[🇧🇩] Energy Security of Bangladesh

[Saif]

Gas crunch leaves BD in frequent power cuts

A nationwide gas shortage is causing frequent power cuts as around three dozen gas-fired power plants are currently out of operation for a lack of input. Power outages are worst in rural areas, while urban areas are experiencing increased load shedding. Officials say the situation is unlikely to

thefinancialexpress.com.bd

Gas crunch leaves BD in frequent power cuts
Situation unlikely to improve until mid-July
Published :
Jul 09, 2024 10:22
Updated :
Jul 09, 2024 10:22

A nationwide gas shortage is causing frequent power cuts as around three dozen gas-fired power plants are currently out of operation for a lack of input.

Power outages are worst in rural areas, while urban areas are experiencing increased load shedding.

Officials say the situation is unlikely to improve until July 15, when the Summit Group's liquefied natural gas (LNG) terminal is expected to resume operations.

A 500 million cubic feet per day (mmcfd) shortfall in gas supply to the national grid has resulted from the shutdown of Summit's floating storage and regasification unit (FSRU).

This gas shortage has forced nearly all major gas-fired power plants to shut down, including the recently commissioned and efficient Unique Meghnaghat 584 megawatt and Summit Meghnaghat 583 megawatt electricity plants.

Cyclone Remal, which struck the southern parts of the country in late May, damaged Summit's FSRU. After the cyclone, authorities discovered the damage on May 29 and reduced LNG regasification to zero by the morning of May 30.

Due to the reduced LNG re-gasification capacity -- down to around 600 mmcfd from 1,100 mmcfd before the cyclone damage, state-run Petrobangla was forced to cancel four spot LNG cargoes scheduled for June deliveries.

The country's overall natural gas output dipped to around 2,600 mmcfd, including around 606 mmcfd of re-gasified LNG, on July 7. This is down from around 3,100 mmcfd before Cyclone Remal, according to Petrobangla data.

To cope with the power shortfall, state-run electricity marketing and distribution companies have been enforcing load shedding for periods ranging from one to several hours, according to a senior official at the Bangladesh Power Development Board (BPDB).

The overall electricity generation on July 7 was around 12,608 MW during peak day hours and 14,521 MW during peak evening hours against the total generation capacity of 26,815 MW, according to BPDB data.

The senior BPDB official acknowledged that rural areas are currently experiencing the worst of the power outages.

The gas crisis is having a wider impact, jeopardising industrial output, slowing down the filling of compressed natural gas (CNG) vehicles and causing increased hardship for household consumers.

Household consumers in Dhaka and surrounding areas allege that gas pressure drops in the morning and remains low throughout the day until evening. This limited gas pressure forces them to restrict their cooking to nighttime hours.​

 

[Saif]

Load-shedding rises as gas supply declines

a pipeline was leaked in an accident Tuesday night further lessening the supply of LNG

en.prothomalo.com

Load-shedding rises as gas supply declines
Staff CorrespondentDhaka
Published: 11 Jul 2024, 11: 14

A man working in candlelight during load-shedding in Siddik Bazar area of DhakaProthom Alo file photo

The supply of liquefied natural gas has been low for over one and a half months due to the closure of one of the two terminals. Amid this, a pipeline leaked in an accident Tuesday night further lessening the supply of LNG.

Meanwhile, the industries, domestic and power sector is suffering due to the gas crisis. Power generation has stopped in several power plants resulting in a rise of load-shedding across the country on Wednesday.

The daily demand of gas in the country now stands at 3.8 billion cubic feet. However, only 3 billion cubic feet of gas is provided to tackle the pressure. The two floating terminals in Cox's Bazar's Maheshkhali provide 1.1 billion cubic feet of LNG daily, which dwindled to only 250 million cubic feet. The daily supply has dwindled to some 2.25 billion cubic feet as a result of this.

Petrobangla sources say the terminal operated by the Summit Group was closed down due to the damages it sustained during cyclone Remal on 27 May. The overall daily supply of LNG declined by 500 million cubic feet after the incident.

The terminal is likely to resume operations by the middle of this month. Meanwhile, the Anwara-Fouzdarhat pipeline was leaked by the workers of a contracting agency while digging up the soil for examination in the Anwara area of Chattogram. It stopped LNG supply through pipelines. The engineers of the Gas Transmission and Distribution Company Limited (GTCL) are trying to repair it.

Petrobangla director (operations and mines) Md Kamruzzaman Khan told Prothom Alo, "Gas supply has declined due to a flaw in the pipeline. Although we are not sure, it could take two to three days to repair the pipeline."

Meanwhile, the residents of Dhaka and other cities of the country are suffering due to the gas crisis. Already there was a decline in production at several industries due to the gas crisis. Now it has become even more difficult to run the factories. A total of 6,000 MW power was being generated using gas, which dwindled to below 4000 MW yesterday. As a result, the people outside Dhaka had to suffer a few hours of load shedding.

Sources in the Power Division, PDB and PGCB say the country has a power generation capacity of 26,000 MW daily. The maximum demand of power at 3:00 pm Wednesday was 14,300 MW. However, a little more than 12,000 MW was generated.

As a result, the authorities have to enforce more than 2000 MW of power outages. Load shedding has become more frequent from Tuesday night. It became more frequent after 12:00 pm yesterday.

PDB member (generation) Khandaker Mokammel Hossain told Prothom Alo, "There is no lack from PDB's end. Several power plants had to be closed down due to technical complications. The deficit due to this is being compensated through load-shedding. However, power generation has been the highest from oil-fired power plants."​

 

[Saif]

Normalcy expected as gas supply resumes after pipeline fixed

The authorities repaired a damaged gas- transmission pipeline 62 hours after an accident and resumed the flow of re-gasified liquefied natural gas (LNG) through it on Friday morning. Md Rafiqul Islam, managing director of state-owned Rupantarita Prakritik Gas Company Limited (RPGCL), which handl

thefinancialexpress.com.bd

Normalcy expected as gas supply resumes after pipeline fixed
M AZIZUR RAHMAN
Published :
Jul 13, 2024 00:10
Updated :
Jul 13, 2024 00:10

The authorities repaired a damaged gas- transmission pipeline 62 hours after an accident and resumed the flow of re-gasified liquefied natural gas (LNG) through it on Friday morning.

