🇧🇩 Energy Security of Bangladesh

[Saif]

Govt trying to solve power cuts within 2-3 weeks: Rizwana

The interim government is trying to solve the power outage problem within the next two-three weeks, Adviser for Environment and also Water Resources Syeda Rizwana Hasan said yesterday

www.thedailystar.net

Govt trying to solve power cuts within 2-3 weeks: Rizwana

File photo

The interim government is trying to solve the power outage problem within the next two-three weeks, Adviser for Environment and also Water Resources Syeda Rizwana Hasan said yesterday.

She said the load-shedding issue was discussed in the advisory council meeting held with Chief Adviser Prof Muhammad Yunus in the chair at his office.

"We'll try to reach a solution to this problem within two-three weeks," Rizwana said while replying to a question at a press briefing at the Foreign Service Academy after the meeting.

Election to be held after necessary reforms

The environment adviser said there were two main aspirations behind the mass uprising -- one, to end rampant discrimination, and the other, much-needed reforms.

Referring to the formation of six commissions to reform six key sectors, Rizwana said, "We initially expect that the commissions would place their reports within three months."

She said the implementation of the recommendations to be placed by the six commissions would depend on whether the government can build a political consensus on these. "We'll go for dialogue at one stage."

"We're thinking about elections after taking specific commitments on reforms or bringing specific amendments in some cases by reaching a political consensus through dialogues," she said.

Rizwana said the political parties have already made it clear that they would go for election after reforms.​

 

[Saif]

Reformation to power, energy sector: BWGED places 16-point proposals

Bangladesh Working Group on Ecology and Development today proposed 16-point proposals for reforming the power and energy sector to ensure good governance, transparency and sustainable development to the sector

www.thedailystar.net

Reformation to power, energy sector: BWGED places 16-point proposals
BWGED places 16-point proposal for power sector reform

Bangladesh Working Group on Ecology and Development today proposed 16-point proposals for reforming the power and energy sector to ensure good governance, transparency and sustainable development to the sector.

The organisation made the proposals at a press conference at Dhaka Reporters' Unity.

The working group urged the interim government to adopt "No Coal or Coal Moratorium Policy", cancel any new coal-based plant from the power sector masterplan, move away from dependency on liquefied natural gas, and cancel the earlier-announced third LNG terminal.

They also asked the government to backtrack from the previous government's plan to introduce Japanese technologies including carbon capture and ammonia co-firing, which they termed as "unproven and false technologies".

BWGED also demanded removing 26-56 percent taxes in the renewable energy sector, revoking the Quick Enhancement of Electricity and Energy Supply (Special Provisions) Act 2010, initiating a public investigation committee, making Initial Environmental Examination and Environmental Impact Assessment mandatory for all projects, and initiating new masterplan aiming Net Zero carbon emission.

BWGED member secretary Hasan Mehedi said despite the country's commitment to reduce dependence on fossil fuel for power generation, it did not happen.

"Gas-based power plants generate electricity for half of a year and remain ineffective for rest of the time. As such, the previous government had been increasing LNG-based power plants," he added.

Addressing the event, Khondaker Golam Moazzem, research director at the Centre for Policy Dialogue, said it is high time to prioritise knowledge-based policy decisions and break the syndicate that has long been dominating the power and energy sector.

Mentioning that the previous government took decisions to favour certain individuals or groups, he said, "Now, decisions regarding formulation of laws and policies have to be taken in the light of people's welfare and science-based knowledge."

Moazzem also called for ensuring independence of the Bangladesh Energy Regulatory Commission and Sustainable and Renewable Energy Development Authority, and awarding all new plants through a competitive bidding process.

He further demanded the concerned ministry to disclose the Power Purchase Agreements to ensure transparency and accountability, and urged the interim government to prioritise civil society organisations' voices from local to national levels​

 

[Saif]

PDB says Adani dues inflated by 32pc

The Bangladesh Power Development Board estimated that it owed to the Indian Adani Power $547 million, about 32 per cent less than what was claimed by the company, a sister concern of the...

www.newagebd.net

PDB says Adani dues inflated by 32pc
Emran Hossain 12 September, 2024, 23:11

The Bangladesh Power Development Board estimated that it owed to the Indian Adani Power $547 million, about 32 per cent less than what was claimed by the company, a sister concern of the controversial Indian Adani Group conglomerate.

The group’s chairman Gautam Adani sent a letter to chief adviser to the interim government of Bangladesh Muhammad Yunus last month seeking his intervention to clear his outstanding power bill of $800 million, Indian media reported on September 10.

The PDB confirmed that Adani Group asked for payment of $800 million in dues.

Officials at the power development board’s finance division explained that an unequal power purchase agreement that brought Adani into the country’s power scene last year in a deal patronised by Sheikh Hasina and Narendra Modi allowed price manipulation and the overpricing.

Power, energy and mineral resources adviser Muhammad Fouzul Kabir Khan said that a special committee was engaged in evaluating power and energy deals, including the one with Adani, signed during the tenure of the now overthrown Awami League government.

‘We are also writing a reply to the letter sent to the chief adviser explaining our position on the matter,’ he said sharing his knowledge regarding the difference in the estimates of its dues payable to Adani.

The power purchase agreement, better known as PPA, allowed Adani Power to generate electricity in its 1,600MW Godda power plant by burning coal carrying a calorific value of 4,600 kcal/kg, but charge Bangladesh for the use of coal carrying the calorific value of 6,322 kcal/kg.

It means, Bangladesh is being charged by Adani for a high quality coal use, while in reality the plant is using a lesser quality coal.

The price of coal varies greatly depending on its quality, explained officials at the PDB’s finance division, citing different prices of coal on the Indonesian index on Wednesday.

The price of a tonne of coal on the Indonesian index drops down to $51.18 from $127.72 between the categories of the coal producing 4200 kcal/kg and 6500 kcal/kg. The lowest quality of coal on the Indonesian index costs $31.78.

