special feature
Energetica India
Bangladesh Energy Overview
The article shows the picture of the power sector in Bangladesh. It looks at the sector challenges,
the government policies and expected power trends in the country.
B
angladesh, with its 160 million
people in a land mass of 147,570sq
km is an emerging economy of
South Asia. Sustained economic growth
over the last decade has resulted in a con-
siderable high electricity demand. How-
ever, the demand has not been met due
to inadequate generation addition in the
past. Load shedding had been increased.
Moreover, outstripping electricity demand-
supply gap has been constraining further
economic progress as required to move
ahead middle class economy.
The Bangladesh government has already
declared its vision for power sector with an
objective to generate electricity for all.
Power System Master Plan 2010
(PSMP 2010)
In order to develop the Bangladesh power
sector, the government had put in place a
Power Sector Master Plan (PSMP) in 2005.
4 energetica
The PSMP 2005 was mainly based on
gas with the perception that Bangladesh
has abundance of gas reserve. But the re-
ality was not that, as such even the exist-
ing gas based power plants could not be
operated due to the shortage of adequate
gas pressure and gas reserve is alarmingly
depleting.
This made the government come up with
a new PSMP 2010 with a vision to provide
electricity for all by 2021. The new PSMP
2010 considered coal as dominant primary
fuel for the attainment of stable power
supply up to the year 2030 in considera-
tion of the diversification of fuel resources.
The PSMP 2010 included an optimum
power development plan and identifica-
tion of the potential power plant sites
based on the fuel diversification study.
It was developed with fundamental con-
ditions of the development e.g. demand
forecast, procurement of primary energy
resources, optimum power development
plan, future optimum power supply struc-
ture including the positioning of gas-fired
power plants, and so on. The fundamental
objective was also to attain stable power
supply by achieving the 3Es i.e, Economic
Growth, Energy Security and Environmen-
tal Protection simultaneously.
According to the Master Plan the fore-
casted demand would be 19,000 MW in
2021 and 34,000 MW in 2030. To meet
this demand the generation capacity
should be 39,000 MW in 2030.
Considering the fuel diversification issue,
the PSMP 2010 aimed to acquire the fuel
composition ratio to be coal 50% (30%
domestic coal and 20% imported coal),
natural gas 25% (including LNG), 5%
liquid fuel and 20% nuclear including re-
newable and cross-border trade. However,
domestic energy supplies are not enough
to fulfill the rapid demand growth for elec-
tricity and natural gas, and so it became
necessary to tap into other power sources
from abroad.
In order to achieve the said target the
PSMP 2010 addressed the following is-
sues:
1. Construction of imported coal power
station
2. Introduction of LNG facilities
3. Construction of the oil fired power sta-
tion
4. Import the electricity generated by
hydro power from the neighbouring
countries or joint development
5. Introducing a high efficient power sup-
ply and low CO2 emission technology
6. Improving 10 points thermal efficiency
on average
The PSMP 2010 recommended the re-
vision of tariff structure to recover main-
india · JAN | FEB14
 special feature

