[🇧🇩] Energy Security of Bangladesh

[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.​