Power sector dependent on private companies
Md Joynal Abedin Khan: The nation has become dependent on private sector for generating power, building transmission center and distributing hubs to maintain electricity throughout the country causing fear to create crisis in future.
The companies have already showed that private sector has 54.35 percent contribution on power generation after the government’s approval for dealing power plants by the private sector and the Independent Power Producers (IPPs) since 1996 while 45.65 percent produced by state-owned power plants, said the official sources of Power Development Board (PDB).
Even the alone Summit Power Limited (SPL) played a major role of power generation with around 21 percent contribution of total electricity in last few years, they said.
The total power generation capacity of 137 public-private power plants is 19,000 megawatt (MW). Of these, 80 private power plants have generation capacity of 9,000 MW. Another 28 private power plant are under contraction and 12 plants are waiting for approval, while 18 public sector power plants are under construction, those generations capacity is 8,900 MW.
The nation’s access to electricity also increased by 92 percent with the rise in power production and the number of total electricity consumers is rose around 32.3 million this year, they said.
According to the latest statistics prepared by the Power Division, the country’s total power generation capacity stood at 20,343 MW, of which 11,057 MW came from private sector, while 9,286 MW came from public units.
As per the latest annual report of the PDB, which was published recently, showed the government spent Tk 7,565 crore to purchase power from IPPs. Out of that amount, Tk 2,069.71 crore went to Summit Meghnaghat plant’s coffer alone, according to them.
The power generated by the private companies witnessed that a substantial growth of electricity was completed in one decade and the private sector might have created a ‘hostage position’ by the power supplying groups in the near future if government fail to control the rein of private companies, said experts.
If the government will not aware about the dependency for power on private sector then the companies may raise the price of electricity ignoring order of the authorities concerned. They can seek financial stimulation support, more subsidies and other lucrative facilities, they said.
Professor Dr M Shamsul Alam, Energy Advisor to the Consumers Association of Bangladesh (CAB), said there is no reason for renewing the contract for these plants as a good number of power plants owners withdrawn government subsidies to generate a single unit of electricity.
“Payment of capacity charges to power plants is a growing expenditure for PDB, particularly for rising unused and under-utilisation of capacity. As a result , the budget for fiscal 2020-21 has allocated Tk 24,853 crore to the power division, which is 4.9 percent higher than the revised budget for fiscal year 2019-20,” said Khondaker Golam Moazzem, Research Director of the CPD.
The government is rightfully investing in distribution and transmission systems as the coronavirus pandemic has shown that modernisation of the systems is very important, said M Tamim, a Professor of Petroleum and Mineral Resources Engineering of Bangladesh University of engineering and Technology (BUET).
“Summit Power Limited (SPL) has over 21 years of experience in the power sector. It owns and operates power plants having a total installed capacity of 976 MW,” SPL Chairman Muhammed Aziz Khan said.
State Minister for Power, Energy and Mineral Resources Nasrul Hamid stated in the National Parliament that the government provided Tk 52,260 crore (522.60 billion) subsidy to power sector in the last 10 years. He also informed that the average cost of per unit electricity generation costs for both public and private sectors was Tk 13-14 (based on furnace oil), Tk 25.30 (based on diesel) and Tk 2.5-3.0 (based on natural gas).
The government provided Tk 51,157 crore was withdrawn by some private companies without generating a single unit of electricity in the same time, the minister said.
Imran Karim, Vice-President of Bangladesh Independent Power Producers Association (BIPPA), said, “Without a strong support from the state, it was not possible for the private sector producers to reach the milestone of power generation.”
As per the latest Power System Master Plan 2016, the government envisioned to generate 24,000MW of electricity by 2021, 40,000 MW by 2030, and 60,000 MW by 2041.