BSREA says renewable energy incentives in Bangladesh’s 2026–27 budget largely benefit RESCO and solar power firms, leaving residential users, farmers, EPC companies, and solar businesses outside support mechanisms.
The Bangladesh Sustainable and Renewable Energy Association (BSREA) on Sunday called for a major revision of the government’s renewable energy incentive framework, arguing that the benefits announced in the 2026-27 national budget are reaching only a limited segment of the sector while excluding most solar energy users and businesses.
Speaking at a press conference at the Dhaka Reporters Unity (DRU), BSREA leaders said that although the budget announcement had generated widespread optimism, a review of the Statutory Regulatory Order (SRO) issued by the National Board of Revenue (NBR) revealed that the incentives were largely restricted to selected solar power generating companies and providers operating under the RESCO-model-based power purchase agreement (PPA) system.
According to the association, the current framework leaves out a large section of solar energy users, including households, agricultural users involved in solar irrigation, small commercial consumers and businesses linked to the renewable energy supply chain.
BSREA said Bangladesh’s renewable energy market has been built over the years by importers, distributors, dealers, retailers, Engineering, Procurement and Construction (EPC) companies and self-financed solar users. However, these stakeholders are not receiving meaningful benefits under the existing incentive structure.
The organisation noted that while RESCO companies have gained advantages through the current SRO framework, thousands of importers, dealers, retailers and EPC firms active in the renewable energy sector are facing the risk of financial losses and potential job cuts.
It said the present SRO mainly targets consumers accounting for about 20 to 22 percent of total electricity consumption, leaving a large number of end users outside its coverage.
BSREA further argued that although the RESCO model may be effective for large industrial consumers, it is not suitable for residential users, agricultural consumers involved in solar irrigation or rural communities. Consequently, most consumers remain beyond the reach of government incentives.
The association also said a public perception has emerged that customs duties on solar panels and related equipment have been completely withdrawn and that prices have fallen significantly. In reality, however, there has been no substantial change in the tax and duty structure for most solar products, creating confusion in the market and placing additional pressure on businesses.
BSREA alleged that the current budget and related SROs fail to introduce effective new incentives for solar irrigation, solar street lighting and battery energy storage systems (BESS).
Despite the presence of approximately 1.7 million diesel-powered irrigation pumps across the country, there is still no clear roadmap or financial support mechanism for converting them to solar-powered systems, the organisation said.
The association also expressed concern that the long-standing “weight-based assessment” method for valuing renewable energy equipment imports remains in place. It said no effective steps have been taken to replace it with the internationally accepted “transaction value” method, resulting in project costs being inflated through overvaluation compared with actual import prices.
BSREA further questioned the decision to limit tax and duty benefits for mounting structures, lithium cells, battery packs and BESS until June 30, 2028. It argued that domestic manufacturing capacity for these products remains underdeveloped and that an early withdrawal of incentives could discourage investment and slow market growth.
According to the association’s assessment, residential consumers, agricultural users involved in solar irrigation and small commercial consumers account for 63 percent of the country’s electricity users. Yet they receive no direct benefit from the current incentive regime.
BSREA also said the budget does not address several critical issues affecting renewable energy investment, including access to low-interest long-term financing, payment security, risk mitigation and investment protection.
The organisation warned that under the current SRO framework Bangladesh is unlikely to achieve its target of 10,000 megawatt-peak (MWp) solar capacity by 2030. Instead, total capacity may reach only 2,000 to 3,000 MWp.
However, it argued that revising the SRO to provide zero-percent customs duty and tax benefits for all importers, EPC companies, distributors and other solar sector stakeholders could help the country achieve between 6,000 and 8,000 MWp of solar capacity by 2030. This could be accomplished by utilising just 25 percent of rooftop space in Dhaka and other divisional cities, it said.
BSREA demanded equal duty benefits for all renewable energy equipment, including solar modules, inverters, battery storage systems, mounting structures, DC cables, connectors and smart meters. It also called for a minimum 10-year tax holiday and income tax exemption, extension of tax benefits to residential and agricultural users involved in solar irrigation and the designation of solar irrigation, solar home systems, rooftop solar and BESS as national priority sectors.
“Renewable energy is not a special privilege for any specific business group; it is directly linked to the energy security of every citizen. Therefore, the incentive framework must be equally accessible to all,” BSREA President Mostafa Al Mahmood told the press conference.
Among those present were BSREA President Mostafa Al Mahmood, Senior Vice President Jahidul Alam, Vice President M A Taher, Vice President Engineer Md. Ruhul Amin, General Secretary Md. Ataur Rahman Sarkar Rozel and Director (Finance) Nitai Pad Saha.
