Pakistan's rooftop solar boom offers policy lessons for Bangladesh energy transition: Experts

Bangladesh can accelerate its transition to renewable energy and alleviate pressure on public finances by replicating Pakistan's consumer-led rooftop solar model, provided the government dismantles prohibitive import duties and restructures domestic electricity pricing incentives.

Energy experts, policymakers, and industry leaders highlighted these findings during a dialogue titled "Solar Revolution in Pakistan: Lessons for Bangladesh from National Budget Perspective" held in Dhaka today (23 June). The discussion was moderated by Centre for Policy Dialogue Research Director Khondaker Golam Moazzem.

Participants noted that Pakistan's rapid solar expansion was driven by a combination of high electricity tariffs, low-cost Chinese solar equipment imports and favourable net-metering policies. 

The model has created a privately financed solar transition worth an estimated $13.7 billion and could offer insights for Bangladesh as it aims to add 5,000 megawatts of renewable energy to the national grid over the next five years.

Chief Whip of Parliament Nurul Islam Moni, who attended the event as chief guest, said renewable energy remained a government priority for building a sustainable and affordable power system.

He said Bangladesh was seeking to deepen cooperation with China in renewable energy, with a major solar-related agreement potentially under consideration. "However, no final decision has been made," he said.

Moni said solar power had already been installed at the Parliament complex, while plans were underway to expand rooftop solar systems to government buildings and industrial facilities.

He added that the government intended to convert irrigation pumps and tube wells to solar power to reduce agricultural costs and support rural communities.

Pakistan's citizen-led solar growth

A significant portion of the discussion focused on Pakistan's recent solar expansion, which participants described as largely driven by households and businesses rather than by large public or financial-sector initiatives.

Muhammad Basit Ghauri, manager of Special Initiatives and China Programme at Renewables First Pakistan, said the shift was driven by consumers responding to high electricity tariffs, unreliable grid supply and favourable net metering arrangements. 

He said three developments converged in 2024: rising electricity tariffs, a surge in low-cost Chinese solar panel imports and supportive net metering policies, which together triggered a rapid expansion of rooftop solar systems.

David Hasnat, president of the Bangladesh Independent Power Producers' Association, said relatively lower electricity tariffs in Bangladesh reduce the financial incentive for households and firms to shift to solar. 

He also noted that Bangladesh receives lower solar irradiation than Pakistan, requiring policy designs tailored to local conditions rather than replication of foreign models.

Tariffs, regulation and financing barriers

Ashraful Alam, member (renewable energy) of the Sustainable and Renewable Energy Development Authority, said import duties remain a major barrier to solar expansion. He noted that batteries currently face duties of 62-67%, while solar panels imported by general traders are subject to around 29% duty.

He said a high-level committee has been formed to review the tariff structure in consultation with the National Board of Revenue, and a revised duty regime could be announced as early as next month.

Participants urged the government to reduce duties on solar equipment, simplify net metering procedures, expand access to financing and allow solar assets to be used as collateral for bank loans.