Category: Energy and Power

Bangladesh is facing a challenge in its fi ght for energy independence.

For decades, the country relied on its own natural gas to produce over 60% of its electricity.

Now, those local reserves are rapidly running out.

To make up for the shortage, Bangladesh has fallen into a trap of spending millions of dollars importing expensive and unpredictable foreign fuel like Liquefi ed Natural Gas (LNG), coal and oil.

This massive spending is draining the country’s foreign currency reserves and hurting the economy.

To truly protect its independence, Bangladesh must shift away from imports and build a domestic energy system powered by local renewable energy sources.

Bangladesh’s Climate Prosperity Plan aims for a bold 40% clean energy share by 2041, but red tape is blocking progress.

At fi rst, the proposed National Budget for FY 2026-27 brought hope by removing import duties, value-added tax (VAT), and advance income tax (AIT) on solar equipment.

However, the National Board of Revenue (NBR) quietly weakened this plan.

Just three days before the budget announcement on 11 June 2026, the NBR issued Statutory Regulatory Orders (SROs) with strict conditions that directly undermine the government’s green goals.

The SROs implement contrasting tax policies, scaling back broad fi scal support for fossil fuels while offering a signifi cant, phased income tax holiday to encourage utility-scale clean energy generation.

The comparative table below outlines the primary tax and incentive structures by the NBR: Stakeholder groups criticize current NBR policies.

Groups like the Centre for Policy Dialogue (CPD) and Bangladesh Solar and Renewable Energy Association (BSREA) point out restrictive eligibility.

They argue these tax waivers mainly benefi t large corporations instead of residential rooftop users or small farmers.

Analyzing the above table, NBR SROs act as a barrier to energy independence by creating an unfair market.

It grants duty and tax waivers only to VAT-registered Renewable Energy Service Companies that generate electricity under a PPA.

Instead of encouraging a widespread solar boom across households and villages, the policy limits tax and duty benefi ts almost entirely to large commercial operations and utility-scale projects.

The SROs potentially exclude everyday residents, small-scale farmers and rural entrepreneurs, who are completely excluded from tax incentives.

As a result, while a massive industrial conglomerate can import solar components duty-free to cut costs, an ordinary citizen trying to install a modest 02 kW solar system on a village roof must pay heavy import duties.

By shutting out everyday consumers, the SROs are choking the massive potential of decentralized clean energy.

Bangladesh has the technical capacity to generate over 100,000 MWp from advanced rooftop solar alone.

To unlock this, the public must be empowered to become active energy producers.

When fi nancial policies create barriers for the average household, it stunts the growth of the clean energy grid and slow down job creation.

While the national budget aims to create over half a million generic jobs, civil society groups point out that a fully unlocked renewable energy sector could independently create over one million green jobs.

Unfortunately, this economic potential is currently stalled by bureaucratic red tape.

This regulatory barrier may reveal a deeper conflict in the state’s economic strategy.

Its old attachment to fossil fuels is undermining its new climate goals.

Even though offi cial statements celebrate a green transition, Government funding continues to back dirty energy.

This keeps fossil fuels artifi cially cheap and slows down the shift to clean energy.

The contrast between fossil fuel incentives and renewable energy support in the current National Budget (FY 2026-27) could be examined as follows: Sector Present Status and Allocation Impact on Energy Independence Renewable Energy Allocation Only 2.20% (Tk 379.24 crore) of the total Tk 17,193 crore power development budget Severely inadequate to fund the Tk 21,750 crore annual investment required for a green transition Fossil Fuel Subsidies 15% VAT and 2% advance income tax waivers remain active for LNG imports Artifi cially lowers fossil fuel costs and prolongs dependence on imported energy Coal Project Expansion Active funding for domestic coal mining (like Barapukuria), where extraction costs (USD170/ tonne) exceed global prices (USD 90-120/tonne) Wastes national funds that could otherwise support solar energy development Ultimately, setting clean energy goals means nothing without the right regulations to back them up.

To escape the expensive trap of importing fuel before its own gas reserves run out, Bangladesh must align its tax policies with its long-term vision.

Resolving this crisis requires immediately canceling or majorly revising the restrictive NBR-issued SROs so that everyone gets equal tax benefi ts.

True energy independence cannot be achieved by only favoring big corporations.

