The solar energy industry in Bangladesh is growing faster than it has in the past ten years. New data shows that the country’s solar capacity will reach over 1,300 megawatts (MW) in 2025, which is more than double what it was five years ago.

Analysts say that while the growth is a big step towards diversifying the country’s energy mix, renewable energy still only makes up a small part of total electricity generation. This raises concerns about Bangladesh’s reliance on fossil fuel imports in a world where prices are always changing.

Ten Years of Solar Growth

According to government energy data and independent sector estimates, Bangladesh’s solar capacity grew from 200 MW in 2015 to 650 MW in 2021, and then it grew even faster in the final three years.

Utility-scale solar parks, more rooftop solar installations, and a global trend of dropping photovoltaic (PV) module prices have all contributed to the development.

Recently opened solar parks in Feni, Mymensingh, Cox’s Bazar, and Sunamganj gave the biggest boost, adding more than 400 MW.

        (Chart: Growth of Bangladesh’s Solar Capacity from 2015 to 2025)

Energy Mix Still Mostly Based on Fossil Fuels

Even with these improvements, Bangladesh’s overall energy mix is still mostly made up of natural gas and imported fuel oil. In 2024, renewables made up only 5.2% of the national electricity mix, which is only a little more than the 3% that was recorded ten years earlier.

     (Chart: The mix of electricity in Bangladesh: renewables vs. fossil fuels)

Experts argue that the slow pace is due to problems with the way things are set up, such as a lack of land, delays in designing utilities, and inconsistent regulations for renewable energy.

Bangladesh’s official goal for renewable energy, getting 40% of its energy from sustainable sources by 2041, is still a long way off.

Why is the solar industry growing right now?

1. Technology that costs less

Prices for solar modules around the world have dropped by over 40% since 2020, making it easier to deploy them on a big scale.

2. Net metering on the roof

The government’s net-metering system lets businesses, mainly in textiles and RMG, install solar panels on their roofs to lower their electricity rates. The system already has more than 100 MW of capacity.

3. Money and grants from other countries

Donor agencies and private investors are putting money into a number of large-scale projects, which is speeding up the growth of utility-scale solar.

4. The cost of importing fuel is going up

The case for renewable energy made in the US has gotten stronger because worldwide LNG and oil prices keep going up.

Problems that could hurt long-term growth

But the industry still has problems that keep happening:

There isn’t enough land in densely populated places for big solar farms.

The grid infrastructure is quite old, especially in places that aren’t big towns.

Private-sector solar goals are slowed considerably by delayed PPA approvals.

Changes in renewable tariffs and other policy uncertainties make it hard to prepare for the long run.

Energy experts say that Bangladesh may have a hard time reaching its renewable energy ambitions without modernising its power grid and getting steady policy backing.

Solar Projections Through 2030

Based on past growth rates and government pipeline projects, it is possible that Bangladesh’s solar capacity might reach more over 3,000 MW by 2030 if growth continues at the same rate.

                   (Chart: Expected Solar Capacity, 2025–2030)

The forecasts are based on the idea that a number of large-scale solar farms that are now being negotiated will be built and that rooftop solar will continue to grow in industrial areas.

The Government’s Plan

The Power Division of Bangladesh has come up with a plan to speed up the use of renewable energy. This plan includes putting solar panels on water bodies, replacing diesel pumps with solar irrigation, making it mandatory for new industrial buildings to have solar panels on their roofs, and expanding cross-border trade in renewable energy.

Officials say the government is dedicated to expanding solar infrastructure, but they also note that “significant adjustments” are needed to reach long-term sustainability goals.

What to expect

The solar power revolution in Bangladesh is picking up speed for the first time, but growth is still uneven. Renewables still don’t make up a big part of the overall energy mix, even though capacity is growing quickly.

Experts say that Bangladesh will need to make a far bigger push towards renewable energy if it wants to avoid future energy crises and satisfy its global climate commitments. This is because electricity demand is predicted to rise substantially over the next ten years.