The energy crisis we have quite casually and carelessly sleepwalked into hit home rather rudely for millions of Bangladeshis this week, as a scorching midsummer week was met with large shortfalls in electricity generation, leading to some old-fashioned rationing by the authorities to get through the day, what we in the Subcontinent like to call 'load shedding' (somehow it works). As the week got underway, the deficit between electricity generation and demand was running as high as a dizzying 1500MW-plus at its peak.
Coupled with the oppressive heat that took hold, the humidity was enough to sap your strength and spirit, amid the usual hustle and bustle of the capital, the chaos that abounds from all its corners and alleys. Truth be told, the government's strategy of using this moment to not paper over any cracks that may have appeared in their narrative of shepherding over 160 million people towards a better, brighter future, ever-more prosperous and resourceful, but rather to serve up some bitter uncomfortable truths - none harsher than to expect more of the same going forward.
That was delivered by none other than the prime minister herself. Noting that the prices of diesel, fuel oil, LNG have all increased significantly in the international market, Hasina reiterated her recent calls to embrace austerity and increase savings, which she said would be beneficial to face any type of crisis in the future. She also floated the idea that in this new era of "Load Shedding Revisited, citizens may be provided detailed scheduling of area-wise loadshedding in advance. That certainly would help to soften the blow caused by sudden power cuts, as you could then at least plan your day around them. There are legitimate questions though over whether or not these pre-set schedules can always be maintained at the control room level.
The prime minister does hit the nail on the head of course, when she alludes to the fuel prices on the international market - they are the true source of all our consternation at the moment. The post-Covid rally in energy prices has only gathered further steam since Russia commenced its war in Ukraine, where any hopes for a swift resolution have been kicked into the long grass. The war of attrition we are witnessing now only makes things worse, and coming at a time when our own proven reserves of natural gas - so vital to propping up the need for a range of fuels to serve a population closing in on 200 million - are now dwindling fast, with no new discoveries of any significance for almost a generation now. The perfect storm we are now faced with in the energy sector presents us with the peculiar predicament of having massive installed capacity for electricity generation, outstripping even demand or in other words: even more than we could use. Yet here we are, forced to generate in deficit of demand due to lack of fuel.
The bold venture into LNG import was always going to be an expensive go-around for the problem. The current state of the market has actually proven prohibitive, forcing the government to abandon its periodic purchases on the spot market. Meanwhile exploration activity - that we urged at the start of the year should be the number one priority for the energy sector in 2022 - still remains far too limited. The fact is that even if prices do stabilise and start coming down in the international market, without some new discoveries of our own going forward, we may never get to utlise all that installed capacity we already have on the books. And that would represent a colossal waste of public resources.
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