Not only 10 projects, now the Power Division is contemplating to set up many more solar power plants as it received the NBR’s notification for reinstating the tax exemption  on such private investment. Power Division officials said it is now certain the number of solar projects is going to be increased from the existing 10 proposed plants. Earlier the Power Division had planned to set up 10 solar power plants in the private sector and sought the Finance Ministry’s concurrence for National Board of Revenue (NBR) to reinstate the tax holiday on private investment. Each of the proposed plant was supposed to be 50 MW with a total capacity of 500 MW. “Finally, we have received the NBR notification in this regard and now the number of solar plants will be more than 10,” said Energy and Power Adviser to the interim government Dr Muhammad Fouzul Kabir Khan said. However, how many will be the total number of such proposed plants has not been settled as yet, he told UNB. Power Division officials said the number of solar plants might be between30-40. As per the NBR circular, issued on October 27, the private investors in renewable energy will get a 10-year tax exemption on their investments. The circular said that those companies which will start commercial operation of their renewable energy-based power generation project on the basis of Build-Own-Operate basis under the Private Sector Power Generation Policy of Bangladesh within a period between July 1, 2025 to June 30, 2035 will avail a tax holiday for 10 years. Rooftop solar panels may influence urban temperatures: Study    “These companies will get 100 percent tax exemption for the first 5 years, 50 percent for the next 3 years and 25 percent for the remaining 2 years”, said the NBR notification. The tax incentive to provide the benefits over a ten-year period was designed to support long-term growth and development of renewable energy projects, the circular added. Earlier, the government had withdrawn these exemptions through a gazette notification issued on June 26, 2023, saying that companies which achieve their commercial operation date (COD) between January 1, 2023 and June 30, 2024, will get tax exemptions. Under the terms of the previous gazette, private power generation companies—excluding coal-fired plants—are eligible for various tax exemptions. As outlined in the previous NBR notification, private power generation companies will enjoy a 100 per cent income tax exemption until 30 June 2036, limited to income derived from power generation activities. Additionally, foreign personnel employed by these companies will be exempt from income tax for three years following their arrival in Bangladesh. Further exemptions include a 100 per cent income tax break for the first five years of operation starting from COD, a 50 per cent exemption for the next three years, and a 25 per cent exemption for the subsequent two years, said the previous notification. Sources report that the interim government, after taking office, suspended the Speedy Increase of Power and Energy Supply (Special Provision) Act 2010 and cancelled 34 solar power projects that had been approved under this law. Govt considers resuming industrial gas connections These projects were originally selected without a tender process and on an unsolicited basis. In place of this, the Power Division has opted to open a tender for the establishment of 10 solar power projects, with a total capacity of 500 MW—each project offering 50 MW. However, many potential investors expressed reluctance to participate in the tender without the availability of tax exemption benefits. As a result, state-owned Bangladesh Power Development Board (BPDB) was unable to issue the tender for the projects. Following this, the Power Division requested the revival of the tax exemption benefits, sending a letter to the NBR. A top official of the BPDB said that after reinstatement of the tax holiday, they are now expecting that more investors will be coming to participate in the bidding for the private solar power projects. “Actually, there are a number of propositions—the total solar projects might be up to 40 with each capacity of 50 on an average,” he said. “But—from capacity to locations— everything of the new solar power project will be finalised within this week in a top level meeting,” he said. Bangladesh’s clean energy transition Bangladesh has set ambitious targets to meet 40% of its energy needs through renewable sources by 2041. Achieving this will require an estimated investment of $1.5 to $1.71 billion, according to Center for Policy Dialogue (CPD). In alignment with its commitment to a low-carbon development path, Bangladesh is increasingly focusing on renewable energy and energy efficiency. According to the Sustainable and Renewable Energy Development Authority (SREDA), Bangladesh currently produces 1,374.35 MW from renewable sources, with 230 MW from hydropower and 1,080.36 MW from solar energy. According to a Power Cell document, projects totaling 3,963.5 MW are at different implementation stages. Specifically, 943.5 MW of projects are under construction, 609 MW have received letters of intent (LOI) or notifications of award (NOA), 228 MW are in the tendering process, and 2,183 MW remain in the planning stage.

The state-owned Bangladesh Power Development Board (BPDB) has failed to float an open tender for setting up 10 grid-connected solar power plants in the private sector, despite a top-level decision by the Power Division as part of renewable energy promotion. “The officials concerned have not been able to complete their preparations to float the tender, even though the decision is being given the utmost priority by the interim government,” said a source wishing anonymity. Earlier, the Power Division directed the BPDB to float the tender for the development of 10 grid-connected solar power plants in the private sector, each with a capacity of 50 MW, totalling 500 MW. Sources said the move came against the backdrop of the interim government’s decision not to sign any further contracts under the Enhancement of Power and Energy Supply Act (Special) Act, 2010. As a result, the future of 34 proposed private-sector grid-connected solar power plant projects, for which the BPDB had previously issued Letters of Intent (LoI) under the previous Awami League government, has become uncertain. BPDB had selected these firms through the process of ‘unsolicited offer’ under the Speedy Enhancement of Power and Energy Supply Act (Special) Act, 2010. Under this law, the government can award the contract of a project to any private firm without a tender process. Energy experts have criticised this Special Act as the root cause of all corruptions and irregularities in the power and energy sector during the Awami League tenure. Read: BPDB likely to invite tender for setting up 10 grid-connected solar power plants They alleged that many underqualified private companies were awarded power plant projects, significantly increasing costs and contributing to an annual sector loss of Tk 70,000 crore. As a result, after the fall of the Awami League government in a mass upsurge, the Dr Yunus-led interim government assumed office and decided to suspend the law and not sign any further contracts under the Speedy Enhancement of Power and Energy Supply Act (Special) Act, 2010. The interim government’s Energy Adviser Dr Muhammad Fouzul Kabir Khan announced the decision soon after assuming office in the Power and Energy Ministry, saying that all future projects will be implemented through an open tender process. This decision, however, put the private sponsors, who pursued the 34 solar projects, in great difficulty as they had already spent huge amounts of money to procure land and secure the LoI. In such a situation, they expressed their interest to get these projects through a competitive bidding process and secure the contract through open tender. Read: BPDB to prepare position paper on its financial and economic condition within a week “We have decided to initially float a tender for setting up a good number of location-wise 50 MW solar projects. It will help those who have already procured land to get the project through a competitive bidding process,” Senior Secretary to the Power Division Habibur Rahman told UNB about 10 days ago. He said the government is trying to implement solar power projects as part of renewable energy promotion. The private sponsors will set up the plants at their own cost and the BPDB will purchase electricity from the private plants for a specific period of time. “The BPDB will soon float the tender for a number of grid-connected solar projects, each of 50 MW capacity. Mostly, those locations will be selected where power evacuation facilities are available with grid substations,” said the power secretary. He, however, did not provide details of the locations. Read more: Interim govt contemplating new bond issuance to clear BPDB’s dues with pvt power producers  A senior official of the BPDB mentioned that mainly the Independent Power Producer (IPP) Cell-1 has been working on preparing the tender document and site selection. Despite repeated calls over the mobile phone, Director of the IPP Cell-1 Shamsuzzoha Kabir did not respond to queries in this regard.

The Sustainable and Renewable Energy Development Authority (Sreda) has finalised a draft policy guideline for purchasing idle electricity from solar power plants now being used for running irrigation pumps.