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Bangladesh Energy Prosperity Declaration 2023

Nov 22, 2023

| Staff Correspondent

The civil society organizations working on climate, energy and power sectors organized a three-day long conference on 'Bangladesh Energy Prosperity 2050' from 27-29 April 2023 in the Bangabandhu Military Museum, Dhaka. Climate Parliament Bangladesh, Bangladesh Working Group on Ecology and Development (BWGED) and the Earth Society jointly organized the conference in association with ActionAid Bangladesh, Bright Green Energy Foundation (BGEF), Center for Participatory Research and Development (CPRD), Centre for Policy Dialogue (CPD), Change Initiative, Coastal Livelihood and Environmental Action Network (CLEAN), Participatory Research and Action Network (PRAAN), Solis Power and Energy (SPEL) and Waterkeepers Bangladesh.

A Convening committee jointly led by Saber Hossain Chowdhury, MP, Honorable Prime Minister's Special Envoy on Environment and Climate Change and Hasanul Haq Inu, MP, Chair, Parliamentary Standing Committee on the Ministry of Information.

Waseqa Ayesha Khan, MP, Chair of the Parliamentary Standing Committee on the Ministry of Power, Energy and Mineral Resources; Tanvir Shakil Joy, MP, Chairperson, Climate Parliament Bangladesh; Nahim Razzaq, MP, Convener, Climate Parliament Bangladesh; Mir Mostaque Ahmed Robi, MP; Selim Altaf Gorge, MP; Barrister Shamim Haider Patwary, MP and Ahsan Adelur Rahman, MP addressed the conference.

A total of 283 representatives comprised energy experts, producers, economists, investors, diplomats, researchers, lawyers, anthropologists, trade unionists, development organizations, affected communities, women representatives and youths, including Dr. Atiur Rahman, former Governer of Bangladesh Bank; Dr. Qazi Kholiquzzaman Ahmad, former Chairman of Palli Karma-Sahayak Foundation (PKSF); BD Rahmatullah, former Director General of the Power Cell; Ambassador Mahfuzur Rahman; Farah Kabir, Country Director, ActionAid Bangladesh; Solar Power expert Dipal Chandra Barua and Syeda Rizwana Hasan, Chief Executive, Bangladesh Environmental Lawyers Association (BELA) participated in the conference.

A 21-point Energy Prosperity Declaration was proclaimed in the presence of policymakers, energy experts, youths, and other representatives of civil society.

Bangladesh Energy Prosperity 2050

29 April 2023, Dhaka, Bangladesh

We, the 283 representatives of policymakers and civil society, being part of the Bangladesh Energy Prosperity 2050 Conference —

1. Recognize and appreciate the significant progress the Government of Bangladesh (GOB) made in achieving 100% electricity coverage and initiating national energy connectivity across the energy and power sector;

2. Are united in our appreciation of the GOB for devising the Mujib Climate Prosperity Plan (MCPP) that sets targets for the country's energy and power sector transformation, i.e., 30% Renewable Energy (RE) in the energy mix by 2030, 40% by 2041, and 100% by 2050;

3. Acknowledge that the MCPP's RE targets are aligned with Article 16 of the Constitution of the People's Republic of Bangladesh, which directs the State to transform rural areas through electrification radically; Article 18A directs the State to protect and improve the environment for the present and future generations; and the Planetary Emergency declared by the Parliament of Bangladesh;

4. Request the GOB to establish the MCPP as the guiding policy instrument over vertical, horizontal and related policy documents, including but not limited to the Perspective Plan 2041 and Five Years Plans (FYP) devised to realize Vision 2041, National Energy Policy 2004, Draft National Renewable Energy Policy 2022, Delta Plan 2100, Draft National Solar Energy Roadmap 2041, Energy Efficiency and Conservation Master Plan 2016-2030, and Import Policy Order 2021-2024. This alignment is necessary to ensure energy sustainability by promoting RE as much as possible;

5. Are concerned that the draft Integrated Energy and Power Master Plan (IEPMP) is not aligned with the MCPP and other policy directions and decisions adopted by the Cabinet;

6. Are concerned that the draft IEPMP was formulated with limited country ownership where most key stakeholders were not sufficiently consulted. Even key policymaking bodies, especially those related to the energy and power sector, were neither fully included in the process nor briefed on the outcome;

7. Request that the GOB initiates a nationally owned inclusive IEPMP process that takes into account the contributions of fossil fuels to carbon emissions, modern technology use, integration of renewable energy in major economic activities, public debt incurred by the import of fossil fuel, and thereby revises the IEPMP to align with the MCPP to enhance energy sovereignty, prioritize energy security, economic stability, social and environmental sustainability;

8. Request the GOB for increased public investment to upgrade the Transmission and Distribution (T&D) systems to meet upcoming challenges of intermittent power supply from renewable sources;

