Tapping Natural Resources
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.