Bangladesh's Summit Group plans to invest $3 billion in solar, wind and hydroelectricity generation projects in south Asia as a part of its clean energy push and efforts to diversify its fossil fuel-based business, its chairman said on Friday.

Summit Power International, the Singapore-based holding company for all power generation assets of Bangladesh's Summit Group in which Japanese utility JERA holds a 22% stake, will build 1,000 megawatts of solar and wind energy projects with battery storage in India, group Chairman Aziz Khan told Reuters.

"We have signed memorandums of understanding with large Indian companies. This will be the cheapest form of electricity for Bangladesh, cheaper than even natural gas-based power," Khan said in an interview at his office.

Summit, which operates over a dozen fossil fuel-based power generation units and owns one of the country's two floating storage and regasification unit (FSRU) to handle imports of liquefied natural gas (LNG), also plans to build 700 megawatts of hydro power plants in Bhutan and Nepal, Khan said.

Khan said current global LNG prices were still high, adding they were continuing to destroy demand in key sectors in Bangladesh, impacting economic growth and leading to frequent power outages.

LNG had been central to Bangladesh's economic growth in the last decade, as millions gained access to the electricity grid for the first time. The super-chilled fuel, along with rapidly dwindling local gas reserves, generated about two-thirds of its electricity over the second half of the last decade.

However, high global LNG prices after Russia's invasion of Ukraine, difficulty paying for fuel imports amid declining forex reserves and value of its currency and unexpected spikes in demand due to erratic weather resulted in the south Asian nation facing its worst power crisis in a decade this year.

Khan expects LNG prices to trend downwards as new supply comes on board, adding that he expects Summit's second FSRU to start operations in April 2026.

"I personally feel that after this winter, gas prices will come down," Khan said.

by reuters