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Research: Demand for CSR among Millennials

Bangladesh’s Renewable Energy Challenges and Sustainable Solutions

Bangladesh is behind on its renewable energy targets, with only four percent of its energy coming from renewables compared to a 2020 target of ten percent. Achieving the goal of 100 percent renewable energy by 2050 is challenging. The success of COP28's agreement to boost renewable energy depends heavily on Asia, where many countries, including Bangladesh, face significant hurdles.

Energy Infrastructure Challenges

Debates continue over energy sources—renewables versus fossil fuels—and the high land requirements for solar expansion. However, the specific needs of developing countries like Bangladesh to achieve a green transition receive limited attention.

Bangladesh has built many power plants but lacks investment in transmission and distribution systems. This has led to regular power outages despite power plants operating below capacity. Rising costs of importing coal, gas, and oil emphasize the need to diversify domestic energy sources into renewables. Dwindling gas reserves and lack of new exploration add to the urgency.

Upgrading the transmission and distribution system is crucial to manage the intermittency of renewable energy. Achieving the 2050 goal will also require regional energy trade, necessitating expanded transmission systems. The recent tripartite power-sharing agreement between Bangladesh, Nepal, and India is a positive step but requires dedicated transmission lines and grid integration.

Financing and Policy Support

Infrastructure projects in developing economies struggle to attract sufficient financing due to high costs and shallow domestic financing markets. A combination of funding sources at different project stages can address this constraint. Public financing from governments and banks can support early stages, while bond financing can be used later.

Maintaining concessional rates for sectors like renewables and transmission is crucial as Bangladesh progresses. Multilateral development institutions can provide long-term financing for projects with public benefits. Southern-led development banks and traditional Bretton Woods Institutions (BWIs) can offer various forms of support.

In addition to financing sources, the costs of financing must be transparent and central to policy discussions. Increasing production capacity without improving transmission and distribution systems will lead to underutilized power plants and accumulating loan repayments.

Job Impacts and Agrivoltaics

Bangladesh needs to consider the job impacts of a green transition, focusing not only on the number of jobs but also on who benefits. An ongoing study by the BRAC Institute of Governance and Development (BIGD) estimates the job impacts of renewable transition in Bangladesh. Solar energy, while feasible, is land-intensive and relies heavily on imported inputs, resulting in fewer upstream employment gains.

Integrating solar energy with agriculture—known as agrivoltaics—can reduce land intensity and provide more jobs for women and low-skill workers. Agrivoltaics, which involves harvesting crops and solar energy on the same land, could be a promising solution for Bangladesh. It can increase land productivity and reduce irrigation needs by providing shade. Implementing agrivoltaics requires a pilot project, changes to the 2016 land policy draft, and coordination between the power and agriculture ministries.

Conclusion

Bangladesh faces significant challenges in transitioning to renewable energy, but with coordinated investment, policy support, and innovative solutions like agrivoltaics, the country can make substantial progress. Addressing financing constraints and upgrading infrastructure are critical steps towards achieving its renewable energy goals and ensuring a sustainable and inclusive green transition.

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