian Development Bank, following the footsteps of successive governments, alleged the Consumers Association of Bangladesh on Wednesday...

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Govt commercialises power sector on WB, ADB prescriptions: CAB
PBS employees’ strike against discrimination continues
Staff Correspondent 05 June, 2025, 00:04

The interim government appears to continue commercialising the country’s power and energy sector on the prescriptions of the World Bank and the Asian Development Bank, following the footsteps of successive governments, alleged the Consumers Association of Bangladesh on Wednesday.

The consumer rights body came to the conclusion based on recent steps taken by the government, particularly in its response to resolving the conflict that prevailed between the Rural Electrification Board and its entity Palli Bidyut Samity for a while.

Taking its root in discrimination between employees of the institutions, the conflict also led to the demand that employees on contract or appointed on irregular basis be regularised.

Several thousand employees of the PBS offices in the country have been demonstrating on the Shaheed Minar premises in the capital Dhaka for about two weeks to press their various demands.

The committee that the interim government formed after coming to power in August 2024 recommended turning the PBS into a company as part of a structural reform.

‘The intention to turn the Palli Bidyut Samity into a company is to fulfil the target set by the World Bank and the Asian Development Bank to commercialise the power and energy sector and turn the sector into an import market,’ said M Shamsul Alam, energy adviser at the CAB, at a press conference at the Dhaka Reporters Unity in the capital.

There are 80 Palli Bidyut Samity offices operating under the Rural Electrification Board, supplying electricity to 80 per cent of villages in Bangladesh, a market of 3.60 crore people. Though appointed by the REB, the PBS employees are governed by a separate service rules, which the High Court found discriminatory.

About 40,000 employees of the PBS began their movement against discrimination past year when the authoritarian Awami League government was in power. The movement was suspended several times following promises from the past government that were never met. Instead, many of the PBS employees were terminated and framed in false cases.

After the interim government assumed power, the Power Division formed a committee in September past year to evaluate structural reforms of the PBS and the REB. The presentation the committee made on its recommendations on June 1, according to the CAB, effectively talked about turning the PBS into a company.

The evaluation committee did not have representation from consumers, the CAB said, while pointing out that the committee never disclosed identities of experts cited in its report.

The CAB rejected the committee’s report, accusing it of failing to recognise the impacts on rural consumers of the crisis of electricity and its frequent price hikes.

‘Accepting the recommendation of the committee will be like throwing consumers from a frying pan into a burning stove,’ said the CAB in a written statement read out by Shamsul Alam.

The PBS offices are mostly loss-incurring running on subsidies, the CAB said, while the REB is always making profits. Most of the subsidies, ranged between Tk 60,000 to Tk 70,000 crore, go to the PBS. The proposition that turning the PBS into a company will make it profitable and benefit the consumers does not make any sense to the CAB.

Like in other power entities, irregularities were rampant in purchases and tenders at the REB, the CAB alleged, adding that the rights body had to shelve its plan of probing corruption in the REB due to non-cooperation from the Power Division.

The power and energy sector has been under a reform initiative prescribed by the ADB and the WB in 1980s, the CAB said, adding that the target of the reforms was to privatise the sector.

The previous governments, including the past AL government, had turned the power and energy entities into companies in accordance with the WB, ADB prescriptions, the CAB said.

There are 75 companies under the power and energy ministry, the CAB said, all the companies are profitable and have surplus money. The companies invest the surplus money in fixed deposits and then lend from banks to run own operations. The companies make huge profits and have budget deficits at the same time.

Power price is increased to make up for the deficits, the CAB said, adding that turning the PBS into a company would increase its expenses, further raising its deficits.

Deficit is used by the government to justify reduced energy import, increase power price and import electricity. In 2023-24, power import capacity accounted for 9.34 per cent of the installed capacity of 27,824MW. But the actual import of power accounted for 18 per cent of the power consumed in the year.

‘Companies have a long history in this country,’ said Humayun Kabir Bhuiyan, general secretary of the CAB, at the press conference, recalling the exploitative nature of the colonial East India Company.​

 

[Saif]

Palli Bidyut Protest: Staff shortage sparks concerns over Eid power supply

Demonstrators' demands include removal of REB chairman, unified service rule

www.thedailystar.net

Palli Bidyut Protest: Staff shortage sparks concerns over Eid power supply
Demonstrators' demands include removal of REB chairman, unified service rule

File photo: Reuters

Power supply during the Eid-ul-Azha holidays may be disrupted in many rural areas as Palli Bidyut Samity (PBS) workers continue to protest, causing staff shortages in several offices across Bangladesh.

With the Eid vacation beginning today and many city dwellers travelling to their hometowns, officials from various PBSs say that they may not be able to ensure uninterrupted electricity due to a lack of line crews and technical staffers.

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Eighty PBSs distribute about 60 percent of the country's total power supply under the Bangladesh Rural Electrification Board (REB).

Employees from multiple zones have joined an ongoing demonstration at Dhaka's Central Shaheed Minar, demanding changes to service conditions.

The Daily Star has seen at least 10 letters from the chiefs of different PBSs to their superiors, stating that operations of power distribution may suffer during the holidays due to the lack of manpower.

"Most staffers from seven sub-zonal offices, 18 complaint centres, and 11 substations in Sunamganj have joined the Shaheed Minar demonstration, leaving only three to four linemen per office," wrote Milan Kumar Kundu, general manager of the Sunamganj Zonal Office, to a director of Bangladesh Power Development Board, which oversees the PBSs.

"It's becoming extremely difficult to keep substations running, respond to complaints, or maintain power lines with such limited manpower," he wrote.

Protesters under the banner of Bangladesh Palli Bidyut Association have been demonstrating over the past 15 days to realise their seven-point demand, including the removal of REB chairman, a unified service rule, withdrawal of cases filed by REB against dismissed employees, and their reinstatement.

Since the demonstrations started on May 21, various PBSs have been trying to carry out the linemen's work with day-to-day basis staffers.

According to GM Milan, the workers are also rushing for their holidays.

Customer dissatisfaction over power supply has been visible for several days, he said, adding that the staffers who live in the PBS complex are feeling insecurity and they sought help from law enforcers.

General managers from zonal offices in Rangpur, Manikganj, Jashore, Chattogram, and Sylhet said that they were also facing a manpower shortage, raising concerns about potential power service breakdown.

After a meeting with Power Division officials yesterday, the Palli Bidyut Association in a statement said their protest would continue until their seven-point demand is met.

Meanwhile, the Consumers Association of Bangladesh (CAB) yesterday called for a unified service rule for PBSs and REB to resolve the crisis.

The government is aggravating the issue by following advice from the World Bank and ADB without addressing the real problems, it said.

CAB Energy Adviser M Shamsul Alam said, "The root cause is the inequality and discrimination between REB and PBS staff."

Criticising the government's failure in resolving the issue, he said that commercialisation of rural electricity supply would not help solve the core problem.​

 

[Saif]

The untapped potential of wind power

Wind power, with its immense capacity to generate clean, renewable energy, remains underutilised in Bangladesh's energy strategy. However, recent developments signal a shift in direction. A major offshore wind project, still in its early stages, was announced at COP28 as a collaborative initiative

thefinancialexpress.com.bd

The untapped potential of wind power

Wasi Ahmed
Published :
Jun 11, 2025 00:51
Updated :
Jun 11, 2025 00:51
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Wind power, with its immense capacity to generate clean, renewable energy, remains underutilised in Bangladesh's energy strategy. However, recent developments signal a shift in direction. A major offshore wind project, still in its early stages, was announced at COP28 as a collaborative initiative involving fashion brands Bestseller and H&M Group, Copenhagen Infrastructure Partners (CIP), and a local partner. This ambitious project seeks to advance sustainable energy solutions and reduce greenhouse gas emissions along the fashion industry's value chain.

According to statements from the partners, the project aims not only to stabilise the supply of renewable energy to local apparel manufacturers linked to these global fashion giants but also to significantly cut emissions-by an estimated 725,000 tonnes annually. The fashion industry is a major contributor to global emissions, with more than 70 per cent arising from upstream power generation, which is still heavily reliant on non-renewable sources like coal, oil, and gas. This initiative envisions feeding energy generated from near-shore wind turbines to the national grid. With a projected capacity of 500 MW, the project aligns with Bangladesh's goal of reducing fossil fuel dependence, fostering job creation, and enhancing energy security.

More broadly, renewable energy sources such as wind and solar require greater attention. In the case of wind power, although initial installation costs are relatively higher, operational and maintenance expenses are much lower compared to traditional energy sources. Wind energy is harnessed from the natural movement of air caused by atmospheric pressure differences-an ancient concept that has been used for centuries. Wind results from uneven heating of the Earth's surface by the sun, influenced by rotation and geographical features. Warm air rises to form low-pressure zones, while cooler air creates high-pressure areas; air flows between these zones, producing what we experience as wind.

Humans have long used wind as a resource-from traditional windmills grinding grain and pumping water to today's sophisticated wind turbines. Unlike fossil fuels, wind is inexhaustible and does not pollute the environment. Wind turbines generate electricity without releasing carbon dioxide or other harmful pollutants, making wind power one of the cleanest and most sustainable energy sources available. This positions it as a key component in global efforts to combat climate change and reduce carbon footprints.

Globally, wind power has already proven its viability. Denmark leads by example, with wind turbines providing nearly half of its electricity needs. Germany, the United States, and China have also made significant investments in wind energy. China, in particular, has the highest installed wind power capacity, while the U.S. continues to expand its offshore and onshore wind infrastructure. These countries demonstrate the practical and economic feasibility of wind energy and offer models for nations like Bangladesh to follow.

However, wind power is not without challenges. A major concern is its intermittency-wind speeds can be unpredictable and vary by region and season. To counter this, countries are investing in advanced energy storage systems and smart grid technologies to ensure consistent electricity supply regardless of wind fluctuations.