Instead, the country needs an open, inclusive framework that empowers every household, farm and community to contribute to a green energy future

Chevron Australia has signed a new fi ve-year agreement to supply 46 petajoules (PJ) of natural gas to Alinta Energy, strengthening energy security for homes, businesses and industries across Western Australia.

The new contract will commence in July 2027, with gas sourced from Chevron’s Gorgon, Wheatstone and North West Shelf projects.

It extends a long-standing partnership between the two companies that spans more than four decades.

Chevron Australia President Balaji Krishnamurthy said the Gorgon and Wheatstone projects have become key pillars of Western Australia’s energy security, together supplying around 40% of the state’s domestic gas demand.

The agreement follows an earlier seven-year deal signed in 2020, under which Chevron supplied 20 petajoules of gas annually to Alinta from the Wheatstone project.

The latest deal comes as Chevron and Woodside Energy continue to fi nalize an asset swap aimed at aligning ownership interests with project operatorships across several major gas developments in Western Australia

The government will gradually reduce fuel prices whenever there is an opportunity to do so, State Minister for Power, Energy and Mineral Resources Aninda Islam Amit said on 3 July.

Referring to the latest reduction in LPG cylinder prices, he said the government immediately lowered the price in line with changes in the global situation and will continue making similar adjustments whenever conditions allow.

Speaking to reporters after a meeting with offi cials of the Palli Bidyut Samity and the Bangladesh Power Development Board (BPDB) at the Jessore Circuit House, Amit said 98% of the country’s LPG is imported and that the sector is entirely dependent on the private sector.

He said fuel prices had increased due to the conflict in the Middle East, making it diffi cult for many households to manage their expenses.

However, as global conditions improved, the government adjusted LPG prices to provide some relief, he added.

The current gas supply crisis, coupled with the rapid depletion of proven recoverable reserves in Bangladesh’s producing gas fi elds, indicates that the country’s energy challenges will continue to deepen over the remainder of the decade.

At the current pace, neither BAPEX’s exploration activities nor Petrobangla’s initiatives to expand LNG import infrastructure are likely to deliver signifi cant additional gas supplies before 2030.

Domestic gas production, which once peaked at 2,750 MMCFD, has now fallen below 1,750 MMCFD.

Meanwhile, two floating storage and regasifi cation units (FSRUs) anchored offshore near Moheshkhali supply between 1,050 and 1,100 MMCFD of regasifi ed LNG (RLNG).

Total gas supply currently ranges between 2,750 and 2,800 MMCFD against a coincident peak demand of 4,000-4,200 MMCFD, leaving a widening supply defi cit of 1,000-1,200 MMCFD.

This chronic gas shortage has severely affected every major consumer category, including power generation, fertilizer production, industries, CNG stations, and residential users.

Petrobangla’s 50-well and 100-well drilling programs have so far failed to produce the expected results.

Although exploration activities on Bhola Island led to several gas discoveries, Petrobangla has been unable to connect these reserves to the national gas grid for more than three decades.

Gas was fi rst discovered in Bhola in 1994.

Bangladesh made a timely decision in 2010 to begin importing LNG, and RLNG has been supplied to the national grid since 2018.

However, despite growing demand, Petrobangla has yet to launch any major new initiative to expand RLNG imports through additional FSRUs or accelerate the development of the proposed land-based LNG terminal at Matarbari.

The interim government led by Dr.

Muhammad Yunus canceled the contract with Summit Energy for a third FSRU without fully assessing its long-term implications.

Had the project proceeded as planned, the facility could have been in an advanced stage of development and capable of supplying an additional 500 MMCFD of RLNG by mid-2027.

The interim government also discontinued negotiations with Excelerate Energy for a deepwater floating LNG terminal off the coast of Kuakata.

In addition, two advanced proposals to import RLNG from India through cross-border pipelines were abandoned.

As a result, Bangladesh’s downstream gas supply chain-which is already under severe strain-faces an even greater risk of crisis between 2027 and 2029.

The situation demands the highest national priority, requiring an aggressive program of onshore and offshore gas exploration alongside immediate efforts to establish at least two additional FSRUs by 2029.

Expanding the gas transmission network will also be essential to accommodate additional RLNG imports.

Present Situation of the Gas Supply Chain According to Petrobangla’s daily gas intake and offtake report for 24 hours in mid-July 2026, the total gas supply stood at 2,690 MMCFD.

Domestic gas fi elds contributed 1,626 MMCFD, while RLNG imports added 1,044 MMCFD.

