Bangladesh’s sustained efforts to curb energy waste and improve efficiency are yielding significant economic and environmental benefits, with the country on track to meet — and potentially exceed — its national energy efficiency targets ahead of schedule, a new report has found.
The study, Bangladesh’s Energy Efficiency Goals Within Reach, published by the Institute for Energy Economics and Financial Analysis (IEEFA), shows that consistent efficiency gains since 2016 have strengthened energy security during periods of global market volatility and helped the country save billions of dollars in fossil fuel imports. The report was authored by Shafiqul Alam, Lead Energy Analyst for Bangladesh at IEEFA South Asia.
Between the 2014–15 and 2023–24 fiscal years, Bangladesh improved its energy efficiency by 13.64%, placing it well on course to achieve the national target of a 20% improvement by 2030. The analysis tracks trends in primary energy consumption relative to GDP growth over the past decade.
Shafiqul said that energy efficiency gains in the 2023–24 fiscal year alone reduced fossil fuel consumption by 7.02 million tonnes of oil equivalent, helping the country avoid import costs of around $3.34 billion.
The report notes that while early progress was uneven, the global energy price shock of 2021–22 elevated efficiency to a national priority. Bangladesh’s 2016 Energy Efficiency and Conservation Master Plan is cited as a critical policy framework that enabled faster and more coordinated action.
Momentum has since been reinforced through targeted programmes, affordable financing and regulatory reforms. At the current average annual improvement rate of 1.52%, Bangladesh could reach its 2030 energy efficiency target as early as 2029. The report also projects that the country will meet its revised Nationally Determined Contribution target of 19.2% by 2035 at least a year ahead of schedule.
Further gains will largely depend on households and industry, which together account for roughly two-thirds of total energy consumption. Significant savings have already been achieved through the widespread adoption of LED lighting and the growing uptake of energy-efficient air conditioners.
Shafiqul said energy efficiency labelling would play a crucial role in accelerating the adoption of efficient appliances by addressing information gaps in the market.
However, the report cautions that many of the easiest efficiency gains have already been realised. It calls for greater focus on industrial motors, captive power generators, electric boilers and passive building design to unlock the next phase of savings. High import duties on LED components and inverter compressors are identified as key barriers requiring policy attention.
Shafiqul added that energy efficiency should not be viewed solely as a tool for reducing electricity bills, noting that a coordinated effort involving regulators, consumers, financiers and technology providers could rapidly transform Bangladesh’s energy system.
