Clean Energy Expansion Models: A Comparative Analysis of US State Approaches and Implications for Bangladesh

As Bangladesh considers options for decarbonizing its economy, this policy paper explores complementary approaches to meet clean energy goals while upskilling the labor force and developing the economy. Currently, the private sector is underused as a delivery mechanism for climate finance, with merely 1% of these funds being channeled through it at the national level. As Bangladesh approaches its graduation from the least developed country status in 2026, it is essential to diversify financing strategies and engage the private sector more robustly to manage the rising costs of finance and debt servicing.

Bangladesh’s goal, as outlined in its updated Nationally Determined Contributions in 2021, is to reduce greenhouse gas (GhG) emissions by either 5% (without international support) or 15% (with international support) by 2030, below “business-as-usual” emissions based on 2011 levels. To inform the priorities of Bangladesh, this policy paper reviews literature on clean energy commitments or targets put forth by these states, as well as literature related to the context or history in which each of the four states, or four models, is developing its policies or programs. Following this context, the paper studies each model’s approach to identify how and why the policies or programs were implemented and what opportunities and challenges the states faced during implementation. Finally, it explores Bangladesh’s energy sector, including its operational, financial, geographic, and infrastructure challenges; current financing plans; and education and private sector involvement in economic development to help inform possible next steps for Bangladesh in its energy transition.