As a low-lying country situated in one of the world’s largest river deltas, Bangladesh is highly vulnerable to the consequences of climate variability and change. The country is the eighth most populous in the world and one of the most densely populated. Almost one third of its people live below the poverty line, and only about 60% of the population has access to electricity. At the same time, Bangladesh is coping with a serious energy crisis as a result of sluggish growth in energy supplies and intense expansion of energy demand. Furthermore, challenges associated with urbanization (especially in Dhaka, Chittagong and Khulna metropolitan areas) have led to concerns over livable environments, with problems relating to air pollution, noise pollution, and waste disposal, among others.
Within this context, Bangladesh has taken a leadership role in addressing climate change adaptation and mitigation through the national Bangladesh Climate Change Strategy and Action Plan 2009, which outlines its LEDS.
This paper builds on work conducted under USAID’s CCEB program. The program aims to enhance capacity for LEDS in Bangladesh and help policy-makers understand the potential of clean energy development to expand (not replace) the country’s existing capacity, considering both immediate impacts on greenhouse gas reductions and consumer electricity prices. As part of CCEB, ICF developed a bottom-up, scenario-based model of the Bangladesh power sector called the Power Sector Policy Analysis Model (PSPAM). It was developed using detailed plant-level data on the Bangladesh power sector. A key source of data for this case study was the Power System Master Plan (PSMP), which describes Bangladesh’s road map for energy policy and power expansion based on future energy demand projections and supply options. PSPAM uses bottom-up emission estimates, along with cost and performance data for the power sector, to analyze system generation costs, capacity, and fuel mix, power prices, and power sector subsidy levels, as well as carbon dioxide (CO2) emissions. PSPAM allows policy-makers to focus on high-level results across multiple scenarios that are relevant for policy discussions.