tenance costs and future investment for Installed Capacity of BPDB Power Plants
plant and equipment due to the fact that as on February 2014
the prevailing tariff did not envisage fund- Unit Type Capacity(Unit)
ing for neither appropriate maintenance Coal 250 MW
nor future system expansion. While the Gas 6615 MW
prevailing tariff policy adheres to the cost Heavy
1963 MW
reflection, it was also recommended that Fuel Oil
the power development surcharge into the High
Speed 683 MW
power tariff be introduced for the purpose Diesel
of funding the development of the pow- Hydro 230 MW
er system and/or energy saving projects. Imported 500 MW
PSMP 2010 recommended to promote pri-
Total 10241 MW
vate investment and develop an environ-
Tabl2 1. BPDB —- Bangladesh Power Development
ment that allows private funding. Board.
The aggregated investments for the de- of living standard, increase of agricultural
velopment of the generation, transmission production, progress of industries as well
and related facilities are found to be at as overall development of the country.
Taka 4.8 trillion (US$ 69.5 billion). The an-
nual average of the investment amounts Power Generation Scenario In Bangladesh
to Taka 241 billion (US$ 3.5 billion). Bangladesh as a country has faced severe
The government fully recognizes the fact power crisis which has compelled the State
that public sector investment alone is not to enter into contractual agreements for
sufficient to achieve its target and has high-cost temporary solution, such as oil
aimed at mobilizing resources from the pri- based rental and public sector peaking
vate sector investments. The government power plants  on an emergency basis.;
has been promoting the development thereby resulting in fiscal pressure.
of infrastructure through the promotion With a power sector which is almost de-
of Public-Private Partnership (PPP) as the pendent on natural-gas fired generation
policy to develop public services via private (89.22%), the country is confronting a
sector investment. simultaneous shortage of natural gas and
The Master Plan as a whole, requires an electricity. Nearly 800 MW of power could
annual allocation of Taka 241 billion and not be availed from the power plants due
the amount calculated for future availabil- to shortage of gas supply. Other fuels for
ity covers only 51% of the total require- generating low-cost, base-load electricity,
ment, while the remaining 49% has yet to such as coal, or large hydropower, are not
be identified in its funding source. It is im- readily available and Government has no
perative that the funding source needs to option but to go for fuel diversity option
be expanded and efforts should be made for power generation.
to increase the funding volume from each
of the funding sources to fill the gap. Calendar Year Wise  Generation Addition program (From 2013 to 2018)  In MW
In addition to what has been described YEAR 2013 (MW) 2014 (MW)
of the conventional Sources of funds,
Public 662 604
funding can be sought to the mecha-
Private 692 1366
nisms such as Global Environment Facility
Power
(GEF) and Clean Development Mechanism Import
500
(CDM) established for protection of the Total 1854 1970
global climate. Table 2.
Steps have been taken by government to
generate 7,000 MW by 2013 and 13,000
Total(%) MW by 2018.  4432 MW of power (as of
2,44% September, 2013) has been added to the
64,59%
grid.
The plan suggested to go for fuel-mixed
19,17%
option, which should be domestic coal
30%, imported coal 20 %, natural gas
6,67%
(including LNG) 25%, liquid fuel 5%, nu-
2,25% clear, renewable energy and power import
4,88% 20%. In line with the Power system Master
Plan 2010, an interim generation addition
100%
plan up to 2018 has been prepared, which
is as seen in tables 2, 3.
Short, Medium and Long Term Plans
The Government has undertaken some
short term, medium and long term plans
to make electricity available to the country.
Under the short term plan, rental power
plants will be installed using liquid fuels/
gas and capable to produce electricity
within 12-24 months.  Total 1653 MW
was installed by this time from rental pow-
er plants.
Under the medium term plan, initiatives
have been taken to set up power plants
with a total generation capacity of 11,497
MW. The plants are mainly coal based;
some are gas and oil based.
In the long term plan, some big coal fired
plants will be set up, one will be in Khulna
and other will be in Chittagong, each of
having the capacity of 1300 MW. Some
300-450 MW gas based power plants will
be set up in Bibiana, Meghnaghat, Ashu-
gonj, Sirangonj and in Ghorashal.
2015 (MW) 2016 (MW) 2017 (MW) 2018 (MW) TOTAL (MW)
1837 1510 0 1320 5933
 1097 638 1271 0 5064
 500
2934 2138 1271 1320 11497

 Plants Commissioned During 2009 – September 2013

Generation Plan of Bangladesh’s
Power Sector YEAR 2009 (MW) 2010 (MW) 2011 (MW) 2012 (MW) 2013 (MW) TOTAL (MW)
Though the power sector in Bangladesh Public 255 800 607 587 2249
has witnessed a few success stories, there
Private 356 270 125 44 795
exists gap between what’s been planned
Q. Rental 250 838 300 1388
versus what the power sector has been
able to deliver. The demand for electricity is Total 356 775 1763 951 587 4432
increasing rapidly with the improvement Table 3.

