Seventh Five Year Plan FY2016 – FY2020 "Accelerating Growth, Empowering Citizens"

Meta Data

Draft:

Revision of previous policy?:

Draft Year:

2015

Effective Start Year:

2015

Effective End Year:

2020

Scope:

National

Document Type:

Plan/Strategy

Economic Sector:

Energy, Power

Energy Types:

All, Power, Renewable, Solar, Other

Issued by:

General Economics Division (GED) Planning Commission Government of the People’s Republic of Bangladesh

Source:

Planning Commission Government of the People’s Republic of Bangladesh (BN)

Planning Commission Government of the People’s Republic of Bangladesh (EN)

File:

7th Five Year Plan FY2016 (BN)

7th Five Year Plan FY2016 (EN)

Overall Summary:

The 7th FYP reflects a continuation of the major goals articulated in the 6th FYP. The core targets set in accordance with the vision and goals of the Perspective Plan under the 7th FYP include: A. Income and poverty; B. Sector Development; C. Macroeconomic Development; D. Urban Development; E. Human Resource Development (Education, Health and Population); F. Water and Sanitation; G. Energy and Infrastructure including:  Installed Generation Capacity of electricity to be increased to 23,000 MW by 2020  Ensure energy mix for energy security  Electricity coverage to be increased to 96 percent with uninterrupted supply to industries  Reduce system loss from 13% to 9%, improve energy efficiency & conservation  Construction of 6.15 km. long Padma Multipurpose Bridge at Mawa-Janjira  Construction of about 26 km. long Dhaka Elevated Expressway  Construction of Dhaka-Chittagong expressway and upgradation of Dhaka-Chittagong highway to 4-6 lane.  Improve the multimodal transport network with a significant increase in the share of rail and waterways traffic  Reduce urban traffic congestion with focus on Dhaka and Chittagong cities  Reduce the incidence of road accidents  Completion of the following high Priority Mega Projects: Padma Bridge, Deep Sea Port Project; MRT-6 project; LNG terminal project; Payra Port Project; Rooppur Nuclear Power Plant Project; Rampal Coal Power Project; Matarbari Coal Power Project H. Gender equality, income inequality and social protection I. Environmental Sustainability and J. ICT Development. The Plan is structured as follows: Part 1: Macroeconomic Perspective: Strategic Directions and Policy Framework; Part 2: Sector Development Strategies including Power and Energy as Sector 5.

Access

Energy access priorities:

The target is to provide electricity to almost all the population with special emphasis on reliable power to productive sectors which will require major expansion and up gradation of transmission and distribution networks.---Addressing the energy constraint is of the highest priority to achieve higher growth. The strategy needs to provide a balanced approach that looks at both supply increases through new investments and demand management.

Energy access targets:

Electricity coverage to be increased to 96 percent with uninterrupted supply to industries.---Access to electricity (% of households)... 72% (FY 2015) 80% in 2016, 85% in 2017, 90% in 2018, 94% in 2019 and 96% in 2020.---It is expected that more than 90 percent population will come under rural electrification Programme after implementation of 7th Five Year Plan.

Clean cooking solutions:

Financial Incentive Mechanism for Improved Cooking Stove - FY2015-FY2016.

Consumer subsidies:

Financial Incentive Mechanism for Improved Cooking Stove - FY2015-FY2016.

Efficiency

EE priorities:

Energy efficiency and conservation will be enhanced across the industry from generation to the consumer end.---Industrial users of gas as well as captive generators will have to increase efficiency through cogeneration/tri-generation.---Improving power sector efficiency and reducing transmission and distribution losses.---GoB has been promoting electrified irrigating pumps in place of diesel based pumps for greater efficiency in agriculture. To conserve water in paddy production, the Department of Agricultural Extension has been promoting ‘alternate wet and dry’ method for irrigation in paddy fields. This will be further emphasized in the 7th FYP.---GoB is committed to developing a pathway for addressing gender friendly energy efficiency with special emphasis on LCD.---The Building sector can be motivated to construct more eco-friendly buildings that require less energy. Potential opportunities for investments like these will be reviewed and pursued accordingly.---Setting a target of a feasible energy efficiency level based on the research is required [...].

EE targets:

Reduce system loss from 13% to 9%, improve energy efficiency & conservation.---Policy for compliance by industries: [...] Achieving energy efficiency by 25% from the current level in the operation of the plant(s).

