Need for expansion of renewable energy

For Bangladesh to sustain the growth of its manufacturing industry, a reliable and affordable power supply is essential. However, the sector is currently facing a severe crisis due to rising fuel prices. Excessive dependence on imported fuels and other inputs required for power generation has significantly increased production costs, making it difficult to ensure profitability and long-term industrial growth.
A major portion of the country's fuel demand, particularly liquefied natural gas (LNG) and coal, must be imported. This has become increasingly expensive because of global instability in energy markets caused by geopolitical tensions. Such conditions often lead to supply disruptions and price volatility. Even electricity generation using heavy fuel oil (HFO) remains highly costly.
While HFO-based power generation is expensive, solar energy offers a much more cost-effective alternative. Over the long term, solar power plants require significantly lower investment and operating costs per megawatt (MW), making them a more sustainable option for Bangladesh's future energy planning.
Although Bangladesh has an installed power generation capacity of approximately 25,000-27,000 MW, actual generation under peak conditions is often limited to around 14,000-16,000 MW, while demand ranges between 16,000 and 17,000 MW. Despite having sufficient installed capacity on paper, the country is unable to ensure a stable power supply because of fuel shortages, supply constraints and other system limitations.
The contribution of renewable energy remains very low, accounting for less than 5.0 per cent of total power generation. Therefore, it is time to place greater emphasis on the development of the renewable energy sector. Expanding renewable energy capacity would help reduce government subsidies, lower generation costs and ensure a more reliable and sustainable energy supply that meets growing demand.

Kawsik Azad Pronoy
Unit Head
Dutch Bangla Bank
Corporate Business Division