Cross-Border Renewable Power Purchase and Energy Attribute Agreements in Bangladesh

by Barrister Tahmidur Rahman | Sep 20, 2026

Projects & Real EstateRenewable PPAs and green attributes8 min read

Cross-Border Renewable Power Purchase and Energy Attribute Agreements in Bangladesh

We advise developers, exporters, multinational buyers, lenders and state counterparties on renewable power purchase agreements and energy attribute arrangements involving Bangladesh, from utility-scale and rooftop solar contracts to cross-border electricity imports, certificate purchases and the evidence behind green supply-chain claims. We also advise lenders on bankability.

Overview

Renewable power purchase and energy attribute deals in Bangladesh

Bangladesh's power sector is changing. The state still buys most electricity through the Bangladesh Power Development Board (BPDB) as single buyer, but pressure for cleaner supply now comes from many directions: export customers in Europe and North America asking factories for renewable electricity, lenders and development finance institutions with climate commitments, and the government's own energy transition goals. Each of these produces a different kind of power purchase arrangement. We advise on them as part of our projects, energy and real estate practice in Bangladesh, from early structuring through to disputes. Each needs its own contract design.

For utility-scale solar and wind, the familiar model is a long-term power purchase agreement with BPDB, supported by an implementation agreement with the government and, in some projects, a government guarantee. Tariff, take or pay obligations, deemed energy for grid curtailment, payment security, change in law and termination payments are the terms that determine whether a project is bankable. Recent policy changes, including reviews of earlier contracts and a shift towards competitive tenders, mean investors and lenders now look closely at risk allocation and remedies if the offtaker pays late. Lenders test each term against the offtaker's actual payment record.

Industrial buyers, especially garment, textile and leather exporters, increasingly look for renewable power closer to home. Options include rooftop solar owned by the factory, rooftop solar installed and operated by a third party under a long-term supply or lease arrangement, and net metering for systems connected to the distribution network. A framework allowing a factory to buy power directly from a remote renewable generator over the grid remains limited and under development, so contracts must be designed around the rules that actually apply today, with flexibility to adapt if wheeling or open access arrangements are introduced.

Cross-border trade adds another layer. Bangladesh already imports substantial electricity from India, and a tripartite arrangement has allowed hydropower from Nepal to reach Bangladesh through the Indian grid. Further regional projects involving Nepal and Bhutan are under discussion. These contracts raise questions about transmission rights, currency, payment security, force majeure, dispute resolution seat and the treatment of renewable attributes once electricity crosses a border. Investors in cross-border generation need agreements that work under the laws of every country involved and that reflect each government's approvals and policy commitments. Each power purchase contract must fit the others.

Energy attribute certificates, such as I-RECs, allow buyers to claim the environmental benefit of renewable generation separately from the electricity itself. For Bangladeshi exporters reporting to international brands, the quality of these certificates, how they are bought, retired and evidenced, and whether claims are accurate, now matters legally as well as reputationally. We help clients draft attribute purchase agreements, review certificate chains and align public claims with what the documents support. To discuss a project or procurement plan, contact our Dhaka office. Good records protect both buyer and seller when claims are later examined. We work with technical advisers.

01 · What we handle

Core workstreams

  • Utility-scale PPAs and implementation agreements
  • Rooftop solar and on-site supply
  • Corporate procurement structures
  • Cross-border electricity contracts
02 · How it runs

Four clear stages

  1. 01Objectives and route
  2. 02Structure and term sheet
  3. 03Documents and approvals
  4. 04Operation and claims
03 · Start here

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Consultations in Dhaka or by video. Scope, team and fees are agreed in writing first.

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How we help

How we support renewable power and attribute transactions

Workstream 01Projects & Real Estate

Utility-scale PPAs and implementation agreements

  • Objectives and route
  • Structure and term sheet
  • Documents and approvals
  • Operation and claims
Workstream 02Projects & Real Estate

Rooftop solar and on-site supply

  • Objectives and route
  • Structure and term sheet
  • Documents and approvals
  • Operation and claims
Workstream 03Projects & Real Estate

Corporate procurement structures

  • Objectives and route
  • Structure and term sheet
  • Documents and approvals
  • Operation and claims
Workstream 04Projects & Real Estate