Md Rafiqul Islam, managing director of state-owned Rupantarita Prakritik Gas Company Limited (RPGCL), which handles LNG trading in Bangladesh, confirmed the development to The Financial Express on Friday.

"We have carried out repair works around the clock despite adverse weather conditions to restore the damaged Anwara-Fouzderhat pipeline in Chattogram," he said.

The 30km, 42-inch Anwara-Fouzderhat pipeline, which had been offline since an accident on the afternoon of 9 July, resumed supplying re-gasified LNG at around 7:20 on Friday after repairs, he said.

By 10:30 on Friday, the pipeline was carrying about 150 million cubic feet per day (mmcfd) of re-gasified LNG -- bringing the country's total supply to about 400 mmcfd, Mr Islam said.

Another pipeline, the 91km, 30-inch Moheshkhali-Anwara line, which remained operational after the accident, was carrying about 250 mmcfd on Friday morning, he added.

The RPGCL managing director hoped the country's overall re-gasified LNG supply would reach the full capacity of its current infrastructure to 600 mmcfd by Friday evening.

RPGCL, a wholly-owned subsidiary of state-owned Petrobangla, looks after the LNG trading in Bangladesh.

Shafiuddin M Farhad Omar, deputy general manager of state-owned Gas Transmission Company Limited (GTCL), said a 3.0-metre section of the damaged pipeline had been replaced with a fresh patch and welded to restore gas supplies.

Mr Omar, who oversees GTCL's operations in Chattogram region, could not specify the repair cost but said Petrobangla's senior management would settle all relevant issues, including compensation, after discussions with the Chinese company involved in the pipeline accident.

He said the pipeline was damaged when struck by a soil testing rig operated by First Harbor Consultant Ltd in the Majherchar area on the bank of Karnaphuli river in southern Bangladesh.

The rig was deployed by China Road Bridge Construction Ltd to conduct soil testing for a jetty on Karnaphuli river, which would be used for a China Economic Zone, Mr Omar said.

Punctures were identified in the Anwara-Fouzderhat pipeline on the afternoon of 9 July, subsequently affecting LNG re-gasification from the operational floating, storage and regasification unit on Moheshkhali island, he said.

GTCL, a subsidiary of Petrobangla, builds, owns, operates and maintains the national gas grid and gas transmission pipelines.

The country's gas-guzzling consumers got a sigh of relief with the resumption of operation of the damaged gas transmission pipeline. Overall power supply improved and gas supply to consumers increased from Friday morning, sources said.

However, consumers will be able to get increased volumes of re-gasified LNG once the Summit LNG Terminal comes online next week. The Summit's 500 mmcfd capacity FSRU arrived at the Moheshkhali mooring facility on Thursday night and is preparing to start operations next week.

In an official statement on 12 July, the Ministry of Power, Energy and Mineral Resources also confirmed that the damaged pipeline was restored at 07:20 on Friday morning.

Acknowledging the inconvenience to consumers, State Minister for Power, Energy and Mineral Resources Nasrul Hamid has ordered authorities to map gas transmission pipeline routes before any physical or infrastructure work nearby.

Such accidents could be avoided with pipeline mapping, Mr Hamid said in a statement, issued by Deputy Chief Information Officer of the ministry Mir Mohammad Aslam Uddin.​

 

[Saif]

New 42MW wind plant at Matarbari soon

Another wind-power plant is being established at Matarbari coast while several others are in the process for advancing Bangladesh's green-energy goal by utilising huge air-to-electricity potential the country holds. A search for foreign funds for setting up the 42-megawatt-capacity plant has bee

thefinancialexpress.com.bd

New 42MW wind plant at Matarbari soon
FHM HUMAYAN KABIR
Published :
Jul 16, 2024 00:50
Updated :
Jul 16, 2024 00:50

Another wind-power plant is being established at Matarbari coast while several others are in the process for advancing Bangladesh's green-energy goal by utilising huge air-to-electricity potential the country holds.

A search for foreign funds for setting up the 42-megawatt-capacity plant has been launched, officials said Monday.

This planned one will be the second-biggest wind-power station after the recently launched 60MW wind-based plant at the coast of the Bay of Bengal in Cox's Bazar, they said.

Coal Power Generation Company Bangladesh Limited (CPGCBL) has decided to build the power station and sent a preliminary development project proposal (PDPP) to the Planning Commission (PC) for approval, a senior Power Division official said.

The 42MW plant is planned to be set up beside the 1200MW coal-fired power station at Matarbari hub on the Maheshkhali Island, he said.

The state-run CPGCBL is now searching foreign loans for installing the power station estimated to cost of Tk 1.21 billion, the official added.

Meanwhile, with the financial support of a Chinese company-SPIC Wuiling Power Corporation-US-DK Green Energy BD Ltd, a private company, set up the first biggest commercially operated 60MW wind-power plant in Cox's Bazar which started full-scale operation in March last, supplying power into the national grid.

The firm is selling the electricity generated from the plant to Bangladesh government at 12 US cents per unit (1 kWh) under an 18-year management contract.

A total of 22 wind turbines in Khurushkul, PM Khali, Chowfaldandi, and Pokkhali unions of Cox's Bazar near the seashore have already been generating the electricity.

A report of energytrackerasia, a global renewable-energy advocacy group, says the 724-km- long coast of Bangladesh is suitable for wind-power generation as there is "significant wind- power-generation potential. Bangladesh has vast potential to exploit this renewable energy source, which still remains untapped".

Each of the 22 turbines of the existing plant has a capacity of 3.0MW power, altogether generating 60 megawatts of electricity from wind blowing along the bay coast free of cost.

Meanwhile, Bangladesh's first wind-power project was a 0.9MW plant near the dam along the River Muhuri in Feni, constructed by Bangladesh Power Development Board (BPDB) in 2005. Three years later, a 1.0MW wind plant was set up in Kutubdia, Cox's Bazar.

"Both plants are now out of operation for a lack of supervision and interest from the board," said one source.

The government has set a target to generate 10 per cent of electricity requirements from renewable energy by 2025.

Asked about the latest venture, a senior PC official said they had got the PDPP from CPGCBL that has sought approval for the 42MW wind-power project.

