The government has been forced to spend an additional $2.5 billion on fuel imports to meet heightened domestic demand amid the global energy crisis, Power, Energy and Mineral Resources Minister Iqbal Hasan Mahmud Tuku said on Monday.
This has added to the huge liabilities inherited from the previous administration that have left the power and energy sector in a difficult financial position, he said, adding that the only sustainable way out of this financial strain is to accelerate the transition to renewable energy.
“We are in a complicated situation because of enormous liabilities. The way out is renewable energy,” he said while addressing a citizens’ dialogue on the National Renewable Energy Development Strategy at the Dhaka Reporters Unity (DRU), organised by the Consumers Association of Bangladesh (CAB).
Tuku said the government had to spend around $2.5 billion more on fuel imports after panic buying and an unexpected surge in domestic demand during the recent international energy crisis.
“Because of the rush for fuel, we had to procure oil at higher prices, which cost the government around $2.5 billion more,” he said, adding that the government is now working to ensure strategic fuel reserves sufficient for three months to better withstand future supply shocks.
The CAB dialogue featured an 18-point recommendation for promoting renewable energy, while CAB Energy Adviser Dr Shamsul Alam presented the keynote paper.
The adviser said the government has introduced tax incentives to encourage investment in renewable energy and is aiming to generate 10,000MW of electricity from renewable sources by 2030.
“If we can achieve that target, dependence on imported fuel will decline significantly, bringing a transformative change to the energy sector,” he said, expressing confidence that growing investor interest would help achieve the goal.
Calling his current tenure his “second innings” in the ministry, Tuku said he did not support leaving power generation entirely to the private sector.
“The private sector seeks profit. If the government generates electricity, it can provide services without focusing on profit. However, privatising electricity distribution could have produced better results,” he said.
On rooftop solar, he suggested introducing a service model similar to cable television operators.
“If cable operators can install connections house-to-house and collect bills, why can’t rooftop solar operate in the same way?” he said, adding that electricity could be supplied through rooftop solar at around Tk 7 per unit.
Emphasising the protection of agricultural land, Tuku said the government is considering using unused land owned by agencies such as Bangladesh Railway and the Roads and Highways Department for solar projects instead of farmland. He also noted that advances in technology now allow vegetables to be cultivated beneath solar panels.
Responding to concerns over recent power outages, the adviser said most disruptions stemmed from technical problems in generation and distribution.
“In many areas, the network cannot carry the required load. Recently, load-shedding occurred because of faults at two power plants,” he said.
He added that the ministry had formed a technical team and a high-level committee to inspect private power plants regularly, saying proper maintenance would help reduce unexpected outages.
Criticising the previous administration, Tuku alleged that many projects had been undertaken for commercial interests rather than national needs, creating substantial financial liabilities. As examples, he cited the underground cable project in Dhaka and the rural smart meter programme.
“About 250,000 smart meters were purchased, but only 67 have been installed,” he claimed.