The PPA also allowed Adani to combine prices of coal on the Indonesian and Australian indexes and average them to claim a price from Bangladesh.

The Australian coal is of very high quality and more expensive than the Indonesian coal. Adani is allowed to use the high price to inflate its profit though importing coal from Indonesia entirely.

The provision of averaging the combined prices is rather unique since other similar power plants were never allowed such privileges. Power plants, such as Rampal and Payra, were allowed to use only one index for pricing.

The Adani power plant initially raised eyebrows as it had planned to use coal from an Australian mine owned by the Adani Group. The international media reported that Adani was allowed to dump its coal on Bangladesh as the fossil fuel was rapidly losing its market. Adani had to abandon the plan following widespread criticism.

The PPA, termed unequal by energy experts, allowed Adani to charge 60 per cent higher prices than the actual market price early last year, causing widespread outrage in Bangladesh.

In February, Adani demanded about $400 for each tonne of coal for running its Godda power plant in Jharkhand though the same coal was available for $250.

After the uproar over the coal price amidst a severe dollar crisis plaguing the past Awami League government, Adani agreed in what PDB calls a side letter that the company would charge price for coal keeping up with other coal-based power plants.

The PPA however remained unchanged.

The PPA, which was never made public, also lacked discount provision provided by the 1200MW Payra power plant in case of a sudden increase in the price of energy. The Payra plant gives up to 40 per cent discount.

Globally, PPAs offer the discount benefit, up to 55 per cent, for large-quantity coal purchases, energy experts said.

The effectiveness of the side letter expired in June this year, the PDB said.

Letters sent to Adani requesting an extension of the side letter after the autocratic Hasina government fell in early August was not replied.

PDB officials said that Adani rather insisted that their dues to be paid based on the PPA conditions.

Bangladesh is currently receiving a $4.7 billion loan from the International Monetary Fund based on agreeing to implement at least four dozen conditions.

In April, 2018, in a report the US-based Institute for Energy Economics and Financial Analysis said that the Godda project would be one of the most expensive sources of electricity for Bangladesh.

The report pointed out that Bangladesh’s Godda electricity deal was clearly designed to benefit Adani.

In December 13, 2022, the institute in another report said that Bangladesh could not afford electricity produced by Adani without frequently increasing power tariff.

Ever since Adani rolled into operation last year, power price was increased several times.

The Washington Post showed the Godda project as the centrepiece of a report published in December 2022 for demonstrating how political influence and abuses enabled the Adani Group to build its coal empire in India and beyond.

‘The coal will probably come on Adani ships to an Adani-owned port in eastern India, then arrive at the plant on a stretch of Adani-built rail. The electricity generated will be sent to the border over an Adani-built high-voltage line. Under the contract, shipping and transmission costs will be passed on to Bangladesh,’ read a paragraph of the Washington Post report.

The Institute for Energy Economics and Financial Analysis estimated that the coal shipping would involve an 8,000-km sea and a 700-km railway journeys.

Adani also built over 100-km power transmission lines and is entitled to charge Tk 0.29 per unit with a yearly increase rate of 1 per cent, according to a report published in June by the Bangladesh Working Group on External Debt.

The working group report estimated that Adani would have its investment returned in maximum six years while the capacity charge stipulated in the deal with Bangladesh would earn Adani over its 25-year lifetime some $12 billion.

Adani’s Godda investment was estimated to be $2 billion.

The power cell director Muhammad Hossain last year blamed lack of experience for the shortcomings in the deal with Adani.

Bangladesh’s current installed capacity is 27,791MW, but the country is struggling to generate even 13,000MW.

A crippling energy crisis is sweeping through the country amidst humid, hot days, prompting up to 20 hours of power cuts in many places.

Adani-appointed public relation agency in Bangladesh in reply to a request for comment said that what the BPDB said was correct as overdue amount. Amount remained not paid within two months due date.

It also said that Adani had not officially told any news media about any amount outstanding.​

 

[Saif]

Govt must move back on Adani power agreement

THE agreement with India’s Adani Power by way of which it supplies Bangladesh with power from a 1.6GW Godda plant built in the Indian state of Jharkhand exclusively for the...

www.newagebd.net

Govt must move back on Adani power agreement
14 September, 2024, 00:00

THE agreement with India’s Adani Power by way of which it supplies Bangladesh with power from a 1.6GW Godda plant built in the Indian state of Jharkhand exclusively for the purpose has aired fresh fears as the Power Development Board has estimated that it owes Adani $547 million, about 32 per cent less than what the Indian entity has claimed. The Adani Group that owns Adani Power, as Indian media reported on September 10 which Bangladesh authorities have also confirmed, has written to the chief adviser to the interim government of Bangladesh in August seeking an intervention in the clearance of $800 in outstanding power bill. The power board says that the agreement, which brought Adani to Bangladesh’s power scene in 2023 under the patronisation of the deposed prime minister Sheikh Hasina, allows price manipulation and overpricing. Whilst the power board is reported to be writing to the chief adviser to the interim government on Bangladesh’s position on the agreement, the adviser on power, energy and mineral resources says that a special committee was evaluating all power and energy agreements, including the one with Adani, that were signed during the 15 years’ tenure of the Awami League government, overthrown on August 5 amidst a student-mass uprising.

