The many holes in Bangladesh’s energy master plan
Shifting to clean and renewable energy is becoming increasingly popular worldwide, and Bangladesh is not willing to lag behind, as it has recently drafted a long-term master plan for its energy and power sector. The "Integrated Energy and Power Master Plan (IEPMP)," prepared by the Institute of Energy Economic of Japan, sets down the contours of developing the energy and power sector up to 2050. As the plan tries to provide a comprehensive, long-term strategy that commits to a clean energy transition for the country, there is space to review some issues and incorporate considerations to achieve its noble goals.
Like the preceding master plan, the new one includes economic forecasts, energy resource assessment, and power generation and transmission plans, but envisions a bigger role for renewable energy and other modern clean energy sources in the coming decades. Considering three scenarios, the new plan forecasts that if the country aspires for net zero emissions, or if advanced technology can be put to use, it has to utilise solar and wind technologies, expand nuclear capacity, turn coal-fired plants to ammonia co-firing ones, replace gas with hydrogen, adopt carbon capture and storage technology, and minimise oil and captive power.
However, the plan does not provide sufficient details about its methodology and data sources to review the energy demand forecast. The methodology does not take into account extreme events like wars or pandemics, volatility of energy prices and exchange rates, and how changes in technology-driven social practices, like more work-from-home or more online shopping, could impact energy demand in the transport and power sectors.
Moreover, the increase in energy consumption and carbon emissions continues till 2040 in the plan, and only in the net zero scenario does it sharply decrease in the last 10 years. This assumption is not in keeping with the climate commitments of Bangladesh in the Nationally Determined Contributions. The plan should provide a full list of variables and justify the assumptions it makes for the projections.
The IEPMP assigns a significant role to three new technologies – hydrogen, ammonia and carbon capture and storage (CCS) – considering them as clean energy sources. Proven renewable technologies like solar and wind, however, are assigned smaller shares despite their recent growth. In fact, the share of renewable energy in the final power generation mix is projected at merely 11 and 16 percent in 2041 and 2050, respectively, in Advanced Technology Scenario. In contrast, in her national statement at COP 26 in Glasgow in 2021, our prime minister declared, "We hope to have 40 percent of the country's energy from renewable sources by 2041."
In reality, solar and wind are significant contributors in many countries; hydrogen is a much less mature technology to produce electricity and has not been deployed globally on a commercial scale. The plan specifies that growth of solar and wind will be limited due to the variable nature of the power as well as land scarcity, but does not explain how hydrogen can be obtained at such a high quantity to supply 15 percent of the power, nor is there any significant research that justifies such a high potential for hydrogen.
The plan pinpoints the years when the expected technologies will come into operation: ammonia–coal co-firing will start from 2030, hydrogen–gas co-firing around 2035, and carbon capture and storage (CCS) from 2036. But the explanation for why these years were chosen are absent. According to the plan, oil will be the major fuel in the agriculture sector, without factoring in the rapid rise of solar irrigation, the 100 percent electrification coverage of the country, as well as the increase of mechanisation in the sector.
It sets the capacity factor, ratio of actual energy output to the theoretical maximum, of fossil fuel technologies at a level far higher than actual numbers would indicate. While the plan considers the capacity factor of CCGT plants (gas) to be 80 percent, 70 for engine plants, 60 for simple cycle GT plants, and 50 for coal-fired USC plants, a review of recent Bangladesh power data would shows that average capacity factors for gas, coal and furnace oil plants are between 40 and 55 percent. The disparity between the assumptions and reality has serious implications for estimates of the final per unit cost of electricity generation.
Regarding the reserve capacity rate, the plan estimates it to remain high in the years up to 2040, after which it will come down to 20 percent in 2050. It does not discuss how the high rate points to a significant number of power plants with low capacity factors, which will weigh heavily on the cost of electricity production. Nor does the plan offer technological or administrative strategies to bring the rate down.
At present, hydrogen produced from green sources accounts for only one percent of the total hydrogen made globally. Furthermore, renewable hydrogen is quite costly, much more than fossil fuels. Thus, diverting renewable electricity to make green hydrogen, instead of directly contributing to the electricity supply, is wasteful and would slow the pace of decarbonisation. Power-to-hydrogen can be used to accommodate variable renewable energy (VRE), like wind and solar, but the IEPMP does not consider the balancing link between hydrogen and VRE; it only considers hydrogen to be a co-firing fuel for gas and coal plants.
As for ammonia, the IEPMP expects ammonia co-firing at coal-fired thermal plants to start from 2035, and reach significant levels in the electricity mix by 2041. The plan's bid to incorporate ammonia into the mix is unprecedented; its use for generating electricity is still at the research level and is limited to demonstration projects. According to an analysis by the International Renewable Energy Agency, even after future cost reductions, renewable ammonia remains a far costlier source of energy than competing fossil fuels.
Besides, research shows that co-firing ammonia can be even more polluting than using natural gas directly. The process emits nitrous oxide, which is 273 times worse than CO2 as a greenhouse gas. Even if a retrofitted coal plant uses 100 percent ammonia, it would still be costlier than renewable plus storage technologies. As clean ammonia cannot be produced in a cost effective manner in all geographic locations, it can make a country more import-dependent.
The third technology highlighted in the plan, carbon capture and storage, is assumed to start from 2037. While some industries like steel and cement can be decarbonised using CCS technology, it would be more affordable for the power sector to decarbonise through renewables.
The plan sets ambitions for power imports from neighbours like Bhutan, Nepal and Myanmar. At present, Bangladesh only imports fossil fuel-based power from India. Import from Nepal and Bhutan would need the approval of India. Under current circumstances, it is not realistic to expect an increase in diplomatic and business relations with Myanmar in the near future. The import plans, while theoretically sound, will require significant political efforts, with an uncertain timeline for results.
The IEPMP predicts that the public sector share in electricity generation will increase to 75 percent in 2041, and then decrease to 41 percent in 2050, from 51 percent currently. Meanwhile, the private sector share is expected to decrease to 16 percent in 2041 and 11 percent in 2050, from the current 49 percent. There is no mention of the other 48 percent. Plus, no reason is cited for this departure from the past decade that saw the private sector increasingly adding to the country's power capacity.
For frequency control, the plan anticipates that pumped storage, gas turbines and engines, which have high load change rates, should be used. It thus overlooks proven technological solutions like storage capacity, which has already been used successfully in other countries for this purpose and is a much more cost-effective solution.
It appears that the IEPMP has either underestimated or disregarded the considerable renewable energy potential within the country. Opting for solutions that are most likely to align with Bangladesh's current and foreseeable future needs is paramount, enabling the nation to work towards its sustainable development objectives. We should exercise caution in committing to technologies that lack a proven track record and could lead to uncertainty, especially given the technological advancements achieved to date.
Shahriar Ahmed Chowdhury is the director of Centre for Energy Research at United International University (UIU).
Views expressed in this article are the author's own.
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