Govt to tap idle khas land for large solar plants; eyes 460MW in Rampal, 70MW in Matarbari

With the country's power demand expected to rise to 25,000MW by 2030, the government plans to use idle state-owned land for large-scale solar projects to slash land acquisition costs and reduce the reliance on imported fuel.

State Minister for Power and Energy Anindya Islam Amit told parliament today (8 September) that the government is also looking to replace some proposed coal-fired power projects with solar plants. It is now eyeing a 460MW solar plant at Rampal, alongside a 70MW project at Matarbari.

The government has received information on about 60,000 acres of unused land from different ministries, Amit said in reply to a notice on a matter of urgent public importance under Rule 71 of the Rules of Procedure.

Amit said the government had issued the "Guidelines for Development of Renewable Energy Projects using Land Owned by Government Agencies under PPP Modality, 2026" to facilitate renewable energy projects on public land under public-private partnerships.

The initiative was introduced in April primarily to utilise unused khas land for solar power projects to reduce land costs.

The state minister said after scrutiny and assessment of the capacity of transmission and distribution lines, about 30,000 acres have been identified for renewable energy projects.

The land will be allocated to investors through Invest Bangladesh.

The government also plans to install solar power systems on the roofs of all government buildings, he said. A policy has been prepared to attract private investment for the initiative, while the process of enlisting interested investors is under way.

It is also implementing the Policy for Increasing Private Participation in Renewable Energy-based Power Generation 2025, the Renewable Energy Policy 2025, the Net Metering Guideline 2025 and the National Rooftop Solar Programme 2025 to expand private participation in renewable power generation.

A business model for generating electricity from waste has also been finalised, Amit added.

The state minister also noted that investors in large solar projects have raised concerns over issues including wheeling and cross-subsidy charges. The government is taking steps to resolve the issues quickly, he said.

Amit was responding to MP Helen Zerin Khan's notice, who sought details on the government's plans to increase solar power's share in electricity generation over the next five to 10 years. 

She cited rising power demand, dependence on imported fuel, foreign exchange pressures and climate risks, and asked about measures to expand solar power use in government buildings, agriculture, industry and remote areas.

460MW solar plant at Rampal

Amit said there had been a plan to build a second coal-fired power plant as the next phase of the Rampal power project. But considering the natural heritage of the Sundarbans and the sentiments of local people, the government has taken an initiative to develop a 460MW solar project there instead.

A 70MW solar project has similarly been planned at the ash pond of the Matarbari Coal Power Project.

Amit said the ash produced by the Matarbari plant was of good quality and sold after power generation, leaving the land designated for the ash pond unused.

The site, however, cannot be used for other purposes because an ash pond must be maintained there in line with international standards, he said. The government therefore decided to develop a solar power project at the site.

Rising demand, renewable energy target

Addressing MP Helen's concern over rising demand, Amit said electricity demand could reach 24,000MW to 25,000MW by 2030 if the current pace of economic growth and industrialisation continued.

Amit noted that renewable energy had been identified as a priority sector to reduce dependence on imported fuel and strengthen energy security.

The government has formulated the National Renewable Energy Development Strategy 2026-2030, under which it plans to expand solar generation while also harnessing other renewable energy sources.

It has set a target of generating at least 20% of the country's total electricity from renewable sources by 2030 and at least 30% by 2040.

By 2030, the government aims to generate 5,500MW from rooftop solar systems and 4,500MW from ground-mounted solar projects. Another 450MW to 550MW is expected to come from wind, waste, hydropower, floating solar and other technologies, including agrivoltaics.

Tax benefits for solar power

The state minister further mentioned that the government is offering customs and tax benefits to encourage solar power investment. 

Solar panels, inverters, batteries and installation structures can be imported at a 1% tax rate, while a six-month exemption has been planned for small and commercial importers of solar equipment. 

Once the relevant notification is issued, the equipment will be fully exempt from an additional 1% customs duty, regulatory duty, supplementary duty, value-added tax, advance tax and advance income tax for 180 days. 

The government is also allowing solar power investors to supply surplus electricity to the national grid rather than using it only to meet their own requirements. Under the arrangement, the government will buy the electricity at Tk10.50 per unit, Amit said.

The government also sees the expansion of solar power as a way to create new small and medium-sized entrepreneurs while reducing foreign currency spending on imported fuel.

Amit said discussions are under way with Bangladesh Bank and donor agencies to arrange financing for new entrepreneurs in the sector. The government plans to encourage investment in solar projects by arranging loans on easier terms, he said.

According to Amit, expanding solar power will not only reduce dependence on imported fuel and foreign currency spending but also create opportunities for jobs and new entrepreneurs in the country.