9 unsolicited power projects sanctioned

The Power Division is going to award contracts for the generation of 1,800 MW of fuel-based power to nine unsolicited power projects to meet the country’s electricity demands next summer, sources told The Independent. The projects include the production of 800MW of diesel-based electricity at a high cost.

The generation of 1800MW power will cost Tk 10,000 crore annually, raising the losses incurred by the Bangladesh Power Development Board (BPDB).  

Out of the total amount of power, 800MW of diesel-based power will cost Tk. 7,000 crore, while the rest, furnace-oil-based power, will cost Tk. 3,350 crore, a BPDB official told The Independent.

A high-level negotiation committee, headed by power secretary Dr Ahmad Kaikus, has decided to sanction the generation of 1,800MW of power.

The committee held a series of meetings with the selected bidders and decided on the generation capacity of the power plants the interested companies would set up. The committee's third and final meeting ended on Monday.

“We think we'll stick to 1,800MW of power, but some quarters are still pressing to get more projects,” said a committee member.

“We hope that the proposals will be placed at the next meeting of the Cabinet Committee to be held next Wednesday,” said a Power Division official.

However, sources said the companies to be awarded the projects this time were not competent enough in terms of their professional capability.

Among the approved furnace-oil-based proposals, the Summit Group has agreed to set up a 300MW plant in Kodda; Confidence Power has planned to set up a 113MW plant in Bagura; Midland has wanted to install a 150MW plant in Asuganj; Orion has expressed the intention to set up a 100MW plant in Khulna; Acorn has intended to set up a 100MW plant in Julda; and Desh Energy has promised to set up a 200MW plant in Chadpur.

The price of selling power to the government was fixed at 10.50 cent to 10.65 cent per unit in the previous tender held on November 6, 2016.

The government official said only low-profile companies had agreed to sell power at that price. Confident Power and Midlant Power would sell the power they would generate at 10.50 cent, while the others would do so at 10.60 to 10.65 cent.

Among the diesel-based power plant proposals accepted by the committee are Acorn’s 300MW rental plants at Daudkandi and Nowapara, Aggreko’s 200 MW plant at Karanigonj, and APR’s 300MW plant.

The selling price of diesel-based power will be more than Tk. 20 per unit, for which the consumer pays, on an average, Tk. 4.90 per unit.

Of the Tk. 20, the rental plants, for a five-year period, will get 17.25 or 14 taka cent per unit as capacity payment. It means that they will get Tk. 14 per unit as rental cost even if the government does not buy power from them.

The BPDB official said the diesel-based 800MW plant would not be necessary right now as some new plant would start generation within a few months.

As per the government’s decision, the furnace oil-based power plants would have to start generation within nine months and diesel-based plants within 6 months after the final deals are signed.

The official said Desh Energy was not a company of sound standing in the power sector as it was selling diesel-based power to the BPDB at Tk. 28.11 compared to other companies doing so at Tk. 21.

He alleged that Desh Eenergy was awarded the project because one of its owners was connected with the ruling party.

Aggreko, too, has the reputation of selling power at a high price. According to the annual report of the BPDB, the company sold gas-based power at Tk. 4.41 per unit from the Asugonj project as against Tk. 3 charged by other gas-based plants.

Prime Minister Sheikh Hasina recently approved the proposal to generate 3,000MW of power based on diesel and furnace oil. This amount of power will be generated sometime between the next summer and December 2018—during the run up to the next national elections—to overcome the prevailing power crisis.

Before the approval, the BPDB had received 21 unsolicited proposals for the generation of 3,540 MW of furnace oil- and diesel-based power to meet electricity demands across the country.  The proposals had reached the BPDB on June 25, a holiday during the Eid vacation.

Sources said the BPDB received more than 35 unsolicited proposals for the generation of over 5,000MW of power.

Following the PM’s approval, diesel- and furnace oil-based rental and quick-rental power plants capable of producing 1,000MW –1,500MW of power will be set up by independent power producers (IPPs).

Moreover, 500MW furnace oil-based power plants will be set up by government-owned power generation companies. Another 1,000MW furnace-oil-based power plant projects will be awarded through open tender bids. The BPDB will arrange all the steps to implement these projects.

The BPDB official said that 1,800MW of power will take the BPDP’s subsidy burden to Tk. 5,000 crore from the present Tk. 3,500 crore.

According to state minister for power Nasrul Hamid’s Facebook status, the country’s peak demand for power during the summer was 14,000MW. The BPDB said the demand would be much more in 2018 and 2019.

