Policy Brief on Estimating Costs of LNG-based Power Generation and Devising Alternatives Pathways towards Green and Clean Energy
Citation: Raihan, S., Bidisha, S. H., Islam, K. M., Hossain, I., Ahmed, M. T., Chowdhury, O. R., Asaduzzaman, M., and Aahad, A. (2024). Estimating Costs of LNG-based Power Generation and Devising Alternatives Pathways towards Green and Clean Energy. SANEM Publications, Dhaka, Bangladesh.
The power sector has played a crucial role in driving economic development and growth of Bangladesh over the years. In this connection, significant progresses have been made in expanding power generation capacity and improving access to electricity, resulting in an almost threefold rise in installed capacity and maximum generation over the last decade. However, the increasing reliance on imported LNG, coupled with the depletion of domestic natural gas reserves, poses a risk to the financial sustainability. Global energy price volatility and supply disruptions have further exposed vulnerabilities in the face of LNG imports. Therefore, appropriate analysis of costing, considering both the opportunity cost and the environmental cost along with other visible costs incurred from import to final use is necessary to determine the overall cost of energy sources. The cost-effectiveness of the available options should be explored and assessed thoroughly to understand and thereby to choose the optimal energy mix for the country. With a view to achieve its green and clean energy goal of 40 percent clean energy contribution in power generation by 2040 as outlined in the IEPMP (2023), the country must explore viable alternative energy sources and undertake necessary reforms to that end.