Cross-border electricity contracts

  • Objectives and route
  • Structure and term sheet
  • Documents and approvals
  • Operation and claims
Workstream 05Projects & Real Estate

Energy attribute certificate agreements

  • Objectives and route
  • Structure and term sheet
  • Documents and approvals
  • Operation and claims
Workstream 06Projects & Real Estate

Green claims and disputes

  • Objectives and route
  • Structure and term sheet
  • Documents and approvals
  • Operation and claims
01

Utility-scale PPAs and implementation agreements

We advise sponsors, lenders and investors on renewable power purchase agreements with BPDB and related implementation agreements and guarantees. We review tariff structures, curtailment and deemed energy provisions, payment security, change in law, termination compensation and dispute resolution, and explain where risk sits for the project company and its lenders, including how exchange control and tax affect payments to foreign investors. We also review direct agreements.

02

Rooftop solar and on-site supply

For factories and commercial buildings we draft and negotiate rooftop solar arrangements, including equipment purchase contracts, third-party ownership, roof leases, energy supply agreements and operation and maintenance contracts. We consider building approvals, fire safety, structural responsibility, net metering rules, insurance and what happens if the factory moves, sells its building or stops operating before the contract term ends. Each power purchase term is tested against the factory's own lease and finance documents.

03

Corporate procurement structures

Where an exporter or multinational wants renewable electricity for Bangladeshi operations, we assess the routes available under current law, from on-site generation to captive arrangements and certificate purchases. We explain the regulatory limits on direct supply, structure contracts that fit the present rules, and include change in law and review clauses so the arrangement can evolve if a wider corporate power purchase framework is introduced. We also consider certificate-only options where appropriate.

04

Cross-border electricity contracts

We advise on contracts for importing renewable electricity into Bangladesh, including generation, transmission and tripartite supply arrangements. We focus on approvals in each country, transmission and scheduling responsibilities, currency and payment security, force majeure, sovereign counterparties and the choice of arbitration seat, working with counsel in India and other jurisdictions so that each contract works under every law involved. Payment risk is analysed in detail.

05

Energy attribute certificate agreements

We draft and review agreements for buying, transferring and retiring energy attribute certificates, including I-RECs linked to Bangladeshi or regional generation. We check registry rules, the chain of title from generator to buyer, double counting risks, bundling with physical power and the evidence buyers need to support their emissions reporting and the renewable sourcing claims they make to customers. We also consider how certificates are priced and paid for.

06

Green claims and disputes

We review renewable sourcing statements made by exporters and brands, so that public claims match contract documents and certificates. When projects or supply arrangements break down, we advise on payment defaults, curtailment claims, termination, change in law and certificate disputes, through negotiation, expert determination or arbitration in Bangladesh or abroad, alongside our disputes team. Early advice on evidence often prevents later disagreements about green claims.

RecognitionThe Legal 500Asia Pacific ranks Tahmidur Remura Wahid (TRW) Law Firm for dispute resolution in Bangladesh.
Cross-border reach6 jurisdictionsMatters coordinated with counsel in the UK, US, UAE, China, India and Singapore.
Bar and admissionsDhaka and LondonBarristers and advocates in Bangladesh, with a solicitor of England and Wales (non-practising).
HeadquartersDhakaHouse 410, Road 29, Mohakhali DOHS. Consultations in person or by video.
Who leads this work

Partner-led, on every matter.

Projects & Real Estate matters at TRW are led by partners, supported by associates, with one responsible lawyer from first advice to final outcome.

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01

Can a factory in Bangladesh sign a power purchase agreement directly with a remote solar or wind farm?

Not easily at present. Electricity in Bangladesh is largely bought and sold through state utilities, with BPDB as the single buyer for most grid-connected generation, and a general framework allowing corporate buyers to purchase renewable power from a distant generator over the public grid has not been fully established. Factories can, however, use rooftop or on-site solar, third-party owned systems and certificate purchases. We monitor regulatory developments closely and design contracts with review clauses so that a factory can move to a direct power purchase arrangement if wheeling rules are introduced. Interim options can still deliver real benefits.

02

What should a renewable developer look for in a power purchase agreement with BPDB?