The agreement has allowed Adani to generate power from coal carrying a calorific value of 4,600 kcal/kg but charge Bangladesh for the use of coal carrying 6,322 kcal/kg in calorific value. This comes down to the use of low-value coal for the payment of high-value coal. Besides, the agreement has allowed Adani to charge Bangladesh an average of coal prices on the Indonesian Index, in which a tonne of coal in the range of 4,200 kcal/kg–6,500 kcal/kg costs in the range of $51.18–$127.72, and the Australian Index, which is of very high quality and is more expensive, to inflate its profit although Adani sources its coal for the plant entirely from Indonesia. The provision for averaging the combined prices of coal is unique to the Godda project as no other similar plants have been given such privilege. The agreement, thus, allowed Adani to charge Bangladesh 60 per cent higher than the actual market price in 2023. Adani in February demanded about $400 for a tonne of coal although it was available for $250. The agreement also has no provision for discount, which is up to 55 per cent globally, in the case of a sudden increase in coal price as is the case with the 1.2GW Payra plant. Adani, which has invested an estimated $2 billion in the Godda plant, is reported to be getting its investment returns in six years and the capacity charge in the deal would earn Adani some $12 billion more in its 25-year lifetime.

Bangladesh’s installed power generation capacity is about 2.78GW, but it struggles to generate even 1.3GW, with a burdening overcapacity and consequent capacity charge payment. The interim government must, therefore, move back on the Adani power purchase agreement and, rather, improve on the use of generation capacity after a thorough review of the power and energy situation.​

 

[Saif]

Ensuring urgent fuel supply to power plants

Severe load-shedding in the northern and northeastern districts including also Dhaka over the past few days has been causing enormous public suffering. The problems causing the disruptions in smooth power supply are, however, inherited from the immediate past government. The shutting down of

thefinancialexpress.com.bd

Ensuring urgent fuel supply to power plants
Published :
Sep 13, 2024 21:56
Updated :
Sep 13, 2024 21:56

Severe load-shedding in the northern and northeastern districts including also Dhaka over the past few days has been causing enormous public suffering. The problems causing the disruptions in smooth power supply are, however, inherited from the immediate past government. The shutting down of all the operational units of Dinajpur's 525-MW coal-fired power plant, most of the country's gas-fired power plants which share more than 40 per cent of country's total generation capacity remaining out of production due to gas shortage and the huge arrears of unpaid power bills owed to a major power supplier from India, the Adani Group, are some of the issues debilitating the interim government's capacity to resolve the power shortage issue within a short time.

According to the Power Development Board (PDB), its total unpaid bills amount to Tk 350 billion. Even so, the adviser to the ministry of power, energy and mineral resources is learnt to have informed the media on September 11 last that the power situation would improve within three weeks. The steps to be taken for urgent addressing of the issues, he further informed, include urgent fixing of the technical glitches at the Barapukuria thermal power plant, the communication made with the Adani Group to enhance power supply and arrangements made to import LNG (Liquefied Natural Gas). The interim government's sincerity and urgency to respond to the emerging issues will make a difference. Any short-term answer to the problems involving production, supply and distribution of power should be part of a long-term strategy to rid the sector of its deeply ingrained ills. The long-term approach, as often stressed by well-meaning people and experts, should be to exploit the country's own potential reserves of gas and other fossil fuels.

The present problem of the power sector arises out of a lack of fuels to run power plants and the shortage of foreign currency to import those. But these problems could be avoided if the country's power sector was not fully made dependent on fuel import that eats up the lion's share of the hard currency that the country earns from remittances and exports. The main beneficiaries of this policy adopted by the past government have been the private power companies, contractors enjoying the government's patronage, the corrupt bureaucrats and ministers. Sadly, the nation's forex reserve was thus depleted to import LNG, coal and oils to feed the power plants that have the capacity to produce about double the power the country needs at the moment. But those remain idle for a lack of fuel. Now the nation is being forced to bear this unnecessary burden.

Under the circumstances, it would be incumbent upon the interim government to meet the emergencies through holding negotiations with major sources of fuels including the gulf countries, Indonesia and elsewhere so that fuel supplies to the power plants remain uninterrupted. At this point, the steps taken, as told by the energy adviser, to scrap the indemnity act "Quick Enhancement of Electricity and Energy Supply (Special Provision) Act in 2010" to protect the government from any judicial proceedings drawn against it, cancellation of the ministry's authority to fix energy tariffs, holding open bids for contractors and so on should be implemented as soon as possible.​

 

[Saif]

600MW power outage can be cured overnight

Bangladesh currently reels from load shedding to the tune of around 2,000-3,000 megawatts of electricity daily as the demand far outstrips production, market-insiders say, although much of it can be healed readily. Despite having the shortfall in electricity generation, state-run Bangladesh Power

thefinancialexpress.com.bd

600MW power outage can be cured overnight
Operating six idle HSFO-based power plants under 'No-Electricity, No-Payment' arrangement holds the key
M Azizur Rahman
Published :
Sep 14, 2024 23:56
Updated :
Sep 14, 2024 23:56

Bangladesh currently reels from load shedding to the tune of around 2,000-3,000 megawatts of electricity daily as the demand far outstrips production, market-insiders say, although much of it can be healed readily.

Despite having the shortfall in electricity generation, state-run Bangladesh Power Development Board (BPDB) has kept six furnace-oil-run power plants, having the generation capacity of around 600 MWs, idle as the interim government has yet to decide on continuation of their operation under 'no-electricity, no-payment (NENP)' mechanism, they have said.

Officials think if such six furnace-oil plants got approval for continuing electricity generation under NENP, they would be able to contribute to reducing at least one-third of the load shedding without any immediate investment from the government.

"Of the peak-load power plants, these are most economical because they are the only plants among the 150 new ones that do not entail capacity payments," says a senior BPDB official.

"Operating these plants poses no financial burden on the government either," he adds.

Typically, load shedding occurs for only 2-3 hours per day, equating to 30 to 40 per cent of the time when additional power is needed. At this plant-load factor, the NENP plants are 8-15-percent cheaper than other high sulfur-fuel oil (HSFO)-based plants that require capacity payments, the official explains.

Load shedding primarily occurs during peak periods, and these HSFO-based plants are particularly suited to such scenarios.

Unlike coal- or liquefied natural gas (LNG)-based plants, which require longer startup times and have slower load- adjustment capabilities, HSFO-fired plants can be activated instantly, ramped up or down quickly, and shut down when demand decreases.