EE action plans:

Actions have been taken to convert Ghorashal, Baghabari, Shikalbaha and Shahjibazar simple cycle power plants into combined cycle power plants. Nevertheless, addressing this energy efficiency issue is a major challenge that will be tackled during the Seventh Plan. ----Demand Side Management (DSM) through Energy Efficiency and Conservation (EEC) improvement will be a key focus of the gas sector in the Seventh Plan to conserve the shrinking gas resource.---The subsidy policy will need to be coordinated with pricing of energy products both for fiscal sustainability but also to promote efficient energy use in total as well as by product categories.---Energy Efficiency and Conservation Programme: FY2016-FY2020.--- Strict enforcement of Brick Kiln Act 2013 for phasing out of traditional brick Kiln.---Bangladesh Standards and Testing Institution (BSTI) will oversee the Implementation of Bangladesh Standards through a national certification marks Scheme Promotion of quality control [...] Emphasis will be laid also on [...] standardization and labelling of energy efficient electrical appliances & equipment of selected 6 BRESL products.

EE lighting and mechanical system standards:

GoB also plans to replace conventional street lights with LED and solar lights. Energy efficient appliances will be certified through BSTI, and their use will be highly encouraged.

EE labeling:

Bangladesh Standards and Testing Institution (BSTI) will oversee the Implementation of Bangladesh Standards through a national certification marks Scheme Promotion of quality control [...] Emphasis will be laid also on [...] standardization and labelling of energy efficient electrical appliances & equipment of selected 6 BRESL products. To this end, all policies, rules, regulations and criteria are being developed taking cognizance of relevant internationally available documents.

EE building standards:

Incorporate and introduce Green Building Code in our National Building Code to have energy efficient building/green building to address climate change.---The Building sector can be motivated to construct more eco-friendly buildings that require less energy. Potential opportunities for investments like these will be reviewed and pursued accordingly.

EE financial incentives:

The subsidy policy will need to be coordinated with pricing of energy products both for fiscal sustainability but also to promote efficient energy use in total as well as by product categories.---Financial Incentive Mechanism for Improved Cooking Stove - FY2015-FY2016.---SREDA will be empowered to offer financial incentive schemes for promoting the programmes to conserve power system in the range of 1,000MW during the Seventh Plan.---Tax rebates for production of environmentally friendly products, including energy efficient appliances, recycled materials, sustainable paper products etc.

EE public awareness/promotional programmes:

GOB will also seek to employ non-pecuniary means to encourage energy saving, and interact with targeted programmes involving private sector institutions.

Renewable Energy

RE priorities:

Use of alternative sources of energy.---Installations of solar panels for small scale irrigation in rural areas will be given priority.---The Government will, of course, have to play its pro-active role in [...] facilitating use of renewable energy including solar power in agriculture production.

RE targets:

Renewable energy is expected to provide 5-10% of total generation.---Share of renewable energy to the total electricity generation (%) (including hydro): 3.6 (FY 2015) 5 in 2016, 6 in 2017, 7 in 2018, 8 in 2019 and 10 in 2020.---The Government’s plan is to generate 800MW of power through renewable energy by FY2017 with a target of 10% of the total electricity to be met from renewable resources by FY2020.

RE action plans:

Roof top solar PV systems are also being introduced in the country with the current installed capacity estimated at 32 MW. [...] Mini-grids and grid-connected MW-scale solar PV plants are also being explored.

Environment

Energy environmental priorities:

The Government is also aware of the environmental consequences of coal mining and is taking steps to address the concerns.---. The Government of Bangladesh’s Vision is to eradicate poverty and achieve economic and social prosperity for all people. This will be achieved through a pro-poor Climate Change Management Strategy, which prioritizes adaptation and disaster risk reduction, and also follow the path of low carbon development, mitigation, technology transfer and the mobilization and international provision for investments in coping mechanisms and green technology.

Pollution level targets, PM10, PM2.5, SOx, NOx:

Mean urban air pollution of particulate matter (a) PM10 in μg/m3 (b) PM2.5 in μg/m: a) 130.90 (2013) b) 78.00 (2013); 125.0 77.0 2016; 120.0 76.0 2017; 115.0 75.0 in 2018; 110.0 74.0 in 2019; 105.0 73.0 in 2020.

GHG emissions reduction targets:

CO2 emissions (tonnes per capita) 0.34 in 2015, 0.348 in 2016, 0.356 in 2017, 0.364 in 2018, 0.372 in 2019 and 0.38 in 2020.

Pollution control action plans:

To meet national air and water quality standards.1. Monitor, control and prevent environmental pollution and degradation related to air, water and soil [...] 3. Implementation of emission, effluent and waste management strategy 4. Introduce low-sulphur diesel and compatible standards vehicles 5. Introduce energy efficient affordable technology.---Expanding air quality management activities, focusing on gross diesel polluters, and the extension of air quality monitoring to major cities.[...] Introduce cleaner fuel & transport standards to achieve environmental sustainability. Strict enforcement of Brick Kiln Act 2013 for phasing out of traditional brick Kiln.