Key points include the tariff and any indexation, the currency of payment and exchange rate risk, take or pay or deemed energy protection if the grid cannot accept output, payment security such as letters of credit or guarantees, change in law protection, force majeure, termination events and compensation, and the dispute resolution forum. Lenders will also look at assignment and step-in rights. Recent reviews of earlier contracts mean that the power purchase terms should be tested against realistic scenarios, including payment delays and changes in government policy, before financial close. Lenders will insist on this analysis.

03

How does rooftop solar under a third-party ownership model work for Bangladeshi factories?

A developer installs and owns the system on the factory roof and sells electricity to the factory under a long-term supply agreement, or leases the equipment to the factory for a fixed payment. The factory avoids capital cost, while the developer takes on performance and maintenance. The legal points include the roof lease or licence, structural and fire safety responsibility, building approvals, metering, insurance, price adjustment, early termination and what happens on sale of the factory. Lender consents may also be needed where the building or equipment is mortgaged or hypothecated. Each power purchase term should match the roof lease.

04

What are energy attribute certificates and are they valid for Bangladeshi exporters?

An energy attribute certificate represents the environmental attributes of one unit of renewable electricity, commonly one megawatt hour. Buyers retire certificates to support a claim that their consumption is matched with renewable generation. International schemes such as the I-REC Standard issue certificates for generation in many countries, and Bangladeshi exporters use them to support reporting to brands. Their value depends on the registry rules, the reporting standard the buyer follows and accurate retirement records. We review purchase contracts so customer claims are supported by evidence. Keep registry statements and retirement confirmations for as long as brands may verify them.

05

Can a power purchase agreement and certificate purchase be combined in one contract?

Yes. A bundled agreement transfers both electricity and the associated certificates from the same generator, which many buyers and reporting standards treat as stronger evidence of renewable sourcing. Where physical supply is not possible, an unbundled certificate purchase agreement can stand alone. Bundled contracts must deal with metering, issuance timing, who registers the generator, delivery shortfalls and replacement certificates. In Bangladesh, the practical scope for bundling depends on the supply model, so we usually start by confirming what physical power purchase route is available before drafting the attribute terms. The price of electricity and certificates should be stated separately.

06

What legal issues arise in importing renewable electricity across borders into Bangladesh?

Cross-border supply typically involves agreements between generators, transmission operators and state buyers in more than one country, each requiring its own government approvals. Issues include transmission access and charges, scheduling and losses, payment currency and security, sovereign immunity, force majeure caused by events in another country, change in law in each jurisdiction and the choice of a neutral arbitration seat. Ownership of renewable attributes must also be agreed, so that both the exporting and importing countries do not count the same green power towards their targets. Each country's power purchase approvals should be mapped at the start of negotiations.

07

Do Bangladeshi exporters face legal risk from inaccurate renewable energy claims?

Yes, increasingly. International brands and their regulators in export markets are tightening rules on environmental claims, and suppliers can be asked to provide evidence of renewable sourcing under contractual audit rights. An overstated claim may breach supply contracts, codes of conduct or customer sustainability requirements, and can damage relationships with buyers. We help exporters audit their renewable claims against power purchase contracts, metering data and certificate retirements, and adjust public statements and buyer submissions so they are accurate, consistent and defensible. Accuracy now protects future orders. Each claim should be traceable to a specific power purchase contract or certificate.

08

How are disputes under power purchase and certificate agreements resolved?

Most large power agreements in Bangladesh provide for arbitration, either under the Arbitration Act 2001 with a Bangladeshi seat or before an international institution such as the ICC, LCIA or SIAC with a foreign seat. Technical disputes about metering or availability may go first to an expert. Certificate contracts often choose English or Singapore law. Enforcement against state entities raises additional issues of immunity and assets. We advise on dispute clauses at the drafting stage and represent clients in negotiations and arbitrations when disputes arise, working with our disputes team. Good drafting reduces the risk of costly delays.

How a matter runs

From first call to resolution.

  1. 01

    Objectives and route

    We clarify what the client needs, such as physical power, cost savings, certificates or a combination, then map the regulatory routes available in Bangladesh and any cross-border approvals that would be required. Early clarity saves negotiation time.

  2. 02

    Structure and term sheet

    We propose a contract structure, allocate key risks such as curtailment, payment default and change in law, and agree a term sheet with the counterparty, lenders and other stakeholders before full drafting begins. Term sheets reduce later disputes.