Offshore wind farms present several advantages over land-based installations. Wind speeds over water are typically stronger and more consistent, yielding higher energy outputs. Offshore projects also alleviate land-use pressures, as they do not compete with agricultural or residential land. Additionally, placing turbines near coastal urban centres reduces the need for extensive transmission infrastructure. For nations with long coastlines and growing energy needs, offshore wind represents a particularly attractive solution.

Investing in wind power also brings significant economic benefits. The sector creates employment opportunities across multiple fields, including manufacturing, construction, maintenance, and research and development. As global demand for renewable energy rises, the wind industry can become a powerful engine for job creation and economic growth. Moreover, increased reliance on domestically generated renewable energy reduces exposure to volatile global fossil fuel markets, enhancing national energy independence.

The integration of wind with other renewable sources-such as solar and hydro-can further strengthen energy systems. Hybrid setups that combine different sources ensure a more stable electricity supply. For example, during times of low wind, solar power can help bridge the gap. Such hybrid approaches are crucial for building resilient and flexible energy infrastructures, especially in regions facing climate-related uncertainties.

In light of the climate crisis, the urgency of transitioning to renewable energy has never been clearer. Wind power offers a viable, scalable, and environmentally sound alternative to fossil fuels. For Bangladesh, which is vulnerable to the impacts of climate change, prioritising wind energy could have far-reaching benefits not just in reducing emissions but also in securing long-term energy sustainability.

To fully realise this potential, policymakers must act decisively. This includes facilitating investments in wind infrastructure, streamlining regulatory approvals, supporting research and development, and creating incentives for private sector participation. The success of wind energy depends on a collaborative effort between government, industry, and civil society to embrace innovation and sustainable growth.

However, for wind power to truly take root in the country's energy landscape, it must move beyond pilot projects and into the core of national energy planning. Only then can Bangladesh harness the full power of wind to build a cleaner, greener future.​

 

[Saif]

Energy ministry assessing model PSC for onshore blocks

The energy ministry is currently evaluating a draft Model Production Sharing Contract (MPSC) to launch an onshore bidding round after 28 years. State-run Petrobangla has already prepared the draft and submitted it to the Energy and Mineral Resources Division (EMRD) under the Ministry of Po

thefinancialexpress.com.bd

Energy ministry assessing model PSC for onshore blocks

M Azizur Rahman
Published :
Jun 11, 2025 01:01
Updated :
Jun 11, 2025 01:01

The energy ministry is currently evaluating a draft Model Production Sharing Contract (MPSC) to launch an onshore bidding round after 28 years.

State-run Petrobangla has already prepared the draft and submitted it to the Energy and Mineral Resources Division (EMRD) under the Ministry of Power, Energy and Mineral Resources (MPEMR) for approval, Petrobangla Chairman Md Rezanur Rahman told The Financial Express Wednesday (June 4).

He said the terms of the MPSC have been made attractive to potential international oil companies (IOCs) in line with the recommendations of global leading consultant Wood Mackenzie.

Mr Rahman disclosed neither the number of blocks to be offered for exploration by the IOCs nor the prices.

Sources said Petrobangla has moved to launch the onshore bidding round after nearly three decades to expedite hydrocarbon exploration in onshore areas, especially in hilly ones, to help meet the country's mounting natural gas demand in industries, power plants, and other gas-guzzling entities.

Under the MPSC, the gas purchase price is linked with the dated Brent on a three-month rolling average basis.

The MPSC terms of the previous 1997 onshore bidding round were linked to high sulphur fuel oil (HSFO) with a price floor and a ceiling.

"We are working on fixing the new formula so that the price could be linked to around 8.0 per cent of the dated Brent crude with a capping in the Brent crude price," said another Petrobangla official.

Based on the current Brent price assumption, gas price is anticipated to be in the range of around $5.0 per million British thermal units (MMBtu).

This would bring gas prices more in line with the costs of supplying gas from liquefied natural gas (LNG) imports, which Bangladesh is projected to increasingly rely on, should the country fail to make a turnaround in its domestic gas production.

If fixed under this market-based pricing formula, the new gas price for onshore blocks will be nearly double the highest current price offered under the existing MPSCs for onshore gas blocks.

The US-based Chevron is getting around $2.76 per MMBTu against its gas sales to Petrobangla, while Singapore's KrisEnergy receives around $2.31 per MMBTu under the current gas pricing formula linked to HSFO.

Petrobangla also purchases natural gas from three of its subsidiary state-owned companies.

It purchases gas from state-run Sylhet Gas Fields Ltd (SGFL) and Bangladesh Gas Fields Company Ltd (BGFCL) at Tk 28 per Mcf (1,000 cubic feet) and from state-run Bangladesh Petroleum Exploration and Production Company Ltd (BAPEX) at Tk 112 per Mcf.

The price of LNG imported from long-term contract suppliers - Qatar Energy and OQ Trading International - was $10.66 per MMBTu and $10.09 per MMBTu, respectively, until the first seven months of the current fiscal year.

Petrobangla is also working on narrowing down the differences in exploration benefits to attract the IOCs to take part in the next onshore bidding round.

It floated the last bidding round for 24 offshore blocks last year under the MPSC 2023 with no response from the IOCs.

Under the MPSC 2023, gas was priced at 10 per cent of the dated Brent on a three-month rolling average basis. Based on the current Brent price assumption, the gas price would be in the range of around $7.08 per MMBtu.

During Bangladesh's latest onshore bidding round in 1997, four onshore blocks - block-5, block-7, block-9, and block-10 - were awarded.

Currently, four IOCs have active PSCs, either individually or under joint venture, to explore three shallow-water blocks for offshore exploration.

Chevron is active in exploring and producing natural gas in three onshore gas fields under blocks 12, 13, and 14.

KrisEnergy is producing natural gas from the Bangora field under block 9.

ONGC Videsh Ltd (OVL) and Oil India Ltd (OIL) are jointly exploring shallow-water blocks SS-04 and SS-09.

Currently, Bangladesh imports lean LNG from RasGas of Qatar and Oman Trading International (OTI) of Oman under long-term contracts and from different suppliers under spot market terms to meet the mounting natural gas demand.

The country's overall gas output is around 2,883 mmcfd, including the re-gasified LNG, against the demand of over 4,000 mmcfd.​

 

[Saif]

No new gas connection to households, says energy adviser

Bangladesh interim government power, energy and mineral resources adviser Muhammad Fouzul Kabir Khan said on Friday that no new gas connections would be provided to households.

www.newagebd.net

No new gas connection to households, says energy adviser
Zaman Monir . Sylhet 13 June, 2025, 19:54

Muhammad Fouzul Kabir Khan | BSS file photo

Bangladesh interim government power, energy and mineral resources adviser Muhammad Fouzul Kabir Khan said on Friday that no new gas connections would be provided to households.

‘Even if we wait till doomsday, there is no possibility of providing gas connections to households,’ he said.

Fouzul Kabir came up with the comments while talking to journalists after visiting two gas wells at Golabganj upazila in Sylhet in the morning.

Stating that the pipeline gas is being wasted in households, he said that had he had the opportunity, he would have turned off the gas connections to all houses in Dhaka as well.

He added that providing gas to houses was a waste when industrial factories were not getting sufficient amount of gas.

‘The government, however, will supply gas cylinders at a low price in areas, including Sylhet, where gas is extracted and liquefied petroleum gas cylinders will be used in houses from now on,’ Fouzul said.

The production of about 200 million cubic feet gas is being decreased every year in the country, Fouzul Kabir said, adding that imports of liquefied natural gas, however, have increased.

‘So, efforts are being made to increase gas production to reduce imports,’ he said.

The adviser said that 16 million cubic feet of gas was being added to the national grid per day from the Kailashtila-7 and Sylhet-10 gas wells.

Fouzul Kabir inspected Well 7 at Kailashtila Gas Field in the Golabganj municipal area under the upazila, and the rig pad of Kailashtila Well 1 at around 10:00am.

Later, he also inspected the Kailashtila Molecular Sieve Turbo Plant under the same upazila.​

 

[Saif]

Govt to buy 2 more spot LNG cargoes in July to feed more gas to industries

The government is eyeing the import of two more spot liquefied natural gas (LNG) cargoes in July to supply more gas to industries and other commercial consumers, excluding power plants. State-run Rupantarita Prakritik Gas Company Ltd (RPGCL) has floated a couple of tenders to purchase two spot LNG

thefinancialexpress.com.bd

Govt to buy 2 more spot LNG cargoes in July to feed more gas to industries

FE Online Report
Published :
Jun 14, 2025 20:12
Updated :
Jun 14, 2025 20:12

The government is eyeing the import of two more spot liquefied natural gas (LNG) cargoes in July to supply more gas to industries and other commercial consumers, excluding power plants.

State-run Rupantarita Prakritik Gas Company Ltd (RPGCL) has floated a couple of tenders to purchase two spot LNG cargoes for the July 15–16 and 17–18 delivery windows, a senior RPGCL official told The Financial Express on Saturday.

The volume of each of the spot LNG cargoes is around 3.36 million British thermal units (MMBtu).

The bid winner will deliver the LNG cargo 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 located on Moheshkhali Island.

If this tender is successful, the country’s total purchase of spot LNG cargoes in early July will be five in total.

The country might seek to buy more spot LNG cargoes in late July, said the official.

Bangladesh has purchased three spot LNG cargoes for June deliveries.

RPGCL is a wholly owned subsidiary of state-run Petrobangla and oversees LNG trades in Bangladesh.

Bangladesh previously awarded its latest spot LNG cargo tender to POSCO International Corporation of South Korea for the July 11–12 delivery window at \$12.68 per MMBtu.

Officials said the interim government has been importing more spot LNG cargoes, as it has decided to import six additional LNG cargoes to supply an augmented volume of re-gasified natural gas to industries.

Gas supply to industries has already increased from early June with the import of additional spot LNG cargoes, a senior Petrobangla official said.

The government aims to increase around 250 million cubic feet per day (mmcfd) of gas to industries by ramping up spot LNG imports and diverting gas from power plants to industries.

According to the Ministry of Power, Energy and Mineral Resources (MPEMR), average gas supply to industries during the first four months of 2025 until April was 997 mmcfd, compared to 823 mmcfd during the same period of the previous year.

