10 new oil-based power plants

Bidding criteria relaxed

The government has finally backtracked from the stringent criteria that it had earlier set for bidding for 10 new oil-based power plants. It has made the changes that some of the independent power producers (IPPs) had demanded to ensure a level playing field, said sources in the Bangladesh Power Development Board (BPDB).
The prerequisite for the bidders to have fuel-oil-handling capacity has been removed. Also, the condition that the bidder could not have any litigation with any state-owned entity has also been removed.
Besides, a company can now bid for as many power plants as it wants. Previously, the number was restricted to only two power plants, to be submitted in a single envelope with the firm’s technical capabilities and tariff rates spelt out.
The BPDB had earlier set June 29 as the bid-submission deadline to select contractors for the 10 furnace-oil-fired power plants to be set up at 10 different locations. The plants have an electricity-generation capacity of 100 megawatts each.
A BPDB official told The Independent that the new changes were made after Bangladesh Independent Power Producers’ Association (BIPPA), a platform for the country’s 34 IPPs, in a letter to the Power Division under the power, energy and mineral resources ministry, protested against the selection criteria.
The BIPPA concerned urged the authorities to change the terms to ensure a fair deal.
“The qualification of the bidder should not depend on the litigation status with any related government authority,” the letter read. It pointed out that litigation may occur with reasonable causes and have a suitable conclusion by exploring several avenues of correction for the development of the sector.
“Seeking the aid of law is a constitutional right for any individual or lawful entity,” the BIPPA letter argued. The private entrepreneurs also requested that all bidders be allowed to participate for all the power plants to ensure wider participation and competitive tariff rates.
Golam Kibria, director of IPP cell-3 of BPDB, told The Independent that he had learnt about the changes, but had not received any official letter yet. “We will change the tender notice after receiving the letter from the ministry,” he said.
Lauding the changes, Prof. M Shamsul Alam, an electrical engineer and energy adviser of the Consumers’ Association of Bangladesh (CAB), said that these would ensure a level playing field. He also said the country’s power sector bids already involve less competition compared with other sectors. He further said that the BPDB’s previous set of criteria would have restricted bidding to a handful of IPPs.
“Had that happened, private electricity production would have been syndicated and common people would have had to pay the price,” he added.
The new power plants have been planned to be set up in Chandpur, Chowmuhoni of Noakhali, Feni, Meghnaghat of Narayanganj, Bagerhat, Takurgaon, Rangpur, Bogra, Shantahar, and Jamalpur.
Currently, private companies supply electricity from 30 oil-fired plants and the public-sector utilities supply electricity from 17 similar plants. These 47 plants have a combined capacity of generating about 3,550 MW of electricity, which accounts for around 30 per cent of their total installed generation capacity.

 

10 new oil-based power plants

Bidding criteria relaxed

The government has finally backtracked from the stringent criteria that it had earlier set for bidding for 10 new oil-based power plants. It has made the changes that some of the independent power producers (IPPs) had demanded to ensure a level playing field, said sources in the Bangladesh Power Development Board (BPDB). The prerequisite for the bidders to have fuel-oil-handling capacity has been removed. Also, the condition that the bidder could not have any litigation with any state-owned entity has also been removed. Besides, a company can now bid for as many power plants as it wants. Previously, the number was restricted to only two power plants, to be submitted in a single envelope with the firms technical capabilities and tariff rates spelt out. The BPDB had earlier set June 29 as the bid-submission deadline to select contractors for the 10 furnace-oil-fired power plants to be set up at 10 different locations. The plants have an electricity-generation capacity of 100 megawatts each. A BPDB official told The Independent that the new changes were made after Bangladesh Independent Power Producers Association (BIPPA), a platform for the countrys 34 IPPs, in a letter to the Power Division under the power, energy and mineral resources ministry, protested against the selection criteria. The BIPPA concerned urged the authorities to change the terms to ensure a fair deal. The qualification of the bidder should not depend on the litigation status with any related government authority, the letter read. It pointed out that litigation may occur with reasonable causes and have a suitable conclusion by exploring several avenues of correction for the development of the sector. Seeking the aid of law is a constitutional right for any individual or lawful entity, the BIPPA letter argued. The private entrepreneurs also requested that all bidders be allowed to participate for all the power plants to ensure wider participation and competitive tariff rates. Golam Kibria, director of IPP cell-3 of BPDB, told The Independent that he had learnt about the changes, but had not received any official letter yet. We will change the tender notice after receiving the letter from the ministry, he said. Lauding the changes, Prof. M Shamsul Alam, an electrical engineer and energy adviser of the Consumers Association of Bangladesh (CAB), said that these would ensure a level playing field. He also said the countrys power sector bids already involve less competition compared with other sectors. He further said that the BPDBs previous set of criteria would have restricted bidding to a handful of IPPs. Had that happened, private electricity production would have been syndicated and common people would have had to pay the price, he added. The new power plants have been planned to be set up in Chandpur, Chowmuhoni of Noakhali, Feni, Meghnaghat of Narayanganj, Bagerhat, Takurgaon, Rangpur, Bogra, Shantahar, and Jamalpur. Currently, private companies supply electricity from 30 oil-fired plants and the public-sector utilities supply electricity from 17 similar plants. These 47 plants have a combined capacity of generating about 3,550 MW of electricity, which accounts for around 30 per cent of their total installed generation capacity.