9 unsolicited power projects sanctioned

The Power Division is going to award contracts for the generation of 1,800 MW of fuel-based power to nine unsolicited power projects to meet the countrys electricity demands next summer, sources told The Independent. The projects include the production of 800MW of diesel-based electricity at a high cost. The generation of 1800MW power will cost Tk 10,000 crore annually, raising the losses incurred by the Bangladesh Power Development Board (BPDB). Out of the total amount of power, 800MW of diesel-based power will cost Tk. 7,000 crore, while the rest, furnace-oil-based power, will cost Tk. 3,350 crore, a BPDB official told The Independent. A high-level negotiation committee, headed by power secretary Dr Ahmad Kaikus, has decided to sanction the generation of 1,800MW of power. The committee held a series of meetings with the selected bidders and decided on the generation capacity of the power plants the interested companies would set up. The committees third and final meeting ended on Monday. We think well stick to 1,800MW of power, but some quarters are still pressing to get more projects, said a committee member. We hope that the proposals will be placed at the next meeting of the Cabinet Committee to be held next Wednesday, said a Power Division official. However, sources said the companies to be awarded the projects this time were not competent enough in terms of their professional capability. Among the approved furnace-oil-based proposals, the Summit Group has agreed to set up a 300MW plant in Kodda; Confidence Power has planned to set up a 113MW plant in Bagura; Midland has wanted to install a 150MW plant in Asuganj; Orion has expressed the intention to set up a 100MW plant in Khulna; Acorn has intended to set up a 100MW plant in Julda; and Desh Energy has promised to set up a 200MW plant in Chadpur. The price of selling power to the government was fixed at 10.50 cent to 10.65 cent per unit in the previous tender held on November 6, 2016. The government official said only low-profile companies had agreed to sell power at that price. Confident Power and Midlant Power would sell the power they would generate at 10.50 cent, while the others would do so at 10.60 to 10.65 cent. Among the diesel-based power plant proposals accepted by the committee are Acorns 300MW rental plants at Daudkandi and Nowapara, Aggrekos 200 MW plant at Karanigonj, and APRs 300MW plant. The selling price of diesel-based power will be more than Tk. 20 per unit, for which the consumer pays, on an average, Tk. 4.90 per unit. Of the Tk. 20, the rental plants, for a five-year period, will get 17.25 or 14 taka cent per unit as capacity payment. It means that they will get Tk. 14 per unit as rental cost even if the government does not buy power from them. The BPDB official said the diesel-based 800MW plant would not be necessary right now as some new plant would start generation within a few months. As per the governments decision, the furnace oil-based power plants would have to start generation within nine months and diesel-based plants within 6 months after the final deals are signed. The official said Desh Energy was not a company of sound standing in the power sector as it was selling diesel-based power to the BPDB at Tk. 28.11 compared to other companies doing so at Tk. 21. He alleged that Desh Eenergy was awarded the project because one of its owners was connected with the ruling party. Aggreko, too, has the reputation of selling power at a high price. According to the annual report of the BPDB, the company sold gas-based power at Tk. 4.41 per unit from the Asugonj project as against Tk. 3 charged by other gas-based plants. Prime Minister Sheikh Hasina recently approved the proposal to generate 3,000MW of power based on diesel and furnace oil. This amount of power will be generated sometime between the next summer and December 2018during the run up to the next national electionsto overcome the prevailing power crisis. Before the approval, the BPDB had received 21 unsolicited proposals for the generation of 3,540 MW of furnace oil- and diesel-based power to meet electricity demands across the country. The proposals had reached the BPDB on June 25, a holiday during the Eid vacation. Sources said the BPDB received more than 35 unsolicited proposals for the generation of over 5,000MW of power. Following the PMs approval, diesel- and furnace oil-based rental and quick-rental power plants capable of producing 1,000MW 1,500MW of power will be set up by independent power producers (IPPs). Moreover, 500MW furnace oil-based power plants will be set up by government-owned power generation companies. Another 1,000MW furnace-oil-based power plant projects will be awarded through open tender bids. The BPDB will arrange all the steps to implement these projects. The BPDB official said that 1,800MW of power will take the BPDPs subsidy burden to Tk. 5,000 crore from the present Tk. 3,500 crore. According to state minister for power Nasrul Hamids Facebook status, the countrys peak demand for power during the summer was 14,000MW. The BPDB said the demand would be much more in 2018 and 2019.