Solar could save $2.7b in 2022-2024: Ember

Bangladesh could save $2.7 billion between 2022 and 2024 by solar generation, according to a report published by Ember, a global energy think tank.

In another mini briefing published by Ember, it was found that spot market LNG imports could cost Bangladesh about $11 billion between 2022 and 2024 while solar could reduce these imports by 25 per cent and save the country $2.7 billion.

A recent analysis by Institute for Energy Economics and Financial Analysis (IEEFA) showed that Bangladesh imports about 59 per cent of the LNG from the spot market, opening itself to price volatility risk.

According to a report jointly published Thursday by Ember, the Centre for Research on Energy and Clean Air (CREA) and IEEFA, solar generation allowed seven Asian countries – China, India, Japan, South Korea, Vietnam, Philippines and Thailand – to avoid billions of dollars in fossil fuel costs in the first half of 2022 alone.

The report shows that in the wake of soaring fossil fuel prices, solar power is already contributing to meeting electricity demand in Asia and enhancing energy security.

The contribution of solar generation in seven key Asian countries avoided potential fossil fuel costs of approximately $34 billion from January to June 2022. This is equivalent to 9 per cent of total fossil fuel costs during this period.

The report finds that the majority of the estimated $34 billion savings are in China, where solar met 5 per cent of the total electricity demand and avoided approximately $21 billion in additional coal and gas imports from January to June 2022.

“Asian countries need to tap into their massive solar potential to rapidly transition away from costly and highly-polluting fossil fuels,” CREA’s Southeast Asia Analyst Isabella Suarez said.

“A key challenge for successful solar expansion in Asia will include investments in grid stabilisation and energy market reform which, in turn, depend on how attractive solar is to investors,” an IEEFA financial analyst said.

“In the short-term though, cost elements such as capital costs, fuel costs as well as operations and maintenance costs will be critical to realising the region’s solar potential.”

The report said that Japan saw the second-highest impact, with $5.6 billion in avoided fuel costs thanks to solar power generation alone.

In India, solar generation avoided $4.2 billion in fuel costs in the first half of the year. It also avoided the need for 19.4 million tonnes of coal. Likewise, Vietnam’s solar power avoided $1.7 billion in additional fossil fuel costs. Viet Nam’s solar generation was close to zero terawatt hours (TWh) in 2018. In 2022, solar accounted for 11 per cent of electricity demand from January to June.

While solar only accounted for 2 per cent of Thailand’s electricity in the first six months of 2022, an estimated $209 million of potential fossil fuel costs were avoided. The Philippines avoided $78 million in fossil fuel spending, despite solar accounting for only 1 per cent of generation.