[🇧🇩] Energy Security of Bangladesh

[Saif]

865,000 illegal gas connections snapped in last 2 yrs: Nasrul

State Minister for Power, Energy and Mineral Resources Nasrul Hamid today said in the last two years, a total of 865,000 illegal gas connections have been snapped

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865,000 illegal gas connections snapped in last 2 yrs: Nasrul

State Minister for Power and Energy Nasrul Hamid. File photo

State Minister for Power, Energy and Mineral Resources Nasrul Hamid today said in the last two years, a total of 865,000 illegal gas connections have been snapped.

Of these, 336 were industrial connections, 475 commercial connections, 97 captive power plants, and 13 CNG stations.

"A total of 989km of illegal pipelines have been removed and Tk604 crore has been fined from the illegal consumers", he while visiting the headquarters of the Titas Gas Transmission and Distribution Company Limited in the city today.

System loss in gas distribution segment has been brought down to 7.5 percent now from 22 percent two years ago.

"Now, our target is to bring the system loss to a zero-level in the next two years, " he said, giving a description of the recent moves of the Titas Gas Company.

Titas has been the largest entity in the gas distribution segment having about 2.8 million retail consumers, out of a total 4.8 million of the country.

Briefing reporters, Nasrul said the government has been intolerant in taking action against illegal connections.

He, however, admitted that some influential quarters including local lawmakers, public representatives of different levels have been the main impediments.

"But mind it, the minister of the energy and power ministry is the prime minister herself and she has strong directives to remain uncompromising in this regard, " he said.

Petrobangla Chairman Zanendra Nath Sarker and Titas Managing Director Engr Md Haronur Rashid Mullah were present on the occasion.

Nasrul sadi Titras Gas Company has initiated a move to implement a Tk 12,000 crore project in the areas under Dhaka and Narayanganj cities to replace the old pipelines to stop gas leakages.

Apart from this, Titas Gas has been negotiating with different donor agencies including Asian Development Bank, World Bank, and JBIC of Japan to install pre-paid gas meters to reduce system loss in gas consumption.

Petrobangla Chairman Zanendra Nath said all the distribution and transmission companies have installed meters to ensure accountability in gas trading among them.​

 

[Saif]

Nuclear, coal plants may limit gas-fired power gen in Bangladesh: Report

Bangladesh's new nuclear facilities, coal-fired plants and renewable energy may limit full-capacity utilisation of gas-fired power plants in the near term, according to a latest report. The latest Global LNG Outlook 2024-2028 from the Institute for Energy Economics and Financial Analysis (IE

thefinancialexpress.com.bd

Nuclear, coal plants may limit gas-fired power gen in Bangladesh: Report
SAJIBUR RAHMAN
Published :
Apr 26, 2024 00:25
Updated :
Apr 26, 2024 00:25

Bangladesh's new nuclear facilities, coal-fired plants and renewable energy may limit full-capacity utilisation of gas-fired power plants in the near term, according to a latest report.

The latest Global LNG Outlook 2024-2028 from the Institute for Energy Economics and Financial Analysis (IEEFA) also observed that Bangladesh might opt for gas-fired peaking plants instead of only base-load plants to accommodate more renewable energy.

The country may seek to limit the liquefied natural gas (LNG) demand growth by frontloading energy efficiency in industrial processes and captive generation, it stated.

The report presents the International Energy Economics Forecasting Association's (IEEFA) projection for worldwide LNG demand spanning from 2024 to 2028.

Despite plans to ramp up the country's LNG terminal capacity, fiscal challenges may limit a drastic LNG demand growth in the short-term, it said.

"Low spot market LNG prices resulted in a rebound in demand from Bangladesh by 17.9 per cent in 2023 after imports fell by 14.4 per cent in 2022, but sensitivity to volatile LNG prices, fiscal challenges, and competing energy resources in the power sector point to a moderate medium-term demand growth," Shafiqul Alam, Lead Analyst, Bangladesh Energy said.

Regarding the global LNG demand, lackluster demand growth combined with a massive wave of new export capacity is poised to send LNG markets into oversupply within two years.

The LNG demand in Japan, South Korea, and Europe-which together account for more than half of the world's LNG imports-is expected to fall through 2030.

In emerging Asia, LNG demand growth will face significant economic, political, financial, and logistical challenges that may not be fully resolved in an oversupplied market.

Global LNG supply capacity is set to reach 666.5 million metric tonnes per annum by the end of 2028-a 40 per cent increase in just five years-despite uncertain demand, the IEEFA report said.

However, such rapid LNG demand growth in emerging economies is not guaranteed, even in an oversupplied market. Countries in South and Southeast Asia, for example, will face distinct barriers to rising demand, including fiscal and credit challenges, extensive infrastructure delays, and contracting issues, among other obstacles.

The global LNG crisis following Russia's full-scale invasion of Ukraine in 2022 brought these issues to the fore, spurring many markets to reduce the role of LNG in their development plans and accelerate the development of alternative energy sources.