The government will have to provide a subsidy worth around Tk 35 per cubic meter for importing the additional LNG cargoes for industries, the MPEMR said.

The import cost of the LNG would be Tk 65 per cubic meter, while its selling price would be Tk 30 for new industries and Tk 31.50 for captive power plants.

State-run Petrobangla has planned to reduce natural gas allocations for gas-fired power plants to 1,050 mmcfd from the existing 1,200 mmcfd.

Bangladesh currently imports LNG from Qatar Energy and OQ Trading International under long-term deals and also purchases LNG from the spot market to re-gasify it in its two operational floating, storage and re-gasification units (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 sectors to cope with the mounting demand.​

 

[Saif]

Investing in energy future

BANGLADESH stands at a crossroads. On the one hand, it faces intensifying climate risks, mounting fuel import costs and increasing energy demand; on the other, it has the opportunity to shape a more sustainable and resilient energy future. The national budget for the 2025-26 financial year...

www.newagebd.net

RENEWABLE ENERGY TRANSITION
Investing in energy future
Musharraf Tansen 15 June, 2025, 00:00

BANGLADESH stands at a crossroads. On the one hand, it faces intensifying climate risks, mounting fuel import costs and increasing energy demand; on the other, it has the opportunity to shape a more sustainable and resilient energy future. The national budget for the 2025-26 financial year, recently unveiled, provides a timely lens through which to assess how seriously the country is preparing for a renewable energy transition. While there have been institutional efforts — notably the government’s move to update the Renewable Energy Policy 2008 to make it more relevant to the current context — the fiscal strategy laid out in this year’s budget does not reflect a proportionate commitment to the renewable energy agenda.

Current allocation

IN THE previous financial year (2024–25), the government had made a modest yet symbolically important allocation of Tk 100 crore (approximately $10 million) to establish a renewable energy fund. This was widely interpreted as a recognition that a transition to clean energy is not just desirable but necessary. Unfortunately, in the 2025–26 financial year budget, there is no mention of any continued or enhanced funding for this renewable energy fund, signalling a retreat rather than progress.

Instead, the broader energy and mineral resources division received a total allocation of Tk 2,178 crore — up from Tk 1,086 crore in the previous budget (which was later revised downward to Tk 1,053 crore). While the increased budgetary allocation may appear encouraging on the surface, it lacks any dedicated or earmarked fund for renewable energy development. In other words, there is no clear indication that any portion of this increased allocation is targeted towards achieving the country’s stated renewable energy goals.

This omission is glaring, particularly when viewed against the targets outlined in the Integrated Energy and Power Master Plan, which aims to generate 40 per cent of Bangladesh’s electricity from renewable sources by 2041. According to the plan, meeting this target would require a cumulative investment of approximately $37.4 billion to install 37.8GW of renewable energy capacity by 2050. The previous Tk 100 crore allocation, although symbolic, covered less than 0.03 per cent of the estimated investment requirement. The disappearance of even that symbolic commitment in the current fiscal year raises serious concerns about the country’s policy coherence and long-term strategy.

In the absence of sustained and scaled-up investments, policy reforms and clear budgetary commitment, the country risks falling behind its own renewable energy road map. Simply put, Bangladesh cannot afford to allow renewable energy to remain an afterthought in its national budgeting priorities — not when the stakes are this high.

More broadly, the energy sector budget continues to be skewed in favour of fossil fuels. A significant portion is still devoted to liquefied natural gas subsidies, diesel-based generation and capacity payments for idle fossil fuel plants. These priorities undermine the broader goal of transitioning to clean energy. At a time when global energy prices are volatile and the fiscal pressure from energy imports is growing, this approach risks deepening Bangladesh’s economic vulnerability.

Despite policy statements advocating for renewable expansion, the budget does little to shift the energy paradigm. There is no substantial provision for retiring outdated oil-based generation capacity. Neither is there a dedicated allocation to support the development of utility-scale solar or wind projects, or to build the necessary transmission infrastructure to integrate intermittent renewable sources into the national grid.

Barriers beyond budgets

BEYOND financial allocation, Bangladesh faces several structural and regulatory barriers to renewable energy development. While some incentives exist — such as tax holidays for solar equipment imports and duty reductions on key components — these have not been sufficient to spur large-scale private investment. Land acquisition remains a major obstacle, as does the lack of grid connectivity in remote or suitable locations for renewable projects.

Policy inconsistency further hampers progress. The Renewable Energy Policy of 2008 is outdated and lacks enforcement mechanisms. Tender processes are often delayed or cancelled, creating uncertainty for investors. Moreover, there is limited coordination between different government agencies, which slows down project approvals and implementation. Even when policies are in place, weak institutional capacity at both national and local levels constrains effective execution.

Bangladesh’s continued reliance on imported fossil fuels also acts as a structural impediment. In the 2023-24 financial year, the government spent billions on energy imports, which exacerbated the trade deficit and drained foreign exchange reserves. Instead of reallocating these funds to build domestic renewable capacity, the 2025–26 financial year budget continues this dependency, with more than Tk 7,000 crore proposed for subsidies on liquefied natural gas alone. This not only distorts market signals but also undercuts the competitiveness of renewables.

Green shoots

DESPITE these challenges, there are positive developments that suggest a shift, albeit gradual, is underway. The operation of a 60 MW wind power plant in Cox’s Bazar marks a significant milestone, being the country’s first major commercial wind project. Similarly, a 500 MW solar tender is currently in progress, aimed at integrating large-scale solar generation into the national grid.

Institutions like the Sustainable and Renewable Energy Development Authority and the Renewable Energy Research Centre in the University of Dhaka are contributing to the policy and research landscape. Their efforts in energy auditing, project feasibility assessments and capacity building are laying the groundwork for future growth. The newly announced Tk 100 crore renewable energy fund, while modest, indicates an institutional willingness to explore alternative financing mechanisms.

There are also encouraging signs in the private sector. Several local companies are investing in rooftop solar for industrial use, spurred by rising electricity tariffs and unreliable grid supply. Bangladesh has also seen a proliferation of solar irrigation systems in rural areas, supported by donor funding and government facilitation. These decentralised renewable energy solutions are critical for ensuring energy access in off-grid areas and reducing pressure on the national grid.

Recommendations

BANGLADESH must rethink its budgetary and policy approach to turn these green shoots into a robust forest of clean energy. Here are majore recommendations:

Scaled up targeted investment: The government should commit to allocating at least Tk 1,000 crore annually to renewable energy development. This funding should prioritise utility-scale solar and wind projects, battery storage, and smart grid technologies. Special attention should be given to scaling solar irrigation and mini-grid solutions for off-grid communities. Such targeted investments will yield both environmental and economic returns.

Financial market integration: Bangladesh must develop financial instruments to mobilise private capital. Green bonds, blended finance, and viability gap funding can reduce risks for investors. The central bank can play a role by issuing refinancing schemes for renewable projects. Local banks and non-bank financial institutions should be equipped with tools and incentives to lend to green energy ventures.

Fixing policy inconsistency: A new Renewable Energy Act is urgently needed to replace the outdated 2008 policy. This act should mandate clear targets, streamline approval processes, and ensure regulatory certainty. Transparent and timely tender processes must become the norm. Government agencies should coordinate better to ensure smooth implementation.

Redirecting fossil subsidies: The government should gradually phase out fossil fuel subsidies and reallocate these funds to clean energy development. A portion of the liquefied natural gass subsidy budget can be redirected to support renewable energy research and development, grid modernisation, and capacity building. This reallocation will not only reduce fiscal pressure but also level the playing field for renewables.

Advancing enabling infrastructure: A modern, flexible grid is essential for integrating renewable energy. Investments in transmission and distribution infrastructure must go hand-in-hand with renewable deployment. Net metering should be simplified and expanded. Technical standards for grid connection should be clearly defined to avoid project delays.

The 2025–26 budget marks a cautious step towards renewable energy development in Bangladesh. While the creation of a renewable energy fund is a move in the right direction, the overall allocation and strategic direction remain insufficient for a transformative shift. The continued emphasis on fossil fuel subsidies and lack of systemic support for renewables highlight the need for a more coherent and ambitious approach.

The transition to clean energy is not just an environmental imperative but an economic necessity. It is about reducing dependence on volatile global markets, creating green jobs, and ensuring energy security for future generations. Bangladesh has the technical capacity, entrepreneurial spirit, and policy frameworks to lead in South Asia’s green transition. What it needs now is the political will, financial commitment, and policy coherence to realise that potential.

The time for incremental change is over. The budget for the 2025–26 financial year should be seen as a foundation — but the real work lies ahead. Bangladesh must act boldly, invest wisely and lead decisively in building a resilient, inclusive and sustainable energy future.

Musharraf Tansen is a PhD Researcher and former Country Representative of the Malala Fund.​

 

[Saif]

Bangladesh’s energy policy raises more questions than answers

The recent announcement to build a new coal-fired power plant to generate cheaper electricity than oil-fired peaking plants further highlights the lack of policy coherence.

www.thedailystar.net

Bangladesh’s energy policy raises more questions than answers

The sudden shift to competitive bidding and the suspension of more than 30 renewable energy projects have cost developers dearly. FILE VISUAL: ALIZA RAHMAN

The government's approval of a new renewable energy policy, which sets higher targets of 20 percent and 30 percent electricity generation from renewables by 2030 and 2041 respectively, is a welcome step towards advancing the energy transition. However, despite these enhanced commitments, a lack of support mechanisms and persistent policy inconsistencies continue to hinder progress in the renewable energy sector.

While the national budget for fiscal year (FY) 2025–26, unveiled on June 2, articulates an ambitious vision of building a society based on "three zeroes"—zero poverty, zero unemployment, and zero net carbon emissions—it fails to offer incentives for the private sector to scale up renewable energy deployment.

