Dhaka to seek $13b from Beijing
Power for every citizen by 2021
JAGARAN CHAKMA
Bangladesh will seek a fund of USD 13.08 billion from China to implement 15 projects, including a coal-based power plant and expansion of power distribution lines, to ensure power for every citizen by 2021. Prime Minister Sheikh Hasina has cleared the proposal to discuss the projects with the prime minister of the Peoples Republic of China during his upcoming trip. Though the schedule of the visit to Bangladesh is yet to be fixed, Bangladesh is making preparations ahead of the Chinese premiers trip. The list of projects that Prime Minister Sheikh Hasina has cleared are: extension and augmentation of power distribution system (USD 16 million); a 1,320 MW coal-fired power plant (USD 1,573 million); Gazaria 350 MW coal-fired thermal power plant (USD 450 million); Mollahat 100 solar PB power plant (USD 155 million); 100 MW wind power plant (USD 255 million); pre-payment metering priority project for the Bangladesh Power Distribution Boards (BPDBs) six distribution zones (phase-2) (USD 105 million); reduction in system loss by replacing 5 million electro-mechanical energy meters with electronic meters (USD 468 million); project to strengthen the power grid network under Power Grid Company of Bangladesh Ltd. (PGCB) (USD 1,322 million); expansion and strengthening of power system network in the Dhaka Power Distribution Company Limited (DPDC) area (USD 3,000 million); design supply and installation, testing and commissioning of 33/11 KV substations on a turnkey basis in the Dhaka Electric Supply Company Limited (DESCO) area (USD 64.57 million); Payra 1,320 MW thermal power plant project (second phase) (USD 1,000 million); and a coal-based power plant project at Pekua, Coxs Bazar of 2x600 MW capacity or above (USD 3,339 million).
Meanwhile, the Chinese firm, Guangdong Power Engineering Co. Ltd (GPEC), has evinced interest in signing a memorandum of understanding (MoU) for three power generation projects in Bangladesh during the upcoming visit of the Chinese prime minister to Dhaka. GPEC is an affiliate of the China Energy Engineering Group.
In a letter to the state minister for power, energy and mineral resources, GPEC has expressed its interest to sign a MoU for setting up coal-fired power plants (2x60 MW) at Dighipara, Parbotipur, Dinajpur or Pekua, Coxs Bazar; coal-fired power plants (2x660 MW) at Payra, Patuakhali (second phase); and NG/LNG combined cycle power plant (750 to 850MW) along with NG/LNG stations/terminals at Haripur, Megnaghat or Khulna or Chittagong. Our proposal is to construct these power plants on a government-to-government preferential export buyers credit/soft/concessional loan, GPEC said.
However, we are yet to receive any response from the Bangladesh government. We understand that it takes time to decide and start the process for such projects. Therefore, it is important to convey further information to enrich our proposal, it added.
GPEC said the Chinese premier is scheduled to visit Bangladesh very soon at the invitation of Bangladesh Prime Minister Sheikh Hasina, on the eve of the 40th anniversary of the two countrys diplomatic relations.
It is a great opportunity for both nations to expedite bilateral trade and investment. To take advantage of the visit, we have submitted an expression of interest (EOI) to build these power plants with the prior consent of our competent authorities in China, which has been registered in the Chinese embassy in Dhaka as well, GEPC said.
The expected interest rate will be less than 2 per cent per annum with a long repayment period (could be 20++ years) and other finance-related costs, like insurance premium, commitment fee, upfront fees, management fees, etc. Bangladesh will not require its own funds to implement these projects, other than the land acquisition and construction of ancillary infrastructure on the sites. Implementing agencies of Bangladesh do not need to arrange finance for the implementation of these projects or to share or invest their portion of finance from other financial institutions or sources mentioned in the EOI. The proposed projects will be implemented with the latest technologies of the world (super critical/ultra super critical for coal projects) to reduce adverse impact on the environment, GPEC said. It added that the details of technical and commercial proposals would be submitted after the MoU is signed.
