Nawab Ahsanullah's house was the first to get a generator in Dhaka in 1901. Then in 1933, the Dhanmondi Power House, a 6MW plant at Paribagh, started commercial electricity supply only to the elite area of the city. The 10MW thermal plant at Siddhirganj was the biggest plant until 1962, when the first and only hydropower plant at Kaptai was commissioned with 40MW capacity and connected to Siddhirganj by a 232km transmission line. Back then, illuminating Dhaka was the only goal and most of the old district towns were privileged to get electricity only at night, and two railway workshops and a few industries – tea, cotton and sugar – got limited supply from nearby generators.
In 1971, the war-ravaged independent Bangladesh started its journey with 500MW of installed capacity. During the 1973-74 oil crisis, Bangladesh's overall energy consumption was low with the economy still agriculture-based. There were a few industries and almost all the rural areas were without electricity. So, the shock from the crisis was limited only to a portion of the economy and public life.
Today, as the world faces another even more critical energy crisis in less than 50 years, Bangladesh stands to suffer a real shock. Electricity now powers the whole of its economy and life. After half a century since independence, Bangladesh claimed 100% electricity coverage only last March 2022. The remote rural household that got its first electricity connection a few months back is now having power cuts for hours a day. The outage is again going to be a part of urban life as well. Just a day after the prime minister urged the people for austere use of electricity and brace for scheduled outages, the energy ministry on Thursday chalked out a hardline approach to save energy and reduce fuel import bills to ease pressure on the economy.
Shortening office hours, reintroducing work-from-home and banning decorative lighting are among the measures the government may take.
Use of decorative lights has been banned in community centres, malls, shops, offices and homes. Offices may be asked not to use ACs below 25°C. These measures are expected to lower electricity demand by 2,000 megawatts (MW) – about a 6th of the country's total generation.
Experts have called the initiative a rational and timely one.
Bangladesh raised its generation capacity by 44 times since independence and was able to keep outages almost nil for the last few years. The sudden surge in generation came at a huge cost though. The country's natural gas production was not enough to power the generators, which resulted in a gradual increase of reliance on imported furnace oil and liquefied natural gas. The government was keeping the price of the produced electricity low with huge subsidies which has now gone beyond bearable with skyrocketing oil and gas prices due to the Russia-Ukraine war.
Bangladesh's power sector subsidy rose to Tk28,000 crore in the just-ended fiscal year and Tk25,000 crore was spent in subsidies for LNG import to meet the gas demand for keeping the power plants running. An amount of Tk84,000 crore has been kept aside for the new financial year which may grow even larger.
Bangladesh's per capita electricity consumption, less than 400KwH, is among the lowest in the world. As the economy continues to expand, so has the demand for electricity. The Padma Bridge, which opened just on 25 June, has encouraged big companies to set up industries in the south-western districts where electricity demand is set to pick up.
Then came the abrupt cap in demand, which was inevitable, as in many countries – developed and developing.
As the people of Sri Lanka became unable to pay bills for food, energy and medicine with record inflationary pressure, the country has been hit with a severe electricity crisis, keeping schools closed and enforcing lengthy power blackouts while people are forced to fall back on firewood for cooking.
Pakistan plans to cut office days to five from six in a bid to reduce energy use.
With a spectre of a far worse energy crisis looming, even rich countries are on war footing and only one step away from energy rationing. From London to Paris to Geneva, consumers are worried about how to keep warm in the coming winter. The International Energy Agency (IEA) estimates Europe can save 10 billion cubic metres of gas per year by adjusting the thermostat by just 1°C.
Countries are taking a hard approach to cope with the looming energy shortage amid European fears of more cuts in Russian pipeline gas supplies, as Russia is responding to the sanctions it is facing from the US and its western allies.
The German energy minister has urged Germans to voluntarily change consumption behaviour to conserve energy.
France is planning measures to reduce energy consumption by 10% over the next two years.
Russia slashed pipeline capacity to Germany by 60% and reduced supplies to many other countries, pushing up gas prices in Europe by more than 50% and power prices to their highest since December last year. To overcome the shock, Germany recently reached a deal with the US for long-term LNG supply by ship, while other European countries are looking for the same arrangements with Qatar. They are planning to build LNG terminals, floating storage and regasification units.