"The proposed cost of the project is comparatively higher. We have asked the company to rationalize the cost estimation and then send it again to the PC. Then we will consider approval," said a senior official.

Meanwhile, the government has also planned to construct three more wind projects with a cumulative power-generation capacity of 102 megawatts in Sirajganj, Bagerhat and Chuadanga.

Besides, contractor selection for a 50MW wind-power project in Chandpur and a 30MW plant in Feni is in the process.

In September 2022, the BPDB signed a contract with Mongla Green Power Limited firm for building a 55MW wind plant in Mongla, Bagerhat, where Bangladesh's second-largest seaport is situated.

Official data show Bangladesh's total power-generation capacity is around 22,000 MWs. Around 51 per cent of the capacity is natural gas-fired, while 27 per cent is from furnace oil, 6.0 per cent from gasoil or diesel and only 2.0 per cent from hydropower and solar, with another 5.0 per cent imported from India. The share of wind energy is almost zero.​

 

[Saif]

Gas short supply hurting industries

Poor gas supply and frequent electricity cuts have been taking a heavy toll on the country's industrial production, thus leading to rise in the cost of doing business, affecting productivity and eroding competitive edge, industry people said. Textile and garment industry's growth, according to ins

thefinancialexpress.com.bd

Gas short supply hurting industries
MONIRA MUNNI
Published :
Jul 16, 2024 00:47
Updated :
Jul 16, 2024 00:47

Poor gas supply and frequent electricity cuts have been taking a heavy toll on the country's industrial production, thus leading to rise in the cost of doing business, affecting productivity and eroding competitive edge, industry people said.
Textile and garment industry's growth, according to insiders, which is important for macroeconomic stability and sound financial sector, needs government's priority attention to resolve the energy crisis.

Textile millers said up to 50 per cent of their production capacity remained unused due to gas supply shortage, forcing many garment exporters to source raw materials from outside the country.

Frequent load shedding is also causing damage to expensive and sophisticated machinery and electrical equipment.

The whole supply chain of textile and garment exports from spinning to weaving - dying -- printing have been affected.

"We are passing a challenging time. The overall supply chain has been disrupted due to energy crisis," Shams Mahmud managing director of Shasha Denims said.

Spinning mills can't produce in full capacity while price hike has raised the cost. And these factors are forcing exporters to go for imported raw materials like yarn and fabric which are cheaper than the local ones.

Besides, electricity cut or gas supply disruption is also cause damage to goods amidst production process, he said.

Explaining the situation, he said an average-sized textile mill has to pay about Tk 40 million a month following the price hike of gas. The amount was Tk 20 million before the hike.

"I need to pay additional Tk 240 million annually for all energy costs. And it is ultimately affecting cash flow," he noted.

There is liquidity crisis in banks while interest rate has gone up, he said adding that as a result working capital has become costly for private sector.

Even high-performing factories are now facing financial crunch. This will also have a massive impact on financial sector, giving rise to macroeconomic instability, he noted.

Buyers are also shifting to Pakistan, Vietnam, India and Turkey due to long leadtime, rise in cost of production, Mr Mahmud said.

"Industry is suffering and we are losing competitive edges," Mr Mahmud, who is also a director of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said.

Talking to the FE on Monday, Khorshed Alam chairman of standing committee on local spinning, weaving, dying and printing mills listed with Bangladesh Textile Mills Association (BTMA) said they held a meeting on 13 July with all members.

Almost all mills located at industrial areas, including Narsingdi, Madhabdi, Baburhat, Pabna and Sirajganj, are not getting electricity for eight to nine hours a day.

And factories mostly spinning, dying and printing are in dire situation because of energy crisis.

"Sudden electricity cut cause damage of 40-60 per cent of the yarn producing from cotton that are in the process ," he said, explaining that weaving mills suspended production and exporters are not buying fabrics from them.

Textile Mills require uninterrupted energy supply to run operation as they operate 24 hours, he said adding the mills need more than two hours to restart.

Similarly printing and dying segments are also facing severe problems due to gas and electricity problems, Mr Alam, who is also chairman of Little Star Spinning Mills Ltd, said.

When asked, BTMA president Mohammad Ali Khokon said government increased gas price with assurance that industry would get uninterrupted gas supply.

"But we are not getting uninterrupted gas. Rather the situation has worsened further," he said adding that power outage for at least 10 to 11 occasions causes 40-50 per cent production fall and rise in cost.

"What buyers are now doing is that they are sourcing goods from other countries," he added.

It takes three years to be nominated by buyers, he said expressing his deep frustration.

The leaders suggested a long-term government policy to help industry to plan better

Like textile and garment, other industries like ceramic and plastic are also suffering.

Talking to the FE, Irfan Uddin general secretary of Bangladesh Ceramic Manufacturers and Exporters Association (BCMEA) said ceramic making is largely dependent on gas-fired kilns.

They are also suffering severely not only crisis of gas but the hike in gas prices as they are not uninterrupted gas supply despite significant rise in prices.

The government increased the gas price per cubic meter to Tk 30 from Tk 13.

"At the end of the day, we are paying for air, not gas" he noted

About 25 factories in Dhaka, Gazipur and Narsingdi have been suffering a production loss of estimated Tk 200 million every day for around the last one month due to the supply crunch of natural gas, the BCMEA on June 26 said in a letter to energy state minister.

Ceramic goods-manufacturing units require gas supply pressure at 15 psi (pounds per square inch), whereas the pressure in those areas fluctuate between three and zero only, it noted.

Ceramic is a gas dependent manufacturing industry and natural gas constitutes 10 to 12 per cent of its total production cost, the association said explaining that kilns in the ceramic industry need 24-hour uninterrupted gas supply to burn the products at 1200 centigrade at the desired PSI.

"Whenever the required pressure of gas goes down, the half-done products inside a kiln become wastage, even a kiln needs 48 to 72 hours to resume production in full swing after a halt," the BCMEA said, adding that sometimes an industry owner has to encounter severe trouble due to inoperative machinery.

According to Mr Uddin, there are around 70 ceramic factories across the country while 20-25 are engaged in exports.

