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15 February, 2018 12:49:43 AM

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Fuel base should be diversified: BIDA

Goal to become high-income country
Jagaran Chakma
Fuel base should be diversified: BIDA

With domestic gas reserves dropping and furnace oil too expensive to be sustainable, the country needs to diversify its fuel base to become a high-income country by 2041, according to the Bangladesh Investment Development Authority (BIDA).

BIDA pointed this out it in its Bangladesh Investment Guide -2018, released yesterday (Wednesday).

The BIDA analysis says that at this moment the primary energy source share is 55.7 per cent from natural gas, 16.8 per cent from oil, 3.7 per cent from coal, 0.1 per cent from hydro/solar/ wind, 22.7 per cent from bio-fuel and waste, and 1 per cent from imported power.    

The diversification of energy sources is vital for the planned expansion for power, BIDA noted.

About natural gas, BIDA said the country’s remaining 8.3 TCF reserve of natural gas is expected to last only 9.5 years. It suggested that to ensure efficient usage of natural gas, piped gas should be phased out from households and provided to key manufacturing sectors.

Side by side, additional gasfields need to be explored.

It also said LPG should replace piped gas for households.

However, it said the higher cost of LPG remains the biggest challenge to widespread adoption. LPG also has great potential for usage in automobiles, it noted.

Over 40 private firms have received LPG licences with over 11 already operational.

LNG is expected to be a major fuel to meet the country’s  growth targets. It is estimated that over 70 per cent of the gas supply will be LNG in 2041. LNG imports are expected to begin in 2019. The country is investing heavily to build infrastructure for LNG import and planning to set up several LNG-based power plants.

About the oil, BIDA said the demand is increasing by 6.2 per cent every year and it would continue to rise till 2041, but this will be led mostly by non-power sectors. It also suggested that LPG should be introduced in mass transportation and the subsidy on oil should be phased out.

Regarding coal, BIDA said Bangladesh has healthy reserves of high-quality coal, but domestic coal extraction will take time as necessary infrastructure will have to be constructed.

However, the use of coal will pose environmental challenges, it added. BIDA also said imported coal will be cost-effective for the power sector instead of domestic coal extraction. Coal is held to be the cheapest source of primary energy. Domestic coal extraction on a mass scale cannot happen until 2025, it observed.

The government has set a target to increase the share of renewable energy to 10 per cent of the total power grid by 2021. But there is constraint of land to expand renewable energy in the wider aspect. However, biogas can be cost-effective in rural areas of Bangladesh. Besides, BIDA indicated that the government needs extensive investment to develop power networks to ensure quality supply of power.

SR

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Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
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Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

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