Energy experts proposed sweeping policy support, including full duty exemptions on solar equipment, battery storage and electric vehicles, alongside the creation of a Tk5,000 crore revolving fund, to accelerate Bangladesh’s renewable energy transition.
Welcoming the government’s plan to generate 10,000MW of solar power by 2030, they said scaling up the renewable energy capacity could generate substantial economic benefits, including annual savings of $1.5 billion to $2 billion in fuel imports.
Additional gains could come from rooftop solar, solar irrigation and the electrification of transport, they observed at a press conference at the National Press Club in Dhaka on Monday.
The press conference was organised by ActionAid Bangladesh, the Just Energy Transition Network Bangladesh (JETNET-BD) and the Bangladesh Sustainable and Renewable Energy Association.
They pointed to ongoing geopolitical tensions, particularly in the Middle East, which have disrupted global energy markets and driven up the prices of oil, diesel and coal.
Against this backdrop, a shift to renewable energy is seen as critical to reducing Bangladesh’s reliance on imported fuels.
Presenting the keynote paper, Shafiqul Alam, lead energy analyst at the Institute for Energy Economics and Financial Analysis (IEEFA), said Bangladesh is facing a deepening energy crisis marked by rising import dependence, supply disruptions and mounting subsidy burdens.
In fiscal year 2024-25, import dependence stood at 65 percent in the power sector and 62.5 percent in overall energy use, he said.
The temporary closure of the Strait of Hormuz disrupted operations at Eastern Refinery, while load-shedding exceeded 2,700MW.
At the same time, the government is incurring heavy subsidies—over Tk 65 per cubic metre for LNG and up to Tk70 per litre for diesel—putting further strain on public finances.
“There is no alternative to accelerating the transition to renewable energy,” Alam said.
Zakir Hussain Khan, managing director of Change Initiative, emphasised the need to overhaul financing structures for renewables.
He said reallocating at least 30 percent of fossil fuel subsidies to clean energy in the next national budget could unlock around $360 million in investment.
He also highlighted the potential of introducing a modest carbon pricing mechanism, which could create up to $10 billion in fiscal space and significantly boost green financing.
Speakers underscored the importance of mobilising diaspora investment, proposing a “Probashi Bond” worth about $4.5 billion to support solar expansion. They also flagged institutional and financial bottlenecks, including the absence of a dedicated green financing window at Bangladesh Bank and high lending rates from commercial banks.
To address these challenges, they recommended concessional refinancing at 3–4 percent interest and the introduction of CSR-linked financing mechanisms to reduce borrowing costs for investors.
Mostafa Al Mahmud, president of the Bangladesh Sustainable and Renewable Energy Association (BSREA), said that while the 10,000MW target is technically achievable, there is a clear gap in execution.
Previously announced 3,000MW target saw limited progress, raising doubts about whether the new goal will be realised, he added.
He also criticised the tax structure, noting that duties on solar components can reach up to 28 percent, discouraging investment.
He called for immediate tax cuts and the introduction of financial instruments such as solar bonds.
Speakers also questioned the effectiveness of the current public-private partnership (PPP) model, arguing that its complexity could delay project implementation. As an alternative, they suggested assigning projects directly to the Bangladesh Power Development Board (BPDB) for faster execution.
Regarding the institutional capacity, they said the Sustainable and Renewable Energy Development Authority (SREDA) needs to be strengthened and repositioned as an implementation-focused agency with faster approval processes.
Dipal Chandra Barua, chairman of Bright Green Energy Foundation, advocated a decentralised approach.
“It is time to implement a model where people generate their own electricity,” he said, adding that the government should focus on creating a supportive environment by reducing costs and taxes on solar technologies.
Energy expert Prof Ijaz Hossain warned that failure to resolve the energy crisis could pose a major challenge for the government.
