On 16 June 2025, Bangladesh unveiled its Renewable Energy Policy 2025, outlining an ambitious goal: to meet 20 per cent of the country’s energy needs from renewable sources by 2030, and 30 per cent by 2040. Seventeen years after the first Renewable Energy Policy in 2008, this new policy is not just an update; it’s a response to years of missed targets and stagnation.

The 2008 policy had set bold objectives: 5 per cent renewable energy by 2015 and 10 per cent by 2020. But those goals were never met. Today, renewables contribute only around 4 per cent of the total energy mix mainly from off-grid solar home systems, highlighting the gap between policy promises and actual outcomes.

The 2025 policy introduces several forward-looking ideas. These include technologies like Agri-Voltaic systems, Floating Solar, Green Hydrogen, Peer-to-Peer (P2P) energy trading, Battery Energy Storage Systems (BESS), and the creation of a Sustainable Energy Development Fund (SEDF). It also proposes long-overdue tools like Renewable Purchase Obligations (RPOs) and Renewable Energy Certificates (RECs) to generate demand for clean energy.

To address the shortage of suitable land, a long-standing challenge, the policy encourages the use of unused public land, fallow fields, chars, rooftops, and water bodies for solar and wind installations (with environmental safeguards). There are also financial incentives on offer, including tax holidays and import duty waivers, and efforts to explore carbon trading mechanisms.

Importantly, the policy also recognises the need to upgrade Bangladesh’s fragile electricity grid. It emphasises Grid Code compliance, smart grids, accurate forecasting, and the central role of energy storage in stabilising power supply. The policy supports decentralised systems like mini, micro, nano, and pico solar grids and promotes rooftop solar through net metering and P2P trading.

Yet despite this impressive vision, the ground reality paints a very different picture.

Bangladesh’s energy crisis is growing. Power outages and load shedding remain widespread, driven by fuel shortages and the country’s overwhelming reliance on imported gas, coal, and oil, which together account for over 85 per cent of electricity generation. In 2023, the 1,320 MW Payra Thermal Power Plant, Bangladesh’s largest, suddenly shut down due to a coal shortage. Though the issue was resolved, it served as a stark reminder of our deep dependence on imported fossil fuels.

Making matters worse, global fuel prices have surged, forcing Bangladesh to depend on high-cost rental power plants, which are draining national finances. Meanwhile, the country’s electricity grid remains outdated and ill-equipped to handle large-scale renewable energy integration.

The 2025 policy finally introduces Renewable Purchase Obligations (RPOs), a long-overdue market mechanism to create demand, but whether this proposal will be implemented effectively remains uncertain. Slow bureaucratic processes, lack of coordination among agencies, and complicated approval systems have already delayed most utility-scale renewable energy projects. The issue of land acquisition, especially for solar and wind farms, remains unresolved, despite repeated promises to utilise public land.

The 2025 policy talks about grid modernisation, energy storage, and local manufacturing, but these initiatives lack concrete action plans or guaranteed funding. While financial incentives exist on paper, SMEs and rooftop solar adopters still struggle to access affordable finance.

To bridge the gap between promise and reality, Bangladesh needs a bold and urgent implementation push.

The government must begin by identifying and pre-developing Renewable Energy Corridors in areas that show strong potential for wind and solar power. These corridors should be backed by targeted investments in transmission infrastructure to ensure efficient connection between high-resource zones and major cities and industrial hubs. Research indicates that substantial wind energy can be captured at a height of 25 meters in six promising coastal locations: Patenga, Kuakata, Kutubdia, Char Fashion, Teknaf, and Cox’s Bazar. The Power Grid Company of Bangladesh (PGCB) should lead this effort, supported by dedicated funding.

The government should also mandate rooftop solar and solar water heaters in new industrial, commercial, and large residential buildings. Fast-tracking permits and simplifying registration, especially for small (sub-10 MW) projects, will be crucial. SREDA’s online system must be fully implemented, and BERC procedures for net metering and P2P trading must be streamlined.

Equally important is to promote battery storage integration with solar and wind projects and to encourage hybrid renewable systems like solar-wind or solar-biomass. This will improve reliability, reduce pressure on the grid, and make clean energy more viable.

The 2025 Renewable Energy Policy has all the right elements. But as experience has shown, good policy alone does not deliver results. Without focused, accountable, and well-financed implementation, even the most visionary blueprint will end up as just another unfulfilled promise.

The stakes are high. Bangladesh’s energy security, economic stability, and climate resilience all depend on how quickly and effectively the country can scale up clean energy. With only six years until 2030, the clock is ticking. It’s no longer time to discuss or delay; the era of decisive, relentless execution must begin now.

News Link: Bangladesh's Renewable Energy Crossroads: Bold Policy Meets Brutal Reality