gas connections for captive power plants

Govt makes U-turn

38 captive power plants to get 27 mmcf gas per day

Backtracking from its earlier decision of not providing gas connection to captive power plants, the government has now decided to provide 38 new gas connections to such power plants. Of these new connections, which will require 27 mmcf (million cubic feet) gas per day, 36 were given by the Titas Gas Transmission and Distribution Company Ltd and two were given by Pashchimanchal Gas Company Ltd.
Sources in the Ministry of Power, Energy and Mineral Resources said some of the new connections will be given to Bashundhara, Multi Paper, GM Fabrics and Nourish Poultry and Hatchery Ltd.
When contacted, Nasrul Hamid, state minister for power, energy and mineral resources, declined to make any comment. The Independent also tried to reach Abu Bakar Siddique, secretary of the Energy Division under the ministry, but he did not take the call.
Both Hamid and Siddique are members of the high-powered committee which had earlier decided to stop providing gas connections to captive power plants to save the dwindling national gas reserve.
Sources at the Energy Division said that the government has been forced to provide new connections, as over 200 new applications for gas connections to captive plants were submitted to the ministry. Some of the companies have already imported costly machinery to set up captive power plants.
Earlier on Monday, textile mills owners had met the state minister for gas tariff cut for captive power generation and gas connection to the mills which have already paid demand notes.
In a meeting at Bidyut Bhaban in the capital, the Bangladesh Textile Mills Association (BTMA) said that the increase in gas tariff for generating captive power would have a negative impact on the competitiveness of the sector, as the government has increased the tariff by 100 per cent to Tk. 8.36 per cubic metre.
In that meeting, BTMA president Tapan Chowdhury demanded that the government should provide gas connections to 26-30 spinning, weaving and dying-finishing mills which had already invested Tk. 8,000 crore to install machineries and paid demand notes for connection.
He demanded that the authorities should install electronic volume controlling meter in the factories to ensure fair billing based on actual consumption of gas. The BTMA also demanded gas connection to those factories which have been relocated and also sought uninterrupted and approved volume of gas supply to the textile mills. Nasrul Hamid, however, requested the BTMA leaders to discuss the gas tariff issue with the Bangladesh Energy Regulatory Commission (BERC) as the energy ministry did not hike the gas price. Justifying the government’s decision of not providing new gas connections to captive power plants, some industry
experts said even after an 100 per cent increase in gas tariff for generating captive power, which came into effect from September 1, the cost of per kilo watt electricity production for captive plant is Tk. 4.60, which is Tk 2.97 lower than the price of per kilo watt grid electricity.
The government after six years has raised the price of per cubic gas for captive power plants and made it Tk. 8.36 from Tk. 4.18. In 2009, the difference between grid electricity and captive power was Tk.1.55. Because of repeated price increases of grid electricity, the difference stood at Tk. 2.97 in 2014. All industrial units using grid power faced steep increase in power costs, while the industrial units running on captive power enjoyed the advantage. BERC chairman AR Khan said no power unit has lost its competitive edge for the hike in the gas price for captive power generation. Those who have been getting gas for captive power generation got an advantage of 800 per cent over others in production cost, he added.
In the late 1990s, amid a situation fraught with acute power crisis and availability of surplus gas, the government had allowed businesses to build their own gas-fired power plants to run factories. Since then, around 1,600 such small power plants were set up to ensure uninterrupted productivity.
According to the statistics provided by Petrobangla, there are about 1,000 captive power plants in the country and they use an average of 265 million cubic metres of gas every day. These small power centres produce about 1,000MW of electricity.

 

gas connections for captive power plants

Govt makes U-turn

38 captive power plants to get 27 mmcf gas per day

Backtracking from its earlier decision of not providing gas connection to captive power plants, the government has now decided to provide 38 new gas connections to such power plants. Of these new connections, which will require 27 mmcf (million cubic feet) gas per day, 36 were given by the Titas Gas Transmission and Distribution Company Ltd and two were given by Pashchimanchal Gas Company Ltd. Sources in the Ministry of Power, Energy and Mineral Resources said some of the new connections will be given to Bashundhara, Multi Paper, GM Fabrics and Nourish Poultry and Hatchery Ltd. When contacted, Nasrul Hamid, state minister for power, energy and mineral resources, declined to make any comment. The Independent also tried to reach Abu Bakar Siddique, secretary of the Energy Division under the ministry, but he did not take the call. Both Hamid and Siddique are members of the high-powered committee which had earlier decided to stop providing gas connections to captive power plants to save the dwindling national gas reserve. Sources at the Energy Division said that the government has been forced to provide new connections, as over 200 new applications for gas connections to captive plants were submitted to the ministry. Some of the companies have already imported costly machinery to set up captive power plants. Earlier on Monday, textile mills owners had met the state minister for gas tariff cut for captive power generation and gas connection to the mills which have already paid demand notes. In a meeting at Bidyut Bhaban in the capital, the Bangladesh Textile Mills Association (BTMA) said that the increase in gas tariff for generating captive power would have a negative impact on the competitiveness of the sector, as the government has increased the tariff by 100 per cent to Tk. 8.36 per cubic metre. In that meeting, BTMA president Tapan Chowdhury demanded that the government should provide gas connections to 26-30 spinning, weaving and dying-finishing mills which had already invested Tk. 8,000 crore to install machineries and paid demand notes for connection. He demanded that the authorities should install electronic volume controlling meter in the factories to ensure fair billing based on actual consumption of gas. The BTMA also demanded gas connection to those factories which have been relocated and also sought uninterrupted and approved volume of gas supply to the textile mills. Nasrul Hamid, however, requested the BTMA leaders to discuss the gas tariff issue with the Bangladesh Energy Regulatory Commission (BERC) as the energy ministry did not hike the gas price. Justifying the governments decision of not providing new gas connections to captive power plants, some industry experts said even after an 100 per cent increase in gas tariff for generating captive power, which came into effect from September 1, the cost of per kilo watt electricity production for captive plant is Tk. 4.60, which is Tk 2.97 lower than the price of per kilo watt grid electricity. The government after six years has raised the price of per cubic gas for captive power plants and made it Tk. 8.36 from Tk. 4.18. In 2009, the difference between grid electricity and captive power was Tk.1.55. Because of repeated price increases of grid electricity, the difference stood at Tk. 2.97 in 2014. All industrial units using grid power faced steep increase in power costs, while the industrial units running on captive power enjoyed the advantage. BERC chairman AR Khan said no power unit has lost its competitive edge for the hike in the gas price for captive power generation. Those who have been getting gas for captive power generation got an advantage of 800 per cent over others in production cost, he added. In the late 1990s, amid a situation fraught with acute power crisis and availability of surplus gas, the government had allowed businesses to build their own gas-fired power plants to run factories. Since then, around 1,600 such small power plants were set up to ensure uninterrupted productivity. According to the statistics provided by Petrobangla, there are about 1,000 captive power plants in the country and they use an average of 265 million cubic metres of gas every day. These small power centres produce about 1,000MW of electricity.