9. Are concerned that the adoption of new technologies such as liquid hydrogen, ammonia, carbon capture and storage (CCS), which are still unproven and expensive, would decrease energy security and lock Bangladesh into an unsustainable long-term dependency on foreign energy-producing countries;

10. Demand that the GOB prioritizes solar and wind in power generation to make Bangladesh more resilient and secure from the market volatility of fossil fuels, geopolitics and war and reverse the trend of declining foreign currency reserves;

11. Request that the GOB urgently establish a Renewable Energy Division (RED) under the Ministry of Power Energy and Mineral Resources (MOPEMR) to strategically establish RE as the fastest growing least-cost energy source that powers the inclusive and sustainable development of Bangladesh and make Vision 2041 a reality, establish a One-stop Service Centre (OSSC) that fast tracks the achievement of RE targets, and endows the Sustainable and Renewable Energy Development Authority (SREDA) with the mandate and resources to achieve MCPP targets;

12. Urge the GOB to allocate sufficient budgetary resources to promote RE beginning this year and increasing annually after that and create regulatory frameworks and incentives for green financing until renewable energy targets set in the MCPP are achieved;

13. Demand appropriate fiscal measures, including immediate cancellation of import tax on renewable accessories and incentivization of RE for producers to facilitate much more sustainable economic development;

14. Request the enhanced implementation of net-metering systems so individuals, businesses and communities can be empowered to enter into positive partnerships to help achieve renewable energy targets of MCPP and rapidly transition Bangladesh away from fossil fuel dominance in the energy mix;

15. Further request a legal framework and incentives to facilitate on-grid and off-grid community-based RE, solar irrigation and integrated biogas. We also request to use Khas and reclaimed land available across the country for establishing renewable plants;

16. Demand a capacity enhancement mechanism and information network to create a transition of human resources to support the RE goals;

17. Implore exploring bilateral, regional, plurilateral and multilateral cooperation to achieve MCPP targets, particularly strengthening the regional green grid and mobilizing technologies and financial resources for renewables. At the regional level, we request the GOB to kick off diplomatic initiatives for basin-based management, particularly to initiate Integrated Water Resource Management and to contribute to energy security;

18. Insist that the GOB devises a strategy for the gradual withdrawal of fossil fuel subsidies to secure a level-playing field for RE and fossil fuel-based power generation;

19. Request the introduction of a Carbon Tax that would be an instrumental measure to promote green growth in the country;

20. Demand that in all development efforts, including in the energy and power sector, the GOB will follow a 'no-harm principle' for people's lives, livelihoods, and the environment. We hope these efforts will be strengthened through an information disclosure policy as well as through the protection of whistleblowers and

21. Ensure that all the propositions in this declaration align with the Sustainable Development Goals (SDGs) agreed upon at the United Nations that the GOB has been considering as a priority.

Citizens' Manifesto on Energy Prosperity

According to the constitution of Bangladesh and the schedule declared by the Election Commission, the next parliamentary election will be held in January 2024. We hope that all political parties will participate in the election and declare their Election Manifesto as their commitment to future initiatives for the welfare and economic development of Bangladesh's citizens. On behalf of the Bangladesh Working Group on Ecology and Development (BWGED), we are presenting the Citizens' Manifesto on Energy Prosperity for consideration by the political parties.

In the 15 years since 2007, Bangladesh has witnessed rapid development in the energy sector, especially in power generation. Electricity coverage reached 100% of Bangladesh's areas. Per capita electricity consumption increased threefold, while per capita income increased fourfold in this period. Meanwhile, the country graduated to a lower middle-income country and desires to become a high-income country by 2041. However, foreign consultant-prescribed energy plans, overdependency on imported fossil fuels, overcapacity and environmental destruction invited some long-term negative impacts.

As a strategic commodity, a Just and green transition in the energy sector considering national institutions and expertise, the availability of domestic and renewable sources and rights on the natural resources is crucially important for sustainable development. To this end, our demands are:

1. Achieve 30% Renewable Energy in the energy mix by 2030, 40% by 2041 and 100% by 2050.

As per the 'Mujib Climate Prosperity Plan', the country is committed to ensuring 30% renewable energy in the energy mix by 2030, 40% by 2041 and 100% by 2050. Achieving the target is important not only for climate prosperity but also for sustainable economic development and energy sovereignty of the country.

The Government paid taka 37,289 crore to import fossil fuels for power generation in FY 2021-22 only. This cost is increasing at an average of 41% annually. The generation cost of electricity is also increasing proportionately with it. In FY 2007-08, the generation cost of electricity from imported fuels was taka 6.86 per kWh, which reached taka 17 in FY 2021-22.

In contrast, renewable energy generation cost is gradually decreasing every day. In 2017-18, the Government purchased solar power at taka 16.40 per kWh, which has been reduced to taka 11.00 in recently signed agreements. The price must be reduced in fair competition and an enabling environment.

