In an exclusive interview with Just Energy News (JEN), editor Md Shamim Jahangir speaks with Prof. M. Tamim, Vice Chancellor of Independent University, Bangladesh (IUB) and a leading energy expert, about the interim government’s performance in the power and gas sectors.
JEN: The interim government cancelled two FSRU deals and 37 solar projects. What is your assessment?
Prof. Tamim: Cancelling projects wholesale was a mistake. Each should have been reviewed individually. Solar is the demand of the day, yet production is only 700 MW, while oil still accounts for 11% of power generation. With proper focus, solar output could be raised to 2,000 MW.
The government’s rooftop solar initiative targeting 2,000–3,000 MW is a good step, but I’m doubtful about implementation. Too many agencies are involved, and investment and logistics remain major hurdles.
JEN: The government claims success in reducing subsidies. Do you agree?
Prof. Tamim: Subsidies have been reduced. Furnace oil support fell from 9% to 5%, saving Tk450 crore. Administrative costs were trimmed by another Tk1,000 crore. These are efficiency gains.
But here’s the paradox: despite subsidy cuts, production costs rose – from Tk11.35 per unit last year to over Tk12 now. Consumers are not benefiting. The government promises to keep tariffs stable, but I see no prospect of price cuts.
JEN: Why has investment stalled?
Prof. Tamim: The main issue is the withdrawal of sovereign guarantees for Independent Power Producers. Without guarantees, projects aren’t bankable. Investors don’t trust PDB, which has a record of delayed payments.
This policy change, combined with political uncertainty under an unelected government, has scared off foreign investors. Offshore bidding is a case in point – seven companies collected documents, but none submitted bids.
JEN: What about subsidies in gas? Can Bangladesh phase them out?
Prof. Tamim: Very difficult. The gas sector is struggling. Current demand is 3.8-4.0 billion cubic feet per day, but supply is only 2.6-2.7. That’s already a 1 bcf shortfall.
Domestic production has dropped from 2,700 mmcfd in 2016-17 to 1,700 mmcfd today. Bibiyana is depleting, and BAPEX has failed to meet drilling targets. At this rate, in 4-5 years, gas-based industries and power plants will face disaster. Already, 2,200 MW of power plants are idle due to shortages.
JEN: What solutions do you see?
Prof. Tamim: Three urgent steps: (1)Update gas reserve estimates with independent international experts. Current figures are outdated.
(2) Open the sector to foreign investment. The “BAPEX-only” policy has failed. Chevron has shown that foreign operators can deliver cheap gas – effectively $1.5-2 per unit after adjusting for free gas.
(3) Scale up renewables. Solar and wind must be expanded, but projects must be well-planned and bankable.
JEN: What challenges will the next government face?
Prof. Tamim: Enormous ones. On the power side, we have 27,000 MW of capacity, but 4,000–5,000 MW is idle due to gas shortages and poor maintenance. By 2030, evening peak demand could hit 22,000-23,000 MW. Nuclear may add 2,000 MW, but integrating it safely into the grid will be a major challenge.
On the gas side, unless domestic production increases, industries will collapse, power plants will remain idle, and oil imports will balloon, further crippling the economy.
JEN: Your final word?
Prof. Tamim: Bangladesh’s energy future rests on three things: credible reforms, foreign investment, and smarter gas exploration. Without these, subsidy cuts and short-term fixes won’t prevent a looming crisis.