Energy stalemate and Textile-Industry intensification


    Industrial expansion is the crucial to accelerate the inclusive and export led economic growth. Taking into account the long-cherished and held vision of economic graduation by 2021 has mandated the requirement of robust, sustainable industrial growth and development to make sure 21% of Industrial growth and 38% investment for 8% economic growth resulting our great contribution to global trade, growth trajectory. Forecasting the energy, power requirement and sourcing, GoB has presented a promising target of 24000MW power generation by 2021 which comprises of industry, business and domestic needs. The largest manufacturing sector of Bangladesh, Textile and RMG having sole highest 18% GDP contribution requires the desperately Gas supply to enhance the capacity of Textile Industry to second achieving global economic visions. The energy and power supply has never been dedicative and uninterrupted to Textile Industry and rather became a legacy of this industry. 110 textile plants can't begin the operation due to no connection of Industrial gas found in a recent study in textile in Bangladesh. The investment worth of $321 Million in Textile Industry remained useless since Textile mills require 24/7 uninterrupted power and gas to support operation.



    Tariff hike in Captive Power by 100%, domestic by 55%, commercial by 16% by BERC rock textile industry with multiple adverse consequences escalating cost of operation, inflation, contracting Industrial advancement. This unscrupulous increase is remarked unjustified until improving the production and supply of natural gas in Bangladesh.



    With the brief indigenous power and energy status, Bangladesh has long severely crippled with the power and energy crises as reserve of natural gas is expected to run out in next 10 years. The augmented usage of Gas including domestic, Industry and power generation requires around 1 TCF though the rate is relentlessly on increase with deepening crises. Bangladesh produces 2500 MMBFD against 3300 MMBFD of daily demand which widens and worsens the shortage.



    It is remarkable that many countries showed interest to invest in Power and energy sector development, generation and distribution setting up different plants having large capacity and in some instances Government welcomed and signed deal with India, China, Malaysia and Thailand, Russia, Japan and India to improvise the situation. But the severe doubt, criticism and protest ahead in those projects as most of the plants require gas and coal and hydrocarbon to source locally or imported as the raw element to begin power and energy generation. Relevant energy and power agencies of Government and Ministry are desperate to source gas to meet the growing demand in diverse forms across the Country and cross-border pipeline LNG and grid power transfer. Though many agreements and deals inked over the past years between Bangladesh and different countries with India, Japan, China held but progress is too slow to benefit as expected in Bangladesh soon. Economy of Bangladesh is on the verge of transition to middle income and developing economy, the industrialization across the country has got extreme need and growth trend parallel to high demand of natural gas as the low cost source of energy to cater the growing need of expanding Industries.



    Following recommendations are expected to improve the state of crisis of natural gas and accelerate textile Industry boom in Bangladesh:





    1. Trilateral and quadrilateral natural gas and LNG transmission network sourcing from Myanmar through Bangladesh and China. Myanmar has got surplus reserve of Natural gas to supply to neighboring countries. Gas transmission companies and Petrobangla should initiate to negotiate import from neighboring countries.






    1. Rationing, reallocation and redistribution of limited natural gas by allocating more gas to back industries and domestic use should be replaced by LPG gas or meter rationed gas.


    2. Efficient and modern Captive power generation technology should be encouraged and installed for generational efficiency as well fiscal and non fiscal package support for power generation sector investment.






    1. Bangladesh faced severe criticism as recent projects undertaken have environmental threats as well the relief from deepening power crises as there is dilemma whether power should be sourced from renewable and clean energy or use the local energy at the cost of environment, ecosystem.


    2. An evident and unequivocal energy and power policy from the GoB detailing the sources and allocation of energy and power though a draft policy titled national energy policy was enforced in 2004. That policy needs reviewed and amended incorporating scopes and provisions of far-sighted efficient energy planning, development and distribution including involvement and engagement of provisions for foreign IOC in off and on-shore exploration.






    1. Increasing the capacity of alternative source of renewable energy hydro electric, solar photovoltaic (PV) with minimum environmental harm having far-reaching sustainable development across the Country in the wake of finite and scarce mineral resources.






    1. Alternative and renewable energy source as solar sourced power in small and medium industrial plants and offices as efficient sources of energy. Industrial waste and effluent could be treated for further energy and power generation.


    2. Cutting edge technology and in- country technical know-how have to be retained and improvised to lower the external dependence. Solar power transition would be a mode of least cost, environmentally friendly and never-ending sources of power.






    1. Seismic surveys in deep-ocean with safety measures to be taken to explore the hidden natural gas reserve in the blocks along maritime border of Bangladesh. Inter regional or cross-country energy and power import and share within the regional hub affordably.






    1. In relation to signing agreement of PSC with foreign bidders, their profile, working history and technical expertise as well other reference checks are to be investigated well since the PSC costs much to the Bangladesh raising tariff to the consumer higher.






    1. CAIRNS, Santos, Conoco Philips, Chevron, Statoil exploration firm should be agreed with flexible and oversight conditions to ensure right use of the finite reserve of gas and oil as well Arbitration and Tort law clauses.






    1. Energy source mix ought to increase the use of furnace and diesel in power generation with low use of natural gas as Bangladesh is faced with persistent fuel price decline along with inadequate natural gas reserve.






    1. Bangladesh is the in the grip of severe crisis of power and energy which remained for long and this frail state may head Bangladesh towards slowdown of manufacturing Industrial growth as well deprivation of fifty five percent of total population from energy utility access. No determined aspiration is assumed in short run in energy resource development which may undermine development of power, energy state.






    1. More 3-D and 2-D on-shore and deep water surveys to be carried with more protection measures as previously many exploration companies reported damaged natural gas even though caused unbearable damage too.






    1. Production sharing contracts with IOCs should follow working history reference, technological strength check as well rigid protection and compensation provisions in case of any unavoidable disaster likewise Magurchara disaster by Occidental which diminishes all resources in 2007.




    It is the high time that a consensus needs to be reached by all stakeholders comprising political leaders, business leaders, Experts and Policy makers as well relevant across the country keeping all differences aside on the long term plan of foreign investment, technological exchange support, exploration, leasing, distribution and transmission as well energy tariff of gas to make efficient use of natural resources mitigating all indigenous needs as well setting priority to extensive power generation to mobilize economic actions. If textile friendly energy boosting policies are not taken soon, the projected manufacturing, export growth along vision 2021 may fail and down the GDP growth by 1 percent down the road.



    Against vulnerable energy state backdrop, an evident, well-defined and robust, economically sensible energy policy aiming at the recovery of extant crises as well effective for sustainable energy and power distribution development administering conformity and balance in the incremental demand and rational sources of supply across the wide spectrum existing and emerging sectors up and down Bangladesh. In this regard, policy reform and new regulations including rapid capacity building to reap the outcomes as expected as energy causes multiplier impacts sustainable and equitable socio-economic prosperity, skilled Human development to rebuild the Industrial spree for our modern Industry-led economic epoch.



     

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