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special feature
A total of  38,229 Million-kilowatt hour
(MkWh) net energy was generated during
2012-13. Public sector power plant gener-
ated 47% while private sector generated
53% of total net generation. The share of
gas, hydro, coal and oil based energy gen-
eration was–78.12%,  2.34%,  3.02%
and 16.51% respectively.
Power Distribution Plan
Bangladesh saw a number of distribu-
tion entities taking shape as a result of
reforms, restructuring and corporatization
process of Bangladesh power sector. The
distribution entities were formed with the
objective of bringing commercial environ-
ment including increase of efficiency, ac-
countability and dynamism with the aim of
reaching electricity to all citizens by 2021.
Presently the following five organizations
are responsible for the distribution of pow-
er in the country:
Bangladesh Power Development Board
(BPDB)
7. Rural Electrification Board (REB)
8. Dhaka Power Distribution Company
(DPDC)
9. Dhaka Electric Supply Company
(DESCO)
10. West Zone Power Distribution Com-
pany (WZPDC)
Some Recent initiatives to improve power
distribution in Bangladesh include:
Power System Interface Meter
At present the government has taken mas-
sive measures to reduce system loss and
increase customer satisfaction. Under this
project 409 interface meters have been in-
stalled at all generating stations through-
out the country and Dhaka distribution
zone and transmission network at 230KV,
132KV and 33KV level.
The interface meters have been used as
billing meters. This will be extremely ben-
eficial for the energy auditing system. Op-
erator’s performance will also be enhanced
significantly and accountability and trans-
parency will be established in the energy
auditing system.
Remote Area Power Supply System (RAPSS)
A part of the population lives in remote ar-
eas which are far away from existing grid
line and sometimes isolated from the main
land.
6 energetica
Considering this the government has
identified private sector participation as an
important requirement. Under the RAPSS
concept, private investor will be given an
area (the RAPSS Area) for the develop-
ment, operation and maintenance of the
electricity distribution and retail supply
system, including generation as a utility
for a period of 20 years. The government
has taken initiatives to establish solar mini-
grid for remote off-grid area under RAPSS
where grid expansion is not planned for
the next 15 to 20 years.
Pre Paid Meter
With an aim to improve operational ef-
ficiencies, reduce financial risks and en-
hance customer services, Bangladesh
Power Development Board [BPDB] had
installed nearly 46,000 pre paid meter in
Chittagong, Bogra, Sylhet and Sirajgonj
area. Due to the success of the pre paid
meter, the government has planned to in-
stall this system all around the country.
Renewable Energy in Bangladesh
In the roadmap set by the State for coun-
try’s power sector, renewable energy has
been given due importance.
Power generation in Bangladesh was
mono-fuel dependent, i.e. indigenous
natural gas since 2009 considering its ap-
parent huge availability. About 89% of
generated power comes from natural gas
and the rest is from liquid fuel, coal and
hydropower. The present share of renew-
able energy is only 0.5%.
However, in recent years, it was evident
that actual scenario is other way round
and adequate supply of natural gas has
been at stake due to depleting existing
gas reserves and non-exploration of new
gas reserves. Development of renewable
energy is one of the important strategies
adopted as part of Fuel Diversification Pro-
gram.
Under the existing generation scenario
renewable energy has a very small share
to the total generation. However, under
the changed perspective renewable en-
ergy would have a significant contribution
given the global climate change scenario
and carbon trading prospect.
The government has taken a systematic
approach towards renewable energy de-
velopment with initiatives including devel-
opment of relevant policy and institutional
development.
Renewable Energy Policy
Renewable Energy Policy, brought about in
2008, to facilitate both public and private
sector investment in renewable energy
projects to substitute indigenous non-
renewable energy supplies and scale up
contributions of existing renewable energy
based electricity productions.
The Policy envisions 5% of total genera-
tion from renewable sources by 2015 and
10% of the same by 2020.
Institutional Development
Establishment of a nodal agency, i.e. Sus-
tainable Energy Development Authority
(SEDA) as envisioned in the Renewable
Energy Policy is underway. For the interim
period and to carry ahead initial formation
activities of SEDA, a wing under leadership
of an Additional Secretary of the Govern-
ment has been set up. With governmental
institutional support, the expectations are
that the Renewable Energy Development
Program will gain momentum.
Government Power Utilities like Bangla-
desh Power Development Board (BPDB),
Rural Electrification Board (REB), Local
Government Agency like Local Govern-
ment Engineering Directorate (LGED) and
a significant number of Private Sector
agencies including NGOs are involved in
renewable energy development. Noted
Public Universities and their affiliated Insti-
tutes are involved in research and develop-
ment of Renewable Energy Applications.
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 special feature