Bangladesh’s own gas production once reached 2,750 MMCFD, with the prolifi c Bibiyana gas fi eld alone producing around 1,200 MMCFD.

Today, Bibiyana’s output has declined to approximately 750 MMCFD.

Wellhead pressure in several producing wells is showing alarming signs of depletion despite the installation of wellhead compressors.

Experts predict that Bibiyana’s production could decline below 500 MMCFD by 2030.

Surprisingly, Petrobangla has yet to implement adequate contingency measures to prepare for this eventuality.

At the same time, the gas reserves discovered on Bhola Island remain stranded because of the absence of a transmission pipeline connecting the island to the national gas grid.

The same Petrobangla report showed that gas supply to power plants was only 1,096 MMCFD against a demand of 2,525 MMCFD.

Fertilizer factories received just 120 MMCFD compared with a demand of 329 MMCFD.

Consequently, nearly 48% of gas-fi red power generation capacity remained idle, while only two of the country’s seven fertilizer factories were able to operate.

Industries-including export-oriented textile, ready-made garment (RMG), and ceramic manufacturers-continue to suffer from severe gas shortages throughout the national gas distribution network.

Many small and mediumsized enterprises have already closed, while several large industries have been forced to reduce production.

The outlook beyond 2026 is even more concerning.

Domestic gas production is expected to decline further through 2030, while neither major new gas discoveries nor substantial additional RLNG imports are likely to materialize before then.

What Can Be the Remedies? Years of inadequate planning and delayed decision-making by the Energy and Mineral Resources Division (EMRD) and Petrobangla have created a situation that is unlikely to improve signifi cantly before 2030, even if emergency measures are implemented immediately.

The immediate priority should be to sustain domestic gas production at no less than 1,800 MMCFD while reducing system losses, theft, and pilferage to save at least 200 MMCFD of gas across the national distribution network.

In an emergency, gas supplies to fertilizer factories could be temporarily curtailed so that the saved gas can be redirected to industries, where the economic returns are signifi cantly higher.

The government should immediately invite tenders to construct a gas transmission pipeline connecting Bhola to the national gas grid through Khulna, abandoning impractical proposals to convert Bhola gas into LNG or CNG before transportation.

Every effort should also be made to commission the full 2×1,200 MW capacity of the Rooppur Nuclear Power Plant by the end of 2027 to reduce dependence on natural gas for electricity generation.

Petrobangla should deploy drilling rigs to Chhatak and Tengratila while accelerating exploration at Patharia, Patiya, Sitapahar, and Kashalong in the Chittagong Hill Tracts through experienced international drilling contractors.

The government should also launch a new production-sharing contract (PSC) bidding round for onshore exploration.

If, by the end of 2027, at least 10 exploration rigs-including fi ve operated by BAPEX-can work simultaneously, Bangladesh could potentially discover an additional 3-5 trillion cubic feet (TCF) of gas reserves by 2030.

The government should also reconsider the canceled contract for the third FSRU and simultaneously initiate bidding for a fourth FSRU.

Every effort must be made to expedite the construction of the landbased LNG terminal at Matarbari.

These initiatives will require major expansion of GTCL’s transmission network.

Our assessment indicates that a parallel gas transmission pipeline from Feni to Bakhrabad should be completed by 2030 to evacuate additional RLNG from two new FSRUs.

Before the land-based LNG terminal becomes operational, however, a third pipeline from Moheshkhali to Faujdarhat will be essential.

A substantial portion of this pipeline should be constructed underwater to bypass the highly congested Anwara and North Patenga areas, where acquiring land for a new pipeline would be extremely diffi cult.

Conclusion In the national interest, the recommended contingency measures should be treated as the country’s highest energy priority.

A dedicated task force of experienced energy professionals should be empowered to implement these initiatives with the authority, resources, and incentives necessary to achieve measurable results.

The conventional bureaucratic approach will not be suffi cient to address the magnitude of Bangladesh’s gas crisis.

Only decisive leadership, accelerated project execution, and coordinated institutional reforms can prevent the country’s energy security from deteriorating further before 2030.

Bangladesh has signifi cantly increased its purchases of expensive spot liquefi ed natural gas (LNG) after three key suppliers suspended contracted deliveries by invoking force majeure amid the recent Middle East conflict.

