CPD calls for repeal of quick energy supply Act

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The Centre for Policy Dialogue (CPD) has proposed repealing the "Quick Enhancement of Electricity and Energy Supply (Special Provision) Act 2010", advocating instead for procurement processes in the electricity and energy sectors to be aligned with the Public Procurement Act (PPA) and the Public Procurement Rules (PPR).

To achieve this, CPD's Research Director Khondaker Golam Moazzem suggested that measures should be taken to expedite the evaluation process of the PPA and the PPR.

Moazzem presented the proposal during a media briefing titled "Reforms in the Electricity and Energy Sector: CPD's Recommendations" at the think tank's Dhanmondi office today.

He also pointed out issues of lack of competition, transparency, and accountability in the sector, noting that procedural weaknesses have led to irregularities and policy deviations.

The Quick Enhancement of Electricity and Energy Supply (Special Provisions) Act was framed with an aim to ensure uninterrupted power supply to different parts of the country at any cost. The special provisions of the law facilitated energy imports and allowed urgent extraction and utilisation of minerals related to energy.

The tenure of the special provisions of the law, enacted in 2010, was extended several times. For the last time in September 2021, the cabinet cleared a proposal for the extension of the act for another five years until 2026.

In March 2023, the CPD stated at an event that the Act not only forces the government to adopt inefficient methods for producing and supplying energy but also places additional pressure on customers.

At today's event, Moazzem highlighted that the interim government, which assumed office on 8 August, faces high public expectations for economic reforms, particularly in the energy and electricity sectors.

"With significant figures in the government leading global initiatives for zero carbon emissions and renewable energy, expectations are high for expanding renewable energy in Bangladesh," Moazzem said.

Moazzem highlighted the need for a shift from fossil fuels to renewable energy, suggesting a move away from large-scale power supply structures to support small and medium enterprises.

He also called for reforms in policy, legal frameworks, and environmental practices.

However, there is a need to continue the Mujib Climate Prosperity Plan of the previous government as there are good initiatives in this plan, Moazzem said.

Among the CPD's recommendations, Moazzem proposed transforming the Bangladesh Energy Regulatory Commission (BERC) into a more effective institution, revising the Energy Policy of 1996, and strengthening Bangladesh Petroleum Exploration and Production Company Limited (BAPEX) for onshore and offshore operations.

At the same time, he proposed a change in leadership within the energy and power sector organisations. "The current leadership comprises individuals who are pro-fossil fuels. We need to bring in people who are supportive of renewable energy," he said.

He suggested shutting down the Renewable Energy Wing of BPDB and establishing a Renewable Energy Laboratory, citing the success of energy-efficient infrastructure in countries like Japan and Germany.

Moazzem also criticised the current prepaid meter system, which has led to complaints of high and inaccurate electricity bills.

He recommended an investigation into these billing issues and called for a "no electricity, no payment" system for power plant contracts to reduce subsidy pressure.

Addressing broader issues, Moazzem urged the government to reconsider LNG-based infrastructure projects and to increase investment in renewable energy.

Moazzem proposed a detailed roadmap for energy and electricity reforms, including a 100-day action plan to address immediate needs.

He suggested that the annual financial reports from the past five years of energy and power-related government institutions be audited by international organisations.

He also recommended that rental and quick-rental power plants, as well as those operating below capacity, be shut down as soon as possible. Additionally, there are 28 power plants whose contracts will expire by 2030, and these plants should be closed as their contracts end.

Moazzem further said the government is incurring higher costs due to the lack of competitive bidding in electricity purchases, making it crucial to address this issue.

He also noted that procedural errors have led to significant financial losses. He suggested that the government should consider regional and international cooperation in the energy and electricity sectors.

However, he cautioned that energy cooperation with the United States should not promote the use of LNG in the future.

Moazzem proposed including US companies in domestic gas production and expanding cooperation with the European Union.

He mentioned that the EU has cancelled a contract worth 477 million euros and suggested efforts to recover this agreement.

Moazzem emphasised the importance of continuing cooperation with Russia to ensure the production of nuclear power plants.