solar energy in bangladesh

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Solar Energy in Bangladesh

April 20th, 2011 12:01 pm @Nisha Kumar Kulkarni

In 1971, just 3% of Bangladeshs population had access to electricity. Today, thatnumber has increased to around 40% of the population still one of the lowest in theworld but access often amounts to just a few hours each day. Bangladesh claims thelowest per-capita consumption of commercial energy in South Asia, but there is asignificant gap between supply and demand. Bangladeshs power system depends onfossil fuels supplied by both private sector and state-owned power plants. After systemlosses, the countrys installed capacity for electricity generation can generate 3,800megawatts of electricity per day; however, daily demand is near 6,000 megawatts perday. In general, rapid industrialization and urbanization has propelled the increase indemand for energy by 10% per year. What further exacerbates Bangladeshs energy

problems is the fact that the countrys power generation plants are dated and may needto be shut down sooner rather than later.

Clearly, the present gas production capacity in Bangladesh cannot support bothdomestic gas needs, as well as wider electricity generation for the country. OnSeptember 15, 2009, the Power Division of the Ministry of Power, Energy and MineralResources of Bangladesh pushed for urgent action to be taken to improve the countrysenergy outlook. The Power Division made recommendations such as ceasing gassupply to gas-fired power plants after 2012 to conserve gas reserves for domestic use.

The Government of Bangladesh is actively engaged in energy crisis management. The

National Energy Policy has the explicit goal of supplying the whole country withelectricity by 2020. Since 1996, the government has allowed private, independent powerproducers to enter the Bangladeshi market. It is already importing 100 megawatts ofpower from India and has negotiated with private companies renting plants to buy powerat higher rates.


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Solar Energy

Even with these measures, Bangladeshs gas reserves are quickly diminishing. For thecountry to fulfill its goal of universal electrification, Bangladesh needs to invest inalternative sources of energy. The energy needs of Bangladesh are great not just

because of limited supply; the issue is also mainly one of access. About 80% of thepopulation resides in areas where electricity is akin to a dream. There are estimates thatmany parts of the country will still not acquire electricity from the national grid foranother 30 years. The national grid covers at most 20% of households, but this statisticdoes not capture the infrequency of access and the resources needed to bolster it.

Solar energy therefore has significant potential for Bangladesh. Solar power does notrequire sophisticated technology or know-how. It does not require fossil fuels tofunction, and is highly reliable: it is an economically feasible energy source. There arestudies that suggest that if solar energy is adopted, as much as 10,000 megawatts dailyof solar electricity can be created in the short- and medium-runs this is equivalent to

twice the total amount of electricity produced and supplied on the national grid.

In 2008, at the Washington International Renewable Energy Conference, Bangladeshpledged that 5% of its total electricity generation would come from renewable sources.In 2009, the Bangladesh Bank set up a US$29m fund to promote solar power. Privatecommercial banks and state-owned banks signed an agreement with the central bankthat allowed banks to draw money from this fund under a refinancing scheme with alow-interest interest rate of 5%. The banks could then lend the funds to borrowers fromthe solar power sector at a ceiling interest rate of 10%.

Although the Government of Bangladesh, along with the central bank, have made

strong moves to bolster its solar power investment, in general, banks have not beeninterested because they do not find solar technology as profitable as other areas ofbusiness. The task at hand now is to make solar energy investment more attractive forlenders so that this area of renewable energy can be stimulated and grown.

Urban Potential

Most efforts to promote solar technology in Bangladesh have been directed towardsrural areas. It is understandable given the poor electricity access in rural areas.

Approximately 60 million people in the country are getting unreliable power. And it is fairto assume that since the demand for power in urban areas is generally greater than thatof rural areas, urban households can also benefit from solar technology to escape thecycle of inadequate and irregular access to power.

The average energy need of cities like Dhaka and other urban areas is 4,000megawatts per day that is 200 megawatts in excess of daily national supply. Underthe current plan, Dhakas energy needs have the potential to consume nearly the entireenergy output of the national grida dire situation that leaves much of the countrywithout power. The demand gap needs to be filled and alternative sources, like solar


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power, can easily bridge that gap. Bangladeshs tropical geography lends itself to solartechnology since it receives plenty of sunlight.

There is no current government campaign in effect to promote solar power in urbanareas, but if solar power becomes part of the countrys energy agenda, it could play a

significant role in relieving the stress on the national grid and help Bangladeshi citiesmove towards more sustainable energy practices.

Earlier this month, the city of Dhaka hosted a three-day solar power products exhibitionto further popularize the idea of renewable energy for all people in the country. Everymonth, more than 30,000 solar home systems are installed throughout the country upfrom 12,000 per month just under two years ago. The Rural Electrification andRenewable Energy Development Project (REREDP) has brought solar power to 7.5million people in rural Bangladesh. A similar project needs to be initiated for urbanBangladesh where solar panels, for example, could be installed on the rooftops ofbuildings or in common living areas.

Country Projects

Despite a slow awakening to solar energy potential, Bangladesh has begun to be moreactively engaged in promoting solar energy. In March 2011, the country set a target toinstall 500 megawatts of electricity via solar home systems to combat greenhouse gasemissions and to ensure sustainable development in energy. The plan is to use AsianDevelopment Bank (ADB) solar power project funds to achieve the electricity generationtarget. The ADB will support 3,000 megawatts capacity power in the Asia-Pacific region;to benefit from this design, Bangladesh is partnering with NGOs to prepare its solarprogram. The country also has plans for a solar irrigation system to cut diesel costs.

From the NGO perspective, the not-for-profit organization Grameen Shakti has beensuccessfully working in Bangladesh, bringing 550,000 home solar systems in 40,000villages since 1996. Currently, the organization has given 10,000 families solar power,and has the goal of providing 10 million Bangladeshis with electricity by 2012. Eachsolar unit has been partially subsidized by the government.

Conclusion

The controversy around solar technology is that it is expensive. The argument is that acountry like Bangladesh does not have an abundance of money to throw at new

technologies. However, that is a short-sighted point of view. The expense may be great,but if one weighs that against the potential for an energy crisis in the country, makingprovisions to invest in alternative energy sources does seem logical. Because most ofthe country still cannot access electricity, an energy crisis may have catastrophic effectson livelihoods. Recent studies by the UN and World Bank also suggest the vulnerabilityof developing countries to climate change solar energy and other renewable energysources allow for countries to plan future energy supply, as well as better prepare thecountry for the future effects of climate change. As Bangladesh continues to shape its


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future energy agenda, only time will tell to what extent the country sees alternativeenergy sources as a promising solution to a complex and convoluted problem.

This story originally appeared in the April 2011 edition of the Searchlight South Asia newslettercreated byIntellecap for theRockefeller Foundation.

The opinions expressed on the Searchlight South Asia site are solely those of the authors and do

not necessarily reflect the positions of the Rockefeller Foundation.

Sources:

http://chethoughts.com/?p=373

http://edition.cnn.com/2011/BUSINESS/04/11/bangladesh.solar.power.kalihati/

http://ipsnews.net/news.asp?idnews=53964

http://www.energybangla.com/index.php?mod=article&cat=GreenPage&article=2261




http://www.reuters.com/article/2009/08/17/us-bangladesh-solar-idUSTRE57G15X20090817

http://www.thefinancialexpress-bd.com/more.php?news_id=130905&date=2011-03-31

http://www.usaid.gov/bd/programs/energy.html

solar energy in bangladesh

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