Why is Bangladesh fascinated in the renewable energy of the neighbor

The price of solar photovoltaic panels has decreased to 11 cents per watt in the global market. Adding incidental costs for inverters and infrastructure brings the cost to 14 cents per watt. Without any additional expenses for land acquisition and management, Bangladesh is seeing the potential for renewable energy production through solar power. Bangladesh is seeking to import electricity generated from renewable sources like Nepal, Bhutan, and India. But why? So, is Bangladesh paying more attention to buying electricity produced by renewable energy from its neighbors? It is not unusual to ask such a question.

Recently, the procurement of 40 megawatts of electricity from Nepal has been finalized. Additionally, Bangladesh seeks to purchase another 500 megawatts of electricity from an Indian company, GMR, which is undertaking a construction project in Nepal. The agreement with GMR has also been concluded with the Power Development Board (PDB). However, despite GMR's several requests for security deposits, no money has been deposited on behalf of PDB. As a result, PDB has not signed the power purchase agreement with GMR. However, the hydroelectric power plant that GMR is constructing in Nepal primarily targets Bangladesh. So, whether the agreement happens today or tomorrow, it will eventually take place. But is it crucial for Bangladesh? If so, why? And under what considerations?

The electricity imported from Nepal, currently at 40 megawatts, costs around 8 Taka per unit including operational expenses. The addition of taxes from Nepal, India, and Bangladesh to this cost has not yet been determined. Changes in tax rates in these countries over the years may affect the price of electricity. Simultaneously, this price will be fixed for the next 20 years. However, the possibility of reducing the cost of electricity production through renewable energy over these 20 years is the highest.

To understand why the possibility of reducing electricity production costs through renewable energy is high, extensive research isn't necessarily needed. Analyzing the differences between the solar panels produced by companies a few years ago and those produced today is sufficient. Currently, solar panels with a capacity of 670 watts are available, compared to the previous capacity of 395 watts or even lower. This means that a solar panel that previously produced 395 watts of electricity in the same space can now produce 670 watts. In other words, nearly double the amount of electricity can be generated in the same area.

Previously, approximately three acres of land were required to produce one megawatt of solar electricity. Now, with advancements in technology, it's possible to produce one megawatt of electricity on just two acres of land. This means that more electricity can be generated on less land. In India, the cost of one unit of solar electricity ranges from 2.30 rupees to 2.60 rupees. India is aiming to reduce the cost of this electricity to 1.90 rupees by 2030. In Bangladesh, the cost of solar electricity is still above 10 Taka per unit. Even considering exchange rates, this price is at least three times lower than in Bangladesh. While India is adopting strategies to bring this cost under control, Bangladesh has not been able to achieve this goal for a long time.

In India, the government facilitates land acquisition and develops infrastructure for solar power plants. Conversely, in Bangladesh, companies interested in constructing solar power plants bear all responsibilities. The state does not provide any assistance. Those who construct solar power plants in Bangladesh often incur significant expenses for land acquisition and land development, leading to higher production costs for solar electricity. The World Bank has recently initiated a project in Bangladesh to control the cost of solar electricity. Under this project, the World Bank has requested 6,000 acres of land in Jamalpur, along the banks of the Brahmaputra River. Land development and infrastructure construction will take place in this area, with invitations for tenders being issued through the World Bank.

A company will only install solar panels and associated equipment there. As a result, it will be possible to see how much the actual cost will be. Currently, in solar power, companies set their own prices as there are no tenders. Therefore, it can be said that if such initiatives are successful, the cost of electricity production from renewable sources in the country will decrease. The production cost will decrease to such an extent that electricity production from renewable sources will become profitable in the country. Some may argue that solar power may not be available for more than an average of around 4.9 hours throughout the year. What will be used during the rest of the time? They may not be aware that countries in Africa like Morocco have constructed solar power plants generating up to 700 megawatts, with the entire electricity being stored in batteries.

The use of solar power during cloudy skies or nighttime is becoming feasible. China, for instance, is advancing in this regard by storing a portion of the energy generated from their solar power plants in batteries. This means they are working on establishing a system to supply electricity from renewable sources one hundred percent of the time. This initiative is driven by the global trend of dwindling fossil fuel resources. Additionally, the procurement cost of renewable energy is gradually approaching zero. Then why are we paying so much attention to renewable energy in neighboring countries? Also, it's important to remember that electricity won't be free. We'll have to buy it with our dollars. And once we commit to such agreements, we must plan ahead for how we'll manage our dollar reserves.