Bangladesh’s draft Energy and Power Sector Master Plan 2025 (EPSMP) could lock the country into decades of costly fuel imports, rising electricity prices and renewed corruption risks, according to a critical assessment published by the policy research body Change Initiative.
In a position paper released this week, the organisation warns that the proposed master plan, while acknowledging past policy failures, risks institutionalising what it describes as a “debt-driven energy dependency” that could undermine the country’s long-term economic sovereignty.
The analysis estimates that continued reliance on imported fuels under the EPSMP could drain between $30bn and $45bn in foreign exchange between 2026 and 2050. Although the plan aims to reduce import dependence by around 20% by mid-century, Change Initiative argues this still leaves Bangladesh structurally exposed to volatile global energy markets.
“The plan prioritises liquefied natural gas terminals and refineries over domestic renewable alternatives,” the report says, adding that this approach would leave the economy vulnerable to currency depreciation and international price shocks.
The organisation also raises concerns about what it calls “engineered overcapacity”. According to the draft EPSMP, Bangladesh’s installed generation capacity could rise to 89.1 gigawatts by 2050, while projected peak demand stands at just 59 gigawatts. The resulting 30-gigawatt surplus, the report argues, risks reviving the controversial system of capacity payments, under which consumers pay for unused power plants.
Bangladesh has previously faced criticism for excess generation capacity, which contributed to rising subsidies and higher electricity tariffs during the past decade.
Change Initiative further criticises the plan’s timeline for renewable energy deployment, noting that large-scale solar and wind expansion is largely deferred until after 2040. This, it says, contradicts Bangladesh’s updated climate commitments under its Nationally Determined Contribution (NDC 3.0).
Delaying the energy transition could prevent the country from accessing concessional climate finance in the near term and prolong dependence on expensive fossil fuels, the report argues. It also questions the plan’s projection of $20bn in carbon credit revenues by 2050, suggesting a more realistic figure would be closer to $150m by 2030.
The social impact of the plan is another area of concern. The EPSMP projects electricity prices rising to Tk13.66 per kilowatt-hour and gas prices to Tk70 per cubic metre by 2050. Change Initiative says the plan lacks safeguards such as lifeline tariffs or automatic support mechanisms to protect low-income households and small businesses from price shocks.
“Despite evidence that every dollar shifted from LNG to solar could generate up to $17 in economic gains, the master plan risks repeating an import-centric model that has already drained our foreign reserves,” said M Zakir Hossain Khan, chief executive of Change Initiative.
The organisation has proposed five key revisions to the plan, including mandatory foreign exchange stress tests for new fossil fuel projects, accelerated deployment of renewables, rights-based affordability measures, stricter environmental safeguards and enhanced transparency to prevent overcapacity.