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BANGLADESH ENERGY PATHWAY

Bangladesh faces a harsher summer this year

with its leaning on fossil fuels

Bangladesh has seen increasingly warmer summers and scorching heat waves. The rising heat problem is partly due to Bangladesh’s heavy reliance on fossil fuels like Liquifying Natural Gas (LNG), coal , oil, diesel, and etc. to power its growing economy, leading to emission of more carbon and heat in the atmosphere. Moreover, growing imports of energy burdens Bangladesh’s fragile foreign currency reserves and pose risks of energy crises and resultant power outages, leaving people sweating and suffering in the sweltering summer.
Bangladesh’s reliance on imported fossil fuels is expected to grow even further as it recently drafts an ‘Integrated Energy and Power Master Plan (IEPMP)’ for 2024-2050. The draft new plan is estimated to increase reliance on gas consumption by 360% to generate 30% power by 2050 with massive hikes in energy imports. LNG imports, for instance, are estimated to rise from 4.6 million tons in 2022 to 49 million tons by 2050. Bangladesh’s energy and power policy is hence, increasingly getting locked in into fossil fuel based systems which is adversely affecting the economy.

Fossil fuel dependency is hurting

our economy and environment

Increased reliance on fossil fuel poses dual risks of straining the economy and making power supply vulnerable to global price fluctuations.

Despite excess power generation capacity of 25,700 MW, Bangladesh is unable to afford fossil fuels for power generation resulting in frequent power outages, disrupting industrial production in the sweltering heat stress.

Fossil fuel imports strain forex reserves and spirals the country towards economic shocks and energy crises.

The large allocations for fossil fuel imports divert finance away from investments in renewables as well as from other social sectors. With 6% of total government subsidy going towards the energy and power sector, the budget for the health and social welfare sector gets curtailed.

Moreover, fossil fuels emit high carbon and greenhouse gas into the environment contributing to global warming and climate change. Bangladesh’s energy sector is responsible for CO2 emissions, with 55% of total emission arising from burning of fuels like coal and natural gas.
Mominul Islam, a resident from Khulna coastal district of Bangladesh .
"Summer heat in the coastal belt of Bangladesh is unbearable, especially with the higher moisture due to the sea. Paired with increased electricity outage makes the situation worse, just as everyone needs to use cooling systems"
Ridwan Nomany, a resident in Bagerhat coastal district of Bangladesh
“Working in the farmlands for crop production in this excessive heat is physically taxing for us. We cannot even continue production as frequent and lengthy hours of electricity outages refrain us from using water pumps for irrigation, especially when it is needed the most.”
Shahin Hossain, a worker in a garment factory in Gazipur.
Many times I think of returning back to my village. Rising electricity prices, paired with soaring prices of essentials, whilst paying rent. I am barely making do with my earnings to run my three-member family.”
**Kindly note faces of individuals in the comments above are purposefully withheld for privacy concerns.

fossil fuel debt trap

for bangladesh

Fossil fuel based mega power projects are creating a debt bill of over USD 2 billion every year, of which USD 1.5 billion is due in the public sector and USD 0.5 billion in the private sector. Bangladesh Power Development Board and its subsidiaries owe USD 9 billion to foreign lenders, for which the government guaranteed the security. Private power companies also have an outstanding of USD 4.4 billion. Given the global economic headwinds, racking up debts could be hazardous for the economy.

What experts are saying

Bangladesh's electricity generation model appears unsustainable without a clear transition pathway. Rising subsidies compelled the Bangladesh government to pass rising costs on the consumers leading to price hikes for electricity. Therefore, policymakers should raise their renewable energy targets and reflect the same in the upcoming Integrated Energy and Power Master Plan (IEPMP).
Shafiqul Alam Energy Analyst, Institute for Energy Economics and Financial Analysis (IEEFA)
Fossil fuel buildouts are already having devastating consequences for a deltaic plain riverine country like Bangladesh. Our rivers are drying up, local ecologies are disrupted. We are losing countless lives and the country is burdened with economic debts. The investors must look at people, not profit and stop environmental pollution in the name of any false solutions.
Sharif JamilCoordinator of Water Keepers Bangladesh, Executive Director of Blue Planet Initiative
Dependency on imported fossil fuels for major economic activities has a multidimensional adverse impact on a developing country like Bangladesh. Recent pressure on forex reserve, rise in inflation and cost of living are reflection of over-dependence on imported fossil fuels. Bangladesh’s upcoming policy priorities and energy-dependent economic activities should show positive shifts towards renewable energy rather than reliance on imported fossil fuels.
Dr. Khondaker Golam MoazzemIndustrial Economist and Research Director at Center for Policy Dialogue
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No alternative

to fossil fuel phaseout and promotion of renewable energy

A reorientation of Bangladesh’s renewables in line with Mujib Climate Prosperity Plan could cut spot market LNG imports by 25% and generate USD 2.7 bn savings between 2022 and 2024.
Moreover, following the robust and comprehensive prosperity plan will cut Bangladesh’s overreliance on fossil fuels and facilitate just energy transitions. Energy transitions will enable environmental sustainability, affordable cost of electricity generation for all, without subsidies and fuel price fluctuations.

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