The Bangladesh government on Thursday announced a major policy package to accelerate solar energy development, including a zero percent tax rate for the solar energy sector until 2035.
In addition, a 5% tax credit is provided on payments made on consumers’ solar bills.
The initiative aims to attract investment in the solar energy sector as part of the government’s plan to achieve 20% of total electricity demand from renewable energy sources by 2030, and between 30% and 50% from clean energy by 2050.
Finance Minister Amir Khosru Mahmud Chowdhury, while presenting the national budget in Parliament on Thursday, announced a new notification that reduces import duties, regulatory duties, additional duties and input taxes on essential solar energy components to 0%.
According to the announcement, items such as solar inverters, battery enclosures, lithium cells, lithium-ion batteries, photovoltaic solar panels/panels, mounting structures, battery energy storage systems (BESS), battery management systems, UV-protected solar DC cables and battery thermal management systems will benefit from the exemptions from import duties and taxes.
“The gradual expansion of solar, wind and other clean energy sources will lay the foundations for a low-carbon economy,” the minister said.
He also noted that investors would receive support and incentives for domestic production of renewable energy equipment, including solar panels, wind energy components and battery systems.
Stakeholders in the solar energy sector have welcomed the initiative, describing it as a strong signal of government support for renewable energy investments.
Mostafa Al Mahmud, chairman of the Bangladesh Sustainable and Renewable Energy Association (BSREA), said the incentives demonstrate the government’s commitment to the sustainable energy sector. “There is no alternative to clean energy for sustainable development,” he said, adding that with continued policy support, industries could generate electricity for their own use, while households would also be encouraged to install rooftop solar systems.
Bangladesh currently has a renewable energy generation capacity of 1,797 MW, of which 1,504 MW comes from solar energy.