According to energy sector sources, QatarEnergy, OQ Trading International of Oman and Excelerate Energy of the United States have temporarily halted LNG shipments under fi ve sales and purchase agreements (SPAs), citing disruptions linked to the Iran-Israel conflict and the Strait of Hormuz.

The suppliers have reportedly extended their force majeure notices through mid-July, forcing state-owned Petrobangla to rely heavily on the volatile spot market to maintain domestic gas supplies.

Offi cials said Bangladesh has purchased 33 spot LNG cargoes so far in 2026, including 31 cargoes after the Middle East conflict began, with a record seven spot cargoes imported in each of April, May, June and July

The Bangladesh Energy Regulatory Commission (BERC) has reduced the retail price of furnace oil by Tk4.44 per liter while keeping the prices of diesel and kerosene unchanged for July.

According to a BERC notifi cation issued on 30 June, the retail price of furnace oil has been lowered to Tk109.10 per liter from Tk113.54 per liter.

The revised price will come into effect from 12pm today, the notifi cation reads.

BERC last revised fuel prices on 18 May, when it set the retail price of furnace oil at Tk113.54 per liter.

C limate – related litigation continues to expand worldwide, with courts increasingly treating climate action as a legal obligation rather than a political choice, according to the ‘Global Trends in Climate Change Litigation: 2026 Snapshot’ released by the Grantham Research Institute on Climate Change.

The report shows that 249 new climate cases were fi led globally in 2025, bringing the total number of climate lawsuits since 1986 to more than 3,600 across 62 countries.

The United States remains the most active jurisdiction, accounting for 151 new cases in 2025 and more than 2,000 cases overall.

The study notes that international courts, including the International Tribunal on the Law of the Sea (ITLOS), the InterAmerican Court of Human Rights and the International Court of Justice (ICJ), have reinforced the view that governments have legal responsibilities to address climate change.

The Ministry of Industries, in collaboration with GIZ Bangladesh, has launched a stakeholder consultation to formulate the Electric Vehicle (EV) Industry Development Policy 2026, aiming to establish a comprehensive roadmap for the country’s fast-growing electric mobility sector.

The consultation workshop, held at a hotel in Dhaka recently, focused on developing a supportive industrial and regulatory framework to help Bangladesh achieve its target of ensuring that 30 percent of all transport vehicles are electric by 2030.

The workshop was chaired by Industries Secretary Abdun Naser Khan, according to a press release issued by GIZ Bangladesh.

Addressing the event, Khan said Bangladesh must act now to secure its place in the global EV value chain.

‘If we fail to prepare adequately today, we risk missing not only a promising industrial opportunity but also falling behind in the global value chain,’ he said.

‘Our goal is not merely to import electric vehicles, but to establish Bangladesh as an EV manufacturing nation.’

Bangladesh has called for stronger regional cooperation and increased blue carbon fi nancing to protect vulnerable coastal communities, strengthen climate resilience and support sustainable economic growth in delta regions.

Environment, Forest and Climate Change Minister Abdul Awal Mintoo made the call while addressing the international session titled ‘Accelerating Integrated Climate Action in Asia and the Pacifi c: Regional Cooperation for Blue Carbon Finance,’ jointly organised by the United Nations Economic and Social Commission for Asia and the Pacifi c (ESCAP) and the Landscape Alliance at the UN Conference Centre in Bangkok recently.

In his keynote address, the minister urged the international community to recognise blue carbon ecosystems as vital climate, community and development assets, stressing that mangrove forests and coastal wetlands are critical national infrastructure for climate resilience in Bangladesh.

Adani Green Energy Limited (AGEL) has surpassed 20,000 megawatts of renewable power generation capacity.

The company, which has achieved this milestone in India’s energy sector, reached this capacity within just a decade of commissioning its fi rst project.

Powering over 9 million households, the company currently generates more than 52 billion units of electricity annually, which is nearly 3 percent of India’s total electricity consumption.

This amount of electricity could meet the demand of New York City for an entire year, or almost fully cover the combined electricity demand of Mumbai and New Delhi.

According to data as of May 31 this year, this generation capacity represents about 14 percent of India’s utility-scale solar installations and around 12 percent of the combined capacity of solar and wind power.

AGEL’s current generation capacity includes approximately 14,200 megawatts of solar power, 2,700 megawatts of wind power, and 3,300 megawatts of hybrid power.

In the 2025-26 fi scal year alone, the company added 5,051 megawatts of new capacity, the highest single-year addition by any company outside China.