Resources Potential
Renewable Energy Potential in Bangladesh
Solar Enormous
Bangladesh is hoped to have enormous
potentiality in renewable energy devel- Wind Resource mapping required

opment. Some of the areas like solar PV, Limited potential for micro or mini hydro
Hydro (max. 5 MW).
the potential of development is already
Est. hydro potential: approx. 500 MW
proven. Bangladesh has fitting geographi-
Domestic Biogas System 8.6 Million Cubic Meter of Biogas
cal condition for solar power. Bangladesh
Rice Husk based Biomass gasification Power Plant 300 MW considering 2 kg of husk consumption per kWh
receives an average daily solar radiation of
350 MW considering 0.752 m3 of biogas consumption
4-6.5 kWh/m2. Solar photovoltaic (PV) are Cattle waste based Biogas power plants
per kWh.
gaining acceptance for providing electric- Table 4.
ity to households and small businesses in
rural areas. Development of off-grid solar Category Achievement
home solutions has achieved international SHS 45 MW
benchmark. Other Solar PV Applications including Solar Irrigation 1 MW
According to a survey, there is an exist-
Wind Energy 2 MW
ing market size of 1 million households
Biomass based electricity <1 MW
for Solar Home Systems (SHS) on a fee-
for-service basis in the off-grid areas of Biogas based electricity 1 MW

Bangladesh. At present the national grid Total 50 MW

is serving only 50% of the nearly 10,000 Table 5.

rural markets and commercial centres in
the country which are excellent market
for centralized solar photovoltaic plants.
Throughout the country, different govern-
ment administrative offices, NGO offices,
Health Centres, Schools, banks, police sta-
tions etc are functioning. In the off-grid lo-
cations, these offices are either using tra-
ditional means (lantern, candles, kerosene
wick lamps etc.) or operating their own
diesel gensets.
However, potential of other renew-
able resources is still at the exploration
stage. Potential of Wind Energy is mainly
in coastal areas and offshore islands and
to determine extent of potential wind re-
source mapping project is in process. Some
of the development partners and compa-
nies come forward for wind mapping in
different parts of the country.
Bangladesh has strong potential for bio-
mass gasification based electricity. More
common biomass resources available in
the country are rice husk, crop residue,
wood, jute stick, animal waste, municipal
waste, sugarcane bagasse etc. Exploration
of these resources for electricity genera-
tion is still at preliminary stage. Potentials
for utilizing biogas technologies derived
mainly from animal, kitchen and municipal
wastes may be one of the promising re-
newable energy resources for Bangladesh.
Micro hydro and mini hydro have limited
potential in Bangladesh with exception of
Chittagong Hill Tracts. Hydropower assess-
ments have identified some possible sites
from 10 kW to 5 MW implementation of
which is still at large.
Other renewable energy sources include
bio-fuels, gasohol, geothermal, river cur-
rent, wave and tidal energy. Potentialities
of these resources are yet to be explored.  prehensive large scale program with sup-
Installed Capacity of Renewable Energy
Government utilities are involved in large
scale grid connected renewable energy
based power project development. On the
other hand, private sector is involved with
off-grid home-based renewable energy so-
lutions.
The first significant PV-based rural elec-
trification programme was the Norshingdi
project initiated with financial support
from France. Since the introduction of SHS
in 1996 it has become now the biggest
renewable energy program in Bangladesh
so far installed 900,000 units and ever
increasing due to an integrated program
undertaken by the government through its
financial institution, IDCOL. IDCOL’s pro-
gram is considered as a successful model
for installation of SHSs in the world.
Till now, national capacity of renewable
energy based power is approx. 50 MW as
shown in table 5.
In a developing country like Bangladesh
where meeting generation shortage is the
primary priority, least cost generation tech-
nologies always rule the generation plan-
ning. Unfortunately, renewable energy
cannot compete to achieve grid parity at
the moment. Government incentives like
FiT can enhance the development process,
but it is always difficult to source fund for
such incentives especially under present
tariff rationalization structure. Only a com-
port to buy-down the cost of intervention
can pave the way for Renewable Energy
development.
Renewable Energy Development Program
In line with the Renewable Energy Policy,
the government has plans to develop at
least 500 MW power from renewable en-
ergy by 2015.
Expected Public Sector Participation in
program is:
Total Capacity
Solar 25 MW
Wind 235 MW
Total 260 MW
Recent Initiatives in Renewable Energy:
1. Govt. has exempted income tax for
next 5 years from commercial produc-
tion from renewable energy
2. 100 MW of wind power will be gener-
ated in the off-shore area of Anwara,
Chittagong in IPP model; tendering is
under process
3. Power Development Board [PDB] has
undertaken a project in a remote
area Sullah to provide 600kW solar