IEEFA expects Europe's gas and LNG demand to fall through 2030. Europe's natural gas demand has declined 20 per cent since 2021, due to fuel switching, increased nuclear and renewables generation, and energy efficiency measures.

The IEEFA also revealed that LNG imports to Japan and South Korea fell 8.0 per cent and 5.0 per cent respectively in 2023.

National energy and climate plans envision steep reductions in the role of LNG in both countries, turning instead to nuclear and renewable energy. Taiwan, on the other hand, aims to cut nuclear power, which may boost LNG demand.

China reclaimed its position as the world's largest LNG importer in 2023. However, domestic natural gas production and additional pipeline imports may limit LNG demand growth.

Unprecedented increases in renewables capacity are constraining the need for LNG in the power sector.

In South Asia, fiscal challenges along with the inherent volatility of LNG prices may constrain rapid near-term demand growth, and the role of LNG in power generation is likely to remain low.

In Southeast Asia, extensive development timelines, contract negotiations, and repeated project delays for LNG-related infrastructure may continue to inhibit demand while strengthening political incentives to pursue alternative energy sources.

Robust supply growth will likely lead to lower prices, encouraging an uptick in short-term buying, Sam Reynolds, Research Lead, LNG/Gas, Asia, said.

"Yet in South and Southeast Asia, ongoing fiscal challenges and lengthy delays for new gas and LNG infrastructure pose structural challenges to demand growth that a low-price environment does not fully resolve," Sam added.​

 

[Saif]

Improving summer power supply: Govt pays half the subsidy power ministry needs

The Finance Division last week disbursed Tk 1,500 crore in subsidy against the power ministry’s demand for the immediate release of Tk 3,000 crore to boost electricity supply during the summer months.

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Improving summer power supply: Govt pays half the subsidy power ministry needs
Dollar crunch still bogging down furnace oil imports

Representational photo: Collected

The Finance Division last week disbursed Tk 1,500 crore in subsidy against the power ministry's demand for the immediate release of Tk 3,000 crore to boost electricity supply during the summer months.

The latest disbursement takes the amount of subsidy to Tk 18,799 crore so far this fiscal year. The government allocated a Tk 35,000 crore subsidy for the power sector for the current fiscal year to ensure uninterrupted electricity supply.

However, this move will not help the Bangladesh Power Development Board (PDB) improve the electricity supply significantly as the problem in opening letters of credit (LCs) to import furnace oil stemming from a shortage of dollars is another reason for the insufficient power supply.

The PDB is now enforcing 1,500 megawatts loadshedding a day. Many rural areas are experiencing daily eight to 10 hours of power outages, according to PDB officials.

Senior officials of the ministry and the PDB will hold a meeting today with the representatives of independent power producers (IPPs) to discuss ways to boost power production.

In a meeting with Finance Minister Abul Hassan Mahmood Ali in early April, State Minister for Power and Energy Nasrul Hamid and senior Power Division officials requested the finance minister to disburse Tk 3,000 crore from the Finance Division. The finance minister agreed to release about Tk 1,500 crore as cash support.

Finance ministry officials said they will release more funds next month.

PDB has been enforcing loadshedding, particularly in rural areas, since the end of the Eid holidays due to an increased demand amid the ongoing heatwave across the country.

As of 9:00pm yesterday, PDB produced 15,527MW of electricity against the demand of 16,650MW. Of the produced power, 7,400MW came from gas-based power plants, about 4,100MW from coal-fired plants and about 3,100MW from furnace-oil based plants.

Though the country's liquid fuel-based power plants have a combined capacity of around 6,000MW, the PDB cannot produce more than 3,500MW due to a shortage of fuel.

On April 22, the PDB produced an all-time record 16,233 MW. However, the figure dropped later.

"We don't have enough liquid fuel. Besides, the liquid fuel-based power plants are not designed to run round-the-clock. That's why we need to enforce loadshedding in parts of the country," said Mokammel Hossain, a member of PDB.

State Minister Nasrul Hamid will sit for a meeting today with the representatives of the Bangladesh Independent Power Producers Association (BIPPA).

Faisal Karim Khan, president of BIPPA, yesterday told The Daily Star that they would discuss how to enable IPPs to procure more furnace oil to boost power generation in future.

"The independent power producers cannot procure enough furnace oil due to the banks' inability to open enough LCs because of shortage of dollars. The IPPs have nothing to do with this problem. So, we are seeking help from our regulator [Power Division] and the customer [PDB]," he said.

Asked about the collection of arrear bills from the PDB, he said different IPPs have received different amounts against arrear bills. "The PDB was supposed to clear all the arrear bills until December last year."

This fiscal year, the government issued bonds worth Tk 10,599 crore to IPPs, according to Power Division data.

The power ministry officials earlier this month said about $2 billion is needed in the current fiscal year to clear the dues of all the companies concerned and also for their working capital to supply uninterrupted electricity. Half of this $2 billion would be spent on clearing dues of India's Adani Power and US energy giant Chevron, which is producing gas from Bibiyana, a major gas field in Bangladesh.