In parallel, the government has made sweeping changes to the energy and power sectors. It repealed the Quick Enhancement of Electricity and Energy Supply Act (QEEESA) 2010, which previously allowed unsolicited project proposals without competitive bidding. It has also suspended renewable energy projects that had received Letters of Intent (LOIs) under QEEESA before August 2024. Additionally, the government floated four tender packages for renewable energy projects totalling over 5,000 megawatts (MW) in capacity but removed the payment guarantee clause. Such abrupt policy shifts raise serious concerns for investors.

The recent announcement to build a new coal-fired power plant to generate cheaper electricity than oil-fired peaking plants further highlights the lack of policy coherence. A baseload coal plant is unlikely to reduce the share of oil-fired generation and may instead exacerbate the sector's overcapacity, especially amid sluggish power demand growth.

Proposed budget fails to incentivise renewable energy

While solar power can reduce reliance on expensive oil-based generation, the proposed FY2025–26 budget does not include any incentives to promote solar or other renewable technologies. It also excludes the Tk 100 crore ($8.2 million) in renewable energy funding that was allocated in the previous year's budget. This disconnect between the government's stated ambitions and actual fiscal measures undermines momentum in the renewable energy space.

Abrupt policy changes dent investor confidence

The sudden shift to competitive bidding and the suspension of more than 30 renewable energy projects have cost developers dearly, as many had already invested substantial time and resources in land acquisition.

Furthermore, the exclusion of an "implementation agreement clause"—a provision akin to a payment guarantee—from the tender documents has negatively affected project bankability. Developers may now struggle to secure debt financing. The issue is already visible: Bangladesh failed to attract bidders for the first tender package of 12 projects totalling 453 MW, leading the government to extend the submission deadline six times.

Although 20 local companies ultimately submitted proposals, no foreign firms participated. This lack of foreign interest signals serious challenges for Bangladesh in achieving its 6,145 MW renewable energy target by 2030. Reaching this goal would require annual capacity additions of around 750 MW between July 2025 and December 2030. With the country's current renewable energy capacity at 1,562 MW—and only 400 MW of utility-scale projects under construction—domestic capital alone will not suffice. Foreign investment, along with support from multilateral and bilateral development partners, will be critical.

In June 2021, Bangladesh scrapped 10 coal-fired power projects due to concerns over excess capacity and the growing difficulty of securing funding, especially from institutions focused on environmental, social, and governance (ESG) criteria. The move was also presented as part of the country's enhanced greenhouse gas (GHG) mitigation efforts, raising hopes for an accelerated renewable energy transition.

Fast forward to June 2025: the current government is now reconsidering one of the scrapped plants and plans to build a 1,200 MW coal-fired power plant in Matarbari, next to an existing plant. Although the rationale is to generate cheaper electricity compared to oil-based generation, this logic appears short-sighted.

Bangladesh's peak electricity demand declined by around 1.1 percent in 2025 compared to 2024—falling from 17,200 MW to 16,999 MW. With more than 7,000 MW of baseload capacity already under construction, adding another coal plant will only worsen the country's reserve margin, which currently stands at around 61 percent. This surplus will further strain the power sector's finances as capacity payment obligations rise in the absence of sufficient demand.

The decision also contradicts the GHG mitigation pledge made in 2021 and risks damaging Bangladesh's credibility in the eyes of investors and development partners.

As the government finalises the FY2025–26 budget, it should reconsider introducing a dedicated renewable energy fund and reinstating the Tk 100 crore allocation. It should also waive import duties on components used in rooftop solar systems.

Achieving Bangladesh's renewable energy targets will require not only sustained fiscal support but also a stable and predictable policy environment. Avoiding abrupt policy reversals is essential to attract long-term domestic and foreign investment.

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

 

[Saif]

Govt releases big sum to pay off private power plant dues

A clean chit up to April on huge leftover arrears cost Tk 600 billion as the interim government doubled the state subsidy to pay off the overdue bills to private-sector power producers, officials said. In order to clear all the much-talked-about capacity charges and electricity bills, the governme

thefinancialexpress.com.bd

Govt releases big sum to pay off private power plant dues
Clean chit claims Tk620b in state subsidy in revised budget

FHM Humayan Kabir
Published :
Jun 21, 2025 10:07
Updated :
Jun 21, 2025 10:07

A clean chit up to April on huge leftover arrears cost Tk 600 billion as the interim government doubled the state subsidy to pay off the overdue bills to private-sector power producers, officials said.

In order to clear all the much-talked-about capacity charges and electricity bills, the government already jacked up the power-sector subsidy to Tk 620 billion from Tk 360-billion allocations in the original budget for the outgoing fiscal year (FY) 2024-25, they said Friday.

"We have so far released nearly Tk600 billion worth of funds as power subsidy to pay the arrears to the private-sector rental and independent power producers (IPPs)," says a Ministry of Finance (MoF) official.

"After getting bill of the remaining two months of the current fiscal year (FY) 2024-25, we will provide the remaining arrears shortly," he adds about the contingencies aimed at averting any major power breakdowns.

As a matter of set practice, after getting power-supply and other bills from the Bangladesh Power Development Board (BPDB), the MoF usually scrutinises those and then releases the necessary funds.

A hefty sum of subsidy in the revised budget has given a big respite to Bangladesh government as it has already paid a good amount of overdue bills to the private power producers, officials said.

All 133 private and public-sector power stations across Bangladesh have a combined generation capacity of nearly 20,697 megawatts a day. Out of the total, 78 private-sector power plants has a production capacity of nearly 8,778mws a day.

Besides, BPDB imports 1,160mw power from India where Adani power station from Jharkhand alone supplies nearly 750 megawatts a day.

Finance ministry and power division officials said the government would be paying all the arrears and dues to the IPPs and rental power plants gradually by next FY2026.

The interim administration of Prof Muhammad Yunus has decided to repay off the outstanding capacity charges, power-purchase bills and other liabilities to the local and foreign IPPs and rental electricity producers.

Among the producers are Indian Adani Power, Bangladesh-China Power Company Plant (Payra power plant), Meghnaghat 450mw Power Ltd, 210mw Rural Power Co Ltd, 335mw Summit-Meghnaghat Power Ltd and 414mw Sembcorp NWPC Ltd, 145mw Aggreko International Projects, United Power and Doreen Power.

The bills of the rental power plants and IPPs are paid from BPDB's income and the subsidies provided by the MoF.

However, the bills for imported electricity from Adani and other Indian power plants are paid from BPDB's own income.

About the massive Tk620-billion allocation for the power subsidy in the current revised budget, the MoF official says: "We are paying the arrears every month to the private power-plant owners. But the arrears are comparatively higher than our monthly payments. So, we will allocate a higher amount of money in the revised national budget for the current FY2025."

From the next FY, power division would slash the subsidy on power sector drastically and try to ensure loss-free supply within next few years, says the official.

The government in the newly placed national budget has proposed a Tk 370-billion fund as power subsidy for the upcoming FY2026.

Bangladesh purchases power at higher rates from the costly IPPs and the rental-power producers and sells to the consumers at lower rates by way of subsidizing the distribution.

Another MoF official says Bangladesh wants to be a liability-free country to the IPPs and private-sector power plants from the next fiscal year as it has agreed with the International Monetary Fund (IMF) for getting its financial support.

In the last FY2024 revised budget, the government allocated Tk 394.06 billion in subsidy for the power sector.

Data from MoF, BPDB and a non-government research organisation show a total of Tk 783.7 billion had been paid as capacity charges since 2018-19 till 2022-23.

Some Tk 62.41 billion was paid in FY2019, Tk 89.29 billion in 2020, Tk 132 billion in 2021, Tk 240 billion in 2022 and Tk 260 billion paid in FY2023 as capacity charges for private-and rental-power plants.

Such huge capacity payments to IPPs and rentals have become a big burden for the government while struggling with emaciated foreign-exchange reserves and rising external debts.

Banks can ill afford to provide dollars for repayment of dues of the foreign companies in the power and energy sector. The country had forex reserves worth over US$48.0 billion two years back, which depleted to $22 billion in recent days.

Usually, the state-run power board sells electricity to consumers at rates lower than it purchases from the IPPs and the gap needs to be made up with state subsidies.

Most of the IPPs and rental-power plants are HFO- or diesel-based ones which is costly for generating electricity.

The BPDB purchases the electricity from the private-sector plants at costs that vary from Tk 14 to Tk 26 per kilowatt hour (kwh) for feeding into the national grid.

On the other hand, the average retail price of electricity the consumers pay is some Tk 8.95 per unit and the average bulk electricity tariff is Tk 7.04 per unit.​

 

[Saif]

Power outage hits parts of Dhaka due to Rampura substation malfunction

A major power outage affected several areas of Dhaka on Sunday night following a mechanical failure at the Rampura substation, causing widespread inconvenience to residents, according to local media. Md Shamim Hasan, Director of the Public Relations Department of the Bangladesh Power Development B

thefinancialexpress.com.bd

Power outage hits parts of Dhaka due to Rampura substation malfunction

FE ONLINE DESK
Published :
Jun 22, 2025 23:26
Updated :
Jun 22, 2025 23:26

A major power outage affected several areas of Dhaka on Sunday night following a mechanical failure at the Rampura substation, causing widespread inconvenience to residents, according to local media.

Md Shamim Hasan, Director of the Public Relations Department of the Bangladesh Power Development Board (BPDB), confirmed the matter to Jago News. He said the disruption occurred at around 9:30 PM due to a technical fault in the 230/132 KV grid line connected to the national grid via Rampura substation. Repair work is underway, and normal supply is expected to resume between midnight and 12:30 AM.

