In line with the Mujib Climate Prosperity Plan, Copenhagen Infrastructure Partners (CIP) and Copenhagen Offshore Partners (COP) - the world's leading renewable energy investor and developer - have submitted a $1.3 billion investment proposal to the Government of Bangladesh for developing a commercial offshore wind project off the coast of the Bay of Bengal.
The utility-scale offshore wind project with an initial capacity of 500 MW is expected to be a key driver of Bangladesh's progression into a green nation.
The initial investment proposal and continued collaboration offer made by Denmark, a pioneer and global leader in developing the wind energy industry, was disclosed in a COP press release issued on Tuesday (11 July).
The proposal comes at a crucial point in time for Bangladesh that despite ambitious clean energy targets remains heavily reliant on fossil fuel imports, a costly decision due to inflation-related price shocks.
According to the press release, this offshore wind project in particular presents a unique opportunity for the country to maximise the utilisation of its coastal resources, supporting the development of the 'Blue Economy'.
"As a highly climate-vulnerable nation, Bangladesh's annual Gross Domestic Product (GDP) could fall by as much as 9% by the middle of the century due to climate change, according to the World Bank. Bangladesh, therefore, needs to adapt rapidly to climate change, while simultaneously accessing cleaner, more efficient technologies that support decades of development and growth, a shift away from unstable fossil fuel imports, and limiting emissions as the country aims to achieve high-income status and elimination of absolute poverty by 2041.
"With the Institute for Energy Economics and Financial Analysis (IEEFA) projecting an annual need of $1.7 Billion in funding for the green transition, perhaps this multibillion-dollar proposal from CIP and COP could also kick start a new wave of investment, driving Bangladesh towards a truly climate prosperous future," it added.
In early June, Bangladesh and Denmark approved a "Joint Action Plan" for the next five years under the '2022 Sustainable and Green Framework Engagement'.
During a recent Dhaka visit by Mr Dan Jørgensen, the Danish Minister for Development Cooperation and Global Climate Policy, had agreed to a partnership in green and clean technologies and investment for sustainable development.
While both sides have recognised the importance of improving the ease of doing business in Bangladesh for more Danish investment, Denmark further expressed its interest in supporting renewable energy, maritime, and blue economy sectors, among others.
Once implemented, this offshore wind project will be the first of its kind in Bangladesh – and possibly South Asia, enabling a technology transfer that would accelerate the learning curve for a nascent industry and reduce barriers to entry for future projects.
The preliminary study findings suggest that hundreds of direct and indirect jobs could be created during the construction phase, in addition to dozens of permanent positions during the 30-year operational phase of the project.
CIP and COP have proposed Summit Group – a leading infrastructure operator and developer in South Asia and the largest independent power producer (IPP) in Bangladesh – to join its consortium.