Decarbonization strategy:

To meet energy demands of development through a low carbon strategy. 1. Conserve non-renewable resources and sustaining auto and eco-generation of renewable resources 2. Mass initiative to be taken under Clean Development Mechanism and REDD;---LCD strategy will be developed in collaboration with relevant ministries and agencies along with mainstreaming the National Action Plan on Short-lived Climate Pollutants in all the relevant mitigation sectors.

Carbon markets:

Currently there are twelve CDM projects concerned with solar energy and waste management. The third project is expected to begin soon.---Carbon Credit and REDD Mechanism Programme: The mechanisms for certifying and approving reforestation and forest protection under carbon credit and REDD mechanisms will be rationalized and streamlined and be used to enable substantial forest restoration and coastal afforestation through partnerships with local communities, civil society and private sector.

Green finance:

Enhance CCA (Climate Change Adaptation) financing -In order to ensure continuous funding, the Government will offer more effort to seek international financial support, in addition to allocating funds towards CCA. A new financial mechanism in the form of Green Climate Fund (GCF) is about to be made functional.---Establishing energy efficient green technology based Bangladesh Environmental Specimen Bank.

Energy-water nexus:

Installations of solar panels for small scale irrigation in rural areas will be given priority.

Cooperation in env.:

The Government of Bangladesh’s Vision is to eradicate poverty and achieve economic and social prosperity for all people. This will be achieved through a pro-poor Climate Change Management Strategy, which prioritizes [...] the mobilization and international provision for investments in coping mechanisms and green technology.

Pricing

Energy taxation:

The existing tax and tariff structures will be reviewed to better manage energy demand.

Energy pricing:

Cooperation in energy pricing:

The public sector should collaborate with development partners to conduct research on new technologies, taxation and tariff structure.

Energy Supply and Infrastructure

Infrastructure development priorities:

Use coal as main source of energy for power generation---Infrastructure will be made suitable for a middle income country which will include transformational mega projects for energy and transport sectors.---Development of transmission and distribution system in line with generation.---Completion of the following high Priority Mega Projects: Padma Bridge, Deep Sea Port Project; LNG terminal project; [...] Rooppur Nuclear Power Plant Project; Rampal Coal Power Project; Matarbari Coal Power Project.---Rooppur Nuclear Power Project's first plant (1000 MW) will be commissioned immediately after 2020.---The strategy during the 7th Plan will be to meet the shortfall in domestic gas with coal, particularly imported and LNG while moving ahead with accelerated exploration of hydrocarbons in the offshore and the deep sea.---In the near future, however, the Government intends to expand this deep-sea port and develop a coal Centre as “An Energy Hub” for the whole country.---[F]or the present generation scenario, liquid fuel based power generation will be continued until large scale coal based power plants are in line.---Transmission infrastructure will be added in the tenure of 7th FYP (2016-2020) are given below:  800kV DC Transmission Line : 200 ckt. km  400kV Transmission Line : 3204 ckt. km.---Completion of two units of Rooppur Nuclear Power Plant for 2000 MW electricity production.  230kV Transmission Line : 1755 ckt. km  132kV Transmission Line : 3284 ckt. Km  400kV HVDC Station : 3000 MW  Substations Capacity 400/230kV : 11780 MVA  Substations Capacity 230/132kV : 18300 MVA  Substations Capacity 132/33kV : 17314 MVA  Capacitor Banks installation at Grid substation at 33 level: 1000 MVAR.---Adoption and implementation of a proper (Operation and Mantainance) O&M is of highest priority.

Regional integration priorities:

Exploring electricity-trading options with neighbouring countries (India, Nepal, Bhutan and Myanmar).

Cooperation in connectivity:

Regional cooperation will also be pursued, in particular, to harness hydropower.

Trade

Energy trade priorities:

Ensuring export competitiveness in general – by addressing border barriers (e.g. tariffs) and beyond-the border constraints (e.g. trade infrastructure, energy and telecommunications, regulations, finance).---Exploring electricity-trading options with neighbouring countries (India, Nepal, Bhutan and Myanmar).---Planning for Import Coal Facilities: FY2016.---[T]he Seventh Plan will further expand trade with India and also explore hydro-power import opportunities with Nepal and Bhutan. The hydro-power potential is also considerable through India’s North-eastern state of Tripura. The Seventh Plan power generation programme plans to obtain at least 600MW of electricity through power trade.

Investment

Energy sector investment priorities:

Consistent with the growing demand for infrastructure to support accelerated growth, most emphasis will be given to Transport and energy under the 7th Plan through ADPs (Annual Development Programme). Please see Table 5.9: Seventh Plan Sectoral ADP Allocations (Taka billion) for details on investments on power energy.---The Building sector can be motivated to construct more eco-friendly buildings that require less energy. Potential opportunities for investments like these will be reviewed and pursued accordingly.

