The renewables sector of Bangladesh is expected to see robust growth with its non-hydropower renewables capacity to grow by over five times from end-2021 to 2031 to reach 2,688.9 megawatts (MW).

In a report, Fitch said the country’s current non-hydropower capacity is at 551.7MW as of end-2021 and will grow annually by 19.4%, on the back of existing growth support mechanisms.

Fitch added that the solar sector will dominate the growth and will account for 87% of the non-hydropower renewables capacity mix. The sector’s growth will be mainly from projects by the Bangladesh Power Development Board.

However, it said that about 580MW of those solar projects are still in the planning stages despite the Board’s expectation that they will come online in 2022.

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“We believe the slowed progress is a result of disruptions of solar module imports from Mainland China. This presents downside risks to our robust forecasts of solar power capacity and generation for the short term,” the report read.

Fitch added that the government is compelled to speed up the development of renewables due to the gas supply issue.

“Bangladesh will experience persistent power generation shortage as a dropping domestic natural gas production exposes the market to increasing natural gas imports and elevated gas prices over the coming years,” it said, noting that gas-fired power generation accounted for 81% of its electricity needs as of end-2021.