Remote and hard-to-reach areas of Bangladesh in the past lacked access to grid electricity. Around 6.5 million solar home systems were installed, bringing electric lighting to many poor and marginalised households. At the time, the solar power programme was widely regarded, including internationally, as a strong and effective solution for addressing climate change and taking initial steps towards energy transition. Despite receiving praise at home and abroad, Bangladesh subsequently failed to expand the use of solar and other renewable energy sources on a broader scale.
Despite repeated initiatives to accelerate the energy transition and increase renewable electricity generation, Bangladesh has failed to meet its targets. This is reflected in the World Economic Forum’s Global Energy Transition Index, where Bangladesh now ranks 99th among 120 countries. In South Asia, Bangladesh trails Sri Lanka, as well as neighbouring India and Pakistan.
Amid ongoing global conflicts, developed countries are placing greater emphasis on the energy transition to address energy shortages, which has also been a subject of global discussion for years as part of efforts to tackle climate change. The United Nations Sustainable Development Goals (SDGs) include “Affordable and Clean Energy” as Goal 7, which calls for ensuring access to affordable, reliable, sustainable and modern energy for all by 2030.
Experts say Bangladesh’s lag in the energy transition is primarily due to a lack of preparedness. In the past, targets were set for renewable electricity generation, but the necessary preparations to achieve them were lacking in both the public and private sectors. Challenges included the absence of year-by-year plans or roadmaps, inadequate policies and financing, land acquisition difficulties, limited use of technology and a shortage of skilled workers. More specific initiatives have now been taken to advance the energy transition. Experts believe that proper monitoring of these initiatives could help the government meet renewable electricity targets and make further progress in the energy transition.
The World Economic Forum (WEF) has been monitoring and comparing the performance of energy sectors in different countries for more than 15 years. As part of this effort, it published the Energy Transition Index (ETI) 2026 this year. Using 44 indicators, the index assesses the performance of current energy systems and countries’ preparedness to address future challenges across 120 countries.
The index evaluates the performance of a country’s energy system across three dimensions: equity, sustainability and security. A country’s ETI score is based on two sub-indices: the performance of its energy system, which accounts for 60 percent of the score, and its preparedness for the energy transition, which accounts for the remaining 40 percent.
Bangladesh ranks 99th among 120 countries in the ETI. This year’s index assesses each country on two parameters: system performance (SP) and transition readiness (TR).
The SP score measures the effectiveness of a country’s current energy system across three dimensions: energy security, equitable and affordable access, and sustainability. The maximum score is 100, and Bangladesh scored 63.3 in system performance.
Transition readiness (TR), meanwhile, measures how prepared a country is to advance its energy transition in the future, considering five factors: policy and political commitment, finance and investment, infrastructure, innovation, and education and human capital. Bangladesh scored 30.5 on the TR parameter.
Energy analysts say Bangladesh’s low TR score is largely due to its failure to meet targets for renewable energy despite announcing them. Key challenges include financing, government-led land acquisition and technology, areas in which adequate preparations were not made in the past.
Shafiqul Alam, lead energy analyst for Bangladesh at the Institute for Energy Economics and Financial Analysis (IEEFA), which analyses global energy markets, said the ETI considers two major parameters in assessing progress towards renewable electricity generation. Bangladesh’s low ranking is primarily due to its lack of progress in transition readiness, or inadequate preparation to implement its targets. The gaps may relate to financing, technical capacity and other factors, he said.
He told Bonik Barta: “To advance the renewable energy sector, the government’s programmes must be implemented on time and properly monitored. A major priority for future preparedness is modernising the power grid. The government has now set annual targets for renewable electricity generation, which was not done before. High tariffs were previously imposed on rooftop solar equipment, but these have now been reduced to 1 percent. The tariff reduction is in place for six months, but this period needs to be extended. If these measures are implemented, Bangladesh can improve its position in the global energy transition.”
From 2009 to 2024, the then Awami League government took various initiatives to develop the country’s renewable electricity sector, including targets to generate 5 percent of total electricity capacity from renewable sources by 2015 and 10 percent by 2020. But the government failed to achieve these targets.
Experts believe the targets were missed because of shortcomings in policies, roadmaps, public-private support, incentives and technology, also citing limited land availability and the emphasis on quick-rental power plants and coal-fired electricity generation as key reasons for the sector’s slow progress.
