State-run Power Development Board on Monday signed a 20-year agreement with Southern Solar
Power Limited to purchase electricity from a 200MW solar photovoltaic park to be set up at Teknaf in Cox’s Bazar.
Sun Edison Energy Holding (Singapore) Pte Ltd, a subsidiary of the US-based SunEdison, owns 100 per cent shares of the Southern Solar Power Limited in Bangladesh.
SunEdison, however, was declared bankrupt in the USA early 2016.
The power board will buy electricity from Southern Solar Power Limited although the power board awarded the contract in favour of Sun Edison Energy Holding (Singapore) Pte Ltd on October 21, 2015.
A power board official, however, claimed that the authorities concerned processed and signed the contract following existing laws and rules.
The power board will pay Southern Solar Power Limited Tk 13.26 or 17 US cents for each unit or kilowatt-hour electricity from the solar park, according to the contract.
The contract was signed on ‘no electricity, no payment’ basis.
Power Board secretary Mina Masud Uzzaman and SunEdison chief executive officer for South Asia region Ismael Arias Guerrero signed the contract on behalf of their respective sides.
State minister for power, energy and mineral resources Nasrul Hamid, Power Division secretary Ahmad Kaikaus and Power Board chairman Khaled Mahmud attended the contract signing ceremony among the other officials.
Nasrul Hamid said that the government planned to increase power generation capacities using green energy although they were pretty expensive.
The government has so far approved a number of grid-feeding solar photovoltaic parks with a combined capacity of 300MW, he said.
Being instructed by the Power Division, the Power Board awarded the contract to the company under the Speedy Supply of Power and Energy (Special Provisions) Act 2010 that indemnified officials concerned against any prosecution for awarding contracts without any tender.
On October 1, 2015, the cabinet committee on government purchase approved the power purchase proposal on build-own-and-operate basis.
The Power Board estimated that it would buy approximately 648.24 crore units of electricity from the company over 20 years period at an estimated cost of Tk 8,595.66 crore.
Southern Solar Power Limited would set up the 200MW solar park including other facilities in 15 months. The company has acquired 700 acres of land at Teknaf to build the infrastructures.
Besides the contract, the Power Board also inked two other contracts to buy electricity for 20 years each bypassing tenders.
On February 15, 2016, the Power Board signed a 20-year power purchase agreement with a joint venture initiative between five local and South Korean private companies. The Power Board will pay the company 17 US cents for each unit of electricity.
On October 19, 2016, the Power Board signed a 20-year power purchase agreement with HDFC SinPower Ltd. The Power Board will pay the company 17 US cents for each unit of electricity.