Continuation of such power plants is also needed to meet the mounting power demand, he suggests.

"Over the past several years, Bangladesh got almost all sorts of power plants as part of its energy diversification, resulting in overcapacity," says research director of the Centre for Policy Dialogue (CPD) Dr Khondaker Golam Moazzem.

To ensure the country's future energy security at affordable costs, he opines, the government now requires to streamline the energy sources.

The policy researcher suggests that the provision of capacity payment should be withdrawn from all the rentals and quick rentals and 'no-electricity, no -payment (NENP)' clause should be applicable to all of them.

Speaking in the same vein as CPD's Dr Moazzem, president of Bangladesh Independent Power Producers' Association (BIPPA) Faisal Khan also opines for continuation of NENP mechanism to buy electricity from the HSFO-based power plants.

"The BPDB only pays for the electricity actually produced. Since the project capital costs and loans are paid off during the initial power -purchase agreement (PPA), there is no requirement for capacity payment," he told the FE in support of the NENP method.

Power producers are motivated to maintain high operational efficiency to get optimal dispatch.

"This model can promote a more dynamic and competitive energy market. It will be good for Bangladesh to run expired plants in this model as the infrastructure is already available and no further capital expense is required," says the BIPPA top brass about the merit of kick-starting the laid-off units as an immediate cure for nagging outages reported from different corners of the country.

Sources have said despite having excess electricity-generation capacity, Bangladesh has been struggling to cope with an ever-growing demand, resulting in acute load shedding across the country amid sweltering heat, the rural areas being the worst sufferers.

Improper energy-mix and inefficient infrastructure, coupled with volatile foreign currency and global energy markets, pushed the situation in dire straits, market-insiders have said. They said riding on installations of around 150 new power plants, the previous 'authoritarian' government had declared 100-percent electricity coverage in March 2022 as the first country in South Asia.

But, unfortunately, after achieving such pride, the country started suffering from electricity load shedding again due to newer sort of challenges -primary energy crisis and the piling up of overdue payments against energy purchases by state-run entities.

Load shedding meddled on the very first year of achieving the feat as state-run Petrobangla had to stop purchasing liquefied natural gas from international spot market due to skyrocketing of its price as high as a record US$70 per million British Thermal unit (MMBTu).

The Power Division under the Ministry of Power, Energy and Mineral Resources (MPEMR) then relied more on privately owned high-sulfur fuel oil (HSFO)-run power plants to augment generation along with coal-fired power plants amid continuation of imports from neighbouring India, a senior BPDB official told the FE Saturday.

Again, during June 2023, when the countrywide load shedding intensified amid the shutdown of a number of coal-fired power plants, including the Payra 1,244MW coal-fired plant, due to coal scarcity caused from mounting overdue payments, the gas-fired power plants and HSFO-based power plants augmented generation to overcome the crisis, the official added.

Electricity generation from coal-fired power plants and HSFO-fired power plants and importation also ramped up over the past several months when gas-fired power plants were struggling to generate electricity due to short supply of the fuel caused from the shutting of operation of Summit LNG Terminal until September 11.

Market-insiders say continuation of such power plants is also needed to meet the mounting power demand.

According to latest official data of the BPDB, the country's annual electricity consumption soared by around 25 per cent over the past four years from around 70,534 million kilowatt-hour (MkWh) during fiscal year (FY) 2018-29 to 88,450MkWh during FY 2022-23 amid energy diversification.

Although the power-consumption figure of FY 2023-24 was not available, the BPDB official said it grew by around 8.0 to 10 per cent.

Despite increase in power consumption, contribution of natural gas in overall power generation declined to around 52 per cent during FY 2022-23 from 72 per cent during FY 2019-20. Contribution of HSFO-based power plants slumped to 21 per cent during FY 2022-23 from 27 per cent during FY 2022-23.

Use of expensive diesel-fired power plant continued to grow over the past several years as it reached 2.8 per cent of the country's overall power generation during FY 2022-23 from only 0.8 per cent during FY 2020-21.

Power import from India, including that of Adani's Jharkhand power plant, increased to 12 per cent during FY 2022-23 from 9.0 per cent during FY 2021-22.

Contribution of coal-fired power plants almost doubled to 11 per cent during FY 2022-23 from 6.0 per cent during FY 2021-22.​

 

[Saif]

Energy Adviser seeks Swiss cooperation in renewable energy, advanced technology

Adviser of the interim government for Power, Energy and Mineral Resources, Road Transport and Bridges and Railways Muhammad Fouzul Kabir Khan has sought the cooperation of the Swiss government in the fields of renewable energy and advanced technology. He also invited Swiss businessmen to participa

thefinancialexpress.com.bd

Energy Adviser seeks Swiss cooperation in renewable energy, advanced technology
UNB
Published :
Sep 15, 2024 21:43
Updated :
Sep 15, 2024 21:43

Adviser of the interim government for Power, Energy and Mineral Resources, Road Transport and Bridges and Railways Muhammad Fouzul Kabir Khan has sought the cooperation of the Swiss government in the fields of renewable energy and advanced technology.

He also invited Swiss businessmen to participate in the development of Bangladesh and invest in business.

He made the call when Ambassador of Switzerland to Bangladesh Reto Renggli met him on Sunday.

The Swiss envoy was leading a delegation in the meeting in the adviser’s room in the Ministry of Power, Energy and Mineral Resources at the Secretariat.

The Advisor discussed the activities he has undertaken in a short time after taking charge to ensure transparency and accountability in the power and energy sector. He welcomed Swiss companies to participate in various development activities of Bangladesh.

Fouzul Kabir said that he recently visited the Matabari power plant project. The project also includes deep sea ports, economic zones, railways and road projects. But it is not possible to get real benefits from just setting up power plants, until other projects are implemented.

He observed that a huge number of unplanned development projects in the power and energy sector had been taken up and implemented during the previous government’s tenure.

