Bangladesh’s power sector has reached a state of financial distress that now poses a significant fiscal risk to the national budget, according to a recent technical assessment by the International Monetary Fund (IMF).

The assessment, submitted recently to the Power Division but not yet made public, urges immediate tariff reforms, stronger regulatory oversight, and targeted protections for vulnerable households to prevent deeper structural damage.

At a roundtable titled “Redirecting Finance from LNG to Renewable Energy in Bangladesh,” experts warned that the country’s clean energy transition is stalled not by technology or lack of interest, but by weak governance and policy inconsistencies

Energy sovereignty is the process of ensuring a country's own energy security and independence, where dependence on foreign fossil fuels is reduced and the use of local renewable energy is increased. Currently, Bangladesh's energy mix is generated from about 97% fossil fuels, and the amount of energy generated from renewable energy is only 3%. However, the government has set a target of generating 40% of electricity from renewable energy by 2041. The country has successfully installed 4.1 million units under the Solar Home System programme, which proves the potential and capacity of renewable energy in Bangladesh.

The combination of soaring natural gas demand and plummeting domestic production has pushed the Bangladesh government to diversify its energy sources. In the past, various plans, including the Integrated Energy and Power Master Plan 2023, have attempted to address this concern, but they have driven a shift towards imported liquefied natural gas (LNG) instead. As a result, the LNG pathway, pursued as a fuel diversification strategy without enough investment in domestic gas exploration, has become an economic burden for the country.

The transition to clean energy has emerged as an urgent priority for Bangladesh, yet it is disheartening to learn of rampant corruption and exploitation within the sector. A recent Transparency International Bangladesh (TIB) study has revealed that around TK 250 crore has been siphoned off through corruption in land acquisition and compensation in five solar projects, with irregularities spanning every stage from approval to completion. The study also highlights a significant gap between official cost estimates and actual spending.

The Matarbari Ultra Super Critical Coal Power Project, with a cost of Tk56,693.90 crore, began implementation in 2014, with Tk47,945 crore being financed through a loan from Jica.

The Matarbari Ultra Super Critical Coal-Fired Power Project continues to struggle with serious technical and operational issues that have significantly reduced power generation and triggered mounting financial losses, according to a recent review meeting at the Economic Relations Division (ERD).

In recent years, Bangladesh has made notable progress in renewable energy production. The Sustainable and Renewable Energy Development Authority (SREDA) estimates that five percent of the country's total generation capacity now comes from renewables. Solar energy is the primary contributor, accounting for 82 percent of renewable generation. Rooftop solar is steadily expanding, with 4,267 net-metered systems installed nationwide to date. Large-scale solar parks are also playing an increasingly important role.

According to the anti-corruption watchdog, Bangladesh’s renewable energy ambitions remain stalled as policymakers have yet to place clean energy at the centre of national planning.

Transparency International Bangladesh (TIB) has expressed deep concern over the interim government's decision to cancel 31 unsolicited renewable energy projects involving an estimated investment of around $6 billion, warning that the move could undermine investor confidence at a critical time for Bangladesh's clean energy transition.

AI is rapidly transforming global energy systems, from smart grids to virtual power plants. Bangladesh, however, is only beginning to explore its potential, risking a widening gap

At COP30, the world's biggest names in energy and technology spoke like people already living in the future. For them, AI in power systems is no longer a distant idea. It is already running forecasts, balancing grids, operating virtual power plants, and helping companies achieve 24/7 clean electricity.

State-run Power Grid has undisclosed liabilities which, if taken into account, would exceed the value of its assets and impair its ability to repay.

The company's auditors flagged the liabilities in qualified opinions attached to the FY25 financial statements. To get independent judgements about the financial status of Power Grid, The FE spoke with several auditors and experts, who said the company, already in the red, would be unable to meet its repayment obligations in its current financial position.

US-based Excelerate Energy is set to begin supplying liquefied natural gas (LNG) to Bangladesh from early January under a long-term contract, providing a fresh boost to the country's strained natural gas-supply system.

"We will start purchasing LNG from the US company from January under a sales and purchase agreement (SPA) signed a couple of years ago," a senior Petrobangla official told The Financial Express on Monday.

The Power Division has raised serious concerns over delays in finalising the power purchase agreement (PPA) for the Rooppur Nuclear Power Plant, warning that uncertainty over tariffs could trigger another surge in electricity subsidies.

“We have repeatedly sought the draft PPA for the Rooppur Nuclear Power Plant. Either they send the draft or complete the tariff calculation—we are in the dark about the plant’s power price,” Bangladesh Power Development Board (BPDB) Chairman Engr Rezaul Karim told Just Energy News.

Falling spot prices and weak demand in Asia prompt Dhaka to look beyond its initial import plan for this year

Bangladesh is preparing to ramp up its liquefied natural gas (LNG) imports as global spot prices soften and local gas output continues to fall behind the domestic demand.

The government mulls converting around 30 million cubic feet per day (mmcfd) of unutilised natural gas of gas-rich Bhola island to LNG and carrying it to gas-starved industries in the mainland for consumption, said sources. The volume of converted LNG to be processed from Bhola gas will be only 2.72 per cent of the country's existing LNG re-gasification capacity of 1,100 mmcfd.

The LNG to be processed from Bhola, located around 130 km off the coast from Dhaka, will be carried through river, with storage facilities of around 150 mmcfd each on both banks, a recent meeting of the Energy and Mineral Resources Division under the Ministry of Power, Energy and Mineral Resources (MPEMR) decided recently.

A new civil society report has warned that the Japanese-backed Moheshkhali–Matarbari Integrated Development Initiative (MIDI) Master Plan poses severe governance, economic, environmental and social risks for Bangladesh.

The report titled “The Moheshkhali-Matarbari Integrated Development Initiative (MIDI) Master Plan: Another Japanese Domination for Energy Colonialisation in Bangladesh” was published by the Coastal Livelihood and Environmental Action Network (CLEAN) on Wednesday.