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special feature

power under Climate mitigation pro- project. 230 W solar power in Angorpot and
gramme. 5. PDB and REB are distributing Solar Dahagram Chitmahal Area and in-
4. Rural Electrification Board [REB] has Home System (SHS) to the people liv- stalled 115W at their office building.
taken project for Solar Irrigation Sys- ing in the off-grid areas. 7. Solar PV with capacity of 21.2 KW has
tem. 40 irrigation pumps will be 6. PDB has already installed nearly 11 KW been installed at the Hon’ble Prime
brought under solar power under this solar power to the CHT area, nearly Minister’s office as a demonstration
programme.
8. Nearly 10MW solar plant will be in-
Type of Projects Capacity addition in MW
stalled by PDB in Sarihabari (2-4 MW),
Commercial Solar Projects 340 Rigional Training Office, Rajshahi (1
Social Sector Solar Projects 160 MW), Rajabarihat, Godagari (2-4 MW)
in IPP model. Preparation of tender
Total MW 500
documents is underway.
Table 6.
The Bangladesh Government has also re-
cently initiated 500MW Solar power pro-
Capacity
Type of Projects gramme with the inspiration and support
addition in MW
Solar Irrigation 150 of Asian Development Bank. The strategy
Solar Mini Grid 25 of the mission is to install 500MW solar
power by 2016. The government will en-
Solar Park 135
courage private sector involvement in the
Residential & Commercial Bldgs 10
Solar Roof-top sector; with approximately 340MW for pri-
Industrial Bldgs 20
vate sector.
Total MW 340 Solar power is the most potential source
Table 7. among the renewable energy resources
in Bangladesh. This initiative of Bangla-
Type of Projects Capacity addition in MW desh Government could become a land-
Solar electrification in Health Centres 50 mark success story on how government’s
Solar electrification in Remote Educational Insitutions 40 commitment in combination with strong
Solar electrification at Union e-Centres 7
support from Development Partner could
achieve the targeted renewable energy
Solar electrification at Religious Establishment 12
development in a developing country.
Solar electrification at Remote Railway Stations 10
Under Commercial Solar Projects; the
Solar PV System in Government & Semi-Government Offices 41 categories are (see table 7).
Total MW 160 Under Social Sector; the categories are
Table 8. (see table 8) 7

8 energetica india · JAN | FEB14