Shamim Ahmed president of Bangladesh Plastic Goods Manufacturers and Exporters Association (BGAPMEA) also echoed the same adding that many factories located in Ashulia, Gazipur and Narayanganj could not operate properly for 20 days a month for gas crisis.​

 

[Saif]

BD struggling to get LNG cargoes for regasification

Bangladesh has been grappling to receive LNG (liquefied natural gas) cargoes for regasification after purchases due to a halt in the operation of Summit LNG Terminal at Moheshkhali following accidents. One spot cargo vessel carrying around 3.36 million British thermal unit (MMBTu) of LNG has remai

thefinancialexpress.com.bd

BD struggling to get LNG cargoes for regasification
M AZIZUR RAHMAN
Published :
Jul 26, 2024 00:49
Updated :
Jul 26, 2024 00:49

Bangladesh has been grappling to receive LNG (liquefied natural gas) cargoes for regasification after purchases due to a halt in the operation of Summit LNG Terminal at Moheshkhali following accidents.

One spot cargo vessel carrying around 3.36 million British thermal unit (MMBTu) of LNG has remained stranded in deep sea over the past 10 days and another has been deferred for this prolonged operational delay.

A senior Petrobangla official disclosed this to the FE.

He said the spot LNG cargo of Excelerate Energy LP has been waiting in deep sea since July 15 to deliver the fuel to one of the country's two floating, storage and regasification units (FSRUs).

The state-run Rupantarita Prakritik Gas Company Ltd (RPGCL) purchased it from the US energy giant at $13.55 per MMBTu totalling Tk 6.09 billion.

The government has been counting fiscal penalty to be paid to Excelerate Energy as demurrage for not receiving the LNG cargo in time, the official said without figuring out the amount of the penalty.

Meanwhile, the RPGCL deferred the cargo of Total Energies Gas and Power Ltd, which was scheduled for release during the July 24-25 delivery window, according to an RPGCL official.

The government has purchased the spot LNG cargo at $12.58 per MMBTu totalling the cost of Tk 5.83 billion.

Had Summit's FSRU not encountered the latest accident of tearing down its messenger rope on July 11, both cargoes would have been delivered to the FSRUs for regasification, the RPGCL official said.

Earlier, the government had to cancel four cargoes for June delivery following the initial technical issue of Summit's FSRU due to the Remal mayhem. The terminal shut operations on May 30 after spotting damage to its FSRU.

The RPGCL cancelled three spot cargoes of Gunvor Singapore Pte Ltd and one of QatarEnergy Trading LLC for June delivery windows.

Gunvor was awarded contracts to deliver these spot cargoes for June 07-09 and June 09-11 and June 28-29 delivery windows at $10.4622 per MMBtu, $10.4622 per MMBtu and $12.9697 per MMBtu respectively. QatarEnergy was supposed to deliver the cargo at $10.30 per MMBtu for June 19-21 delivery window.

According to market insiders, Remal's savagery to Summit's FSRU turned out as a boon for the government as it could save around $150 million due to cancellation of the four cargoes, said.

"As cyclone Remal hit the coast, a broken stray steel structure weighing hundreds of tons banged the Summit LNG Terminal, causing significant damage," said a Summit statement earlier.

Summit LNG Terminal returned from Singapore on July 10 after repair, but it suffered a fresh blow the next day of reaching Moheshkhali mooring facility.​

 

[Saif]

1,320MW coal power plant in Patuakhali to fire up in October

A 1,320-megawatt (MW) coal-based thermal power plant located in Kalapara upazila of Patuakhali is ready to begin commercial operations by the end of this year, officials said..The first of the plant’s two units, which can generate 660 MWs daily, will commence production in October while th

www.thedailystar.net

1,320MW coal power plant in Patuakhali to fire up in October

The second 1,320-megawatt coal-based thermal power plant in Kalapara upazila of Patuakhali is all set to begin commercial operations from October this year. In this aerial view, it is seen that much of the plant's main infrastructure is now complete. The picture was taken recently. PHOTO: Sohrab Hossain

A 1,320-megawatt (MW) coal-based thermal power plant located in Kalapara upazila of Patuakhali is ready to begin commercial operations by the end of this year, officials said.

The first of the plant's two units, which can generate 660 MWs daily, will commence production in October while the second will start in December.

This is the second 1,320 MW coal-based power plant in Kalapara upazila, with the Payra Thermal Power Plant situated nearby.

Norinco Intl Cooperation Ltd, a Chinese heavy construction company, and the state-owned Rural Power Company Limited built the plant under a joint venture called RPCL-Norinco Intl Power Limited (RNPL).

Costing Tk 27,000 crore, construction of the 950-acre plant began in August of 2019.

It is located on the banks of Ramnabad river, just two kilometres north of the Payra plant.

Project Director Taufiq Islam said all the ancillary work, including physical structure, is complete.

He also said a 20-kilometre double circuit transmission line has been established to connect the plant with the national grid using Payra plant's existing transmission line. Also, a switching station has been constructed in Amtali upazila of Barguna.

Ashraf Uddin, the plant's supervising engineer, said the plant can produce enough electricity for catering to 10 percent of the country's annual demand.

Currently, Bangladesh has a power generation capacity of around 27,000 MW and the peak-hour demand is around 17,000 MW, according to data of Bangladesh Power Development Board.

Of the total demand, coal-based power sources account for about 25 percent or 6,600 MW.

Shawkat Osman, the plant's executive engineer (mechanical), said instead of using solid coal, they will use powdered coal as it is more efficient and reduces the emission of harmful substances, such as carbon dioxide.

Against this backdrop, Shahriar Hasan, assistant engineer, said it is an ultra-modern power plant, where more electricity will be produced by burning less coal, thereby causing less environmental pollution.

According to sources at RPCL-Norinco, the plant features a fly ash silo, fuel-well pump, rain water reservoir, fire station service and fire-fighting water tank aside from usual elements such as a boiler, power house, turbine, generator, chimney and so on.

Construction of waste water storage basins, administrative building, engineering building, multipurpose hall, workshop and other infrastructures are complete, they said.

Also, the construction of a modern jetty with a conveyor belt for unloading imported coal to be used by the plant alongside the workers' dormitory, canteen and mosque are also complete.

