Power import from India continues despite expiry of deal

Deal may be extended for 5 years despite surplus electricity at home

Shamim Jahangir

21 May, 2021 12:00 AM printer

Bangladesh is importing 160 megawatts of electricity from India without any deal.

The Power Purchase Agreement (PPA) with the Indian state-owned NTPC Vidyut Vyapar Nigam Ltd (NVVN) has expired on 16 March 2021. 

“NVVN will continue to supply electricity under a mutual understanding until the extension of the PPA, which has been proposed to extend for another five years,” said an official.

He said Bangladesh would sit with its Indian counterpart on May 27 to negotiate fresh tariff for the extended period.

Responding to a query as to why the government decided to extend the deal despite surplus electricity generation in the country, the official said, “We have signed a complex deal that will make us pay wheeling charge if we do not renew the PPA.”

However, the tariff is expected to be lowered, he added.

Bangladesh Power Development Board (BPDB) is paying Tk 7.7473 per unit (kilowatt-hours) for 100MW electricity from Indian state of Tripura.

It also paid Tk 7.3784 per unit to import another 60MW from India through the same transmission line.  

Besides, the tariff might be Tk 9.50 per kilowatt subject to the supply of electricity from an Indian HFO-based power plant, officials concerned said.

  The government is expecting a lower tariff than the existing rate after a fresh negotiation, an official said on the condition of anonymity.

In addition, Bangladesh will need to pay Tk 15.05 million per month as the transmission charge to import the electricity.

Now, Bangladesh is utilizing a 24 kilometres Indian transmission line and 31 kilometres Bangladesh Power gridline to import electricity from India. The NTPC NVVN had signed a deal on 15 March 2016, to supply 100MW of electricity from Tripura. After a year, in April 2017, state-owned BPDB had also signed a supplementary PPA.

According to the officials concerned, the PPA between Dhaka and Delhi will be effective from the date of signing and shall remain valid initially up to five years of the date of commencement of the supply.

However, the agreement may be extended beyond the initial period.

The agreement shall be deemed to have come into force with effect from the date of its signing for all other purposes and intents.

It shall remain operative up to March 2050 subject to its revision as may be made by the parties to this agreement.

This agreement may also be extended for a further period as the parties may mutually agree.           

The government has been importing around 1000MW of electricity against the capacity of 1,060MW from India since October 5, 2013, through the Bharamara grid line.

Of the volume, 250MW of power comes from Indian state-owned NVVN’s unallocated quota at an average market tariff of Tk 2.78 per kilowatt (per unit).

Besides, another 250MW comes through the Indian open market through PTC with per unit tariff at $0.0749.

Now, the country has a capacity to produce 25,171MW of electricity including the imported power. However, Bangladesh’s maximum electricity demand was 13,377MW last month.