The Bangladesh Energy Vogue Board (BPDB) can attach Bangladesh Tk13,800 crore ($1.2 billion) of annual loses, funded by authorities subsidies, through electrical energy sector reforms along side focusing more on renewable sources and limiting distribution losses, essentially based on a newest sage of the sage by the Institute for Energy Economics and Monetary Diagnosis (IEEFA).
The sage highlights that Bangladesh can invent the financial savings by sharp half of of the commercial request, met by captive mills, to the grid, along side 3,000 megawatts (MW) of renewables, lowering load shedding to 5% from the fiscal (FY) 2023-24 level and limiting transmission and distribution losses to 8%, reads a press start.
“With the reserve margin hovering around 61.3%, Bangladesh’s energy sector has an overcapacity self-discipline which contributes to the BPDB’s persisting subsidy burden. Despite a series of energy tariff adjustments, the hefty earnings shortfall and subsidy allocation will likely persist within the foreseeable future. IEEFA’s proposed roadmap for reform suggests making improvements to energy request forecasting strategies by factoring within the role of energy effectivity to decrease overcapacity,” says the sage’s author, Shafiqul Alam, lead analyst of Bangladesh Energy, IEEFA.
“Our roadmap recommends limiting new investments in fossil fuels-essentially based generation whereas promoting renewable energy deployment. Extra, it suggests modernisation of Bangladesh’s electrical energy grid to encourage industries to shift to grid energy in location of operate gas-essentially based captive plant life and minimise load shedding. We earn that taking such constant actions can abet decrease the sphere’s subsidy burden,” he provides.
The sage finds that within the course of the fiscal twelve months 2019-20 to FY2023-24, the BPDB’s total annual expenditure elevated 2.6-fold in opposition to earnings increase of 1.8 times, prompting the authorities to allocate a mixed subsidy of Bangladeshi Tk126,700 ($10.64 billion) to be obvious that energy offer to fetch the economy afloat. But, the BPDB recorded a cumulative lack of Tk23,642 crore ($1.Ninety nine billion).
In FY2023-24 alone, the authorities gave a Tk38,289 crore ($3.22 billion) subsidy to the BPDB.
In tell to bring the subsidy burden all of the vogue down to nearly zero, Alam recommends guaranteeing industries completely count on the nationwide electrical energy grid. “Additionally, the nation should silent step by step transition to electric programs from gas-driven dwelling equipment, love boilers. This is in a position to per chance per chance presumably also abet increase the BPDB’s earnings from promoting extra energy whereas lowering skill payments to lazy plant life,” mentioned Alam.
“The window to invent Bangladesh’s energy sector sustainable is all without prolong narrowing, however there remains to be time to rep the sphere reduction heading within the accurate direction by following an correct roadmap,” he provides.
As the principal step of the reform, the sage calls on the authorities to forecast energy request from 2025 by factoring in energy effectivity gains and request shift measures, reads the allege.
IEEFA’s projection by factoring in such variables reveals that the nation’s height energy request in 2030 is likely to be 25,834MW as in opposition to the Integrated Energy and Energy Master Idea’s (IEPMP) forecast, made in July 2023, of between 27,138MW and 29,156MW.
Concurrently, the IEEFA roadmap additionally suggests halting funding in fossil gasoline-essentially based energy and limiting the expend of oil-fired plant life to 5% of total energy generation. If these steps are taken along with the anticipated 4,500MW of fossil-gasoline-essentially based energy plant retirements, the sage expects Bangladesh will fetch a system skill of 35,239MW.
“A system skill of 35,239MW will abet Bangladesh meet the height request of 25,834MW by 2030. This will bring the reserve margins down 66.1% in December 2024 to 36.4% (along side variable renewable energy) and 20% (other than for variable renewable energy) in 2030. A reserve margin of 20%, other than for variable renewable energy, is such as worldwide locations love India and Vietnam,” Shafiqul Alam says.
Finally, the nation can fetch in tips a conservative purpose of installing an complete mixed grid-related renewable energy skill of up to 4,500MW by 2030 to abet decrease largely pricey oil-fired energy generation within the course of the day. The expend of battery storage of 500MW with a backup for three hours will abet decrease the operation of oil-fired plant life within the evening. If batteries change into cheaper within the long inch, Bangladesh could per chance presumably even fetch in tips their increasing expend within the course of the evening height.
“Nevertheless, the success of Bangladesh’s efforts to repair the energy sector’s complications will hinge on how it makes insurance policies more conducive, whether it shifts focal point from GDP-centric request projection to assorted components, love energy effectivity method, modernises the gird, adjusts gas tariffs to plan industries to expend grid energy and addresses the challenges of renewable energy growth,” Alam provides.