Besides, the plant's main transformer has been installed, they added while informing that there are currently 5,979 people working on the project, comprising 972 foreigners and 5,007 Bangladeshis.​

 

[Saif]

https://thefinancialexpress.com.bd/views/columns/promises-made-on-energy-turn-hollow

Promises made on energy turn hollow
Syed Mansur Hashim
Published :
Aug 02, 2024 21:59
Updated :
Aug 02, 2024 21:59

Sadly, the power situation in the country has gone from bad to worse since Covid-19. While the pandemic has come and gone, the energy crisis refuses to go away. While policymakers keep raising tariffs on the promise of steady supply of requisite energy to industry and retail consumers, the assurances have turned hollow and the economy as a whole continues to suffer. Loss of production has led to factory closure causing ultimately unemployment and lower economic growth. A bleak future thus stares in the face of Bangladesh because the supply of energy, i.e. the bulk of fossil fuels that power our industry and power plants have become import-dependent.

Is it not ironic that the country has become overwhelmingly dependent on the whims of foreign energy markets, while significant reserves of natural gas remain unexplored in the country? What has compelled the government to turn a blind eye to several surveys done by international companies about potential gas reserves that are available onshore and which can be made available with acceptable levels of investments? Why is there no enthusiasm on exploring and extracting own reserves of energy? Frankly, it is easier to fleece consumers ---industrial or otherwise---by importing coal, oil and liquefied natural gas (LNG) because the country is a captive market. The government is the sole provider of energy and there are no competitors, unlike the situation in some other countries in the region where state-owned enterprises compete with private ones to sell energy to industry.

Getting back to the crisis in hand, there simply isn't enough energy to go round. Domestic gas is depleting at a fast rate and the import of all types of fossil fuels is hamstrung by a shortage of foreign exchange. There is no way that economic development can continue in a situation where there is a dearth of both energy and power for industry. While the readymade apparel sector (RMG) contributes about 80-85 per cent of the export earning, other important industrial sectors have developed too and also require energy. Though there have been arguments that fertiliser can always be imported and there is no need to keep supplying gas to old, gas-guzzling fertiliser factories, the situation has changed over time with the retirement of old factories and introduction of new ones that are more energy-efficient. Besides, fertiliser is an essential agricultural input that cannot be left to the whims of foreign market fluctuations - both pricewise and availability. Moving on from fertiliser, hundreds of billions of Taka have been poured into the ceramic industry and the country boasts a vibrant sector that practically serves the entire demand of the country. The Achilles heel is that it is entirely gas-run. So, this sector with massive export potential is also facing mothballs in the near future.

What the government isn't telling bulk and retail consumers is that the situation is not going to improve before 2030. Let's look at some facts on the ground. While it is difficult to measure exact demand, the general consensus is that it is hovering around 4,000 MMCFD (million cubic feet per day) and as per published data, supply of the gas on July 13-14 was 2,600 MMCFD. According to media reports, "Of this, the contribution of imported LNG was 604 MMCFD. The production from local gas fields was 1,996 MMCFD. Of these 1,209 MMCFD gas came from gas fields operated by international oil companies. Bibiyana Gas field operated by Chevron alone supplied 996 MMCFD. The current recoverable reserve of the field has depleted below 1.0 TCF" (trillion cubic feet). Again, according to a recent report published in Energy & Power Magazine, "installed generation capacity of grid connected power is 27,504MW (megawatt). Breakdown of this capacity is as follows: Gas-based: 11,180MW (43%), furnace oil: 6,035MW (22.30%), coal: 5,108MW (18.80%), hydroelectricity: 230MW (0.85%), grid-connected solar: 519MW (1.90%), and import: 2,656MW (9.80%)". The net result of all this "foreign" energy dependence is that Dhaka and other major urban centres suffered 2-3 hours of load shedding (while rest of the country suffered between 6 to 8 hours) during the hottest summer days of July.

Import-dependent energy supply is a recipe for disaster. This has long been brought to the notice by Bangladeshi energy experts and for long policymakers have ignored it. Simply because there is much opacity built in certain energy policies and hefty commissions can be paid to fatten the pockets of certain groups of people, the nation's energy security has been thrown out the window. This is the reality we live in today and the suffering has just begun.​

 

[Saif]

Power supply to Bangladesh to be unaffected, Adani says

The recent amendment to India’s Power Export Guidelines will not affect the existing power purchase agreement (PPA) between Adani Power and Bangladesh Power Development Board (BPDB), said Adani Group yesterday.

www.thedailystar.net

Power supply to Bangladesh to be unaffected, Adani says

The recent amendment to India's Power Export Guidelines will not affect the existing power purchase agreement (PPA) between Adani Power and Bangladesh Power Development Board (BPDB), said Adani Group yesterday.

A PR agency appointed by Adani Group in Bangladesh, in a statement, said the amendment aims to connect all Indian power stations, which export electricity to neighbouring countries, to the Indian national grid.

"We have been providing uninterrupted power to Bangladesh from our Godda plant. Adani Power is committed to fulfilling contractual obligations as per BPDB's demand schedule and provisions of PPA and would look forward to continuing reciprocal fulfilment by BPDB," the statement reads.

An internal federal power ministry memo, dated August 12 and seen by Reuters, amends 2018 guidelines governing generators supplying electricity "exclusively to a neighbouring country".

Currently only one plant in India -- Adani Power's 1,600 megawatt (MW) Godda plant in eastern Jharkhand state -- is under contract to export 100 percent of its power to Bangladesh.

The memo states that "the government of India may permit connection of such generating station to the Indian grid to facilitate the sale of power within India in case of sustained non-scheduling of full or part capacity".

The sale of power to the local grid might also be allowed if there is a delay in payments, it said.

The move, which comes nearly a week after longtime Prime Minister Sheikh Hasina fled Bangladesh after deadly protests, could also benefit future projects where all output is locked into export contracts.​

 

[Saif]

It’s time to form an energy audit commission

Despite having built up an over-capacity of power generation in the energy sector), the past government did little to ensure a cheap and reliable supply chain of primary energy, over which it would have total control. That is the irony of the $460 billion dollar economy in Bangladesh. Opinions diff

thefinancialexpress.com.bd

It’s time to form an energy audit commission
Syed Mansur Hashim
Published :
Aug 16, 2024 22:01
Updated :
Aug 16, 2024 22:01

Despite having built up an over-capacity of power generation in the energy sector), the past government did little to ensure a cheap and reliable supply chain of primary energy, over which it would have total control. That is the irony of the $460 billion dollar economy in Bangladesh. Opinions differ about actual demand for power in the country, but it is around 16,000 MW (megawatts). Despite this, power plants were built and commissioned and today, the grid connected power generation capacity stands at slightly above 27,000 MW. Over the course of the last one year or so, the past government has had to take expensive high-interest, short-term loans from international lending institutions simply to defray payments for energy purchases. A ridiculous situation and one that threatened macro-economic stability in the mid to long term!