Over the years, rich countries have invested heavily in clean energy. Now they are in a mad rush for alternative sources of oil and gas and even ramping up use of coal – once painted negatively as "dirty energy". Germany, Italy, Austria and the Netherlands have planned to revive old coal plants, while the Netherlands may reopen an onshore abandoned gas field.
So far, immune from energy shocks, the US is not sitting idle either. President Biden discussed with oil industry executives ways to boost oil production and refining capacity.
All these efforts are focused more on energy supply than to keep demand in check during this crisis, a Foreign Policy analysis says. These approaches, though appropriate responses to the current crisis, are supply-centric which will require huge investment in more infrastructure in drilling, refining and building LNG-facilities in the near to medium term, says the Washington-based news magazine.
The Foreign Policy researchers have called for parallel programmes to cut energy use.
Efficiency investments and demand conservation are often the cheapest and quickest ways to cut the use of oil, gas, and coal, the analysts say.
It recalls the warning aired by US physicist and energy iconoclast Amory Lovins a half century ago during the 1973 oil crisis. Lovins had urged global energy leaders to take the "soft path" – conservation, efficiency and renewable energy – rather than the "hard path" of massive projects for mining, extraction, and industrial facilities.
In his new book, "Reinventing Fire," he shares ingenious ideas for the next era of energy. Again in a public lecture, he divulged a 40-year plan for US energy, showing how the US can get off oil and coal by 2050 and save $5 trillion just by improving designs of vehicles, buildings and factories.
All these ideas, though sound revolutionary, are capital-intensive and much beyond the reach of Bangladesh. Increasing generation capacity by any means has been the top-most priority for Bangladesh to meet the rising electricity demands. It relied heavily on natural gas resources to run power plants and its coal-based projects made slow progress due to global campaigns against "dirty fuel". Domestic coal exploration attempt was halted amid bloody protests, storage and transportation facilities for imported coal also did not progress at the desired level, making switching to coal-fired generation difficult for years to come. Gas exploration also took a back seat for the last few years despite the country's success in ending maritime territorial disputes with India and Myanmar. Both hydroelectric and solar energy comprise roughly 2% of the total generation capacity, with coal accounting for less than 8%, natural gas 51%, fuel oils 35% and imports 5%. The huge $12bn nuclear power plant at Rooppur is still a year away from opening.
No matter good or bad, Bangladesh has little option to change its energy mix. Given the global trend, it does not have much choice to speak against coal and nuclear power.
Energy conservation was promoted throughout OECD countries after the 1973-74 energy crisis. The US endorsed energy efficiency policies to reduce oil imports from the Mideast and explore more domestic oil. France encouraged people to reduce heating temperatures to 20°C in public housing, schools, offices and commercial buildings. Cutting temperature down to 19°C from the current average of 22°C could help Europe save 20% of its Russian gas consumption at almost no cost, according to International Energy Agency (IEA) data.
The 1973 oil crisis also led to greater interest in alternative energy sources, including gas, coal and nuclear.
The French nuclear programme was often cited as a model for the change. The share of nuclear power in French electricity production reached 75% in 1990, up from just 8% in 1973.
The ongoing 2022 energy crisis comes with new lessons.
Nuclear power, often overlooked amid much hype for renewables like solar and wind to reduce emissions, now looks set to make a comeback as the Russia-Ukraine war prolongs and the energy crisis intensifies. Nuclear power's prospects seem to be brightening, IEA Executive Director Fatih Birol said last week, releasing a report on nuclear power's role in the global energy transition.
Bangladesh is a late starter in the nuclear electricity programme. Now, there is no way to look back. Bangladesh also cannot afford to put coal options on hold.
Securing an energy future is the prime concern for Bangladesh, as for all countries across the globe.
And for now, running ACs at 25°C and switching off decorative lights remain among immediate options for consumers until the war ends.
Let us rest our hope on what state minister for energy Nasrul Hamid said in an audio message on Thursday: "This situation is temporary…We were forced to reduce production due to the gas shortage…If all of us become economical in using gas, then I am confident we can overcome this situation."
Let us get ready for a further pinch as well – another rise in energy prices.