Denmark’s green investment proposal valued at US$1.3 billion for developing the country’s first 500 MW utility-scale offshore wind energy project has received a nod in principle from the government to carry out a detailed feasibility study and implement the first phase of development with (site) exclusivity in next 3 years.
Denmark’s Copenhagen Infrastructure Partners (CIP), and Copenhagen Offshore Partners (COP) in association with the Summit Group, Bangladesh’s largest Independent Power Producer (IPP), submitted the foreign direct investment (FDI) proposal in July 2023.
The proposed project site is located in the offshore of Cox’s Bazar district. When functional, the 500 MW (installed) wind energy project would generate electricity which will be supplied directly to the national grid via an onshore substation to homes and businesses.
This offshore wind project, in particular, presents a unique opportunity for the country to maximise the utilisation of its coastal resources, supporting the development of the ‘Blue Economy’.
The project also comes at a crucial point in time for Bangladesh as despite ambitious clean energy targets, the country remains heavily reliant on fossil fuel imports, a comparatively costly power source due to global inflation-related price shocks.
Bangladesh therefore needs to rapidly develop utility-scale renewable energy projects, while simultaneously adapting to climate resilience technologies, to support continued economic growth and eliminate ‘absolute poverty’ by 2041.
With the Institute for Energy Economics and Financial Analysis (IEEFA) projecting an annual requirement of US$1.7 billion in funding for the green transition, this multibillion-dollar proposal from Summit, CIP, and COP may kickstart a new wave of foreign and domestic investments.
Once implemented, this offshore wind project will be the first of its kind in Bangladesh – and possibly in South Asia, enabling a “technology transfer” that would accelerate the learning curve for a nascent industry and reduce technological barriers to entry for future projects.
The preliminary study findings suggest that hundreds of direct and indirect jobs would be created during the construction phase, in addition to dozens of high-skilled permanent positions for the 30-year operational phase of the project.