Electricity coverage increased to 93 pc from 47 pc in 10 years
Zahid Hossain Biplob: The government’s allocation for the power and energy sector has been rising during last one decade, but the country is still struggling to meet the spiraling demand for energy.
The government has proposed allocating around Tk 30,000 crore for the power and energy sector in the upcoming fiscal year, Tk 2,180 crore higher than the allotment given in the outgoing fiscal year 2018-19.
Besides, the allocation for the energy and mineral resources division (EMRD) can get Tk 3648.31 crore.
In the last 10 years, the number of power plants rose by 4 times to 118, power generation capacity increased by three times to 18,353 megawatt and even the maximum power generation tripled to a record of 10,958MW.
Allocation for power and energy is likely to increase by more than 19 percent in the upcoming budget, thanks to the momentum of most of the mega projects in power and energy sector under annual development programme (ADP).
The new allocation amounts to around 6 percent of the proposed national budget that Finance Minister A H M Mostofa Kamal is expected to be placed before parliament on Thursday.
The total budget for 2018-19 fiscal year was Tk 464,573 crore. The allocation for the sector was 0.08 percent higher than that in 2017-18 fiscal year.
The allocation in the 2017-18 fiscal year was Tk 21,118 crore, amounting to around 5.28 percent of the total budget. “Most of the mega power projects like Rampal, Matarbari, Payra are implementing as per the schedule….So our allocation for these projects will be increased significantly in next fiscal year,” said an official of the ministry.
Besides, the transmission and distribution lines will also get additional fund as the government has a plan to ensure uninterrupted power supply to all by next fiscal year, said the official.
He added that the government will also allocate bulk fund for the Dhaka-Chattogram pipeline project, Indo-Bangla pipeline project and Single Point Mooring with double line project.
The government plans to provide Tk 8,500 crore subsidies on LNG price which is main reason behind the rise in the government’s subsidy burden next fiscal year, official sources said.
The percentage of population under electricity coverage has also increased to 93 percent from 47 percent during last 10 years.
The consumers at industries and households especially in villages complain of outages, particularly during the peak hours.
The amount of gas production hits 2,750 million cubic feet this year, which is much higher than that of 1,744 million cubic feet of 2009. Besides, another 650mmcfd was also injected into national grid from imported LNG.
It has raised gas supply to industries and fertilizer factories. But the households’ consumers are suffering due to gas crisis in different part still now.
In order to encourage LNG (Liquid Natural Gas), it will give duty tax exemption. BAPEX plans to dig 108 wells by 2021 and with the completion of digging and commencement of gas production from them as planned, the gas supply situation will improve, said BAPEX sources.
In the outgoing budget the then finance minister proposed extending the existing VAT exemption facility up to June 30, 2019 for the local LPG cylinder manufacturers. He also proposed zero rates on import of photovoltaic cells and proposed to increase the duty rate on the importation of complete solar module/panel from 5 percent to 10 percent.
The government also permitted 50 industries to set up LPG bottling plants in the country. The machinery and equipment required to set up these industries was given duty exemption facility above 1 percent.
Besides, the raw materials required to produce LPG cylinders had given special tax expenditure-reducing the duty from 10 percent to 5 percent.
Energy expert Prof Tamim while contacted told Daily Industry that the mega projects in the power sector got momentum in the current term of the government, but the projects need a long time to be implemented.
Bangladesh has raised the power generation capacity but found little success in utilizing it, said Prof M Shamsul Alam, energy adviser of the Consumers Association of Bangladesh.
The country’s gross domestic product has been increasing at around 7 percent but the annual demand for electricity is growing by 10 percent, he said.
He said there is doubt about the expenditure capacity and the quality of work in the power sector.
The country found zero progress in exploring the coal resources and the vast untapped petroleum resources in the deep water of the Bay of Bengal, said Saleque Sufi, former director for operations at state-owned Gas Transmission Company Ltd, who is now an international energy consultant.