Overview
Despite contributing less than 1% of global carbon emissions, Bangladesh is one of the most climate-vulnerable countries, and without changes, it would see annual economic costs equivalent to 2% of its GDP by 2050, widening to 9.4% by 2100. The country is currently reliant on fossil fuels for energy with gas being the primary source and with coal accounting for almost 7%. However, solar PV and onshore and offshore wind energy costs have dropped by up to 80% in the last decade, making renewable energy increasingly affordable. The government of Bangladesh has revised its Intended Nationally Determined Contribution (INDC) and submitted its Nationally Determined Contribution (NDC) in 2021 to meet the requirements of the Paris Agreement. The country has set targets to cut GHG emissions by 27.56 million metric tons of CO2e (6.73%) by 2030 in the energy, agriculture, and waste sectors. The government has also aimed to meet 40% of electricity demand from renewable energy sources by 2041. China has saved $21 billion in additional coal and gas imports due to investing in solar energy. Bangladesh is expected “Climate change disasters are the “price of humanity’s fossil fuel addiction”-Antonio Guterres, Un Secretary-General to begin generating commercial wind power in 2023 and nuclear power by 2025.
Key Points
The country needs climate finance to mitigate the effects of climate change and develop renewable energy.
The country aims to meet 40% of electricity demand from renewable energy sources by 2041.
The Renewable Energy Policy of Bangladesh set the target of 10% of all electricity from renewable sources by 2020, which was not achieved.
Finance, in particular, has not been given adequate importance in the policy, and the implementation has been lacking.
There is an investment opportunity of at least USD 12 billion on RE over the next decade in generation alone.
The policies and actions of the policymakers need to be more finance-focused.
Moreover, in this revised RE policy the globally practiced tariff mechanism such as Feed-in-tariff, auction, TEC etc. should be included and enforced for all energy and power sector related agencies.
Strengthen the Sustainable and Renewable Energy Development Authority (SREDA)
Discontinue the Quick Enhancement of Electricity and Energy Supply (Special Provision) Act: This act has eroded the competitive bidding process and left room for Power Purchase Agreements (PPAs) at exaggerated tariffs. Discontinuing this act will ensure the competitive bidding process is maintained and PPAs are signed at a reasonable price.
Implement the “green energy” tariffs.
Provide the mechanism for adjustments of certain tariff components.
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