The government has started exploring funds from Bangladesh's development partners to bankroll its ambitious rooftop solar project, according to sources.
To materialise the rooftop solar ambition the Power Division recently requested the Finance Division to arrange US$2.0 billion from the Asian Development Bank (ADB), sources said.
After receiving the request, the Finance Division is now exploring ways to arrange funds for financing projects aimed at generating an additional 3,000 to 4,000 megawatts of electricity from rooftop solar before next summer.
Earlier, government high-ups had ordered diversion of necessary funds from the development budget as the private-sector renewable-energy producers suggested fundraising for financing rooftop solar-power generation.
Sources have said the Power Division on August 31 wrote the letter to the Finance Division urging to obtain $2.0-billion support from the ADB for the expansion of rooftop solar.
Tahmilur Rahman, a senior assistant secretary, in the letter wrote that to reduce dependency on fossil fuels, generate clean and eco-friendly electricity, decrease financial risks in the power sector, achieve greater self-reliance, and attain SDG targets, the government formulated the 'National Renewable Energy Development Strategy 2026-2030" which was approved by the cabinet last July.
The strategy sets a target to achieve 20 per cent of total electricity generation from renewables by 2030. Among this, the target for generating electricity from rooftop solar is 5,500mw.
"Considering the country's current electricity situation and the anticipated electricity demand for the upcoming summer season, generating an additional 3,000 to 4,000 megawatts of electricity from rooftop solar before next summer is under active consideration," he wrote.
Mr Rahman also mentioned that plans have been made to create new entrepreneurs and service providers, install solar systems nationwide, provide necessary incentives, and expand the coverage of the net-metering system.
"Adequate and sustainable financing is crucial to enhance the necessary capacity of the power and energy sector and ensuring sustainable development. As a developing nation, active participation from international development agencies is necessary to implement this government initiative," he added.
Mr Rahman also has written that examples are there where various international development agencies provide effective assistance to developing countries through direct loan support for expanding renewable energy, especially rooftop solar projects.
Therefore, he requested arranging some $2.0 billion from the ADB to catalyse the renewable-energy sector, including the expansion of rooftop solar, and to achieve the targets set by the government.
A Finance Division official told The Financial Express that the funds cannot be arranged under budget-support programme but rooftop solar-related projects can be taken for which financial supports can be sought from the development partners.
Contacted, president of Bangladesh Sustainable and Renewable Energy Association (BSREA) Mostafa Al Mahmud said a large sum of financial support is necessary to materialise the government's target of generating 3,000 to 4,000mw electricity from rooftop solar before next summer.
"During a meeting with Power Division officials last month, we made it clear that without financial backup the initiative won't move forward," he said.
Mr Mahmud guesses that the government is probably creating a Tk 20-billion fund to finance the effort to enhance green-power generation.
"Foreign funds can be a good option for the government since many multilateral development partners provide low-cost funds for clean-energy generation," he notes.
According to Sustainable and Renewable Energy Development Authority (SREDA), presently, the country has the installed capacity to generate 1,852 megawatts of electricity from renewable sources.
