The Financial Express

Transforming energy sources: A tale of two countries  

| Updated: June 09, 2018 21:37:09

Transforming energy sources:  A tale of two countries   

This is a tale of energy transformation in two countries, one in dire need of it to fuel much-needed growth to get out of a quagmire and into respectability; and the other loaded with enough fossil-fuels to feed that country's shortages, but preferring instead to build its own far cheaper renewable energy sources. In the short-term, the former crosses the development hump, as promised to the voters, but the other makes the irreversible shift into innovative-laden solar and wind energy supplies, thus lowering costs and boosting innovative engines. Over the long-haul, as the former begins to suffocate (not as much from the added wealth that disposal energy brings, but from a contaminated atmosphere reflecting a depleting forest cover), the latter emerges as a global renewable leader where every breath only spurs newer ideas and contraptions. Since renewable energy sources do not have boundaries, the collective picture depicts a Gresham outcome: the 'bad' energy source (fossil-fuel) drives out the 'good' source (renewable), exacerbating bilateral relations, worsening them over time.

Entitled either 'Alice in Wonderland' or 'Alice in Un-wonderful-land', depending on the country chosen, the story might very well be about the energy-starved Bangladesh, dependent as it is on a coal-stacked India already irreversibly shifting towards a renewable energy future. While we debate about whether coal-fired plants in Matarbari, Payra, Rampal, and other locations will be helpful or hurtful, we miss the baby of development being drained away when the time comes to flush the bath tub. In other words, India pockets the top-price income from coal supplies to Bangladesh while it goes on a renewable energy-construction rampage.

Statistics expose what is at stake, and tell us even more. Only two years ago, 80 per cent of India's energy was derived from coal, today below 60 per cent. At this rate, Mukta Patil projects that by 2027, India will not need any more coal power at all (April 30, 2018, from: http://www.firstpost.com/ india/if-india-meets-renewable-energy-target-no-additional-coal-power-will-be-till-2027-3413078.htm). Indeed, Geeta Anand, who dubs India as a 'Coal Goliath', points out how US President Barack Obama drove a reluctant Prime Minister Narendra Modi into signing the Paris Agreement, and that, despite the growth in Modi's mutual relations with Donald J. Trump, the two leaders have a contrasting environmental sense and seem set to take their countries along two very different pathways (New York Times, June 2, 2017). With plans to triple renewable output three-fold by 2020, India is now set to eliminate coal usage entirely.

Such a turn-around seems impossible in Bangladesh, where even a dramatic reversal like India's is not even on the cards, and even if it was, too many vested interests hack implementation away. By the time India has shed coal from its energy-producing sources (let us just say 2030), Bangladesh's energy needs will almost triple from where it is now, growing at 21 per cent annually from about 14,000MW. Built upon a 50:50 share, Bangladesh Power Development Board and India's National Thermal Power Corporation embarked upon constructing the 1,320MW Rampal coal-based plant requiring 3.0 million tons of coal annually, while the 1,250MW coal-fired plant in Matarbari, off Cox's Bazaar on the northern tip of Moheskhali island, signed between Coal Power Generation Company (CPGCBL) and a Japanese consortium of Sumitomo Corporation, Toshiba Corporation and IHI Corporation, requires 32 million tons of coal annually by 2030 (JICA, Matarbari Final Report, 2016, 17, but see 10-18). While domestic coal production will expand six-fold by 2030 (from about 1.0 million tons), so too imported coal, mostly from India, by over 25 times (from just under 1.0 million tons today).

Bangladesh will not only be coughing up a lot of badly-needed cash to meet this demand, but it will also be increasingly dependent upon India. That is only from the transaction itself. Lateral costs can pose more havoc, but that is for others to explore and weigh since, to many people, growth may be a higher priority than environmental sustainability. What is worse is that we will look as a dirty neighbour to a country suddenly cleansing itself in a way we could have done, but did not, much like another Indian neighbour, Pakistan, that could have cleansed up its jihadi links but has not.

No doubt the money to be made from coal will draw many Bangladeshi investors and, if the past is any guide, produce vested interests, thus permitting any transition to renewable energy even more unlikely. Pushing the point, just as India is shifting intellect and investment to produce renewal energy sources, we get so strapped from taking that plunge that we will begin to look more technologically back-dated, yes, rustier, than India.

This can be halted in at least two ways, both executed even simultaneously: substituting coal-imports for renewal-energy imports from India, which might look terrible for our re`putation since Rampal (Matarbari and other coal-fuelled plants) will quickly become irrelevant and obsolete; and/or cultivating renewable energy sources ourselves, using either abundant wind-power opportunities (along the coast, on the hill-tracks), or solar energy, which is making a global comeback from its inefficient previous plight to its competitive present promises. We have not examined the details of either, but once we do, we might find turning Rampal, Matarbari, Payra and other plants into alternate usage would still bring long-term benefits.

Collaboration with India is Bangladesh's sine qua non. How we get India to reinvent our electricity transactions mode should be a higher priority than Rampal-based debates. It cannot but be in India's interest that, as it exits the coal era to become a green champion, it will have as high an interest to see Bangladesh follow suit. After all, a more consolidated Indian economy in 2030 will need markets massively, the closer to its border, the better; but for Bangladeshis to buy from India (to which they are so addictive), they will have to spend less on energy, hospital care (to fix up environment-induced problems), and just holding the fort against all forces.

We owe it to ourselves to reconfigure so that the generations after us will have more to remember us by.

Dr. Imtiaz A. Hussain is Professor & Head of the newly-built Department of Global Studies & Governance at Independent University, Bangladesh.

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