Govt mulls 31 renewable power projects cancelled during interim govt

The government has initiated a move to reopen letters of intent (LOIs) for 31 renewable energy projects that were cancelled during the interim government led by Muhammad Yunus.

Power, Energy and Mineral Resources Minister Iqbal Hassan Mahmood said the projects will be reassessed based on merit before any decision is finalised.

"I am reopening all these projects. After conducting merit-based evaluations, we will retain those that are viable," he said.

"I have asked my ministry to present why and on what grounds these projects were scrapped. Hopefully, within the next 8-10 days, we will be able to determine our course of action," he said.

He made the remarks today (27 April) while speaking as chief guest at the Fourth Bangladesh-China Renewable Energy Forum, organised by Centre for Policy Dialogue at a city hotel.

At the event, Sakir Ahmed, additional managing director of Citymead Group, warned that policy decisions taken during the interim period had deepened vulnerabilities in the power sector.

"The power sector was already in a fragile state, but the policy actions taken by the interim government effectively pushed it into the ICU," he said.

He also said, the cancellation of 37 LOIs, despite court directions to continue or renegotiate the projects, has significantly eroded investor confidence in Bangladesh's renewable energy sector.

Responding to the concerns, Iqbal Hassan Mahmood said, the government has initiated a move to reopen letters of intent (LOIs) for the projects. 

The minister further said the government has set a target to generate 10,000MW of solar power within the next five years.

"If we could start today, we would. But there are bureaucratic processes that need to be streamlined first. Still, we are moving with urgency because the current energy situation leaves us with no alternative," he added.

The LOIs for these renewable projects were cancelled in September 2024, about a month after Yunus assumed office. 

At the time, the government argued that the projects, signed during the Awami League ra under the Quick Energy Supply (Special Provision) Act 2010, were awarded without competitive bidding.

Energy experts had expressed strong concerns over the move, warning of long-term impacts on investor confidence and renewable energy expansion.

The cancelled projects collectively accounted for around 3,300MW of capacity, the bulk of which was solar power, alongside nearly 300MW of wind energy and a smaller 25MW waste-to-energy project.

Analysts say Bangladesh could have been in a stronger position in its clean energy transition had the projects not been scrapped.