“In most cases projects have been implemented at a cost much higher than the reasonable one which has not been value for money”.

He said that from now on, he will give importance to implementation of big projects with small projects at low cost.

He also noted that emphasis will also be laid on renewable energy generation and use of environment-friendly energy.

Swiss envoy Reto Renggli welcomed the adviser for assuming offices of three important ministries and said it is a very challenging task. The ambassador appreciated the steps taken by the current government in a short period of time.

He expressed hope that the measures taken including the suspension of the controversial law in the power and energy sector and the cancellation of Section 34A of the BERC Act, introducing the open tender process in government procurement, removal of the secretaries from the post of chairman of the companies under their control will play a significant role in ensuring transparency and accountability.

The Ambassador assured that the offer of investment and technology assistance to Bangladesh will be seriously considered.​

 

[Saif]

S Alam takes Tk 3,287cr in power capacity charge

The coal-based 1,224MW Banshkhali power station, owned by the controversial S Alam group, realised up to more than double the amount received by its peers in capacity charge payment in the 2023–24 financial year, revealed data obtained from the Bangladesh Power Development Board...

www.newagebd.net

S Alam takes Tk 3,287cr in power capacity charge
Emran Hossain 18 September, 2024, 23:35

The coal-based 1,224MW Banshkhali power station, owned by the controversial S Alam group, realised up to more than double the amount received by its peers in capacity charge payment in the 2023–24 financial year, revealed data obtained from the Bangladesh Power Development Board.

The coal-fired power plants compared here include the 1,600MW Adani power station, 1,320MW Rampal power station, 1,320MW Payra power plant, and 370MW Barishal power station.

The capacity charge received by the Banshkhali power plant, energy experts pointed out, shines the spotlight on the typical Bangladesh power scenario— power deals coupled with mismanagement earning private investors predatory profits.

Capacity charge represents the amount of money payable under power deals by the government irrespective of electricity generated, ensuring private investors maximum return on their investment.

The Banshkhali power station generated 240.29 crore units of electricity last year and received Tk 3,287.86 crore in capacity charge, receiving Tk 13.68 while producing a unit of electricity.

The Payra and Barishal power plants, on the other hand, received Tk 5.69 and Tk 5.99 respectively for producing a unit of electricity during the same time, revealed BPDB data.

The Payra power plant received Tk 4,292 crore in capacity charge and generated 754.87 crore units of power.

The Barishal power plant was paid Tk 477.52 crore in capacity charge and produced 79.74 crore units of electricity.

The Rampal power plant received Tk 7.96 in capacity charge per unit of electricity. It was paid Tk 2,236.92 crore in capacity charge and produced 281.15 crore units of electricity.

The controversial Indian business group Adani received Tk 6.6 in capacity charge per unit of electricity produced. The power plant set up in Jharkhand received Tk 5,392.3 crore in capacity charge and produced 816.66 crore units of electricity.

The large amount of capacity charges indicates that significant parts of the power plants’ capacity remained unused last year.

The time the power plants remained out of operation, however, was not always due to the country’s inability to take power from them.

There were times when the power plants remained out of operations because of technical glitches and the failure to manage fuel.

Except for the Payra power plant, the other power stations manage their own coal. The Bangladesh government has a long-term supply deal with Indonesia for procuring coal for the Payra power plant.

‘It is apparent the power plants were paid capacity charge anyway, indicating loopholes in the power deals,’ said Hasan Mehedi, member secretary, Bangladesh Working Group on Ecology and Development.

Bangladesh’s power deals did not follow a pattern and varied case-to-case as they were achieved through one-to-one negotiation bypassing the standard bidding procedure.

The past Awami League government, toppled now by a student-led mass movement, carried out power projects under an indemnity law over the last one and a half decade.

The Banshkhali power plant was used less than 21 per cent of its capacity, according to the BPDB. The Adani power plant was used 60 per cent of its capacity.

‘One of the reasons behind the poor use of Banshkhali power plant was the delay in installing the transmission network needed to evacuate power from the plant,’ said a BPDB official seeking anonymity.

Delays in building transmission networks turning power plants to economic burden are nothing new. A unit of the 660MW power plant remained unused for over a year in the absence of adequate transmission network.

Last year, Banshkhali produced the costliest coal power spending Tk 20.53 for generating a unit of power, followed by Tk 16.11 spent by Rampal power station, Tk 15.14 spent by Adani, Tk 13.16 spent by Barishal power plant and Tk 11.87 spent by Payra power station.

The Banshkhali power plant, which came into operation with its both units between September and October last year, frequently grabbed headlines when the past government intervened in its favour sending police to use lethal force, killing at least 11 people.

Located in Chattogram district, the power plant faced strong opposition from the local people since the very beginning as it affected thousands of families and many villages.

The plant was set up without having a proper environmental impact assessment.

The government also waived the stamp duty of about Tk 3,170 crore on land lease agreement and financing documents for the SS Power 1 Limited under the Private Sector Power Generation Policy.

The interim government has employed a committee of experts for evaluating power deals signed under the indemnity law during the autocratic regime of Sheikh Hasina.

Bangladesh’s current installed power capacity is 27,791MW but the country struggles to constantly generate 13,000MW.

Only six coal-based power plants realised Tk 15,686.6 crore in capacity charge in the last fiscal.

In September last year, the past Awami League government revealed that Tk 1.04 lakh crore was spent in paying capacity charge in the 14 years since the government assumed power in 2009.​

 

[Saif]

Bangladesh to sign deal to import power from Nepal soon: adviser

Bangladesh is poised to sign the tripartite agreement with Nepal and India soon to import hydropower from Nepal via Indian transmission lines, according to Power, Energy and Mineral Resources Adviser Md Fouzul Kabir Khan

www.thedailystar.net

Bangladesh to sign deal to import power from Nepal soon: adviser

Bangladesh is poised to sign the tripartite agreement with Nepal and India soon to import hydropower from Nepal via Indian transmission lines, according to Power, Energy and Mineral Resources Adviser Md Fouzul Kabir Khan.

