Bangladesh’s power gamble and how energy security is in play at the ballot box

As Bangladesh heads towards a tense general election on February 12 – its first since the sudden downfall and subsequent exile in India of long-serving prime minister Sheikh Hasina in August 2024 - energy security is emerging as a decisive fault line in the country’s politics. High-cost LNG imports are stretching public finances, the country’s first nuclear plant is edging towards completion, and renewables, it appears, are advancing even more slowly than official targets suggest. Together, they present the next government with a delicate balancing act of how to keep power flowing without pushing costs beyond what voters, businesses and the state can ultimately bear.

The political backdrop is unusually dramatic. Hasina, who dominated Bangladesh’s political landscape for well over a decade, was forced from office after weeks of intense, student-led protests which led to multiple deaths in mid-2024. What began as opposition to a controversial public-sector quota system quickly widened into broader anger over governance, civil liberties and economic pressures. In the process it plunged Bangladesh into its worst period of civil unrest in decades. As clashes between protesters and security forces escalated, Hasina resigned and fled to India in early August that year.

Her abrupt departure left behind a constitutional vacuum that was filled by an interim administration headed by Nobel laureate Muhammad Yunus. Tasked with restoring stability and steering the country towards elections, the caretaker government now faces scrutiny not just over democratic credibility, but over its ability to effectively manage an economy heavily exposed to global energy markets. As such, the February vote will be a key test of whether promises of reform can be now translated into credible policies by the incoming politicians, particularly in a power sector that underpins everything from export manufacturing of ready made garments (RMG) to household welfare.

LNG

Over the past decade, Bangladesh’s energy mix has shifted sharply as domestic gas fields have declined and electricity demand has surged. Imported LNG stepped in to fill the gap, eventually becoming a cornerstone of power generation policy. Because of this, what was intended as a stabilising solution, however, has also become a source of strain.

More than 60% of Bangladesh’s electricity is now generated using imported fuels, with LNG accounting for a substantial share. Primary energy imports make up roughly 44% of total supply. That exposure has proved costly as volatile global gas prices have battered state finances, forcing repeated increases in electricity tariffs and leaving the government absorbing losses on subsidised regasified LNG sold to power producers.

At home, domestic gas output, once the backbone of the energy system, continues to slide, leaving planners increasingly dependent on spot cargoes and long-term LNG contracts. For the all important RMG sector, Bangladesh’s main export engine, such risks are acutely felt.

To this end, officials are now pressing ahead with plans to expand import capacity, including new onshore terminals and additional floating storage, in addition to regasification units. Securing longer-term supply contracts is also high on the agenda, aimed at reducing exposure to price spikes. However infrastructure installation takes time, and the capital costs involved place further pressure on limited foreign exchange reserves and already-strained public finances.

Nuclear power

Set against this uncertainty is the long-awaited arrival of nuclear power. Bangladesh’s first nuclear facility, the Rooppur plant, has been built with Russian backing and features two 1,200 megawatt VVER-1200 reactors. After several years of delays and escalating costs, the project is expected to begin operations some time this year.

For policymakers, Rooppur offers an attractive prospect: reliable baseload electricity that could reduce dependence on imported gas and insulate the grid from fuel price volatility. Once fully operational, nuclear power will play a major stabilising role in the national system.

Renewables

Renewable energy, at least on paper, occupies a more hopeful, if frustrating, corner of Bangladesh’s energy debate. With more than ample sunlight and some wind potential despite limited land, the country has set ambitious clean-energy targets. Policies such as rooftop solar mandates and tenders for large PV projects signal an intent to curb fossil-fuel dependence while addressing climate concerns.

Progress, however, has lagged and was not helped in the past two years by the political upheaval that gripped the country. Regulatory uncertainty, weak institutional coordination and slow project financing have all weighed on deployment. The result has been that renewables have struggled to compete with gas-fired power, particularly where policy signals are inconsistent.

The path ahead

As election day approaches, energy security is becoming an undercurrent of political debate. Rising electricity prices, dependence on imported fuels and the long-term promise of nuclear and renewables, always just out of reach, are shaping voter sentiment, even as parties focus publicly on democratic reform and accountability after Hasina’s fall.

The next government, whether led by the Bangladesh Nationalist Party, an Islamist coalition or a new centrist force, will inherit an energy sector at a crossroads and a nation in need of quick-fixes. Decisions taken on LNG procurement, nuclear commissioning and renewable investment will shape not just power prices, but Bangladesh’s economic resilience for decades. Managing those choices will test whether the country’s political reset can deliver something more enduring than change at the top. What is needed is a secure and sustainable energy future.