According to an article published in Energy & Power magazine: "The highest-ever generation was 16,477MW on 30 April 2024. In the peak hours on that day, the deficit was 1,000MW. The unit cost of generation in FY 2022-23 was Tk 12.13. The average power tariff was Tk 7.04 per unit" On top of that, the erstwhile government had decided that subsidy on power sector would be removed in phases within the next two years. It is the bulk and retail consumer who would bear the burden of subsidy withdrawal. While consumers could curtail energy consumption by reducing usage, energy-efficiency transformation of industry cannot happen overnight and there is also a cost factor involved.

The arrogance with which the ministry of power & energy and policymakers had ramrodded the entire process was sad to see. The explanation, if any, was that utility companies were running into billions of Taka worth of losses and these had to be covered with ever-increasing rise of tariff. During the golden days of economic development, subsidies on power increased by leaps and bounds in the name of "capacity payment". According to a study by the Centre for Policy Dialogue (CPD), over the last seven years, capacity charge jumped from Tk50 billion to Tk320 billion.

One would have thought that with so much financial outlay, generation cost would be managed. The Bangladesh Power Development Board (BPDB) "forecasted that the generation cost would be reduced to Tk10.50/unit." Why so? Because one major element in all these calculation was not shared publicly. Yes, the power generation capacity (on paper) increased dramatically over the last 14 years, but as experience had shown that little thought had gone into awarding of contracts. There was no audit to calculate whether contracted power companies were actually delivering stated power outputs as per contract. The only thing that mattered was awarding of contracts with zero oversight and this is what has landed the nation in the mess it is in today!

As pointed out by a member of the Bangladesh Energy Society, the capacity charge clause necessitated the unnecessary payment on huge reserve margins that shot up the generation costs. This is supported by the fact that the former state minister of energy had informed the last parliament that the government had to pay beyond Tk 1,000 billion as capacity charge for the past 13 years. Perhaps it was a pipedream that policymakers believed in that international markets for three primary energy sources: liquid fuel, coal and LNG would remain stable for eons to come. It simply goes to show that greed overtook common sense and the economy had become dependent on an energy plan that could be undermined at any time.

Every nation strives for energy self-dependence, regardless of the source of energy. In the case of Bangladesh, it was fortunate to have gas and coal reserves - but these are finite resources, regardless of the reserve size. Yet, we have witnessed the obtuseness of policymakers in making energy plans that was focused on making the country import-dependent while disregarding the very basics of energy-efficiency, curbing wastage and unbridled corruption that would overwhelm the state of finances within a short period of time.

The current government has landed on this mess and it must tackle the severe energy crisis. Much has already been written on the formation of a banking commission to deal with the runaway corruption in the financial sector. It is time to form a proper energy audit commission comprising renowned energy experts of the country and people who understand the energy affair. The task of this commission would be to sift through the evidence of how and where subsidies went, who got what under "capacity charge" and precisely, what is the actual power generation capacity of the various power plants commissioned. Only with such data in hand, can a proper energy policy be formulated and the road to recovery may begin. Recovery will be both painful and time-consuming but this can no longer wait.​

 

[Saif]

Scrap, amend key energy laws, demand energy experts

The reform that Bangladesh now seeks to establish the rule of law following the ouster of Sheikh Hasina ending her autocratic rule should begin with scrapping and changing the...

www.newagebd.net

Scrap, amend key energy laws, demand energy experts
Emran Hossain 18 August, 2024, 00:23

The reform that Bangladesh now seeks to establish the rule of law following the ouster of Sheikh Hasina ending her autocratic rule should begin with scrapping and changing the key energy laws, energy experts said.

In the last 14 years, they said, until Hasina’s fall on August 5, the Awami League government made almost all power and energy deals behind the scene under the protection of an indemnity law named ‘Quick enhancement of electricity and energy supply act, 2010’.

The law handed unprecedented power to the minister for power and energy, which was Hasina herself, enabling her to award power and energy deals without any tender while ensuring that her decisions could not be challenged in any court of law.

The law came to be known as the indemnity law which was enacted in 2010 for two years. Its tenure was later extended four times, giving it a lifetime of 16 years until 2026, ignoring widespread demands from energy and legal experts for throwing it out.

The law oversaw unabated fossil fuel expansion at exorbitant prices further facilitating corruption and inefficiency, channeling a huge amount of public money into private pockets by creating a power system suffering from 50 per cent overcapacity.

‘The cancellation of the indemnity law should be the first step in the reform of the state,’ said Hasan Mehedi, member secretary, Bangladesh Working Group on Ecology and Development.

The call for reform emerged with the uprising that toppled the Hasina regime.

The ‘Quick enhancement of electricity and energy supply act, 2010’ was passed on October 12 in 2010 for two years as an emergency measure to tackle an acute energy crisis after the past Awami League government had assumed power in 2009.

In 2012, the law was given two years’ extension, followed by four year’s extension awarded in 2014, three years extension in 2018 and five years extension in 2021.

The law allows awarding any companies without tender any power and energy projects, including the import of natural gas, coal, liquefied natural gas and petroleum products, as well as the extraction of mineral resources. The law also covers electricity generation, transmission and distribution projects.

In the section 9, the law states that the legality of any activity or measure or order taken or given under it cannot be challenged in any court of law.

No legal action can be taken against any employees and officials who have operated under the law or its subordinate rules or any general or special orders given under it, states section 10 of the law, considering all actions done under it performed in good faith.​

After taking permission from the minister, the subsection 2 of the section 6 states, a special committee can contact and negotiate with a limited number of parties or a single party to process any procurement or investment proposals in the power and energy sector.

The special committee comprising top officials of the energy ministry and the state-owned power end energy entities.