"A delegation of the interim government will visit Nepal soon to sign the agreement for import and export of power," he said while speaking as chief guest at a reception programme marking Nepal's National and Constitution Day at a city hotel last evening.

Bangladesh, Nepal and India recently agreed to sign an agreement to import 40MW of electricity from Nepal via India six years after they reached an understanding on energy cooperation, according to the official source.

At the reception, hosted by Nepal Embassy in Dhaka, the adviser expressed satisfaction over the growing engagements between the two countries.

Commending the friendship and cooperation of Nepal and Nepali people, he underscored the need to accelerate bilateral cooperation in areas of trade, energy, connectivity, and people-to-people contacts, among others.

In his welcome remarks, Ambassador Ghanshyam Bhandari highlighted that the day marked the historic promulgation of a democratic and inclusive Constitution in 2015.

"The day reminds us of the Nepali spirit of patriotism, democracy, and diversity, and is a testimony to the Nepali people's ability to resolve their political issues and differences on their own," he said.

He said as Bangladesh is passing through a transition period, Nepal is committed to stand by the interim government and its people with solidarity to provide all support and cooperation.

The envoy also mentioned that a tripartite deal on the export of 40MW electricity from Nepal to Bangladesh through the Indian transmission line is expected to be concluded sometime soon.

Shedding light on the relationship between Nepal and Bangladesh, he emphasised the need to leverage the transformative power of solidarity and cooperation to boost connectivity and propel economic development and prosperity for the mutual benefit of the peoples of both countries.

A cultural programme showcasing Nepali folk-dance performances was held in the second half of the event.

The event was attended by political leaders of Bangladesh, high-level government officials, ambassadors, heads of missions and diplomats, representatives of international organisations, business leaders, media personnel, and members of the Nepali community living in Bangladesh.​

 

[Saif]

Three dozen renewable energy projects await govt approval
Proper scrutiny of projects a must
M Azizur Rahman
Published :
Sep 23, 2024 00:28
Updated :
Sep 23, 2024 00:28

Nearly three dozen renewable-energy projects with around 3,287-megawatt generation capacity are now stalled at the final stage of inking power purchase agreements (PPAs) with a state power agency.

Sources say with initial government consent before the August changeover, the private entrepreneurs were about to enter into PPAs with state-run Bangladesh Power Development Board (BPDB). But now the process faces delays.

Bangladesh's overreliance on imports of fossil fuels will escalate further if these projects do not get approval for quick start, relevant sponsors fear.

Once implemented, these projects will help the country to ease ever-escalating capacity-payment burdens as all these renewable-power projects will be implemented under 'no electricity, no payment' mechanism with no capacity -payment provisions, they point out.

The circles concerned, however, suggested proper probe into the status of the solar power projects---whether they got approvals bypassing competition under the much talked-about indemnity law.

These projects are aimed at checking Bangladesh's growing over-dependence on the imports of 'expensive' fossil fuels like liquefied natural gas (LNG), petroleum products and coal, to ensure the country's future energy security, a senior Power Division official told the FE Saturday, preferring anonymity.

"The initial works of these renewable projects got momentum a couple of years back against the backdrop of scarcity of conventional fuels like petroleum products, natural gas, and LNG and their soaring prices on the international market after the outbreak of Russia-Ukraine war," he says.

The ongoing Russia-Ukraine war exposed a new dimension of primary-energy situation across the globe, which had prompted Bangladesh to expedite the move to increase the share of renewable energy in the overall electricity- output basket, he adds.

Bangladesh had to stop purchasing LNG from spot market and reduce imports of diesel, furnace oil and coal under an austerity measure, resulting in enforcement of load-shedding.

The country is already struggling to foot mounting energy-import bills worth around US$2.20 billion and sought budgetary support from the multilateral donor agencies, including the World Bank, to get fiscal support.

"Foreign direct investments (FDIs) worth around US$4.5 billion will be at risk and initial investments worth around US$200 million will go down the drain with further delaying of these project works," general secretary of Bangladesh Sustainable and Renewable Energy Association (BSREA) Tofael Ahmed told the FE Saturday.

He said these renewable -energy projects were initiated during the previous government and most of the project sponsors obtained letter of intent (LOI) from the Power Division under the Ministry of Power, Energy and Mineral Resources (MPEMR) several months back and were waiting to ink PPAs with the BPDB and implementation agreements with the government.

But the fall of the deposed Sheikh Hasina regime on August 5 pushed these projects into 'uncertainty' as the interim government has decided to halt further negotiations over the projects that were in the process of final approval under the Quick Enhancement of Electricity and Energy Supply (Special Provision) Act 2010.

"We are yet to get any formal letter from the government over the halting of the renewable-energy projects that are in the pipeline of implementation," said senior vice president of Bangladesh Sustainable and Renewable Energy Association (BSREA) Mostafa Al Mahmud. "But if the government decides to scrap these LOIs, it will be suicidal," he said.

The issuance of LOIs by the Power Division to these renewable power plants meant the government intended and agreed to ink final deals with the project sponsors to move forward with these projects, he said. In the process of obtaining LOIs, the private-sector entrepreneurs have invested around US$200 million from foreign lenders through banking channels, he mentioned.

For full implementation of these projects foreign direct investments (FDIs) worth around US$4.5 billion from different countries, including China, France, Malaysia, Singapore, South Korea, Germany, Japan, the USA, the UAE and Saudi Arabia, are in the pipeline, he said.

The renewable-energy sponsors also purchased and acquired necessary lands, constituted respective special purpose vehicles (SPVs), carried out feasibility studies and were at the final stage of financial closures, said Mr Mahmud.

Although these renewable -energy projects attained approval during the previous government, due diligence was followed during the process of selecting sponsors, he said.

