Reducing the system loss of gas distribution system in Bangladesh

Abstract

Bangladesh’s reliance on natural gas, providing over 60% of total energy, faces a significant challenge: persistent system loss in its distribution network. These losses, caused by technical inefficiencies, illegal connections, metering inaccuracies, and pipeline leaks, contribute to energy insecurity, financial instability for state-owned gas companies, and environmental degradation through methane emissions. Despite a range of interventions, Bangladesh has not achieved a sustained reduction in gas distribution losses. This policy note synthesizes existing research and field interviews to analyze the drivers of system loss and recommend a feasible multi-dimensional strategy integrating technological, regulatory, financial, and institutional reforms. Drawing on domestic data and international case studies, this note proposes a roadmap focused on actionable solutions aligned with national energy goals and international sustainability commitments. Bangladesh’s gas distribution system suffers from persistent and escalating system losses, ranging from 7.5% to 14% markedly higher than the global benchmark of 2%. These losses represent not only a financial burden (≈ Tk 800 billion/year) but also a significant threat to the country’s energy security, industrial productivity, and climate commitments under SDG 7 and SDG 13.