Under the law, the government indiscriminately approved projects, increasing the installed power generation capacity to over 28,000MW in June this year from less than 5,000MW in 2009.

Energy experts frequently said that the rapid expansion of the power generation capacity was unnecessary and harmful and based on flawed growth projection.

The power projects offered riskless investment, guaranteeing huge profits, with capacity charge entitlement, which is a provision to pay investors regardless of power produced by their power plants.

‘The law should not have existed in the first place. It violates standard practices of public procurement around the world,’ said energy expert Ijaz Hossain.

He said that the government has a tough choice to make about holding the past Awami League government accountable for projects implemented under the indemnity law as it implies dealing with international power purchase agreements.

‘The move might bear financial consequences for some parties might choose to go to international courts,’ he said.

The mass uprising, however, has offered an opportunity as well exposing the past government’s acts against the interest of the state and people, giving the interim government the opportunity to renegotiate terms and conditions in existing power and energy deals, said Ijaz.

The past government under the law set up 151 power plants, including dozens of furnace oil, diesel, coal and gas-fired power plants, and two floating, storage and re-gasification units. Drilling of a dozen of onshore gas-wells by local and international oil companies were also conducted under the law. Oil-carrying pipelines were also installed, among other initiatives.

Not a single power and energy agreement was ever made public. The Awami League government also kept all environmental impact assessment a secret.

An analysis of the power projects passed by the Awami League showed that only one power project went through bidding since 2010. The bid, however, carried no significance for its winner was paid higher price through negotiation anyway.

Another result of having such a law is evident in the establishment of the Bosila 108MW power plant, owned by CLC power company, a sister concern of Maisha Group, owned by former Awami League lawmaker Aslamul Haque, who died in 2021. The furnace oil-based Bosila power plant began commercial operation on February 22, 2017, years after it was supposed to be operational. The power plant was set up encroaching river for which it was never made accountable. And the power plant was out of operation for the last four years but its permission was never cancelled.

Consumers Association of Bangladesh energy adviser Shamsul Alam said that the new government should suspend the indemnity law and amend the Bangladesh Energy Regulatory Commission act to ensure people’s right to public hearing before energy price hikes.

The past Awami League government turned the regulatory commission a lame duck in 2022 since when electricity and gas prices were frequently increased under executive orders.

Shamsul Alam demanded that the commission should work to reduce inefficiency and corruption to ensure uninterrupted energy supply without increasing prices.

‘The interim government should first announce that energy prices will not be increased during its tenure and then ensure it through reforms or providing subsidy,’ he said.

 

[Saif]

Power sector’s indemnity act suspended

All the activities under the much-criticised Quick Enhancement of Electricity and Energy Supply Act 2010, commonly known as the Indemnity Act, in the power and energy sector will remain suspended, said the newly-appointed energy adviser to the interim government.

www.thedailystar.net

Power sector’s indemnity act suspended

The government believes the country's power coverage would be 100 percent by 2021. Star/File

All the activities under the much-criticised Quick Enhancement of Electricity and Energy Supply Act 2010, commonly known as the Indemnity Act, in the power and energy sector will remain suspended, said the newly-appointed energy adviser to the interim government.

Initiated in 2010 when the power sector was struggling to meet the country's demand, the act stipulates there is no need to float any tender to award any power plant construction activities.

Procurement under this act does not need to go through the standard Public Procurement Rules that are followed by other ministries.

Though the process was meant to be for a short time, the Awami League government never abolished it. In 2021, it was extended for another five years.

Thanks to this act, hefty amounts were paid as capacity charges to the power plants.

All previous activities under this act will be reviewed by the interim government, said M Fouzul Kabir Khan, the adviser to the ministry of power, energy and mineral resources, at a media briefing in the secretariat yesterday.

"It will be decided by the advisory council whether the act will be abolished or not. But from now on, the pending works under this act will remain suspended," Khan added.

Different media outlets published articles about the anomalies of the sector, especially under this act, which may raise questions among people, said a press release from the ministry.

Under this circumstance, all the negotiations, projects and purchase activities will remain temporarily closed.

However, the contracts that were done under this act will continue.

The interim government will not take any decision regarding hiking the power or energy tariffs by bypassing the Bangladesh Energy Regulatory Commission (BERC).

Last year, the Awami League government amended the BERC Act and incorporated a clause to set the energy prices by themselves without any public hearing.

They have increased the power price several times since this clause was rolled out.​

 

[Saif]

CPD suggests 3 steps to fix energy sector

The Centre for Policy Dialogue yesterday proposed a three-step pathway for energy transition under the interim government that would holistically reform Bangladesh’s energy sector.

www.thedailystar.net

CPD suggests 3 steps to fix energy sector

The Centre for Policy Dialogue yesterday proposed a three-step pathway for energy transition under the interim government that would holistically reform Bangladesh's energy sector.

The think-tank proposed an initial 100-day plan where the interim government would announce key priorities, followed by significant reforms over the next six months.

The reforms would include abolishing certain acts, implementing new policies such as energy audits, renewable energy laboratory and centralising databases on pricing and investment.

The CPD identified four critical acts and policies that need to be revised immediately to ensure competition, efficiency, transparency and accountability in the power and energy sector.

These are the Quick Enhancement of Electricity and Energy Supply Act, the Bangladesh Energy Regulatory Commission Act, the Renewable Energy Policy and the Integrated Energy and Power Master Plan (IEPMP).

"These acts and policies were initiated to benefit vested interest groups in the sector," said Khondaker Golam Moazzem, research director of CPD, while presenting the keynote paper at a media briefing titled "Power and Energy Sector Reform Agenda for the Interim Government".

Under the Quick Enhancement Act, the government awarded public works to conglomerates without issuing any tender notices.

"No public procurement rules were followed under this act. The faulty procurement and bidding process of the major power projects such as the Adani deal, Payra and Rampal power plants cost us an additional Tk 35,000 crore."

Moazzem also called for an international audit of all companies under the ministry of power, energy, and mineral resources to uncover anomalies and corruption from the past government.

"There was no transparency in the information available in this sector. Companies provided different information to different authorities, and all details were kept top secret during the Awami League-led government. All deal documents should be made public."

