The Bangladesh government is likely to extend the tenure of six costly HFO-based rental power plants.
The plants have a combined capacity of 557 megawatts (MW) producing electricity at $0.328 per unit under the Quick Enhancement of Electricity and Energy Supply (Special Provision) Act 2010.
They include 102MW Summit Narayanganj Power Ltd, 100MW Orion Power Meghnaghat Ltd, 100MW Dutch Bangla Power and Associates Ltd, 40MW Khulna Power Ltd, 115MW Khulna Power Ltd unit-2 and 100MW Acorn Infrastructure Services Ltd.
The tenure of these six power plants expired in the months of March and April 2024.
“We are allowing all the power projects under no electricity no payment basis (without any guaranteed minimum off-take),” said an official concerned.
He said, “We have already settled the tariffs. Once the cabinet committee approves it, the plants will get an extension for another two years.”
The official added the tariffs of the electricity came down to 338 US cents in fresh negotiation from 340 US cents of the previous tariff structure.
The government moved for the extension of the plants at a time when it suffered to pay over 8-10 months of bills for the electricity produced in the plants.
Earlier, the government extended two HFO-based rental power plants under the 340 US cents tariff.
According to the government’s Power Division proposals, Bangladesh’s electricity generation capacity has reached 30,227MW including the captive power plants.
The country will need to generate 40,000MW of electricity by 2030 to meet the domestic demand, according to the official estimates.
Meanwhile, the government has shut down 24 rental, quick rental and Independent Power Producer (IPP) plants having combined capacity to generate 2398.50MW after commissioning some large base-load power plants.
Besides, the authorities also extended 14 rental and quick rental power plants having combined capacity to generate 1315MW including nine HFO-based power plants.
The proposoed six power plants have already enjoyed two extensions of two years each time, according to the officials.
The Bangladesh Power Development Board (BPDB) and the government formed a high-powered committee which has already approved the extension of the power projects for another two years after negotiations, officials added.
The BPDB justified that the agency has a capacity to generate 11240MW of electricity from the gas-fired power plants.
But it is projected to produce only 6240MW from the gas-based plants as availability of gas is 1200 mmcfd to feed the plants.
“So the government has no other alternative to run the HFO-based power plants under no electricity no payment by extending the tenure,” said an official.
Moreover, the extension of the plants is also required to ensure reliability of the power supply by the Dhaka distribution zone.
However, energy experts of the country expressed concerns about the extension of costly power plants.
They urged the government to ensure maximum offtake of the electricity from the base-load ones to reduce the burden of the costly fuel-based ones.