"The interim government can scrutinize further the selection process to ensure transparency and accountability," said the BSREA leader, adding that the tariff rates of all the solar-power plants is very competitive and below 10 US cents per kilowatt-hour.

Besides, half a dozen project sponsors have already completed 100-percent purchase of required lands as they achieved the 'go ahead' from the previous government. Mr Mahmud said all sorts of renewable-energy projects are among the projects that obtained LOIs, he said, adding that 2,942 MWs are of solar plants, 320 MWs wind-based power plants and the remaining 25 MWs are of waste-to-energy projects.

Foreign investors have already invested a portion of their committed investments to carry out initial works. They will pour in further funds after the inking of the PPAs and IAs, he said.

He notes that if the interim government goes for scrapping LOIs, a negative message will go to the foreign investors.

"If new tenders are floated, the foreign investors might not come up again due to erosion of confidence and loss of their invested money," the BSREA top brass fears. And it will be time-consuming, too.

Most of the project sponsors are genuine businessmen, said Mr Mahmud.

"To avoid controversy the government can cancel some projects that were awarded on political grounds, including those of former foreign minister Hasan Mahmud, former state minister for shipping Khalid Mahmud Chowdhury and former religion minister Faridul Haque Khan Dulal," he suggests.

Sources said there could be some more projects that took recourse to dubious means to get approval and those need to be dentified.​

 

[Saif]

The roadmap for energy sector must be changed

Govt must move away from import-loan-foreign company-dependent projects and adopt a cheaper, environment-friendly, and sustainable roadmap

www.thedailystar.net

The roadmap for energy sector must be changed

VISUAL: ALIZA RAHMAN

The problems in the energy and power sector have not accumulated over just 15 years. It began in the early 1980s. At the root of the problem lies the neo-liberal ideological approach that since then turned the power sector into a profit-making enterprise for a handful of local and foreign businesses. The alternative approach is fundamentally different—where access to energy and power should be a public right, and resources kept in public ownership and not privatised or turned into private businesses. Under the alternative approach, essential services such as affordable electricity, gas, and water become available for all without discrimination.

In the early 1980s, the World Bank, in the name of development, recommended the neo-liberal reform of the energy sector, suggesting that foreign investment should be brought in. Their logic was that foreign investment would lower electricity and gas prices, reduce financial loss and waste, and increase efficiency through technology transfer. Reform started in the 80s along with structural adjustment programmes in the economy, and the signing of production-sharing contracts with multinationals began according to this roadmap—the first round in 1993, and the second round in 1997. Although the governments during those periods were different, the nature of the policy remained the same and the trend continued even during the regimes that came to power after 2000.

However, after a while, the World Bank's argument about the benefits of privatisation and foreign investment in the energy sector proved to be wrong. We saw gas prices rising, loss/subsidies/wastage increasing, power tariffs increasing, and the prices of other essentials escalating on a regular basis. Furthermore, we did not see technology transfer and capacity development. Rather, the opposite happened. Foreign companies' negligence—the US company in Magurchhara and the Canadian company in Tengratila—caused big explosions in our gas fields. They destroyed natural gas that could have generated power for almost 18 months, and we still haven't received appropriate compensation for that.

During the last regime, foreign investment and privatisation in the energy sector increased further. In 2010, a new law was passed that essentially made the contracts and the contract processes free from any accountability, meaning these contracts and the companies involved could not be questioned or taken to court. This legal indemnity made them untouchable. It became clear that the intentions behind these policies were not in the public interest. When we were told that the reason for this indemnity law was to tackle huge load shedding by establishing "quick rentals," we proposed alternative solutions that would not require "quick rentals." But the government did not show any interest in accepting the cheaper, sustainable solution that would use public-sector plants. They opted for the costly, unsustainable option only to give business to well-connected groups.

The past government took an irrational and aggressive path with regard to the "Power System Master Plan" (PSMP) prepared by the Japan International Cooperation Agency (JICA), which prescribed coal, nuclear energy, and imported LNG—all heavily import-oriented, requiring loan and reliance on foreign companies, including Japanese ones, which benefited from this plan. Since 2011, the construction of coal-fired power plants by companies from India, China, and Japan began all along our coast from the Sundarbans to Cox's Bazar. The coastal area is extremely vital for the country's defence against natural disasters; it is also one of the most vulnerable regions to natural disasters, environmental damage, and climate change. However, the government and the investors totally ignored this fact and began weakening the defence system of the coastal region including the Sundarbans, the largest mangrove forest in the world.

For instance, the $12 billion megaproject for Rooppur nuclear power plant was started in early 2010 by taking a huge loan from Russia and awarding the project to Russia's state-run atomic agency Rosatom. However, people were not informed about the extreme consequences and risks associated with such a plant. There are layers of protection needed against the dangers of a nuclear power plant, considering that this could put the lives of almost 10 million people at risk.

All these megaprojects, especially the coal and nuclear power plants, suffer from irregularities, high corruption, and a lack of transparency. Plus, they initiated surveillance against dissenting opinions. It is easy to see that these plants were not built to generate electricity. There were much better alternatives. Nevertheless, these projects were pursued by the authoritarian government to bag huge commissions for policymakers and profits for a select few. Moreover, the past government sought to stay in power without people's mandate, so they relied on, among other things, international support from some foreign countries. To sustain that support, the government allowed these countries to launch those costly and environmentally harmful megaprojects. As a result, the energy and power sector has now become a huge financial burden for the whole economy and a significant source of environmental damage.

In contrast to the government's approach, we, as part of the people's movement, had developed a real solution for the sector taking the help of independent experts at home and abroad. We prepared an alternative master plan in 2017, where it was explained that there was no need for expensive LNG, dirty coal, or dangerous nuclear power. Our findings showed that our needs could be sufficiently met by focusing on gas exploration onshore and offshore and making real efforts to develop renewable energy. The steps would not require much time and resources to empower BAPEX and build public institutions for renewable energy. We recommended clear plans to utilise a large number of university students graduating every year for this purpose. We need to increase our own capabilities to bring down import costs, reduce pressure on foreign reserves, and boost our confidence and pride as a nation.

