Electricity demand
Demand for electricity in Bangladesh is increasing with time. The country’s economic development, industrial expansion and urban population growth are driving the demand for electricity. Especially in megacities like Dhaka, the demand is highest. Every year the electricity demand of the country is increasing at the rate of about 10-12%. In 2024, Bangladesh’s electricity demand may exceed about 15,000-16,000 MW.
Power supply
Power plant is the main source of power generation system in Bangladesh. But supply does not always meet demand. Currently, the country’s power generation capacity is about 23,000 MW, although actual generation is less, due to shortages in natural gas and coal supplies. Besides, infrastructural constraints and faulty power grid hamper the electricity distribution system.
power plant
Bangladesh has several major power plants, which generate electricity using different types of fuels. Some of the major power plants are:
- Payra Power Station (1320 MW, Coal-fired)
- Rooppur Nuclear Power Project (currently 2400 MW, to be completed in 2025)
- Ghorashal Power Station (1950 MW, Gas Based)
- Matarbari Coal Power Project (1200 MW, Coal Based)
In addition to coal-based, gas-based and oil-based power generation, the country also has some projects based on renewable energy (such as solar panels), but generation from renewable energy is quite low.
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Where is the production?
At present the country’s major power generation centers are spread over various provinces:
- About 5,000 MW of electricity is generated in the Chittagong region.
- About 4,000 MW in Dhaka and its surrounding areas.
- Gas-based generation is high in North Bengal’s power plants, generating about 2,500 MW of electricity.
Type of fuel
Mainly three types of fuel are used for power generation in Bangladesh:
- Natural Gas: A large part of the country’s electricity (about 60%) depends on this fuel.
- Coal: It produces about 30%, but it is harmful to the environment.
- Liquid Fuel (Oil): It is used in limited quantities as it is expensive.
- Renewable energy: Although only 3-5% comes from solar and wind power projects, there are plans to increase this amount in the future.
- Why is the price of electricity higher than other countries?
- The cost of electricity in Bangladesh is higher than other South Asian countries. There are a few main reasons behind this:
- Imported Fuel: The country is dependent on fuel imports for insufficient gas and coal. If the price rises in the international market, it will have an impact.
- Infrastructural problems: Weak infrastructure and management in power generation and supply.
- Low-quality contracts: Many power plants have entered into high-cost power purchase agreements with the private sector, which has increased the cost of electricity.
- Corruption in power sector
- Bangladesh’s power sector has been a victim of corruption for a long time. There have been allegations of corruption in the contracts of several projects and the management of power plants. Power has been purchased at high prices, particularly through power import contracts and quick rental power schemes, which have indirectly increased public consumption. In addition, lack of oversight mechanisms and inefficiencies have further encouraged corruption.
Currently due to load shedding
The main reasons for the load shedding problem in 2024 are:
- Energy Shortage: Disruption of coal and gas supply. Global energy crisis and supply disruptions are responsible for this situation.
- Infrastructural problems: Power distribution network is weak in many areas causing disruptions in power supply.
- Increase in seasonal demand: Increased demand for air conditioners during summer increases the tendency of load shedding.
- Who will get how much money, income and expenses
- Government and private sector investment in power sector in Bangladesh is extensive. The revenue generated from the sale of electricity is mainly distributed through distribution companies and the power grid. However, the government has to pay various subsidies, especially due to the cost of energy in power generation.
The government has allocated a budget of around Taka 50,000 crore to the Power Sector of Bangladesh in 2024, through which the arrears of quick rental projects and implementation of new projects will be met. Income from electricity bills is also significant, but not always profitable due to high fuel costs.
Conclusion
Power Sector of Bangladesh is on the path of progress but facing various challenges. A permanent solution to the power crisis is not possible due to demand-supply shortages, corruption and energy supply problems. However, increasing reliance on renewable energy and good governance can improve the efficiency of the power sector in the future.