Due to the sudden malfunction, electricity supply was cut off in areas including Banani and Moghbazar for several hours. Later in the night, around 10:30 PM, parts of Azimpur and New Market also experienced blackouts.​

 

[Saif]

Diversifying energy sources, export markets

Though price of oil in the global market has not so far gone through the roof since Israel's June 13 attack on Iran followed by the latter's retaliatory missile and drone strikes, there is no guarantee that it will remain so in the coming days. It's already unstable. Overall, the price of cru

thefinancialexpress.com.bd

Diversifying energy sources, export markets

SYED FATTAHUL ALIM
Published :
Jun 23, 2025 01:13
Updated :
Jun 23, 2025 01:13

Though price of oil in the global market has not so far gone through the roof since Israel's June 13 attack on Iran followed by the latter's retaliatory missile and drone strikes, there is no guarantee that it will remain so in the coming days. It's already unstable. Overall, the price of crude oil rose by 4.0 per cent over the week. But in case, the conflict spirals out of control and Iran blocks the Strait of Hormuz, it is hard to say where it would finally end up. If the US enters the scene and starts a bombing campaign on Iran to what it says destroy Iran's nuclear facilities and Iran blocks the Strait of Hormuz in retaliation, the oil price may even shoot up to US$150 a barrel, some experts fear. In that case, countries that depend completely on imported energy including oil and Liquefied Natural Gas (LNG) are going to be at the receiving end. Definitely, Bangladesh with its economy trying hard to recover from the ashes it had been reduced to during the long period of autocracy till August last year, will find it real hard to stand on its feet again. In this connection, the Power, Energy and Mineral Resources Adviser Muhammad Fouzul Kabir told the media some days back, when the tension in the region was escalating, that though Bangladesh was in a vulnerable position as its energy security is dependent on imports, there is no question that the country would be 'in trouble'. However, he still believed that the situation (relating to Iran-Israel conflict) would not go out of control. Even if the price of oil increases by Tk 18 to Tk 20 per litre, the economy would be able to 'absorb the shock', he assured. Clearly, the reason for his relative calm about the country's energy security in the face of any flare-up between the two arch enemies in the Middle East is that Bangladesh earlier in May purchased oil for consumption in the June-July period.

However, the latest developments in the Middle East, to all appearances, show no reason to be complacent. The ongoing strikes and counterstrikes on each other's strategic infrastructures point to something more sinister in the making than one would like to believe. For the US and its Western allies are solidly behind Israel and they would protect Israel at all costs. Here lies the crux of the matter. This is a do or die situation. The oil rich Gulf Arab States lie at the epicentre of the conflict and are the prime target of either party in the war. If oil and natural gas infrastructures of the Gulf region are attacked by either party, energy supply in the entire world will be disrupted for an indefinite period. How does Bangladesh, an energy-starved nation, hope to survive for long in such a situation? Smooth and dependable supply of fossil energy is still the backbone of the world economy. The six months' oil deal from July to December that Bangladesh has reached with its suppliers in the Gulf, is not enough to protect us indefinitely. To be frank, given the volatile political situation in the oil producing region of the Middle East, which is not improving but worsening by the day, Bangladesh's dependence on this region for its energy supply in the long term cannot be a viable option. Had the leadership of the country been forward-looking, the country would meanwhile have developed its alternative sources of energy long since. The 'If-not' approach to energy issue when its source of supply is the Gulf countries, or the diplomatic language that 'we would be monitoring the market' situation' is no sustainable positions to make when it is a question of survival of the economy. It is also not purely about energy supply. We have to be mindful also of the fact that a major source of the country's hard currency in the form of remittance comes from the migrant workers, who are basically unskilled, staying in the Muddle East. If the entire Gulf region is embroiled in a protracted conflict, the migrant workers will become the first victim of the development. Hundreds of thousands of migrant workers would then return home. That would create an added burden on the economy until an alternative destination for their employment is found. As it is with the mainstay of the country's export, the other major source of foreign exchange, which is dependent on a single type of commodity, the apparel products, so is it with the energy source. It's a one-road to the nation's energy security and foreign exchange earning. Experts including Professor Mustafizur Rahman, a distinguished fellow of a local think tank, the Centre for Policy Dialogue (CPD), held that oil price surge in the global market would leave a very negative impact on the trade balance and current account balance in the eventuality of a sustained after-effect of the energy price escalation. The shipping routes for trade of energy and other vital commodities in the Persian Gulf, the Gulf of Aden, the Red Sea and the Mediterranean Sea if severely disrupted, costs of import and export would escalate. Bangladesh is a nation heavily dependent on import of its energy, industrial raw materials and food. The country's export, too, depends on the undisturbed shipping routes through the international waters. But Bangladesh with its present level of forex reserves can hardly foot the bill for about four months' import. That means, it cannot sustain for long once import costs of its vital supplies rocket up and remain so indefinitely. However, economies with sound reserves or developed industrial base can sustain longer in that situation. Obviously, Bangladesh does not fall in that category.

The maritime routes, especially in the Red Sea, the Gulf of Aden and the Mediterranean have been facing uncertainties since the Houthi rebels of Yemen started their attacks on merchant or military vessels friendly to Israel since October 2023. But politicians in power then and now have remained clueless or too engaged otherwise to prepare the nation for such an emergency. In fact, no excuse is enough to justify the failures to take early steps to meet such existential emergencies.

The interim government should look for alternative sources of oil and LNG in other parts of the world, preferably in the East, that are not as dicey as the Middle East. Such steps are also required for its exports and markets for migrant workers.​

 

[Saif]

RAMPAL POWER PLANT: HC questions Indians’ hefty salary, bonus

The High Court on Monday issued a rule asking the government to explain in four weeks why the continued dominance of foreign employees at the Bangladesh-India Friendship Power Company Ltd, widely known as Rampal Power Plant, and the discriminatory pay structure between...

www.newagebd.net

RAMPAL POWER PLANT: HC questions Indians’ hefty salary, bonus
M Moneruzzaman 23 June, 2025, 23:46

The High Court on Monday issued a rule asking the government to explain in four weeks why the continued dominance of foreign employees at the Bangladesh-India Friendship Power Company Ltd, widely known as Rampal Power Plant, and the discriminatory pay structure between Indian and Bangladeshi employees should not be declared illegal.

The bench of Justice Md Akram Hossain Chowdhury and Justice Foyej Ahmed issued the rule after hearing a public interest writ petition filed by Supreme Court lawyer Md Salequzzaman Sagor.

The court questioned why the BIFPCL had failed to reduce the number of foreign employees, mostly seconded from India’s National Thermal Power Company Ltd, to 10 as required by its Human Resources Policy 2018.

The secretary to the Ministry of Power, Energy and Mineral Resources, Bangladesh Power Development Board’s chair, and Bangladesh-India Friendship Power Company’s chair, among other respondents, were asked to reply to the rule in four weeks.

Currently, 51 Indian employees are reportedly working at the plant while the number should have been cut to 10 in 2024.

According to the writ petition, each Indian official receives approximately $4,500 extra in foreign currency per month in addition to high salaries and other benefits, but local employees are paid significantly lower amounts.

This disparity not only drains Bangladesh’s foreign reserves but also violates principles of fair employment, the petition argued.

The court also asked the authorities to explain why all key managerial and supervisory posts – including those of general manager, assistant general manager, chief financial officer, and project director – continued to be held by seconded Indian officials from the NTPC, sidelining qualified Bangladeshi recruits.

Petitioner Sagor, who moved the petition in person, said that the BIFPCL employed over 230 local professionals, including graduates from the Bangladesh University of Engineering and Technology, who were routinely denied opportunities for promotion and were subjected to discrimination.

He also claimed that most procurements were carried out through Indian vendors, despite the availability of suitable products on the local market, further putting pressure on Bangladesh’s foreign exchange reserves.

The lawyer submitted documents showing that the NTPC employees received additional bonuses and benefits not available to the Bangladeshi staff.

He urged the court to order an investigation into the matter and take legal action if any violation of the country’s laws was found.

He further alleged that local employees faced humiliation and religious discrimination in some cases, particularly under the previous administration, and called for the protection of the rights of the Bangladeshi employees working at the plant.

The petitioner, referring to newspaper reports, said that the Indian nationals working at the company were drawing an average monthly salary of more than Tk 10 lakh each, as revealed by a financial review under the Bangladesh Power Development Board.

An equally owned joint venture of the governments of India and Bangladesh, the BIFPC has 51 Indian nationals to run the 1,320MW coal-based power plant situated at Rampal in Bagerhat.

The Indian nationals working at the power plant came on deputation from their original employer NTPC Limited, an Indian public sector entity, said BPDB officials.

A comparison with another power generation joint venture revealed that the Indian nationals employed at the Rampal plant earned three times more than what their peers received, with some Indian nationals’ monthly salary being close to Tk 20 lakh.

On an occasion, a BPDB assessment showed, an Indian employee of the power plant drew Tk 47 lakh in one month, thanks to a bonus and other benefits, while most of his fellow nationals earned between Tk 20 lakh and Tk 30 lakh in that month.

The BPDB’s finance wing reviewed the Indian nationals’ payments in October last year, three months after a student-led uprising toppled the past Awami League regime.

Discontent was widespread against the past AL government for allowing India to exploit Bangladesh in trade and bilateral relations.

A review of the list of 306 people working at the BIFPC revealed that 32 of the top 40 positions are occupied by Indians.

Starting with the position of managing director, the position of project director, all nine positions of general manager, all 18 positions of assistant general manager, and 20 out of the 34 deputy general manager positions are held by Indian nationals.​

 

[Saif]

BD to require around US$1 bn annually until 2030 to renewable energy target

Bangladesh will require between US$933 million and US$980 million annually until 2030 to meet the new target under Renewable Energy Policy, a new report by the Institute of Energy Economics and Financial Analysis (IEEFA) revealed Wednesday. During the post-2030, the country will need between US$1.

thefinancialexpress.com.bd

BD to require around US$1 bn annually until 2030 to renewable energy target

FE ONLINE REPORT
Published :
Jun 25, 2025 20:22
Updated :
Jun 25, 2025 20:22

Bangladesh will require between US$933 million and US$980 million annually until 2030 to meet the new target under Renewable Energy Policy, a new report by the Institute of Energy Economics and Financial Analysis (IEEFA) revealed Wednesday.

During the post-2030, the country will need between US$1.37 billion and US$1.46 billion annually until 2040, the IEEFA report finds.

IEEFA is a global team of energy finance analysts, communications experts, and management professionals, based in Asia, Australia, Europe, North America, and South Asia.