The data on power generation cost, power purchase tariff, efficiency level, plant factor, fuel cost, capacity payment, date of contract expiration, and oil and LNG import costs must be updated regularly on the respective websites.

CPD emphasised the need for all government activities to be conducted under the Public Procurement Act 2006 and Public Procurement Rules 2008.

They urged the government to review all procurement and bidding processes of power plants, phase out inefficient and quick rental power plants and prioritise the identification and assessment of renewable energy resources.

Additionally, CPD recommended forming a probe body to identify anomalies in pre-paid meters and restructuring the power, energy and mineral resources ministry to empower the Sustainable and Renewable Energy Development Authority (SREDA) as the sole authority for implementing upcoming energy transition issues.

In the final phase, spanning 12 to 36 months, CPD suggested the government prioritise investment in advanced grid technologies, modernise grid infrastructure and shift focus from LNG imports to domestic gas exploration.

"The past government has made Bangladesh Energy Regulatory Commission a toothless authority," Moazzem said.

The laws were amended to adjust gas and electricity prices without holding a public hearing multiple times a year.

Without the process, there are two types of problems: it creates a non-transparent market and frequent tariff changes discourage investors.

In the IEPMP, the government had projected faulty energy and power demand, the keynote paper said.

Besides, the policy paper incorporated hydrogen and ammonia co-firing with carbon capture and storage systems, which is a 'false solution' of energy transition.

CPD demanded the review of the market-based pricing formula saying the formula has anomalies. "We need to get rid of subsidy-based power and energy but under a transparent process."​

 

[Saif]

CPD calls for phasing out inefficient power plants

The Centre for Policy Dialogue yesterday urged the interim government to phase out all inefficient power plants as early as possible.

www.thedailystar.net

CPD calls for phasing out inefficient power plants

The Centre for Policy Dialogue yesterday urged the interim government to phase out all inefficient power plants as early as possible.

During a media briefing, titled "Power and Energy Sector Reform Agenda for the Interim Government", at its office, the CPD outlined a comprehensive operational reform strategy for the power sector.

The think-tank asked the government to revise power purchase contracts and incorporate the "no electricity no pay" clause to lessen the burden of capacity payments.

"The government paid a total of around Tk 105,000 crore in the last 14 years as capacity payments to power plant owners up to August 2023," said Khondaker Golam Moazzem, research director at the CPD.

He provided a list of 28 inefficient power plants -- which have a total capacity of 3,655 MW -- based on net electricity generation, generation cost and carbon dioxide emissions, which can be phased out after their contracts end by 2030.

Most of them are quick rental power plants that the previous government promised to phase out. But it failed to do so.

All 16 quick rental power plants were supposed to be phased out by 2023, but as many as 13 are still operational. Of them, two have been getting capacity payment facilities and 11 are operating under the 'no electricity no pay' provision, Moazzem said.

According to the CPD, there is an over-generation capacity of 41 percent at present, significantly higher than the maximum required reserve margin of 30 percent.

"There is a scope to reduce the capacity of 6,677MW without having any major adverse effect on the electricity supply in the country," Moazzem said, adding the previous government did not maintain the retirement schedule of power plants.

Despite providing high subsidies and upward tariff revision, the Bangladesh Power Development Board has still been unable to come out of losses.

He added that no further power tariff revision should be made in the name of subsidy adjustments.

"The previous government had drawn up a plan to increase the price of electricity four times a year for the next three years to withdraw all subsidies in the power sector. They raised the price in February, but through such an adjustment, the burden is fully passed to the consumers -- households, agriculture, industry, businesses, services and other economic activities."

The CPD termed the automated fuel pricing formula, launched in March this year, as unclear. "The price calculation mechanism of petroleum is unclear and there are a few hidden charges without any proper justification."

As the procurement process was non-competitive and confidential, fairness could not be ensured regarding issues such as the determination of power purchase rate and capacity payment. It also led to extensions of contracts with inefficient power plants, it said.

So, the CPD asked the government to review the procurement and bidding process of the power plants.​

 

[Saif]

Energy reforms are long overdue

CPD’s three-step proposal deserves consideration

www.thedailystar.net

Energy reforms are long overdue
CPD’s three-step proposal deserves consideration

VISUAL: STAR

The Awami League government's questionable policies in the power and energy sector badly affected the economy over the last 15 years, prompting experts to frequently call for reforms but to no avail. Now that the interim government has taken charge, we hope to see the initiation of some much-needed actions in that regard. The three-step proposal given by the Centre for Policy Dialogue (CPD) shows where the focus should be. It has put forth a 100-day plan highlighting the key priorities, followed by significant reforms stretching over the next six months.

In particular, four acts and policies highlighted by the CPD need immediate revisions since those were made primarily to benefit vested interest groups. For instance, through the enactment of the Quick Enhancement of Electricity and Energy Supply Act, also known as the Indemnity Act, the erstwhile government awarded public works to conglomerates without issuing any tender notices, while no public procurement rules were followed either. This act should be repealed immediately. The other acts that need revisions are the Bangladesh Energy Regulatory Commission (BERC) Act, the Renewable Energy Policy, and the Integrated Energy and Power Master Plan (IEPMP).

The need for the BERC to operate independently cannot be stressed enough. The amendment to the relevant act, done in 2022 to empower the government to set power and energy tariffs on its own under "special circumstances," without holding any public hearing, was a shady decision that frequently shot up energy prices. This needs to change. In addition, the IEPMP needs to be revised because the government allegedly projected faulty energy and power demand in it. Moreover, the suggestion to link the Sustainable and Renewable Energy Development Authority with the chief adviser's office also deserves consideration, as it will hopefully speed up phasing out of the fossil fuel-based power plants.

Phasing out the inefficient power plants should be another goal for the interim government. According to the CPD, the Awami League government paid a total of around Tk 105,000 crore as capacity payments to power plant owners in the 14 years up to August 2023, which is outrageous. So much money was squandered while citizens were either deprived of power or forced to pay exorbitantly for it. Revising the power purchase contracts and incorporating a "no electricity, no pay" clause will lessen the burden of capacity payments.

These are just a few key areas that need immediate attention from the interim government. There are many other short- and long-term suggestions given by the CPD which are quite well-thought-out, and can, if properly implemented, ensure competition, efficiency, transparency and accountability in the power and energy sector.​