To steer toward the right direction, we must put an end to the destructive journey we have had thus far. The interim government should start scrapping projects like Rampal, Rooppur, and Banshkhali. Some may argue about the financial loss if these projects are scrapped. However, my estimates show that the costs of discarding these projects are lower than the costs of keeping these projects active. These projects will endanger Bangladesh's existence. Thus, continuing them will not only be a financial burden but also jeopardise the safety and security of the country.

Finally, this sector as well as the economy require a fundamental shift in policy framework to ensure public ownership, increase the capability of public institutions, and create the space for active public roles to build a better future in the public interest. The government must move away from import-loan-foreign company-dependent projects and adopt a cheaper, environment-friendly, and sustainable roadmap with public interest—not corporate profit—as the decisive force.

Anu Muhammad is former professor of economics of Jahangirnagar University.​

 

[Saif]

Increased role of non-carbon energy-based power supply

The 68 MW Shirajgonj solar park has been supplying power to the national grid since July, 2024. Developed on 214 acres of land located on the flood plains of the river Jamuna (near the Jamuna Multi Purpose Bridge). the solar park has so far installed 156,576 units of interconnected solar panels wit

thefinancialexpress.com.bd

Increased role of non-carbon energy-based power supply
Mushfiqur Rahman
Published :
Sep 27, 2024 21:32
Updated :
Sep 27, 2024 21:32
Share this news

The 68 MW Shirajgonj solar park has been supplying power to the national grid since July, 2024. Developed on 214 acres of land located on the flood plains of the river Jamuna (near the Jamuna Multi Purpose Bridge). the solar park has so far installed 156,576 units of interconnected solar panels with the capacity of 545 watt each. The plant is being operated by the Bangladesh-China Renewable Energy Company Limited (BCRECL)-- a joint venture of North-West Power Generation Company of Bangladesh and China National Machinery Import and Export Corporation. BCRECL invested approximately US$ 90 million for implementing the plant and signed a contract with BPDB to supply power to BPDB grid for 20 years at a tariff of US 10.20 cents per unit.

At this stage BPDB has only 3 per cent (1 per cent from hydro and 2 per cent from the grid connected solar and wind power plants) power generation capacity from 15 plants using renewable energy sources. There are a number of renewable energy (mainly solar parks) based power plants under implementation at different locations of the country to generate and supply power to the national grid.

The solar parks have been encouraged to install plants in places that are generally recognised as 'non agricultural lands'. Despite technological advancements, approximately 3 acres of land are required in Bangladesh to generate one megawatt of electric power using solar energy. Power producers are hopeful that the solar panels (photovoltaic cells) have improved their efficiency and there will be a requirement for approximately 2 acres of land for generating one megawatt of power using solar energy in the near future.

Bangladesh has installed electricity generation capacity of 27,791 MW (BPDB, 31 August 2024) as against the demand for 11,370 MW (BPDB, 15 September 2024). BPDB calculated power distribution system loss (for 2023-2024) at 7.25 per cent. Media reports say, the required amount of stable power supply can not be ensured at the consumer end for various reasons. The BPDB and its power generation units have been suffering from systematic primary fuel (natural gas, liquid fuel, coal) supply shortages. Additionally, there are technical and management limitations in the power transmission and distribution systems.

A close review of the power plants' installed capacity shows that the 43 per cent of the total power generation capacity depend on natural gas as primary fuel. Petrobangla sources suggest that the total daily demand for natural gas (including the converted gas from imported LNG) in the country is approximately 330 MMCFD to 350 MMCFD. Fifty per cent of the demand for gas supply in the country comes from the power generation plants. But Petrobangla can supply approximately 250 MMCFD. As a result, the gas-based power generation units has to sit idle for fuel shortages. Published reports suggest that Petrobangla owes approximately US$ 607 million to Chevron (company under PSC contracts with Petrobangla) and the LNG suppliers in Qatar, Oman and other Spot LNG suppliers as on September 10, 2024.

Also, the power generation plants that use coal as primary fuel in the country (21 per cent of the total installed capacity) suffer from coal supply shortages and generate significantly less amount of power than the plants' capacity. Furnace oil (21 per cent plants use FO as primary fuel) and diesel (2 per cent plants use diesel as primary fuel) are costly fuels and the plants are generally discouraged to generate power for maintaining the government's subsidy (for generated power) limits for consuming the liquid fuel-based power. BPDB has currently valid contracts for importing 2,656 MW (approximately 9 per cent of the total capacity) of power from India. But the pending import bills are huge at this stage. As a result, the power export companies in India have been supplying less than their capacities and asking for settling their dues.

In the backdrop of the increased pressures for supplying uninterrupted electricity and in line with the global commitment to 'go green', Bangladesh has been trying to generate more power from renewable energy sources. Geographical limitations restrict Bangladesh to generate hydroelectricity. Wind capacity has its own limitations to expand in the country, as there are limited spots suitable for generating wind power on commercial basis. Hence, solar energy has become the main renewable source for generating commercially attractive power at an affordable price.

As the solar radiation availability and intensity varies during the day-time and at night, large-scale solar generation plants have been considering to develop storage capacity (with the help of installing batteries) along with the grid connected solar panels. Experts believe 20-30 per cent storage capacity support may enhance average solar power generation cost up to US 12-12.5 cents per unit. Despite the cost hike, such an arrangement may help stabilise the grid frequency and offset the need for using costly liquid fuel during the peak hours.

Over all, increased use of renewable and non-carbon energy-based power generation will contribute to the country's commitment for reduction in Green House gas emission, and also substantially raise the renewable energy capacity.

Mushfiqur Rahman is a mining engineer. He writes on energy and environment issues.​