People's Energy Plan 2050
Data Series: Electricity Consumption
In the Urban Areas of Bangladesh

A detailed analysis of Bangladesh's urban power consumption pattern, placing energy use in the context of the nation's political economy, governance systems, and growth path. It claims that the rapid expansion of electricity consumption in metropolitan areas is seen as a sign of economic progress while ignoring profound structural inefficiencies, regional disparities, and an unsustainable reliance on fossil fuels. Through the analysis of the sectoral and divisional trends from 2007–08 to 2024–25, the current energy model is economically burdensome, socially unjust and environmentally uncertain. The findings ultimately appeal for a transformative shift toward a decentralised renewable energy-based system aligned with principles of equity and sustainability.

Key Findings

1. Urbanisation-Centric Electricity Expansion: Urban electricity consumption has more than tripled since 2007–08, yet this growth is dominated by the residential sector, which now accounts for over 52.7% of total demand. This indicates that energy expansion is primarily supporting household consumption rather than productive industrial transformation, raising concerns about the sustainability of urban economic growth.  Dhaka Division consumes over 50% of the total urban electricity, making it the dominant energy hub of the country. This extreme centralisation reflects a Dhaka-centric political economy that concentrates infrastructure, investment, and services in the capital while marginalising other regions.

2. Uneven Growth Dynamics: Although overall urban electricity consumption has grown at a CAGR of around 7.35%, this growth is highly uneven across divisions. Emerging regions like Mymensingh show rapid increases, but from a low base, while historically disadvantaged regions continue to lag behind.

3. The Empty Grid Paradox: The industrial sector’s share of urban electricity consumption has declined significantly from 43.1% to 28.1%, reflecting stagnation in grid-based industrialisation. Many industries increasingly rely on captive power due to unreliable and costly grid electricity, undermining the intended outcomes of large-scale power sector investments.

4. Commercial Expansion & New Energy Burdens: The commercial sector has grown more than fivefold, driven by shopping malls, office complexes, and energy-intensive data centres. Additionally, the emergence of the transport sector, particularly electric three-wheelers, has introduced a rapidly growing but largely unregulated electricity demand, placing new strain on urban grids.

5. Import Dependency & Financial Crisis: Approximately 65% of electricity consumption depends on imported fossil fuels, exposing the sector to global price volatility and driving up production costs to over BDT 12 per unit. This has contributed to significant financial losses for the power sector, including rising subsidies and capacity payments for idle power plants.

6. Overcapacity & Inefficiency: Despite having installed capacity far exceeding demand, a large portion of generation remains idle, resulting in massive capacity charge payments.

7. Decoupling of Energy and Industrial Growth: The sharp increase in electricity consumption has not translated into proportional industrial or economic growth. Instead, energy use has become increasingly consumption-driven, raising questions about the effectiveness of energy investments in supporting real economic development.

8. Environmental & Social Injustice: Urban electricity consumption is heavily reliant on fossil fuels, contributing to greenhouse gas emissions and environmental degradation. Peripheral regions, particularly climate-vulnerable areas like Khulna and Barishal, bear the ecological costs of energy infrastructure while receiving fewer benefits, reflecting a pattern of environmental injustice.

9. Governance Deficit & Centralisation: Energy planning remains highly centralised, opaque, and exclusionary. Lack of transparency in Power Purchase Agreements (PPAs), weak public participation, and top-down decision-making processes have facilitated high-cost projects and undermined accountability.

Expected Citation: Mehedi, H., Reason, S. K., Arman, A.B ., & Islam T (2026). Electricity Consumption In the Urban Areas of Bangladesh. Coastal Livelihood and Environmental Action Network (CLEAN): April 2026.