Bangladesh government has set targets for generating 20 per cent and 30 per cent of electricity from renewable energy sources by 2030 and 2040, respectively, under the country’s new Renewable Energy Policy.

“Public finance alone is unlikely to meet these funding requirements, necessitating large-scale private investment,” says the report’s co-author, Shafiqul Alam, IEEFA’s lead energy analyst for Bangladesh.

However, abrupt policy changes, off-taker risk, technology and performance risk, weak project pipelines, a cumbersome loan disbursal process, land acquisition challenges, currency volatility, and lower sovereign rating limit private sector investment in the sector, the report noted.

By engaging with Multilateral Development Banks, international climate finance institutions and bilateral development financial institutions, the government can consider establishing a currency hedging fund to mitigate currency risk.

The current government has suspended 31 utility-scale renewable energy projects that received Letters of Intent through the non-competitive bidding process under the previous government. This sudden shift to competitive bidding and the resulting contractual uncertainties have left investors feeling disconcerted.

The report highlights that Bangladesh should ensure regulatory stability, restore investor guarantees, map and allocate land for projects, and build capacity in both the banking and service provider ecosystems to attract investment.

The report underscores the importance of reinstating the “project implementation clause” to dispel uncertainties over payment or establish a funding mechanism to provide revenue assurance to renewable energy producers, mitigating counterparty risks.

“Land acquisition challenges can be mitigated through the public-private partnership model, which can help mobilise investment in renewable energy projects through special economic zones,” the report suggests.

“In the case of small-scale renewable energy projects, their accelerated deployment will depend on addressing the high import duty on critical components, performance issues and perceived risks. Easing lending norms for green funds can also help scale up such projects,” says Labanya Prakash Jena, Sustainable Finance Consultant, IEEFA.

The report acknowledges the government’s positive move in reducing the customs duty on imported solar inverters and calls on the government to reduce the import duty on components of small-scale solar projects, such as solar panels, FRP walkway, mounting structure and DC cable.

It emphasises the importance of adopting a pre-finance modality of the Central Bank’s green funds to minimise delays and simplify disbursement.

Bangladesh’s low sovereign credit ratings also deter foreign investors. “Moody’s downgraded Bangladesh’s credit rating to B2 in November 2024 from B1 earlier, based on the country’s lower-than-expected economic growth in the near term, political challenges and banking sector risks. This has further deteriorated the country’s credit profile in the international financial market, making borrowing expensive,” notes Jena.

“The government, international organisations, financial institutions, private investors, and renewable energy companies should collaborate to create a conducive environment that fosters innovation, investment, and sustainable growth,” the report emphasises.​

 

[Saif]

Govt to import refined oils for July-Dec for Tk 10,006 crore

The advisory council commitee on government purchase in a meeting on Wednesday approved procurement of refined petroleum fuel oil from six countries at a cost of Tk 10,006.63 crore...

www.newagebd.net

Govt to import refined oils for July-Dec for Tk 10,006 crore
Staff Correspondent 25 June, 2025, 22:36

This representational image shows a cargo ship carrying liquefied natural gas. | BSS photo

The advisory council commitee on government purchase in a meeting on Wednesday approved procurement of refined petroleum fuel oil from six countries at a cost of Tk 10,006.63 crore.

The fuel from Thai Land, the United Arab Emirates, Indonesia, Malaysia, China and India will be consumed for the period of July-December of the current calendar year.

Additionally, the committee also approved importing 25,000 tonnes of octane to be supplied by PT Bumi Siak Pukako Zapin of Indonesia at Tk 208.63 crore and one cargo Liquefied Natural Gas to be supplied by Vitol Asia Pte Ltd of Singapore at Tk 269.029 crore.

Approvals were also given to import 1.05 lakh tonnes of chemical fertilizers -- muriate of potash, triple superphosphateIt and di ammonium phosphate — Canada, Tunesia and Morocco at 649.75 crore.

Besides, 50,000 tonnes of wheat will be importedfrom UAE following approval of a proposal involving Tk 168.82 crore.

Finance adviser who presided over the meeting expressed relief following the ceasefire to 12-day long berserk between Israel and Iran.

A widespread apprehension of closure of the Strait of Hormuz has been thwarted, he said, adding that the price of fuel oils did not increase heavily.

Despite a slight rise in global oil prices amid the tension over the war in Iran and Israel, energy affairs adviser Muhammad Fouzul Kabir Khan on Tuesday said they had no plan to raise fuel prices in the domestic market.

Although prices have risen slightly on the global market, fuel prices at home will remain unchanged. Adjustments will be made using BPC’s profits, added the adviser.​

 

[Saif]

CPD raises alarm over Bangladesh’s energy budget

Centre for Policy Dialogue (CPD) on Thursday raised serious concerns over Bangladesh’s proposed national budget for FY2025-26, warning that its fossil fuel-heavy focus threatens the country's clean energy transition and long-term sustainability. These observations were made during a dialogue

thefinancialexpress.com.bd

CPD raises alarm over Bangladesh’s energy budget

Published :
Jun 26, 2025 16:42
Updated :
Jun 26, 2025 16:42
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Centre for Policy Dialogue (CPD) on Thursday raised serious concerns over Bangladesh’s proposed national budget for FY2025-26, warning that its fossil fuel-heavy focus threatens the country's clean energy transition and long-term sustainability.

These observations were made during a dialogue titled ‘Power and Energy Sector in the National Budget for FY2025-26: Reflections on the Priorities for Energy Transition’, held at BRAC Centre Inn in Mohakhali, Dhaka, reports UNB.

Energy Adviser Muhammad Fouzul Kabir Khan joined it virtually as chief guest.

The panel included CAB’s Professor Dr M Shamsul Alam, Professor Badrul Imam of Dhaka University, BGMEA Vice President Barrister Vidiya Amrit Khan, energy expert Monower Mostafa and BKMEA Vice President Md Akhter Hossain Apurbo.

CPD’s latest analysis warned that the energy budget undermines the government’s Three Zeros pledge – Zero Poverty, Zero Emission and Zero Unemployment, particularly the Zero Emission goal.

It highlighted that without urgent reforms, Bangladesh may fall further behind in its energy transition.

The budget, placed on June 2 and approved on June 22, is titled “Building an Equitable and Sustainable Economic System.” But CPD said it contradicts that vision by prioritising fossil fuels over renewables.

Key Challenges Highlighted

The study, led by Dr Khondaker Golam Moazzem and his team, identified several critical issues:
​

• Persistent Financial Losses: BPDB continues to face losses despite subsidies and tariff revisions, while profits by BPC and RPGCL often come at consumers’ expense.​
• ​
• Rising Fiscal Burden: Power sector subsidies now account for 41% of the national total, with LNG import subsidies rising to Tk 9,000 crore for FY26.​
• ​
• Overdependence on LNG: Domestic gas exploration is stagnant, and the Gas Development Fund is diverted to LNG imports.​
• ​
• Mismatch Between Capacity and Supply: Despite growing capacity, outages persist due to inaccurate demand forecasts and fuel import limitations.​
• ​
• Flawed Pricing Mechanism: The market-based fuel pricing model launched in March 2024 lacks transparency and is vulnerable to taxation and exchange rate shocks.​
• ​
• Slow RE Progress: BPDB has failed to attract bidders for solar projects, and the cancellation of 37 LoIs has harmed investor confidence.​
• ​
• Costly Debt: The government is relying on expensive short-term loans to pay dues, raising sustainability concerns.​
• ​
• Policy Gaps: Key policies like the Integrated Energy and Power Master Plan (IEPMP) are under review, causing alignment delays.​
• Deviation from Transition Goals: The budget’s emphasis on coal extraction and LNG imports signals a retreat from the Zero Emission commitment.​

CPD’s Recommendations
​

• To realign with transition goals, CPD called for:​
• ​
• Ending tax exemptions for fossil fuel power projects.​
• ​
• Introducing carbon taxes and duties on fossil fuel plant imports.​
• ​
• Withdrawing all fossil fuel and LNG subsidies.​
• ​
• Prioritising domestic gas exploration using the Gas Development Fund.​
• ​
• Phasing out inefficient power plants.​
• ​
• Renegotiating unsolicited IPP contracts.​
• ​
• Scaling up renewable energy in the ADP and cutting import duties and VAT.​
• ​
• Creating a Renewable Energy Subsidy Fund.​
• ​
• Investing in smart grids to support RE integration.​
• ​
• Seeking low-interest MDB financing over short-term loans.​
• ​
• Reviewing energy policies with the 2040 RE target in mind.​

CPD said that the upcoming fiscal year will be a decisive test of the government’s resolve to uphold its climate and energy transition pledges.​

 

[Saif]

Govt's budget and policy directions fall short of energy transition expectations

The interim government appears to be drifting from its political pledge to achieve the 'Three Zeros'--zero poverty, zero emissions, and zero unemployment--in the national budget for FY2025-26, the Centre for Policy Dialogue (CPD) said on Thursday. Speaking at a dialogue, held in Dhaka, the CPD ana

thefinancialexpress.com.bd

Govt's budget and policy directions fall short of energy transition expectations
Speakers at CPD dialogue call for ensuing uninterrupted power supply, future energy security

FE REPORT
Published :
Jun 27, 2025 01:02
Updated :
Jun 27, 2025 01:02

The interim government appears to be drifting from its political pledge to achieve the 'Three Zeros'--zero poverty, zero emissions, and zero unemployment--in the national budget for FY2025-26, the Centre for Policy Dialogue (CPD) said on Thursday.

Speaking at a dialogue, held in Dhaka, the CPD analysts expressed their concerns that allocations and policy directions in the power and energy sector fall short of aligning with the government's stated commitment to energy-transition and climate goals.

Speakers at the dialogue also called for stronger policy coherence, transparent planning, and a clear roadmap to support the country's energy transition goals and industrial sustainability.

At the event titled 'Power and Energy Sector in the National Budget for FY2025-26: Reflections on the Priorities for Energy Transition', the CPD shared data showing that the Bangladesh Power Development Board (BPDB) remains a 'heavily loss-making' entity.

