The Energy Scenario of Bangladesh

Energy is essential for every country’s economic growth and significantly improves socioeconomic conditions (i.e., reducing poverty) in poorer countries. Energy plays a vital role to accelerate economic development in a middle-income country like Bangladesh. However, the effective and efficient use of Bangladesh’s energy sector will allow it to satisfy its expanding energy demands and move from a middle-income to a high-income country and achieve the Vision-2021, SDG-2030, and Vision-2041 goals.

Bangladesh regards as one of the fastest-growing economies in Southern Asia, despite its crowded population. Bangladesh’s energy usage has been rising at a rate of more than 8% per year. Other countries’ development experience reveals that when per capita income hits between US$1,000 and US$10,000, as it does in Bangladesh, energy consumption rises rapidly. In June 2021, Bangladesh’s Gross Domestic Product (GDP) per capita was 2,097.000 USD, up from 1,930.000 USD in June 2020. In Bangladesh, the industrial and residential sectors consume the most energy, followed by the commercial and agricultural sectors.

Traditional energy and mainstream energy can classify as energy sources in Bangladesh. Conventional energy resources include cow dung sticks, cakes, dry leaves, rice straw, fuelwood, rice husk, castor oil, ghee, mustard oil, and kerosene lamps. According to the report “Monitoring the Situation of Vital Statistics of Bangladesh (MSVSB), 2016”, 2.9 percent of Bangladeshis utilize kerosene lamps to meet their domestic energy needs.

The Energy Scenario of Bangladesh — Traditional energy sources of Bangladesh

Coal, heavy fuel oil (HFO), high-speed diesel (HSD), hydropower, Liquefied natural gas (LNG), Liquefied petroleum gas (LPG), solar energy, and wind power are all considered mainstream energy sources in Bangladesh. We have a large coal reserve in our country. However, coal produces and utilizes a little here. On the other hand, natural gas has little reserve but has the highest production and consumption of accessible resources. Imported oil and LPG use to meet energy demands. Furthermore, the government has begun importing LNG to fulfill rising gas demand.

Natural gas resources meet about 63 percent of energy demand, with 7% coming from imported LNG, 10% from diesel, 5% from coal, 3% from heavy oil, and 3.3% from renewables. Oil, coal, biomass, and other fuels, among others, are essential.

The country has so far discovered 27 gas resources. According to the eight five year plan and other sources, the recoverable gas reserve was estimated to be around 12.43 trillion cubic feet (TCF) in 1993. By 2011, it had risen to roughly 26.84 TCF, and by the end of 2017, it had reached 27.12 TCF. So far from this quantity, Around 15.22 TCF gas was exacted and used in the country. As a result, the 12 TCF gas that remains can utilize in the future. Furthermore, the country’s remaining gas reserves are expected to be sufficient to meet the country’s expanding natural gas consumption for the next 10–12 years.

Natural gas is available for consumption from two sources: state-owned natural gas businesses under PETROBANGLA, which supply 99.4 percent of the supply, and international oil corporations (IOCs), which provide 0.5 percent of the supply.

So far, 05 coalfields discovered in Bangladesh. The total reserve in these five coalfields is over 7,962 million tons, with a complete extraction of 11.78 million tons as of June 2020.

However, the coal power plant is harmful to the Environment. It emits carbon dioxide on a large scale and damages the Environment. It is the largest anthropogenic source of carbon dioxide and pollutes the Environment seriously, which causes global warming and, finally, climate change. Many countries have reduced or eliminated their use of coal power to meet the Paris Agreement target of keeping global warming to well below 2 °C (3.6 °F) by this century, taking the baseline as it was before the pre-industrial levels, i.e., before 1750. The UN Secretary-General has asked governments to stop building new coal plants by 2020 to achieve the Paris agreement. So, the use of reserved coal in Bangladesh will not generate power in the future as per Paris Agreement.

Biomass is the most frequent source of energy, accounting for 27% of all primary energy sources. The energy demand is also met by importing power from India. The transportation industry consumes over 45 percent of the country’s total oil, while irrigation uses another 21%. In addition to natural gas and crude oil, coal is the primary fuel utilized in brickfields and thermal power plants. Solar Home Systems (SHS) is also used to generate power in both on-grid and off-grid settings. Now, the solar system generates roughly 368 MW of electricity. There are also many poultry and dairy farms where biogas plants are being built, with the biogas being used for cooking and power generating at a capacity of roughly 1 Megawatt (MW).

Bangladesh uses renewable energy as well, although far less than is required. The government of Bangladesh, to boost the usage of renewable energy in the future has done solar household systems, solar irrigation systems, Rooppur nuclear power plant project, and other initiatives. The government has also emphasized the use of renewable energy sources to generate electricity. Renewable energy resources gave significant weight in the Power System Master Plan (PSMP). Under the Sustainable and Renewable Energy Development Authority Act, 2012, the government formed the Sustainable and Renewable Energy Development Authority (SREDA) in 2014 to promote sustainable energy, including renewable energy and energy efficiency. SREDA is prepared to provide any support within its purview to implement renewable energy projects in order to meet the government’s goal of generating power from renewable sources.

Renewable energy sources now generate 648.65 MW of power. In addition, 685 MW of renewable energy projects are under construction, with another 885.77 MW planned.

Even though Bangladesh’s energy sector encompasses a diverse spectrum of products such as electricity, petroleum products, natural gas, coal, biomass, solar, and other renewable energy sources, policymakers have been preoccupied with electricity, the most extensively used kind of energy.

Access to electricity is a composite indicator of development in Bangladesh at the national, community, and household levels. Notably, because electricity is used in the almost all-economic activity, consumption has grown at 10% each year. Bangladesh has made significant progress among the countries with the largest population without access to electricity, according to a World Bank report (2019). In 1971, just approximately 3% of Bangladesh’s total population had access to electricity. According to Bangladesh Sangbad Sangstha (BSS), this ratio increased from 59.6% in 2012 to over 76 percent in 2016 and 93.5 percent in 2019.

The overall energy usage predicts to be roughly 55 MTOE (Million Tonnes of Oil Equivalent). Bangladesh has a per capita energy consumption of 344 kg OE (Kilogram Oil Equivalent). Total installed capacity, including public, IPP, captive, import, and renewable energy, reached 23,548 MW in FY2020, exceeding the target. The percentage of people with access to electricity has climbed to 97 percent, up from 72 percent in the baseline fiscal year of 2015. The persistent and quickly expanding electricity supply and demand disparity are crucial for Bangladesh’s energy sector. According to the Power system master plan, 2016, power generation capacity would reach 24000 MW by 2021, 40000 MW by 2030, and 60000 MW by 2041.

The Bangladesh Energy Regulatory Commission (BERC) develops and implements electricity and energy pricing policies with the help of other government bodies. Concerning the government’s general approach in the sector, the BERC is responsible for deciding the bulk and retail tariff rates for electricity, natural gas, petroleum products, coal, and other mineral resources.

Bangladesh’s government is collaborating with neighboring nations and United Nations Economic and Social Commission for Asia and the Pacific (UN-ESCAP), South Asian Association for Regional Cooperation (SAARC), Bangladesh, Bhutan, India, Nepal (BBIN) initiative , BIMSTEC, South Asia Subregional Economic Cooperation (SASEC), and Developing-8 to improve the growth of the electricity sector.

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