DHAKA Dec 4 Bangladesh's interim government
has unveiled a renewable energy policy, the first of its kind,
to ease the country's severe electricity shortages, and aims to
achieve this by luring investors with a raft of incentives.
"The advisory council (cabinet) approved the policy aimed
at exploring the country's electricity generating potential
from renewable energy resources to meeting the nagging
electricity crisis across the country," said M. Tamim, an aide
to the head of interim government responsible for power and
energy, said on Thursday.
Bangladesh at present faces up to 2,000 megawatts of
electricity shortages which have forced hundreds of
manufacturing firms across the country to shut down.
Tamim said the government aimed to generate about 10
percent of total electricity demand by 2020 from renewable
sources, such as solar, wind, biomass and hydropower.
The government will target domestic and foreign investors
with incentives, such as exemptions from corporate tax for 15
years, low-interest loans and a cap of 3 percent on import duty
and value-added tax, he said.
Tamim said all investment will come from the private sector
and the amount needed to achieve the 2020 target was about $1.5
Renewable energy producers will be allowed to use the
state- owned grid to supply electricity but they will have to
pay transmission charges to owners of the transmission
Renewable energy projects will also require a power
generation licence from the Bangladesh Energy Regulatory
M. Fouzul Kabir, government power secretary told Reuters
that several European firms showed interest in investing in the
sector, though he declined to name the companies.
Industry observers were optimistic about prospects of the
"As the government committed to impose a maximum 3 percent
duty, it may be commercially viable for the projects," said
Quamrul Ahsan, a professor from the electrical and electronic
engineering department of Bangladesh University of Engineering
He said current prices of wind turbine generators and solar
cell were very high, but projects costs might be reduced with
the lower duties.
($1= 68.80 taka)
(Reporting by Serajul Islam Quadir; Editing by Ben Tan)