According to a report by the Institute for Energy Economics and Financial Analysis (IEEFA), increasing energy efficiency in Bangladesh may save $460 million annually and lessen dependency on expensive LNG imports.
The effort to increase energy efficiency can also aid in weaning the nation off of its costly reliance on imports, according to a report that was just released.
In an effort to identify ways to lessen the nation’s rising need for LNG, the paper examined 51 industries and 124 gas-fired captive generators with a total generating capacity of almost 250 megawatts (MW).
“An insatiable appetite for gas could lock Bangladesh into a vicious cycle of spiraling prices and supply issues pertaining to LNG, and threaten to stall its economic transformation,” says the report’s author, Shafiqul Alam, lead analyst – Bangladesh Energy, IEEFA.
“The plan to import sufficient energy for development was not designed to cope with the high-levelof volatility in the international fuel market, depreciation of the local currency, and weak fiscal conditions,” he said.
“Low efficiency in gas-fired captive power generation consumes a significant amount of gas annually. This is despite the average efficiency in captive generation increasing to 35.38% from 30% in the last decade,” Alam said.
“Additionally, a significant percentage of industries do not utilize the waste heat released by these generators,” he added.
It was discovered in the report that Bangladesh could cut its yearly consumption of imported LNG by a staggering 50.18 billion cubic feet, or 21%, by swapping out its large stock of outdated, inefficient generators for more efficient models already on the market and using the waste heat generated by generators for other uses. This would save the country nearly $460 million annually.
Although replacing generators may involve a substantial upfront cost, this investment can be recovered in one to five years. According to the study, waste heat recovery investments only pay for themselves after around a year.
The alternative is to spend far more on building additional infrastructure to cope with the increasing local demand for fossil fuel imports against a global backdrop of tightening regulations to produce environment-friendly products.
