Energy Bangla

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Dhaka Tuesday,  May 22, 2018

Cabinet Committee clears power purchase proposal

EB Desk

The Cabinet Committee on Purchase on Wednesday cleared the Power Division’s proposal for purchasing 1,788MW of electricity from nine private companies through 10 unsolicited deals.
“The government will spend Tk 1,40,532 crore during the contract period spanning from five to 10 years,” said an official statement issued here after the cabinet body meeting with Finance Minister AMA Muhith in the chair.
As per proposal, Power Development Board to buy 800MW of electricity from  diesel-fired plants for five years involving Tk 55, 000 crore and the rest of the amount will be spent for purchasing electricity from furnace oil fired plants for next 15 years.
The government on the last leg of its tenure approved the proposal for purchasing electricity from nine private companies through 10 unsolicited deals.
It is feared that the country will experience a huge amount of loadshedding from next summer as gas-fired power plants will go out of order because of gas shortage.
This country faced 1800-2500MW of loadshedding during the last summer.
“The government had failed to implement big or based load power plants in its two-consecutive tenures. So, in a hasty move, it once again inked the high cost deals with its party men which finally increase the tariff,” Professor Dr Samsul told.
The government, headed by the Power Secretary Dr Ahmad Kaikus, rushed to form a high-level negotiation committee to approve generating of 1,800MW of power on emergency basis to different private companies.
Meanwhile, the government has decided to produce 3,000MW of electricity within a short period of time through unsolicited deals and tendering process.
The decision was taken after the government came under widespread criticism in May amidst a nagging electricity supply shortfall during the summer. As per the government’s decision, the furnace oil-based power plants will have to start producing power within nine months and diesel-based plants within 6 months after the final deals are signed.
Meanwhile, the Prime Minister’s Office (PMO) last week approved Power Division’s proposal.
The Power Division earlier decided to purchase electricity from the nine private companies as the annual rise in electricity demand is predicted to surpass the previous estimation of more than 10 percent.
The government will pay an average 25.2793 US cents per kilowatt from the proposed diesel-fired plants having a combined capacity of 800MW. The tariff from the existing rental plants is 25.7914 US cents a unit (kWh).
Of the proposed independent power plants, Summit Group and Orion Group will set up a 300MW and a 100MW plant in Kodda (Gazipur) and Labonchara (Khulna) with the same power tariff at Tk 8.55 (10.60 US cents) a unit.
Confidence Power will set up an 113MW plant with a tariff of Tk 8.55 a unit in Bogra while the Midland Power and Acorn Infrastructure Services will install 150MW and 100MW plants with power tariff at Tk 8.47 (10.50 US cents) per unit in Ashuganj and Julda (Chittagong) respectively. Desh Energy will set up a 200MW plant in Chandpur with power tariff at Tk 8.59 (10.65 US cents).Bangla Trac Ltd will implement two diesel-fired plants at Daudkandi (Comilla) and Nowapara (Jessore) having combined capacity of 300MW with a tariff at Tk 20.50 (25.4171 cents).
Besides, Aggreko International Projects Ltd will install a 200MW plant in Keraniganj with tariff at Tk 20.16 (25.0039 cents) a unit. APR Energy Ltd will set up a 300MW plant in Keraniganj with power tariff at Tk 20.49 (25.4171 cents) a unit.
The private power sponsors will have to pay $200 per megawatt as liquidated demurrage for their failure in implementing power projects as per the stipulated timeframe.
The official said, adding that the demurrage fee was only $100 previously.
The BPDB is expected to get the required electricity by March 2018, the proposal read.
According to BPDB sources, it received 136 unsolicited proposals following the announcement that the government in principle decided to generate 3,000MW of electricity in the next six to nine months under unsolicited deals.

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