Tap­ping Nat­u­ral Re­sources

Southasia - - Briefing -

Bangladesh is des­tined to be­come the lead­ing econ­omy of the South Asian re­gion. The coun­try has shown con­sis­tent growth in all ma­jor sec­tors such as econ­omy, ed­u­ca­tion, health and trade. To ex­pand its po­ten­tial, the Bangladesh En­ergy Reg­u­la­tory Com­mis­sion (BERC) has com­menced work on a Feed-in-Tar­iff (FIT) struc­ture. FIT will pro­mote in­vest­ment in re­new­able en­ergy tech­nolo­gies in the coun­try. Although the cost for elec­tric­ity gen­er­a­tion from re­new­able en­er­gies such as so­lar, wind and biomass cost higher than con­ven­tional en­ergy, Bangladesh still wants to pur­sue with FIT. Since fos­sil fuel re­serves are fast de­plet­ing, re­new­able en­ergy will serve as an ap­pro­pri­ate sub­sti­tute. More­over, de­vel­op­ing na­tions are mak­ing an ef­fort to re­duce the costs of re­new­able en­ergy by pro­vid­ing sub­si­dies.

The reg­u­la­tory body of Bangladesh has sought sup­port from the USAID to as­sist in im­ple­ment­ing the project. Ac­cord­ing to sources, Deloitte Touche Tohmatsu Emerg­ing Mar­kets, Ltd will as­sist BERC.

Most west­ern coun­tries and some Euro­pean na­tions have in­tro­duced FIT for re­new­able en­ergy. As Bangladesh aims to be­come the eco­nomic hub of the re­gion, FIT will pro­vide a strong ad­van­tage to the coun­try over its com­peti­tors.

The ob­jec­tive of FIT is to present a cost-based pay­ment to re­new­able en­ergy pro­duc­ers. It will also at­tract long-term deals to fund re­new­able en­ergy in­vest­ments. The Bangla- desh government re­cently an­nounced that by 2015 it will in­crease the share of the re­new­able en­ergy sec­tor by 5%. How­ever, a draw­back of the FIT project is that the fi­nan­cial in­sti­tu­tions or the pri­vate sec­tor will be hes­i­tant of in­vest­ing in re­new­able en­ergy.

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