Financial incentives for energy infrastructure:

Use of alternative sources of financing (Export Credit Agency, etc.).

Public Private Partnerships:

Mobilizing private and joint venture investment in power sector.---The total power generation capacity in 2015 stands around 14000 MW which will be increased to 23000 MW by 2020 at the end of the ill Plan, the increase is estimated to be shared at 60:40 ratio between public and private sector.---Basic infrastructure and services at the community level, including [...] energy, [...] services, [...], will primarily be the responsibility of the central government agencies and the local government bodies with increasingly greater involvement of the private sector.---In the near future, however, the Government intends to expand this deep-sea port and develop a coal Centre as “An Energy Hub” for the whole country. The coal Centre will be carried out through PPP (Public Private Partnership) scheme. ---The Seventh Plan assumes a further expansion in the contribution of the private sector in power generation. [...] It is expected that no new rental plant contracts will be needed during the Seventh Plan and the share of rental plants will fall progressively.---Commercial projects will be implemented by the private sector while social projects will be implemented by the different ministries and agencies as a part of social responsibility of the Government. Commercial projects are: (a) Solar Park (grid connected); (b) Solar Irrigation; (c) Solar Mini-grid/micro-grid; and (d) Solar rooftop. The social projects are: (a) Rural health centres; (b) Remote educational institutes; (c) Union e-Centres; (d) Remote Religious Establishment; (e) Off-grid Railway Stations; and (f) Government & Semi-Government Offices in the off-grid areas.---GOB will also seek to employ non-pecuniary means to encourage energy saving, and interact with targeted programmes involving private sector institutions.---The public sector should collaborate with development partners to conduct research on new technologies, taxation and tariff structure.

Governance

Energy management principles:

Ensure energy mix for energy security.---Basic infrastructure and services at the community level, including [...] energy, [...] services, [...], will primarily be the responsibility of the central government agencies and the local government bodies with increasingly greater involvement of the private sector.

National policy structure:

A key step that will be taken in the Seventh Plan is to finalize and adopt the National Coal Policy.---Most importantly, the Government should urgently finalize and adopt the long-pending National Energy Policy, or alternatively develop an Energy Master Plan. In this policy, the following items would need to be delineated: i) Gas Allocation Policy, ii) Domestic gas exploration policy, (iii) Domestic coal utilization; iv) Energy import) Demand side management and energy conservation, vi) Improved Cooking Stove (ICS); and vii) Energy subsidy and pricing.---Develop Energy Subsidy Policy FY2016 (by when LNG import starts).---Domestic Gas Exploration Policy: FY2015-FY2016.---Establish Gas Allocation Policy (incl. LPG and Biogas Alternative policy): FY2015-FY2016.

Energy institutional structures:

In recognition of the importance of energy conservation, the sustainable component of SREDA is entrusted with three main pillars: (1) energy management Programme, (2) energy efficiency labelling Programme, and (3) energy efficiency building Programme.---The GoB will identify an anchor institution, and it will be empowered on LCD. The anchor institution will facilitate sharing of ideas and learning among different institutions working towards mitigation.

M&E of policy implementation:

The policy addresses progress mad on infrastructure development.

Technology

Clean energy technology priorities:

Industrial users of gas as well as captive generators will have to increase efficiency through cogeneration/tri-generation.---Research thrust would include [...] energy management in agriculture.---The Government will, of course, have to play its pro-active role in [...] facilitating use of renewable energy including solar power in agriculture production.---Use of nuclear energy for power generation.---To meet national air and water quality standards [...]5. Introduce energy efficient affordable technology.---In the nuclear energy sector, Nuclear Power Training and Educational Institute will be established which will develop qualified and specially trained manpower.---Expand peaceful use of nuclear energy through establishment of nuclear power plant (NPP) and nuclear medicine centres (NMC).---Establishing energy efficient green technology based Bangladesh Environmental Specimen Bank.

Clean energy technology transfer:

The Government of Bangladesh’s Vision is to eradicate poverty and achieve economic and social prosperity for all people. This will be achieved through a pro-poor Climate Change Management Strategy, which prioritizes [...] technology transfer and the mobilization and international provision for investments in coping mechanisms and green technology.

Clean energy technology deployment:

Gas-to-power technology:

R&D energy efficiency:

R&D pollution abatement:

To meet national air and water quality standards [...]5. Introduce energy efficient affordable technology.---Research will be conducted on better and sustainable utilization of forest resources.

Technology collaboration with other member States:

The public sector should collaborate with development partners to conduct research on new technologies, taxation and tariff structure.

Industrialization support:

Electricity coverage to be increased to 96 percent with uninterrupted supply to industries.---Tax rebates for production of environmentally friendly products, including energy efficient appliances, recycled materials, sustainable paper products etc.