  3. 03

    Documents and approvals

    We draft and negotiate the power purchase, lease, supply, attribute and security documents, and coordinate approvals from utilities, regulators, Invest Bangladesh, Bangladesh Bank and other authorities as the structure requires. We track each approval against agreed milestones.

  4. 04

    Operation and claims

    After signing we support operations, including invoicing disputes, curtailment claims, certificate issuance and retirement records, and the evidence buyers need for reporting, and we advise if the arrangement needs to be renegotiated. Renewal and extension dates are tracked from the start, so negotiations begin well before the current term expires.

“Demonstrates an extraordinary command over both domestic litigation and international arbitration.”

The Legal 500 Asia Pacific, Bangladesh: Dispute resolution, client feedback

FAQ

Questions, answered.

Still unsure? Email info@trw.co with a short outline of the matter.

What is a power purchase agreement?
A power purchase agreement is a long-term contract under which a buyer agrees to purchase electricity from a generator at an agreed price and on agreed terms. In Bangladesh, most large agreements are between independent power producers and BPDB. Smaller arrangements, such as rooftop solar supply contracts, apply the same idea between a developer and a factory or commercial building owner. The contract sets price, volumes, delivery, payment and risk allocation for the whole term.
What is the difference between a physical and a virtual power purchase agreement?
Under a physical agreement, electricity is delivered to the buyer. Under a virtual or financial agreement, the buyer and generator settle the difference between an agreed strike price and the market price, while the buyer receives certificates. Virtual agreements depend on a wholesale electricity market, which Bangladesh does not currently operate in that form, so they are rarely available for Bangladeshi consumption. Certificate purchases are the usual substitute for buyers seeking renewable claims in Bangladesh.
Who regulates renewable energy in Bangladesh?
Several bodies are involved. The Power Division sets policy, BPDB acts as the main buyer, the Bangladesh Energy Regulatory Commission deals with licensing and tariffs in its areas of responsibility, and the Sustainable and Renewable Energy Development Authority promotes renewable energy and efficiency. Distribution companies handle net metering connections. Invest Bangladesh supports foreign investors, and Bangladesh Bank regulates foreign currency payments. Each project needs a map of which authority approves which step. Check the current position with each body before filing, since responsibilities and procedures are revised from time to time.
Is net metering available for rooftop solar in Bangladesh?
Bangladesh has net metering guidelines allowing eligible consumers with rooftop solar connected to the distribution network to export surplus electricity and offset it against their consumption, subject to the distribution company's approval and technical conditions. The rules, eligibility limits and billing treatment should be checked with the relevant utility for each site before a project is designed or a supply contract is signed. Factories should also confirm that their roof and electrical installation meet the required standards.
Are energy attribute certificates the same as carbon credits?
No. An energy attribute certificate represents the renewable attributes of a unit of electricity and is used to support claims about electricity consumption. A carbon credit represents a reduction or removal of greenhouse gas emissions, verified under a separate standard, and is used for offsetting. The two have different rules and should not be counted for the same purpose. We advise on both instruments. Mixing them up can lead to inaccurate public claims and buyer concerns.
How long does it take to negotiate a renewable power purchase agreement?
A rooftop solar supply contract can often be agreed within weeks once technical surveys are done. A utility-scale power purchase agreement with BPDB, together with implementation agreements, guarantees, financing and approvals, usually takes many months and depends on the tender process and government decisions. Cross-border arrangements generally take longer still because approvals are needed in more than one country. Early preparation of documents shortens every power purchase negotiation. Lender requirements can also affect timing.
Can foreign companies invest in renewable generation in Bangladesh?
Yes. Foreign investors can own renewable generation companies in Bangladesh, subject to company registration, Invest Bangladesh formalities, licensing and the terms of any tender. Exchange control rules govern equity remittances, foreign loans and repatriation of dividends. Interest paid on foreign loans is subject to withholding tax, reduced to 10 per cent by the Finance Act 2026. We advise on the full investment structure. Tender terms often set specific ownership and local partner requirements. Power purchase terms matter too.
What information should we provide to start a power purchase review?
Send a short description of the project or procurement need, the location and capacity, the parties involved, any draft term sheet or tender documents and your timetable. For factories, include details of the building, current electricity supply and buyer requirements. We will run a conflict check, confirm scope and fees, and then review the documents and regulatory route in detail. We can usually give initial views quickly. A short call is often the best starting point for a power purchase review.

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