2. Cancel the LNG Terminals and LNG Power Plants to save hard-earned foreign currency reserves and reduce emissions.

After starting the operation of two LNG terminals in 2018, Bangladesh has spent foreign currency of taka 110,000 crores to import 46.2 million cubic meters of LNG. Taka 8,200 crores have been paid additionally as the capacity charges of the LNG terminals.

On the other hand, the foreign currency of taka 376 crore could be saved by replacing only 100 MW of LNG with solar power plants. The amount could be higher, considering the volatility of LNG markets. Thus, proposed LNG terminals and power plants must be canceled, considering the risks and ensuring economic stability and energy security.

3. Cancel the proposed 'Integrated Energy and Power Master Plan (IEPMP) and formulate a National Energy and Power Master Plan based on domestic resources and renewable sources.

The proposed IEPMP is formulated by IEEJ and financed by JICA. It ignored the opinions of Bangladeshi experts, entrepreneurs, consumers and even policymakers during the formulation of the IEPMP. The approach insulted the intellectual capacity of Bangladesh as an independent nation.

In the draft IEPMP, JICA proposed 30.7% of fossil fuels and only 17.1% of renewables in the country by 2050, which is totally against the national development plans and commitments. JICA also proposed to incorporate liquid hydrogen, ammonia and Carbon Capture and Storage (CCS) technology as 'clean' energy. These technologies are not only unproven but also highly expensive and explosive. It will only ensure profit for Japanese companies.

So, the proposed IEPMP must be canceled to formulate a national energy and power master plan involving Bangladeshi energy experts, policymakers, civil society, energy producers and consumers.

4. Cancel Capacity Charges of Private Power Producers and Imposing cost per unit under the 'No Electricity No Payment' Policy.

The rules of paying capacity charges, prescribed by IFIs to ensure guaranteed profit for private power producers, are weighing down the national economy. According to the State Minister, the government paid taka 104,926 crores 81 lakh as capacity charges from FY 2009-10 to 2022-23. It is to mention that capacity charges are paid in USD, which creates additional pressure on the foreign currency reserves.

On the other hand, the renewable energy sector supplies electricity on a 'No Electricity No Payment' basis. Considering its negative impacts on the national economy, all capacity charges must be canceled, and the price of electricity should be paid in taka only.

5. Cancel Import Duties and Taxes from RE-related Accessories to encourage individual citizens and small entrepreneurs.

Dependency on the national grid of electricity could be reduced to half by installing renewable energy in residential, industrial, commercial, agricultural and transport sectors to fulfill the sectoral demands. It will save foreign currency reserves and reduce the burden of capacity charges. But around 28 - 56 percent of import duties, VAT and taxes are imposed on RE-related accessories, which is a major barrier to expanding RE projects. Canceling these taxes will reduce the installation cost by 25% - 27% and enhance RE investment in the country.

6. Allocate an adequate budget for 25% installation cost support for the small and marginal RE entrepreneurs.

Small RE projects taken by the cooperatives, farmers and individual citizens can supply electricity to the national grid after fulfilling their demands. It will reduce the import of fossil fuels and pressure on the national grid. To encourage small entrepreneurs, the power division and other line agencies should provide at least 25% of installation cost support. A budget allocation is necessary to create a special fund for supporting small and marginal RE entrepreneurs.

7. Free Distribution of Net Meters to ensure citizens' participation in RE generation

The Net Metering Guidelines 2018 created an opportunity for citizens to evacuate excess power from nano RE projects. But the cost of Net Energy Meters is still beyond the capacity of common people. As a result, the result is not as impressive as expected. To increase citizen's participation in RE generation, NEMs should be distributed among eligible citizens free of cost.

8. Provide adequate finance and human resources for RE-run educational institutions, hospitals and government agencies

Besides the government agencies, there are more than 5,000 hospitals and 140 thousand primary, secondary and higher secondary educational institutions in Bangladesh that can install rooftop solar power and sell excessive electricity after supplying their demands. It can also be an income-generating scheme for them. Adequate finance and human resources should be allocated to these institutions.

9. Establish national institutions for producing RE-accessories and development of human resources.

National research & development institutions with production units are required to produce quality RE accessories and recycle expired ones. A good number of skilled and semi-skilled human resources is also required for the growing RE industry. In addition to the establishment of a national RE Institution, the vocational institutions, Rural Electrification Board, Department of Youth Development, Department of Social Services, Department of Cooperatives and Department of Women Affairs can offer short courses on RE installation and maintenance.

10. Review and modernize the National Energy Policy considering the potential of RE in Bangladesh.

The latest National Energy Policy was formulated in 2004, reviewing the same formulated in 1996. The policy is almost obsolete now. A new energy policy is required considering the potential of renewable energy, changes in global financing and technological development, and to achieve energy sovereignty.

News Link: Bangladesh Energy Prosperity Declaration 2023

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