Following the change of power in 2024, an interim government took charge of the country and subsequently cancelled 31 renewable energy and solar power projects approved under the previous administration under a special law.
Industry insiders consider the decision a major factor behind Bangladesh’s lag in the energy transition and renewable electricity generation. They believe that, had the projects not been cancelled, foreign investment would have flowed in, and many of the power plants would already have begun operations. They also argue that this would have eased, to some extent, the government’s energy crisis stemming from its reliance on fossil fuel-based power plants amid the Middle East conflict.
According to the Sustainable and Renewable Energy Development Authority (SREDA), Bangladesh currently has 1,816 megawatts of renewable electricity generation capacity, of which solar power accounts for 83 percent, meaning solar power alone accounts for 1,523 megawatts of capacity. Renewable energy currently makes up 3.82 percent of electricity supplied to the national grid.
An analysis of renewable electricity capacity shows that wind power has virtually no presence in Bangladesh’s energy mix. Hydropower accounts for 230 megawatts of capacity, but this comes from old facilities established many years ago.
The current government aims to generate 10,000 megawatts of electricity from renewable sources by 2030. To achieve this, it has launched initiatives to install solar panels on the rooftops of various public and private buildings, and has also reduced tariffs on equipment, batteries and other materials used for solar power generation to 1 percent to promote renewable energy. It has also taken steps to offer investors in the sector tax exemptions at varying rates until 2030.
ActionAid, a non-profit non-governmental development organisation, is working on strategic initiatives to build an environmentally friendly, inclusive and people-centred energy system. One of its programmes on energy transition is called ‘Just Energy Transition’.
Abul Kalam Azad, head of the programme, told Bonik Barta: “I and others have repeatedly stressed the urgency of the energy transition. The current global situation may stabilise in the future, and energy may become more readily available, but will prices fall? That’s the big question. We’ve increased our use of fossil fuels while keeping the renewable energy sector in the background. The crisis may have become more acute now, which is why we’re talking about the issue.”
The current government has set a renewable energy target of 10,450 megawatts by 2030. Industry stakeholders say investment and consumer interests must be prioritised to achieve this goal. The government has reduced the tariff on rooftop solar equipment to 1 percent for six months, but it remains unclear what the rate will be after that period. Sector insiders believe policies need to be more predictable and favourable to encourage renewable energy development.
Many companies in Bangladesh are installing rooftop solar panels at their factories as part of the energy transition, particularly in efforts to increase renewable electricity generation. While private entrepreneurs have welcomed the government’s initiatives, they have called for further policy concessions and infrastructure support.
Azam J Chowdhury, an industrial entrepreneur and chairman of East Coast Group, told Bonik Barta: “Renewable electricity is now a major part of the energy transition, and the private sector has also stepped forward in solar power. To implement these programmes on a wider scale, the government needs to build substations and transmission lines up to solar project sites. It should also fix tariffs and resolve land-related issues quickly.”
He also said, “Omera has already installed 100 megawatts of rooftop solar capacity and is manufacturing solar panels for export. The government is providing policy support and incentives. We need to work together to build the skills and capacity required in this sector. This will also help Bangladesh make further progress in the global energy transition.”
Former SREDA Chairman Mohammad Alauddin considers ensuring implementation a major challenge for the government’s current renewable energy initiatives. He told Bonik Barta: “It’s important to consider whether the private sector is ready and whether government agencies have sufficient expertise. Targets were set previously, but they couldn’t be achieved. Annual plans have now been drawn up, specifying how much clean energy will come from each sector. Alongside state-owned power distribution companies, other stakeholders working in the sector must also be willing to participate.”
SREDA, a state-owned agency, provides technical support to promote renewable electricity generation. Asked about the government’s priorities, SREDA Chairman Muzaffar Ahmed told Bonik Barta: “Rooftop solar is currently the government’s top priority in the renewable energy sector. More work is needed to determine how this programme can further advance renewable energy. The government has already formulated the National Renewable Energy Development Strategy (2026–2030), with 16–17 organisations working together on the initiative.”
Speaking about SREDA’s role in the country’s renewable energy sector, he said: “SREDA is efficiently carrying out its responsibilities as a state-owned agency, including providing technical support for renewable energy. Neighbouring countries such as India, Nepal, Pakistan and Sri Lanka have made significant progress in this sector, while Bangladesh has fallen behind. Our current goal is to encourage public- and private-sector initiatives and provide technical support to help achieve the government’s renewable electricity targets.”