The state-owned BPDB requires a staggering Tk370 billion in subsidies in FY2025-26, which accounts for 41 per cent of the national subsidy allocations, it mentioned.

In contrast, the Bangladesh Petroleum Corporation (BPC), which made a profit of Tk 20.50 billion in FY2024-25, is expected to see a profit shrink to Tk 6.15 billion in the upcoming fiscal.

According to the CDP, the amount of subsidies on import of liquefied natural gas (LNG) surged to Tk 90 billion, Tk 60 billion up from the previous year.

CPD's Research Director Dr Khondaker Golam Moazzem moderated the dialogue, and its Senior Research Associate Helen Mashiyat Preoty delivered the keynote presentation at the programme.

The presentation stated that Tk 225.20 billion has been allocated for the Ministry of Power Energy and Mineral Resources (MoPEMR) in the FY2025-26, which is 0.8 per cent lower than that of the previous year.

The share of such allocation in the total national budget also fell to 2.9 per cent, down from 3.1 per cent in FY2024-25, it said, mentioning development expenditures declined notably while operational costs increased.

The CPD flagged several worrying trends, including stagnation in renewable energy initiatives and inefficient fossil fuel dependency.

Although no new fossil fuel-based generation projects were launched, overall capacity continues to rise, even though the actual electricity supply remained inadequate.

On the renewable front, 37 Letters of Intent for solar power projects were cancelled, and only three public projects with a combined capacity of 108 MW remain in the pipeline, according to the presentation.

The dialogue also underscored the need for a growing disconnect between fiscal actions and political ambitions, citing delays in revising strategic documents such as the Integrated Energy and Power Master Plan (IEPMP), the Perspective Plan, and the Mujib Climate Prosperity Plan (MCPP).

As a result, the government's 'Three Zeros' goal now risks slipping into what CPD dubbed '2.5 Zeros'.

Energy expert Professor Dr M Shamsul Alam, Adviser to the Consumers Association of Bangladesh (CAB), criticised the continued rise in fuel prices despite the subsidy claims.

"The government says it is enhancing energy security, but the situation remains unchanged," he said.

He also alleged that the country's increased dependence on fuel import, which he termed a legacy of the previous government's 'looting', is continuing under the current administration without meaningful corrective measures.

Director of the BGMEA Mr Faisal Samad, urged the CPD to assess the impact of power disruptions on industry productivity and costs.

"We need to engage with the Power and Energy Adviser and the Chief Adviser to devise a strategic action plan for ensuring smooth industrial operations at least until the upcoming election," he said.

He also stressed the need for a short-term resolution within the next 30 to 45 days.

Echoing similar concerns, Director of BTMA Engr. Razeeb Haider raised his concern over the country's growing energy vulnerability.

"We are overly dependent on gas from Bibiyana. What will happen if it underperforms? There are no clear answers on offshore gas imports or the transmission of gas from Bhola to Dhaka," he questioned.

The national budget lacks any clarity to this effect, he lamented.

Energy analyst Mr Monower Mostafa said the allocations for power and energy sector should have better reflected the 'Three Zeros--particularly the goal of zero carbon emissions.

"This sector is the largest emitter, yet no tangible steps were visible in the budget to engage manufacturers or reduce the carbon footprint," he said.

Mr Md. Akhter Hossain Apurbo, Vice-President of BKMEA highlighted the plight of the ready-made garment (RMG) sector due to energy supply disruptions.

"Despite paying high prices for gas and electricity, we are facing frequent outages that disrupt fabric production in Savar, Gazipur, and Narayanganj. We urge the government to ensure uninterrupted supply at a reasonable cost," he said.​

 

[Saif]

Chevron to revive $90m gas compression project

After a year-long standstill, Chevron Bangladesh is set to resume its Jalalabad Compression Project, following the settlement of overdue payments by state-run Petrobangla. The move signals renewed momentum in Chevron's investment plans to bolster Bangladesh's domestic gas output at a time of growi

thefinancialexpress.com.bd

Chevron to revive $90m gas compression project

M Azizur Rahman
Published :
Jun 27, 2025 09:01
Updated :
Jun 27, 2025 09:01

After a year-long standstill, Chevron Bangladesh is set to resume its Jalalabad Compression Project, following the settlement of overdue payments by state-run Petrobangla.

The move signals renewed momentum in Chevron's investment plans to bolster Bangladesh's domestic gas output at a time of growing energy demand and depleting reserves.

"Chevron Bangladesh President Eric M Walker conveyed the company's intent in a recent meeting with me," Petrobangla Chairman Md Rezanur Rahman told The Financial Express Thursday.

He (Mr Walker) formally confirmed it in a letter dated June 22 to Petrobangla's Director (finance) AKM Mizanur Rahman.

The US energy giant plans to invest between $80 million and $90 million to complete the project, which is expected to help arrest the ongoing decline in gas production from the Jalalabad field, said the finance director.

Chevron Bangladesh, a subsidiary of US energy major Chevron, had earlier stalled the Jalalabad Compression Project due to unpaid dues by Petrobangla, which had reached as high as $280 million.

The project aims to enhance gas extraction from the Jalalabad gas field, potentially unlocking an additional 352 billion cubic feet (Bcf) of gas, according to earlier Chevron estimates.

In his June 22 letter, Mr Walker acknowledged Petrobangla's payment of the arrears in April as a "positive outcome" and cited it as the reason for resuming the project.

He, however, noted that continued work on the project will depend on Petrobangla staying current on its monthly gas and condensate payments, and settling outstanding late payment interest, amounting to around $25-26 million, by September 30, 2025.

Petrobangla said it expects to pay the interest by July.

Petrobangla had requested Chevron in April to resume the investment, after clearing the dues and committing to a payment schedule.

The US company had previously deferred the project in April 2024, demanding full repayment of arrears before proceeding.

Meanwhile, Chevron has a separate $500 million investment proposal pending with Petrobangla. It seeks rights to explore Block-11 and expand its reach over Block-12 in the gas-rich Surma Basin in northeastern Bangladesh.

The company aims to discover fresh gas supplies to meet the country's growing energy needs, leveraging its existing Bibiyana gas processing infrastructure to fast-track production if discoveries are made.

Chevron is already the largest natural gas producer in Bangladesh, supplying around 1.08 billion cubic feet per day (Bcf/d) from its three onshore fields-Bibiyana, Jalalabad, and Moulavi Bazar-located in blocks 12, 13, and 14.

From its recently drilled BY-28 well in the Bibiyana field alone, it currently supplies around 40,000 Mcf/d of gas into the national grid.

A few years ago, Petrobangla had allowed Chevron to expand its operational area by granting access to a 60 sq km 'flank' zone north of the Bibiyana field.

Chevron subsequently invested $150 million in drilling the BY-27 and BY-28 wells.

According to sources familiar with the matter, if new gas reserves are discovered in Block-11 or the extended area of Block-12, Chevron can swiftly ramp up production, potentially reaching up to 1.35 Bcf/d, using its existing processing facilities.

Petrobangla has yet to formally approve Chevron's broader exploration and investment plans, but energy officials suggest the successful resolution of the arrears dispute may pave the way for deeper collaboration.​

 

[Saif]

Bangladesh trapped into fossil fuel use

After two decades from today Bangladesh will still continue to substantially depend on fossil fuels for energy, with nearly 10,000 MW of the installed power generation capacity in 2045 directly relying on gas, coal, and liquid oil.

www.newagebd.net

Bangladesh trapped into fossil fuel use
Emran Hossain 28 June, 2025, 00:29

After two decades from today Bangladesh will still continue to substantially depend on fossil fuels for energy, with nearly 10,000 MW of the installed power generation capacity in 2045 directly relying on gas, coal, and liquid oil.

The actual fossil fuel dependence in 2045, however, will be far higher because some of the installed capacities in that year will be disguised as clean energy, a definition that replaced renewable energy in the Integrated Energy and Power Master Plan in 2023, introducing technologies yet in infancy but promises to make coal and gas cleaner.

By 2041, the installed power generation capacity in Bangladesh will exceed 60,000 MW, the IEPMP said, stating that 40 per cent of the capacity will be based on clean technology, which energy expert terms as ‘green washing’.

Bangladesh’s plan about the fossil fuel reliance reflects the global admiration for development using dirty energy, which led to a 60 per cent increase in carbon-dioxide emissions from energy and industry sectors since the United Nations Framework Convention on Climate Change was signed in 1992.

‘Perhaps the most interesting aspect of such aggressive fossil fuel expansion is the role foreign investors played behind it,’ said Sharif Jamil, head of Waterkeepers Bangladesh, a nongovernmental and non-profit body dedicated to the protection of water bodies and the restoration of water ecosystems in the country.

The foreign investments in Bangladesh included foreign direct investments and investment from multilateral development banks, which came as part of a deep global conspiracy involving fossil fuel lobbies, said Sharif Jamil.

While destroying Bangladesh’s renewable energy potentials, he said, the investments created a market from where Bangladesh would have no escape for decades.

‘The business model at work is rather brutal where investors profit from destroying economies and environments of third countries,’ said Sharif, explaining that the investors mine fossil fuels in third countries and burn them in others for profits.

‘Bangladesh has turned into a milking cow, always depending on others for energy,’ he said.

Over the past two decades, energy experts said, major power and energy sector plans were penned with help from by the Japan International Cooperation Agency and the Asian Development Bank. Japan provided money and technical support in formulating Bangladesh’s past four power sector master plans since 2005, each invariably promoting fossil fuel while undermining renewable energy potentials.

The ADB, on the other hand, was involved in energy-related plans involving $2 billion over decades, energy experts said.

Bangladesh’s current installed power generation capacity of 27,426 MW, overwhelmingly relying on imported fossil fuel, is the outcome of decades of the energy plans. Only about 4 per cent of the installed generation capacity is renewable energy dependent.

The immediate past authoritarian Awami League government, which was notorious for its widespread human rights violation, built the huge fossil fuel fleet with steady investments from its harshest critics, overseeing a sixfold increase in the installed power generation capacity between 2009 and 2024.

