Bangladesh has been experiencing a decline in domestic gas production, leading to a greater reliance on imported fossil fuels for its energy needs. This shift has resulted in higher energy costs for the country due to frequent price fluctuations influenced by geopolitical factors since 2022. The government has responded to the increasing gap between electricity generation costs and selling prices by raising power tariffs for various consumer groups, effective from June 2026, except for those with minimal consumption levels.
Industries and major energy consumers are advised to prepare for future energy price hikes by taking steps to shield themselves from escalating costs. Despite recent adjustments to power tariffs, the substantial subsidy in place may necessitate additional tariff increases in the future. To mitigate this, transitioning to clean and cost-effective energy sources is recommended to yield long-term economic advantages.
In the past, industries benefitted from low-cost energy supported by domestic gas, but the current scenario in Bangladesh has changed. Industries with up to five megawatts sanctioned load are facing significant tariff hikes, putting pressure on operational expenses and competitiveness. Similarly, households with higher energy consumption levels are witnessing substantial increases in their electricity bills, with a notable rise for those exceeding 75kWh monthly consumption.
The shift towards clean energy solutions, particularly rooftop solar and energy-efficient technologies, is becoming more viable and attractive for both industries and households. The cost of rooftop solar energy is now competitive, offering potential savings compared to grid-based electricity tariffs. The higher electricity tariffs also incentivize investments in energy efficiency measures, such as efficient motors and variable frequency drives, which can enhance industrial energy resilience and reduce operational costs.
Despite recent tariff adjustments, power sector subsidies in Bangladesh remain substantial. To ensure sustainability and financial health in the power sector, consumers should anticipate gradual cost transfers from the government. As global energy market disruptions persist, the government may consider further tariff adjustments to address the increased costs of imported liquefied natural gas.
Consumers, whether households or industries, are urged to proactively address the challenges posed by rising energy prices by adopting clean energy solutions. The successful transition to energy-efficient LED lighting in Bangladesh highlights the potential for similar advancements in other sectors. Increased awareness and education on energy-efficient technologies, such as BLDC fans and rooftop solar, are essential for driving widespread adoption and maximizing energy savings.
The Sustainable and Renewable Energy Development Authority (SREDA) plays a crucial role in promoting clean energy initiatives and should focus on organizing national-level campaigns to educate consumers on energy-efficient practices. By embracing clean energy technologies, consumers can take control of their energy bills and contribute to a sustainable energy future.
Shafiqul Alam, the lead energy analyst for Bangladesh at the Institute for Energy Economics and Financial Analysis (IEEFA), emphasizes the importance of transitioning to clean energy sources to navigate the challenges of rising energy costs and achieve long-term economic benefits.