Rethinking Bangladesh’s energy security

Bangladesh’s power sector has been on my mind lately. The shortages we face today may feel immediate, but the vulnerabilities behind them have been building for years. Some decisions were made under enormous pressure and were perhaps unavoidable at the time. Others, with hindsight, deserve another look.

Many years ago, I used to spend quite a bit of time with Professor Taifur of the Department of Electrical Engineering at Bangladesh University of Engineering and Technology (BUET). Bangladesh was then struggling with severe power shortages, and rental and quick-rental power plants were being introduced as an emergency response.

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Professor Taifur was pragmatic about it. He believed rental power was difficult to avoid under the circumstances. Prolonged shortages, after all, do not merely inconvenience households; they disrupt factories, businesses and the wider economy.

There was, however, one aspect he was uncomfortable with: capacity charge payments, particularly payments for available capacity even when plants were not generating. That concern remains strikingly relevant. Estimates reviewed by the Bangladesh Energy Regulatory Commission and reported by The Daily Star suggest that capacity charges could cost the power sector more than Tk 48,000 crore this fiscal year.

But another conversation with Professor Taifur has stayed with me even longer.

As Bangladesh began building larger coal-, oil- and LNG-based plants, installed capacity was rising rapidly. The logic seemed straightforward: build enough plants and the electricity shortage would eventually disappear.

Professor Taifur saw a different problem.

“Bangladesh will suffer for this one day,” he told me.

He was not against building power plants. His question was more fundamental: what would keep them running?

Bangladesh did not have enough domestic coal, oil or gas to support an increasingly fuel-dependent generation system. If much of the energy needed to run those plants had to come from abroad, he argued, we would remain exposed to international prices and supply disruptions beyond our control.

At the time, I probably did not fully appreciate what he meant. Today, I do.

Bangladesh’s dependence on imported primary energy has risen from 47.7 percent to 62.5 percent in just four years, according to a recent assessment of the Institute for Energy Economics and Financial Analysis (IEEFA) reported by The Daily Star. Earlier this month, 62 generating units were reportedly facing fuel shortages, while the average daily generation shortfall reached nearly 1,500MW during one week.

We have added generation capacity. But the capacity to produce electricity and the energy security needed to keep producing it are not the same thing.

That question returned to me yesterday during a long conversation about Bangladesh’s present power situation with a senior executive of one of China’s major power equipment manufacturers and EPC companies. He recalled raising much the same concern years ago with Bangladesh’s then-state minister for power: building generation capacity was one thing, but sustaining it securely over the long term was another. I was struck by how closely his concern echoed what Professor Taifur had told me years earlier.

Perhaps, in trying to overcome electricity shortages, we became too focused on how many megawatts we could build and not enough on where the energy to produce them would come from.

For now, the response has to be practical. If shipping constraints are holding up coal supplies, Bangladesh should use diplomatic channels where necessary to secure vessels from friendly countries, including China. Longer-term government-to-government arrangements with producers such as Indonesia and Australia could also reduce our exposure to the spot market and, importantly, to any single source of supply.

The larger question is what our future energy mix should look like. Nuclear power deserves a serious place in that discussion, particularly as Rooppur has already given Bangladesh a foundation to build on. Future projects could consider China alongside Russia, France, South Korea and other established suppliers, but the choice must go well beyond price. Safety, financing, proven technology, fuel security, lifecycle costs and Bangladesh’s long-term strategic interests should determine the way forward.

For years, Bangladesh’s power debate was largely about how quickly we could add megawatts. Given the shortages we faced, that focus was understandable. But the challenge ahead is no longer simply one of capacity. It is whether we can reliably fuel that capacity when global prices rise, supply chains are disrupted or another crisis emerges.

The present difficulties will pass. The more important question is what we learn from them. If, five or 10 years from now, Bangladesh finds itself exposed to the same vulnerabilities, we will no longer be able to call the crisis unexpected. We will have seen the warning signs and had the opportunity to act.

Energy security, ultimately, is not about how many megawatts we can build. It is about how many we can depend on when we need them most.

The writer is the CEO of Energy Quality Management System. He can be reached at cloubd@gmail.com