The Power Development Board is likely to award contracts to 8-10 private companies soon for supplying electricity from fuel oil-fired power plants with 2,000MW combined generation capacity.
The board would float tenders in August for buying electricity from similar power plants with 1,000MW combined generation capacity to fulfil government’s desire to increase the power generation capacity by 3,000MW by March 2018, board officials said.
Some power board officials, however, warned that the move would increase the average power generation cost significantly as such move in 2009-10 doubled the cost in one year after all the plants came into operation.
They said that the 20 rental power plants with 1,665MW combined capacity were awarded under the Speedy Supply of Power and Energy (Special Provisions) Act 2010 that indemnified officials concerned against prosecution for awarding contracts without tender. The new contracts would also be awarded under the act without any tender.
‘We will award contracts to 8-10 private companies for a total of 2,000MW power under the speedy supply act,’ power board chairman Khaled Mahmud told New Age on Monday.
‘We will complete the negotiations in a couple of days to finalise the contracts,’ he said, adding that the power board would float tenders for 1,000MW power after awarding the contracts for 2,000MW power.
On July 10, the power division issued a letter asking the power board to award contracts in a shortest possible time to ‘eligible’ private companies for diesel-fired and furnace oil-fired power plants with 800-1,200MW and 1,000-1,200MW combined generation capacity respectively.
The contract would be made for five years for diesel-fired and for 15 years for furnace oil-fired power plants, according to the letter.
The power division also asked to float tenders to award 15-year contracts to private companies for furnace oil-fired power plants with a total 1,000MW generation capacity.
Consumers Association of Bangladesh energy adviser M Shamsul Alam, also an electrical engineer, said that the government was paving ways for some of its ‘favourite’ private companies to do business in power sector.
The measures the government have so far taken is only lingering the crisis in the power sector for years as it has no intention to offer electricity at affordable price to the consumers, he observed.
People would be the worst victim of the consequences of the decision as the government is adamant to realise the entire supply cost of electricity from the consumers, he said, adding that it would affect the economy severely.
Citing the grounds of increasing power generation costs caused by expensive short-term measures, the Bangladesh Energy Regulatory Commission increased the average bulk electricity prices by 106.75 per cent to Tk 4.90 per unit or kilowatt-hour until September 2015 since March 2010.
The commission also increased the average retail price of electricity by 69.25 per cent — up from Tk 3.76 per unit to Tk 6.33 per unit — in eight phases between March 2010 and September 2015.
Another move for raising prices of electricity to adjust the deficits is now under the commission’s consideration.
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