High import duties affecting the development of photovoltaics in Bangladesh – pv International magazine

Analysts at a recent event in Dhaka called for the removal of high import tariffs on solar products in Bangladesh as it could reduce prices of solar systems by up to 11%.

May 29, 2024 Syful of Islam

Government Bangladesh currently applies an import duty of 26.2% on solar panels, a 37% tax on photovoltaic inverters and a 58.6% import duty on mounting structures. However, according to several analysts attending a meeting in Dhaka last week, these high import tariffs are a major obstacle to the implementation of solar PV in Bangladesh.

“We have demanded that the government reduce tariffs on solar products in the upcoming budget to help grow the sector,” said Dipal C. Barua, president of the Bright Green Energy Foundation (BGEF). magazine pw.

He said reducing import duties could significantly reduce the cost of solar PV systems, especially in the residential, commercial and industrial (C&I) segments, as well as in the solar irrigation industry.

“With a cost reduction of about 10%, garment factory owners will be increasingly interested in installing solar panels on their roofs,” Barua said. “Distributed solar energy production is heavily impacted by high tariffs on solar products.”

Barua, former president of the Bangladesh Solar and Renewable Energy Association, said the recent decline in solar module prices has helped offset the impact of the tariffs to some extent.

“But as high tariffs ultimately drive up prices for solar products, banks have since shown less interest in opening letters of credit Bangladesh has been experiencing a serious dollar shortage for several years,” he added.

Atiur Rahman, a former central bank governor, agreed with Barua’s sentiments.

“The government should abolish customs duties and taxes on such solar energy sources so that the cost of installing photovoltaic systems is reduced by 8% to 11%, with the aim of promoting solar energy in Bangladesh– said Rahman.

Khondker Morshed Millat, a lecturer at the Bangladesh Institute of Bank Management, said solar entrepreneurs need adequate tax incentives to leverage available green financing from commercial banks and non-bank financial institutions.

Nasif Shams, Director of Institute With Energy on University With Dhakasaid tax incentives should also be introduced to help reduce the price of solar energy systems.

Data from the International Renewable Energy Agency (IRENA) show that Bangladesh has installed 767 MW of solar power by the end of 2023, up from 524 MW at the end of 2022.

Bangladesh authorities have approved 2.1 GW of solar power in 2023, including 630 MW in December 2023 alone. In April this year, the government approved the construction of three more solar plants, each with a capacity of 100 MW.

This content is copyrighted and may not be reused. If you would like to collaborate with us and would like to reuse some of our content, please write to: [email protected].