The power projects awarded during the AL era almost always avoided competitions and with unequal power purchase deals that drained foreign currency reserve.

The one hundred per cent electrification project, which mainly involved an expansion of the national grid with funding from development partners and multilateral development banks, in fact, replaced rooftop solar initiatives in remote areas, which took years to build.

‘We have gradually become energy colonies of some countries, whose investment interests determined our energy choices, though they meant us no benefits,’ said Hasan Mehedi, member secretary, Bangladesh Working Group on Ecology and Development, a platform of green activists.

The 1,496MW coal-based Adani power plant is the largest single power plant to remain in operation through 2045, earning a return six times of its initial investment.

Another 5,000 MW of existing coal capacity will remain in operation through 2050, the time by when many countries promise to achieve net zero emissions.

The coal-fired power plants in Bangladesh include 1,224MW Banshkhali power plant, 307MW Barishal power plant, 1,234MW Rampal power plant, 1,244MW Payra power plant and 1,150MW Matarbari power plant.

Of the existing gas-based power plants, over 2,500 MW will remain in operation through 2048. The power plants include two Meghnaghat power plants of 583 MW and 584 MW capacity, 400MW Ashuganj power plant, 230MW Sylhet power plant, Bibiyana power plants of 400 MW and 383 MW, and 260MW Ghorashal power plant.

The IEPMP projected a very ambitious economic growth between 2019 and 2050, justifying the need to aggressively increase energy consumption to power the growth.

The IEPMP noted that the ‘in-between scenario of growth’, among three projected scenarios, would necessitate about a fivefold gas and coal consumption and a sevenfold oil consumption.

A good portion of the gas demand will be met through the import of liquefied natural gas.

The IEPMP plans to increase coal consumption through the 2030s before introducing ammonia-cofiring to curtail greenhouse gas emissions in coal power plants.

Gas-fired power plants, on the other hand, will witness hydrogen co-firing in 2037, said the IEPMP.

The co-firings will take years to eventually replace the fossil fuel completely, obviously depending on the economy’s capacity to afford these highly expensive technologies, energy experts said.

The co-firings in most cases are not clean and emit carbon.

The IEMPM also promotes carbon capture and storage technology to reduce greenhouse gas emissions, though experts held it among false solutions, invented to linger coal consumption.

According to a Center for Policy Dialogue analysis of the IEPMP, renewable energy would not constitute even half of the clean energy target by 2041, which would be 40 per cent of the 61,000MW installed power generation capacity.

Clean energy in the IEPMP accounts for 18 per cent of the installed generation capacity to be achieved in 2030. Less than 6 per cent or 1,726 MW will come from renewable energy. The installed power generation capacity in 2030 will be 40,000 MW.

By 2050, Bangladesh installed power generation capacity is expected to reach 90,000 MW.​

Related News

 

[Saif]

Rooftop solar: Caution before commitment

In what appears to be an attempt to fast-track renewable energy adoption, Chief Adviser Professor Muhammad Yunus recently directed the installation of rooftop solar panels on all government buildings including educational institutions and hospitals. The move is meant to go hand in hand with Banglad

thefinancialexpress.com.bd

Rooftop solar: Caution before commitment

Published :
Jun 28, 2025 21:20
Updated :
Jun 28, 2025 21:20

In what appears to be an attempt to fast-track renewable energy adoption, Chief Adviser Professor Muhammad Yunus recently directed the installation of rooftop solar panels on all government buildings including educational institutions and hospitals. The move is meant to go hand in hand with Bangladesh's Renewable Energy Policy 2025 which targets sourcing 20 per cent of electricity demand from renewables by 2030. As per the latest IRENA report, Bangladesh remains significantly behind its regional peers in solar electricity generation, with only 5.6 per cent of its power coming from solar, in contrast to 24 per cent in India, 17.16 per cent in Pakistan and 39.7 per cent in Sri Lanka. To meet upcoming target, tenders for 55 land-based solar plants have already been floated, but their full implementation could take until 2028. Hence, the government is now looking to rooftop spaces as a more immediate solution.

There are, however, significant doubts over the practicality and efficacy of this large-scale rooftop solar rollout. First off, the claim that 5.6 per cent of national electricity comes from solar power needs further investigation. It is plausible that this figure is indicative of installed capacity rather than actual output, which may be much lower given that many rooftop units stopped functioning soon after installation. Some high-rise buildings installed solar systems only to meet RAJUK's compliance requirements, and it is doubtful whether these systems are operational or connected to the grid in any meaningful way. Before allocating resources to this initiative, policymakers must distinguish between mere installation and reliable energy generation, particularly in a country where public infrastructure projects often neglect long-term maintenance.

Implementing solar panels across all government buildings would require an enormous investment, possibly running into thousands of crore taka. Without proper planning, this could turn into a massive misallocation of public funds. There is a real risk that many of these panels would exist only on paper, much like the proverbial cow that exists in the book but not in the shed. Government hospitals, in particular, need uninterrupted and stable electricity to run life-saving equipment. Poorly installed systems, equipment failures or even overcast skies during the rainy season could damage sensitive medical devices and endanger lives. Similarly, schools and colleges that are already struggling with limited resources may end up with faulty or inefficient solar systems that become long-term financial burdens. The idea of public-private partnership, where private companies install and maintain systems out of their own commercial interest, appears promising at first glance, but previous experiences with such arrangements do not inspire much confidence. The government must also assess whether older buildings can bear the added weight of solar panels, and whether institutions in shaded or congested areas get enough sunlight to justify the cost. A nationwide rollout without checking these basic facts would be irresponsible, no matter how noble the intentions behind it.

Before moving ahead, the government must undertake a thorough feasibility study to examine whether a nationwide rooftop solar rollout is truly worth the investment. As part of this, it must assess the existing installations, especially those installed under the RAJUK directive, to see how many are still functioning, how much electricity they actually generate and what maintenance issues have arisen over time. The study must also evaluate costs, technical challenges and the potential for grid integration across different categories of buildings. Only after establishing the project's practical benefits and sustainability should large-scale implementation proceed. There is no denying that renewable energy is the way of the future, but rushing in without proper groundwork could easily turn a well-intentioned plan into a costly misadventure.​

 

[Saif]

Govt plans to launch onshore bidding after 28 years

The interim government is preparing to offer several onshore blocks in hilly regions to international oil companies (IOCs) under a proposed production sharing contract (PSC), aiming to enhance domestic natural gas production amid rising demand. "We are planning to offer onshore Block-22A and Block

thefinancialexpress.com.bd

Boosting Gas Output
Govt plans to launch onshore bidding after 28 years

FE Report
Published :
Jun 28, 2025 23:37
Updated :
Jun 28, 2025 23:37

The interim government is preparing to offer several onshore blocks in hilly regions to international oil companies (IOCs) under a proposed production sharing contract (PSC), aiming to enhance domestic natural gas production amid rising demand.

"We are planning to offer onshore Block-22A and Block-22B, along with several other hilly onshore blocks," Petrobangla Chairman Md Rezanur Rahman told The Financial Express on Saturday.

He said the long-anticipated onshore bidding round is likely to be launched within the next two months.

The Energy and Mineral Resources Division (EMRD) under the Ministry of Power, Energy and Mineral Resources (MPEMR) is currently reviewing a draft of the new Model Production Sharing Contract (MPSC), which was prepared and submitted by state-run Petrobangla.

The new MPSC aims to attract foreign investors by offering more competitive terms, developed in consultation with global energy consultancy Wood Mackenzie.

However, Mr Rahman did not disclose the exact number of blocks to be offered or specific pricing details.

Petrobangla's move comes nearly three decades after the last onshore bidding round, as the government seeks to ramp up hydrocarbon exploration in underexplored hilly regions to meet the surging demand for natural gas in industries, power plants, and other key sectors.

One major update in the new MPSC is its pricing mechanism. Under the proposed terms, the gas purchase price would be linked to 8 per cent of the dated Brent crude average over three months, with a price cap to mitigate extreme volatility.

A Petrobangla official said this could set the gas price at around $5.00 per million British thermal units (MMBtu), based on current Brent crude assumptions.

This price would align more closely with the cost of imported liquefied natural gas (LNG), which the country increasingly relies on due to stagnating domestic output.

In comparison, the 1997 MPSC linked gas pricing to high sulphur fuel oil (HSFO), with a fixed floor and ceiling. Under that structure, US-based Chevron currently receives $2.76 per MMBtu and Singapore's KrisEnergy receives $2.31 per MMBtu.

Petrobangla also purchases gas from its state-owned subsidiaries.

It buys gas at Tk 28 per Mcf (1,000 cubic feet) from Sylhet Gas Fields Ltd (SGFL) and Bangladesh Gas Fields Company Ltd (BGFCL), and at Tk 112 per Mcf from Bangladesh Petroleum Exploration and Production Company Ltd (BAPEX).

By contrast, LNG from long-term suppliers QatarEnergy and OQ Trading International cost $10.66 and $10.09 per MMBtu, respectively, over the first seven months of the current fiscal year.

Officials said that Petrobangla is also working to harmonise exploration benefits across contracts to better attract IOCs, after the offshore bidding round in 2023 failed to draw interest.

That round offered 24 offshore blocks under terms that priced gas at 10 per cent of dated Brent, or around $7.08 per MMBtu based on current prices.

The last onshore bidding round in 1997 saw the award of four blocks -- Block-5, Block-7, Block-9, and Block-10.

At present, four IOCs are engaged in exploration activities in Bangladesh.

Chevron operates gas fields under Blocks 12, 13, and 14. KrisEnergy produces gas from the Bangora field in Block-9. ONGC Videsh Ltd (OVL) and Oil India Ltd (OIL) are jointly exploring shallow-water blocks SS-04 and SS-09.

To meet the shortfall, Bangladesh imports lean LNG from long-term partners RasGas of Qatar and Oman Trading International (OTI), as well as from the spot market.

Currently, the country's total gas output, including re-gasified LNG, stands at around 2,883 million cubic feet per day (mmcfd), against a demand of more than 4,000 mmcfd.​