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Dead horse rental power plants jeopardize country’s economy

  • Sun Online Desk
  • 7th August, 2022 11:50:43 PM
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Dead horse rental power plants jeopardize country’s economy

The country is struggling to overcome reserve shortfall caused by rental and quick rental power plants which are dead horse.

Although the rental power plants are destroying economy, those are being nourished day by day to invite extreme peril, experts opined.

Energy experts underscored need for closing such power plants much ago. Instead of following advice of the experts, the authorities decided to extend tenures of four oil and five HFO-based rental power plants.

The government has to purchase powers from the private power plants at high price and count huge subsidy.

Colossal capacity charge was paid in absence of power from the idle rental and quick rental plants, sources claimed.

Experts are of the opinion that rental power plants have wreaked great havoc on the reserve and economy at large.

There are 18 rental and quick rental power plants in the country. Of those, 10 operate as per “No electricity, no payment” policy and remaining eight are subjected to the capacity and other charges.

The government spent around Tk 70,000 crore in capacity charge of rental power plants in past 12 years.

Drawing an analogy, experts claimed that the cost of per unit power in traditional power plants is Tk 7 and Tk 17 in rental plants.

The government has decided not operate oil based power plants in view of growing fuel price. In this situation, entertaining white elephant like rental plants is suicidal.

Director General of Power Cell Mohammad Hossain said “We have to pay for the staffs and maintenance of the 10 rental power plants. The remaining eight plants will be closed upon expiry of term.”

In FY 2019-20, the government spent Tk 18,124 crore in capacity charge of the rental power plants.

Of the money, Tk 1, 714 crore went to the owners of 22 rental and quick rental plants and Tk 1,276 crore to owners 19 rental and quick rental power plants, a reliable sources claimed.

In nine months of FY 2021-22 (July 2021-March 2022), Tk 678 crore was pocketed by the owners of 12 rental and quick rental power plants in exchange for no power.  

In a virtual discussion, Dr Khondaker Golam Moazzem, research director of CPD, said only one third electricity of quick rental was utilised in 2020, but the government continues to spend money for the purpose.

Per unit of power usually costs Tk 7-8, he said adding that government has to buy power from quick rental plant at Tk 600 per kilowatt. Even many idle plants are being paid and the countrymen have to bear the brunt, he opined.

After coming power in 2009, Awami League government approved rental and quick rental plants to accelerate electricity production.

Having started for two years, such rental plants got extension on various occasions.

Recently, the government extended tenure of five rental plants for another two years. The government will have to buy electricity at Tk 16.40 per unit from the power plants.

Newly extended plants are: 40MW HFO rental power of Khulna Power Company at Noapara in Jashore. The country will bear the cost of Tk 459.98 crore in two years.

The country may need to pay Tk 1,295.42 crore to 115-MW Khulna Power Company Unit-II Ltd in Goalpara of Khulna; Tk 1,146.51 crore to 100-MW Dutch Bangla Power and Associates Ltd in Siddhirganj of Narayanganj; Tk 1,146.51 crore to 100-MW of Orion Power Meghnaghat Ltd in Meghnaghat of Narayanganj; and Tk 1, 157.52 crore to 102-MW Summit Narayanganj Power Ltd in Madanganj of Narayanganj.

Besides, the government is going to extend tenure of four other rental power plants for another five years. Those are 100-MW PowerPac-Mutiara Keraniganj Power Plant, 100-MW Acorn Infrastructure in Chattogram, 50-MW Sinha Power in Chapainawabganj and 50-MW Northern Power in Rajshahi.

Following this development, PBD will have to buy per unit of electricity at Tk 17.

Last year, the Parliamentary Standing Committee on Power, Energy and Mineral Resources Ministry at a meeting received a report submitted by the authorities concerned that rental and quick rental power plants would be closed by 2024. The power plants will be shut upon expiry of tenure. The Parliamentary Standing Committee also recommended for the same. But the reality is contrary to the decision.

About the issue, energy expert Prof Dr Badrul Imam said rental and quick rental power plants have created a pressure on the country’s revenue requiring to be closed immediately.

The government has to count capacity charge for the rental and quick rental power plants to the tune of nearly Tk 2,000 crore per month, he added.