Bangladesh's power grid: Modernisation imperative for energy security
Bangladesh has expanded power generation rapidly, but its transmission and distribution grid has lagged behind. With Rooppur nearing operation and renewables on the horizon, modernising the grid is no longer optional—it is central to energy security, cost efficiency, and system stability
Over the past ten years, Bangladesh's power sector has shown an impressive increase in generation capacity and electricity access.
However, the nation's power grid has failed to keep pace with rising demand and rapid infrastructure expansion, resulting in over-capacitated systems, significant energy wastage, and persistent distribution inefficiencies.
The commissioning of large-scale projects such as the Rooppur Nuclear Power Plant (RNPP) raises critical concerns regarding Bangladesh's ability to evacuate additional power and adequately upgrade its grid infrastructure.
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Operating close to maximum capacity, Bangladesh's current power system experiences frequent load shedding, outages, and considerable energy losses.
While earlier estimates placed transmission and distribution losses between 12% and 15%, recent Bangladesh Power Development Board (BPDB) data for FY 2024–25 show system losses at 10.13%, slightly higher than 10.06% in the previous year.
This figure remains well above the global average of 6% to 8%. Aging infrastructure, inadequate maintenance, and grid overloading largely explain these losses.
Energy experts emphasize that one of the grid's core weaknesses is its inability to manage peak demand, warning that the existing infrastructure is ill-equipped to absorb additional capacity from projects such as Rooppur.
This results in inefficient evacuation and distribution, leading to higher energy wastage.
Against this backdrop, serious concerns have emerged regarding power evacuation from the Rooppur Nuclear Power Plant (RNPP). As of December 2025, Unit-1 is in its final stage of readiness, with electricity generation now expected to begin in early 2026.
However, several technical challenges remain unresolved. Grid bottlenecks particularly the complex river crossing for the Rooppur–Dhaka transmission line and delays in the Dhaka Ring project continue to threaten the plant's full operationalization.
An official from Power Grid Bangladesh (PGB) stated that despite RNPP's near-operational status and a generation cost of approximately BDT 10 per kWh, there has been no substantial progress in constructing the Dhaka Ring.
This ring transmission route is essential for supplying power to Dhaka, the country's most demand-intensive region.
In the absence of this infrastructure, the system remains dependent on expensive oil-based power plants, costing Tk20 to Tk25 per kWh, thereby increasing financial pressure especially as Bangladesh is set to begin repayments of a $500 million loan to Russia from 2026.
Although Russia has recently deferred the start of the main debt repayment until September 15, 2028, the slow implementation of the Dhaka Ring highlights a major gap in strategic planning and execution.
Another critical concern relates to the frequency requirements of the Rooppur Nuclear Power Plant, as nuclear facilities operate efficiently only under stable and precise frequency conditions.
Bangladesh's already strained grid infrastructure struggles to meet these technical requirements. Any mismatch between generation output and grid capacity could lead to increased system losses, power outages, and operational disruptions.
Therefore, substantial grid upgrades are necessary to accommodate the additional capacity from Rooppur and upcoming renewable energy projects.
Since the government has replaced the outdated Power System Master Plan (PSMP) 2016 with the Integrated Energy and Power Master Plan (IEPMP), which is currently under revision.
In parallel, the newly gazetted Renewable Energy Policy 2025 provides a roadmap for energy transition.
The policy targets 20% of electricity generation from renewable sources by 2030 and 30% by 2040, a shift that will require significantly enhanced grid stability and the deployment of battery energy storage systems (BESS).
However, implementation has been slowed by bureaucratic delays, financing constraints, and limited technical capacity.
To address these barriers, Bangladesh must invest in smart grid technologies that enable real-time monitoring and management of electricity flows through digital communication systems.
Grid modernization is a global trend. Countries such as Germany, Japan, and the United States have successfully integrated high shares of renewable energy using smart grid technologies and advanced energy storage solutions.
Bangladesh can also benefit from regional cooperation as a complementary strategy. Recently, the country achieved a milestone by importing 40 MW of electricity from Nepal through the Indian grid, with agreements signed to increase imports to 60 MW.
This trilateral cooperation illustrates how interconnected regional grids can enhance energy security and system reliability.
Research by the International Renewable Energy Agency (IRENA) suggests that smart grids can reduce energy losses by up to 30% while significantly improving system reliability.
Although the policies provide a structural framework for such initiatives, successful implementation will require strong technical expertise, adequate financing, and sustained political commitment.
Energy professionals and economists have called for urgent action to address Bangladesh's grid challenges, emphasising the importance of regional cooperation like cross-border electricity trade with India and Nepal.
While regional power trade holds significant promise, geopolitical and infrastructure-related constraints have limited its expansion, despite its recognition within the upcoming policies.
Despite these challenges, the opportunities are equally significant. By prioritising grid modernisation, investing in smart technologies, and strengthening regional cooperation, Bangladesh can transform its power sector and advance toward its goal of becoming a high-income country by 2041.
The time to act is now, before grid inefficiencies undermine further progress in the power sector.
With strong political will, sufficient resources, and appropriate technological expertise, Bangladesh can resolve its grid crisis and pave the way for a more secure and sustainable energy future.
Md Mehadi Hasan Shamim is a research associate at the Centre for Policy Dialogue (CPD).
Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions and views of The Business Standard.