The rest of the amount will be used to pay the bills of purchasing liquid fuel, liquefied natural gas and coal for power generation.​

 

[Saif]

undefined | The Financial Express

thefinancialexpress.com.bd

Titas Gas losses heighten in Q3
FE REPORT
Published :
May 01, 2024 08:37
Updated :
May 01, 2024 08:37

State-owned Titas Gas Transmission and Distribution Company reported a 125 per cent year-on-year increase in losses in the third quarter through March of FY24.

It failed to return to profit even after the Bangladesh Energy Regulatory Commission (BERC) had hiked commission to Tk 0.21 from Tk 0.13 per cubic metre.

Titas Gas endured a loss of Tk 1.65 billion for the first time in FY23 after the government narrowed its profit margin.

At the time, it claimed that operating cost had surpassed income in FY23 for the decline in commission to Tk 0.13 from Tk 0.25 per cubic metre and that it would show a better business performance if the government increased the commission to Tk 0.21 per cubic metre.

"But the situation has not improved yet. We are still unable to cover our costs even after the regulator increased the commission," said General Manager (Finance) of Titas Aparna Islam.

Titas Gas has declared earnings per share of Tk 2.14 in the negative for the third quarter of FY24, which was Tk 1.19 in the negative for the same quarter of the year before.

In the first nine months through March of FY24, the company has shown a loss of Tk 1.67 per share.

The gas distribution margin of Tk 0.25 per cubic metre was "significantly high", said Mr Alam, who is serving as senior vice-president of the Consumers Association of Bangladesh.

"I believe the commission of Tk 0.13 was also high. Titas has already begun charging [prepaid] consumers meter rent. Now, the government has increased it [commission] to Tk 0.21, which is unexpected."

The company, which enjoys a monopoly on pipeline gas distribution in Dhaka and Mymensingh, earned a profit of Tk 3.18 billion in FY22.

It had secured good profits in the years until FY23 since its establishment in 1964.

Meanwhile, the stock went down 3 per cent to Tk 22.90 per share on Tuesday.

Titas Gas was listed on the Dhaka and Chattogram bourses in 2008 under direct listing through offloading of 25 per cent shares in the stock market. Currently, Petrobangla holds 75 per cent of the company's shares.​

 

[Saif]

Power price to go up four times a year

The government has 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, which the IMF recommends.

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Power price to go up four times a year
Govt moves to withdraw subsidies in 3 years following IMF advice

Visual: Star

The government has 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, which the IMF recommends.

The plan was placed before a meeting between the visiting International Monetary Fund (IMF) mission and officials of the power and energy division yesterday.

The power price would be hiked in small amounts so that the consumers do not get a shock, power division officials told The Daily Star, adding that subsidy on gas would also be withdrawn gradually.

According to the officials, the IMF mission, led by Chris Papageorgiou, wanted to know the outstanding bills of the Independent Power Plants and how much had they been paid in bonds.

Meanwhile, the Consumers Association of Bangladesh (CAB) yesterday alleged that the government was hiking power and fuel prices to protect the interests of dishonest businesspeople.

It said the sector would not need subsidies had the government stopped irregularities and corruption.

CAB made13 recommendations, including a ban on non-competitive investments, so that the government does not have to raise the price.

The IMF mission arrived in Dhaka on April 23 for its second review of the $4.7 billion loan programme. The third tranche of the loan would be released following the review.

During meetings with finance ministry officials earlier, the IMF team asked the government to gradually reduce subsidies for power, gas, and fertiliser.

After entering into the IMF's $4.7 billion loan programme in January last year, the government hiked the prices of electricity and gas several times.

After 2022-23 fiscal year, the government subsidies for electricity, gas and fertiliser nearly doubled.

In the current fiscal year, the subsidy allocation is Tk 84,542 crore and the figure could be about the same in next year's budget.

The subsidy for power is around Tk 35,000 crore and around Tk 6,500 crore for gas this fiscal year.

The finance division this fiscal year paid the power division around Tk 19,000 in bonds and cash but unpaid bills amount to around Tk 60,000 as of last January, officials said.

A power division high officials said despite the hikes in electricity prices, Tk 7 to Tk 8 has to be subsidised for every unit of power produced.

"This is the main reason for the piling up of unpaid bills," the official said, adding that this time the IMF mission wanted to know the plan for reducing the arrears and subsidy burden.

The official said the government would withdraw the subsidies for the power and energy sector as it had done for petroleum fuels.

The IMF mission also wanted to know whether the Rooppur Nuclear Power Plant would require any subsidy.

"We told them that the per unit generation cost for the Rooppur plant would be low and would not need any subsidy," the official said.

Power division officials said the first unit of the 2,400-megawatt Rooppur plant would start production next March.

The IMF has been insisting on reducing the subsidy for the power and energy sector and diverting the money saved to the social safety net programmes.

The IMF mission will end its tour with joint meetings with finance division and Bangladesh Bank officials on May 6 and 7, according to finance division officials.​