Govt to formulate investment-friendly policy on renewable energy by June 2026 : Minister

The government has taken steps to formulate an investment-friendly policy by June 2026 to attract investment in the renewable energy sector of Bangladesh.

Minister for the Ministry of Power, Energy, and Mineral Resources (MPEMR) Iqbal Hassan Mahmood said this while speaking as the chief guest at the market sounding workshop on Sonagazi 130 MW Solar PV (photovoltaic) with BESS PPP Project organised by Bangladesh Economic Zones Authority (BEZA).

Minister of State Aninda Islam Amit also spoke at the event as a special guest.

The Executive Chairman of BEZA, Chowdhury Ashik Mahmud Bin Harun, chaired the event.

“Prime Minister has formed a committee to formulate a policy to find what the government has to offer to help the investor in this sector,” said the MPEMR minister.

He also added that the government will act as a facilitator and will provide support to do profitable business in this sector by formulating an investment-friendly policy very soon.

The minister recalled how a favourable policy adopted by Shahid President Ziaur Rahman helped to boost the garment sector business.

The government intends to introduce such a policy in the solar sector to attract investors in Bangladesh and accelerate the growth of the solar energy business, he said.

The government may revoke taxes on frame, photocell, battery, etc., to reduce the business cost, enhance storage capacity and facilitate the solar energy business, he said, putting emphasis on the need to enhance solar power storage capacity.

Citing Pakistan as a success story, the minister noted that the Pakistani government imported solar equipment and offered it to investors with incentives, yielding positive results.

He said Bangladesh could adopt a similar approach by either directly importing solar equipment or permitting private-sector imports at zero duty.

Stressing the need to prioritise investment to expand the renewable energy sector, the minister said entrepreneurs would be encouraged if the government imposed minimal duties and taxes on imports and offered a five-year tax holiday.

“Investment must come first before revenue. After five years, the government will naturally receive taxes,” he said, adding that the matter will be proposed for discussion among the policymakers.

Emphasising the vast solar energy potential in Dhaka, the minister said leasing rooftops in Dhanmondi, Mohammadpur and other similar residential areas of Dhaka to private investors under a net metering system could generate up to 1,000MW of electricity from the city alone.

He noted that the initiative would reduce pressure on the national power grid and allow the conserved electricity to be supplied to industries.

The energy minister has reiterated his belief that the government’s investment-oriented initiatives would help to revolutionise solar power in Bangladesh, like the garment sector.

“The private sector has a very important role to play in Bangladesh’s renewable energy journey,” state minister Aninda Islam Amit said.

Bangladesh must now move toward a more balanced power generation mix, he said.

Imported fuel will continue to have a role, but excessive dependence on imported energy exposes the country to international price shocks, foreign exchange pressure, and fiscal burden.

Solar power can help reduce this exposure, especially if projects are developed at scale and through competitive procurement, he added.

The Sonagazi project is an important test case.

It is located at the National Special Economic Zone, where BEZA-owned land can be used for clean energy generation.

The proposed project structure brings together the key institutions -- BEZA as land owner and project sponsor, the BPDB as off-taker, the PGCB for grid evacuation, Power Division for policy support, SREDA for renewable energy policy coordination, and PPPA for PPP structuring and procurement support.

The project is also forward-looking because of the potential inclusion of battery energy storage, said the state minister.

"As Bangladesh increases the share of solar and other variable renewable energy, storage will gradually become more important for grid stability, peak management, and better utilization of renewable power."

He welcomed suggestions and feedback from the workshop to move ahead with the endeavour successfully.

The government must create the right enabling environment through clear policies and predictable processes, as well as ensuring proper coordination among agencies, Mr Amit added.