Rupsha 800 MW LNG Power Plant: ADB's Gas Addiction Locks Bangladesh in Stranded Assets

Bangladesh's energy transition, exemplified by the Rupsha 800 MW Liquefied Natural Gas (LNG) Combined Cycle Power Plant (CCPP) in Khulna, presents a critical challenge to national energy security and fiscal stability.

The project, intended to be a cornerstone of industrial revitalisation, is instead poised to become a multi-billion-dollar stranded asset. Driven by the Asian Development Bank's (ADB) historical preference for financing fossil gas, the facility faces insurmountable obstacles, including a chronic lack of secure fuel supply, ballooning costs, and severe environmental and social disruption.

The Rupsha power plant is a definitive case study demonstrating how misaligned donor priorities lock a climate-vulnerable nation into an unsustainable, high-carbon trajectory, jeopardising the rights and economic future of its citizens.

Key Findings

Lopsided Financing for Fossil Gas: Historically, the ADB has directed a staggering 91.3% of its energy financing in Bangladesh toward gas-based infrastructure, while allocating only a marginal 8.7% to Renewable Energy (RE), effectively stifling the growth of a sustainable energy sector.
Precedents of Stranded Assets: The Rupsha power plant follows a pattern of ADB-financed failures, such as the Bheramara-Khulna gas pipeline, which remained dormant for 15 years, and the Khulna 225 MW Dual Fuel Power Plant, which operated at a 0.3% load factor, resulting in BDT 1,824 crore (USD 148 million) in capacity payments for an idle facility.
No Operational Necessity: The Rupsha project was initiated despite Bangladesh having chronic overcapacity (46% reserve margin in 2018) and a severe domestic gas crisis (demand exceeding supply by up to 0.8 bcf/day), undermining its fundamental justification.
Uncertain Fuel Supply: The project proceeds without a secure fuel source. The Commercial Operation Date (COD) has been pushed back repeatedly, now to January 2027, due to the complete absence of at least 70 mmcfd required gas supply, leaving the facility stranded.
Profiteering Over Public Interest: Multilateral lenders, such as ADB and ISDB, and international contractors, such as SEC, AEN, and L&T, have already secured substantial profits through fees, interest, and contracts, totalling hundreds of millions of dollars, decoupled from the plant's operational success.

Expected Citation: Mehedi, H. and Mostafa, M. (2026). Rupsha 800 MW LNG Power Plant: ADB's Gas Addiction Locks Bangladesh in Stranded Assets. Coastal Livelihood and Environmental Action Network (CLEAN): May 2026.