Sustainable Energy for Development

A Project Supported by GTZ

Working Paper

 

Productivity Improvement in Industry through Energy Efficiency Programs

Prepared by:
Centre for Energy Studies (CES), BUET
Dhaka, May 2006

PREFACE

17 May 2006

 

This report has been prepared by the Centre for Energy Studies, BUET for the GTZ project entitled “Sustainable Energy for DEvelopment” (SED).

The consultants for the project were Prof. Dr. Shahidul Islam Khan, Director, CES and Prof. Dr. Ijaz Hossain, Professor, Chemical Engineering Department, BUET.

 

The report has been prepared to fulfill the contractual obligation to provide data, information and analysis of the energy sector in Bangladesh with particular reference to energy efficiency. The contents of this report should only be used for the purpose of this appraisal study as indicative results because the consultants did not get enough time to verify all the collected information. In addition many assumptions had to be used for this study.

 

 

CONTENTS

1.0 Introduction....................................................................................................  4

2.0 National Energy Policy and Energy Efficiency ...........................................  5 

3.0 The Energy Scenario of Bangladesh ...........................................................  5 

3.1  Gas Sector................................................................................................................ 5

3.2  Electricity Sector...................................................................................................... 6

4.0 Energy Consumption in Industrial Sector ...................................................  8 

4.1  Introduction............................................................................................................... 8
4.2  Analysis of Industrial Electricity and Gas Consumption.................................... 9

4.3  Disaggregated Industrial Energy Consumption................................................ 10

5.0 Problems of the Energy Sector ..................................................................  14 

6.0 Brief Description of Significant Industries ................................................  15

 

6.1  Scrap Steel and Re-rolling Mills.......................................................................... 15

6.2  Cement Clinker Grinding Mills............................................................................. 16

6.3  Pulp and Paper Mills............................................................................................. 16

6.4  Ice Plants and Cold Storage................................................................................ 16
6.5  Glass and Ceramic Factories .............................................................................. 17
6.6  Hoffmann Kilns ...................................................................................................... 17
6.7  Textile Dyeing ........................................................................................................ 17
6.8  Small and Medium Enterprises (SME)............................................................... 18

7.0 Crosscutting Energy Efficiency Improvements ........................................  18

8.0 Suggestions for Energy Efficiency Improvement Projects......................  19

 

Appendices .............................................................................................................  21

A.  Some Bangladesh Energy Sector Issues ............................................................. 21
B.  Stakeholder Perspective .......................................................................................... 21
C.  Some Relevant Data ................................................................................................ 21

1.0 Introduction

An overall view of the primary energy consumption in the year 2004 is shown in Table 1, while Table 2 provides a brief overview of energy infrastructure and resources. About 32% households have electricity connection and approximately 4% households have natural gas supply. The Rural Electrification Board (REB) network covers approximately 40% of rural Bangladesh, but within the grid covered area only 40% households have electricity connection. Renewable energy other than biomass constitutes a very small percentage of the total energy consumption.

 

Bangladesh suffers from chronic shortage of electricity and gas. At present, the electricity situation is so bad that at peak hours (5-10 p.m.) approximately 600 MW of load shedding is required. The unreliable electricity has been directly linked to loss of productivity, and hence to lowering of economic growth rate. The World Bank estimates an annual loss of nearly 1 billion dollars due to unreliable power. Even though foreign and domestic Independent Power Producers (IPP) are keen to invest, the Government is wary of excessive private sector participation in the sector, especially for contracts requiring all payments in foreign currency.

 

Table 1 Primary Energy Consumption in Bangladesh for 2004

 

	Physical Units	Energy Units	(%)	% of Fossil
Natural Gas	450 bcf	445 million GJ	35.1	69.1
Oil	3.7 million tons	158 million GJ	12.5	24.5
Coal	1.5 million tons	41 million GJ	3.2	6.4
Hydro	1.0 TWh
Biomass	50 million tons	625 million GJ	49.2
Solar PV	3 MW (2 GWh)
Wind	1 MW (2 GWh)

 

Table 2 Energy Infrastructure and Resources in Bangladesh

 

	Total	Operational	Remarks
Generation	4700 MW	3700 MW	90% gas based
Captive	1100 MW	1000 MW	95% gas based
Refineries	1	1	1.5 million tons/year
Gas Fields	22	12	Reserves – 20 Tcf (5 consumed)
	Undeveloped – 7	Suspended – 3	Resources – 32 Tcf (mean)
Coal Fields	4 Undeveloped – 3	1 Just starting	Reserves – 204-764 million tons Resources – 2715 million tons
Transmission	1856 km	1856 km	90% in the eastern region
(Gas)			Severe limitation in most areas
Transmission (Electricity)	3485 km	3485 km	Concentrated in eastern region Severe bottleneck in most areas