The Financial Express

The unexplored solution to energy sustainability

Lankabangla and Fianancial Express Lankabangla and Fianancial Express
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The impressive GDP growth over the last decade, thanks to a significant industrial expansion during this period, has raised energy demand in Bangladesh. To address this increasing demand, Bangladesh has followed the conventional path of focusing mostly on increasing power generation capacity. Though the solution to increasing energy demand should be a comprehensive approach of increasing power generation capacity, considering renewable energy solutions and most importantly, addressing the energy efficiency. It would be a difficult road ahead for Bangladesh, if it does not incorporate energy efficiency at a broader level at all applicable sectors. Because both cost effective energy solutions and environment friendly industrial growth highly depend on it.

In line with the vision of boosting industrial growth and bringing most of the population under electricity access, in 2009, the government took several initiatives and adopted new policies regarding the power and energy sector. These initiatives are the key contributors to take the installed generation capacity from 5,272 Megawatt (MW) in 2009 to 20,618 MW in 2020. According to the Power Sector Master Plan (PSMP) 2016, electricity generation would stand at 24,000 MW in 2021, 40,000MW in 2030 and 60,000MW in 2041. Though the recent study by CDP has shown that the overcapacity of power generation would be a serious concern if the existing PSMP plan is not revised going forward. According to the study, the overcapacity of Power generation will be 47 per cent considering the power requirement as per their models. This demands a strong drive from the policymakers to reassess the PSMP current plan and remodel the plan as per the new socio-economic scenario.

However, this scenario is not a rare phenomenon in developing countries because they always take the traditional path of increasing power generation capacity. The alternative ways of meeting the demand through better planning, improving energy efficiency have rarely been seriously thought of. Also, the generation capacity, in many cases reflects higher than the actual case on the ground because many plants are running at lower efficiency than they are shown. Additionally, whatever source of fuel is considered (gas, coal or fuel), without energy efficiency measures in place, the total per unit energy cost cannot be sustained at a compatible industrial level. That is why these days energy efficiency is considered as the fourth fuel.

Energy Efficiency is a comprehensive approach and demands a combined effort in terms of adopting policy and guidelines as well as developing functional institutions to implement and monitor across the different sectors of energy consumers. Like a few other developing countries, Bangladesh had also taken initiatives to address this issue and developed Energy Efficiency and Conservation Plan 2030. Sustainable and Renewable Energy Development Authority (SREDA) has been assigned with the job to implement the master plan. One of the key objectives of this master plan is to help the government improve energy intensity (national primary energy consumption per gross domestic product/GDP) in 2030 by 20 per cent compared to the 2013 level.

A total of 95 million toe or 113 billion m3 of gas equivalent is expected to be saved in the period. Energy savings will amount to BDT 768 billion in total, or an annual average BDT 51 billion at the current price. At a time when our national gas reserve is decreasing, and imported energy costs are imposing more burden on all the stakeholders, cost-saving through energy efficiency steps can be a game-changer. SREDA has already implemented different programmes like Energy Audit and consumption reporting, Minimum Energy Performance Standard (MEPS), Low investment loan for EE&C Investment, Green Purchase program for ECO-Friendly Public Procurement, Carbon abatement project as capacity development etc. These programmes have brought some changes, but with the current capacity in terms of resource and technical expertise, it is a real challenge for SREDA to get a significant change in energy efficiency.

One of the significant barriers in improving energy efficiency at industrial level is the mindset of procuring capital machinery, considering only immediate capital expenditures rather than doing the project cost analysis on a life cycle basis. For example, both gas engines and gas turbines can be procured with a lower capital investment if the efficiency of the machines is compromised. To address this issue, financial support through banks and institutions should be provided to the investors if the project planning is developed through energy efficiency modelling considering life cycle based costing.

A few years back in a joint study by World Bank and GTZ , it was shown that as much as 7 per cent of the total gas could be saved if new Combined Cycle Gas Turbine (CCGT) power plants for base-load and state-of-the-art gas turbines for peaking purpose are adopted by replacing old and inefficient power plants. Though slow in implementation, the government has taken such initiative in line with the advice from the World Bank. The study also suggested that by rehabilitating old power plants, 2-3 per cent of the total supplied gas can be optimised. The older coal-based power plants should again go under the rehabilitation programme for improving efficiency. Though the new coal-based power plants like 1200 MW Matarbari coal-fired power plant which is under construction for Coal power Generation Company Bangladesh Limited (CPGCBL), has addressed the issue of energy efficiency; and by adopting the Ultra Super Critical Technology (USCT), the plant will have a 41.99 per cent efficiency against the average 34 per cent.

From the consumers' point of view, energy efficiency will directly help reduce long term costs and achieve global accreditations to explore global markets and joint venture investments. Be it a fertiliser industry or textile, machines like boilers, motors, steam turbines etc., are quite common, and a well-designed factory facility always provides an opportunity to improve energy efficiency. Introducing Cogeneration or Combined Heat and Power (CHP) by utilising waste heat from the engines, can be another way of increasing efficiency for the industries which are producing captive power through natural gas. It is to be acknowledged that the idea of cogeneration is more familiar to the industry owners due to the new regulations related to energy efficiency by the state-owned gas transmission and distribution companies. But the effectiveness of the cogeneration system needs to be improved to have a better result. A current energy consumption assessment and ongoing study will help the management to identify the top priorities where small scale investments will enable them to extract the benefits of energy efficiency. These studies by the investors should be conducted with the real intention of improving energy efficiency rather than to produce a report for financial and audit institutions.

To make a nationwide impact, residential energy usage-- which is around 30 per cent of the total consumption-- should also have to go through several performance driven programmes. The new BNBC guideline has adopted such policies like mandatory solar power system for a specific category of structures, improved metering system, energy-efficient lighting system etc. Slowly but surely, these regulations have started to deliver some fruits.

Energy efficiency is not only about optimising fuel and saving costs. It has a broad based impact on the environment. Reducing carbon emission is directly linked to efficiency improvement. Hence, introducing energy efficiency from a broader perspective and incorporating all stakeholders under the same umbrella with better functionality and ensuring the implementation of the Energy Efficiency & Conservation Master Plan 2030 (EECMP) should be among national top priorities. Also, it is to be mentioned that the energy sector, industrial growth, environmental changes and technology-- all the essential components continuously change with time; and reviewing the EECMP with experts and bringing necessary changes with continually changing relevant energy components should be done regularly.

Tareq Ahmed Robin is currently serving as Managing Director of YGEN Engineering Ltd.

[email protected]

Eusha Rahman is an author and researcher. [email protected]



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