Home Power & Energy Cheap coal now PDB’s burden
Power & Energy - March 27, 2024

Cheap coal now PDB’s burden

Power plant owes Tk 25,000 cr

Zarif Mahmud : Japan’s public aid agency JICA funded the electricity master plan in 2010. That plan called for 40,000 megawatts of electricity generation by 2030, more than half of which would come from coal-fired plants. As per the plan, 17 power plants have been approved by the government.
The initiative to build coal-based power plants on a large scale was criticized at home and abroad. The government’s main argument then was that coal-fired power was the cheapest. It appears after 13 years, coal
Not cheap by any means. Excluding health and environmental aspects, the per unit cost of coal power exceeds that of solar power.

Bangladesh Power Development Board (PDB) has to pay the huge cost of production in coal-based plants. Last year, PDB incurred a loss of around Tk 48,000 crore while paying the price of electricity purchased at higher prices. Currently the company is unable to pay dues. These private power plants owe Tk 25 thousand crores to PDB.
The government may have had some idea about the cost of coal-fired power plants. Because of that, 17 centers were allowed but later canceled seven. Six coal-fired plants of the Power Master Plan are in full production. The remaining four are scheduled to enter production. The average production cost of the centers coming into production is about Tk 10 to Tk 21 per unit. On the other hand, the production cost of eco-friendly solar power is currently Tk 11 per unit.
In response to the question of what is the reason for the increase in the cost of coal-based power plants, Nasrul Hamid, Minister of State for Power, Energy and Mineral Resources told yesterday on telephone, ‘When we signed the contract for coal-based power plants, the dollar price was Tk 80 to Tk 82. Now it is official Tk 110, in reality more. Due to this difference in the dollar, the price has gone up. Apart from this, the international energy market is also quite unstable due to the Russia-Ukraine war. If the situation becomes normal in the future, the cost of coal-based power plants will decrease further.
Matarbari is one of the most expensive coal-based power projects in the country. Cox’s Bazar’s Maheshkhali Upazila’s Matarbari has a coal port with this power plant. The cost of construction of port and power plant has exceeded Tk 52 thousand crore. It is expected to be the most expensive coal-fired power plant in the world. The center went into production in mid-November last year. Production cost information for this center is not available. It is believed that the cost of this center, which is one of the most expensive in the world, will surpass the records of all centers.
There are currently six coal-fired power plants operating in Bangladesh. This center is yet to be fully operational in Banshkhali, Chittagong. Among the remaining four power plants are the 1300 MW Payra Power Plant jointly owned by Bangladesh and China at Payra in Patuakhali, the 1360 MW Rampal Power Plant, the 2000 MW Adani Power Plant and the 307 MW Barisal Power Plant in Barguna.
PDB engineers said that a company named Bangladesh-China Power Company Limited (BCPCL) has been registered to operate the Payra power plant. In the 10 months from April last year to January this year, Payra power plant spent an average of Tk 6.82 per unit. With this, if the capacity charge of the center is added Tk 2.83, the price of electricity per unit here has fallen to Tk 9.65.
Then there is the Rampal Power Station next to the Sundarbans at Bagerhat. The cost of coal per unit of the 1320 MW plant has fallen to Tk 7.87. If central rent of Tk 5.19 is added to this, the cost per unit stands at Tk 13.06.
Meanwhile, S Alam Industrial Group’s 1320 MW power plant at Banshkhali in Chittagong was partially commissioned last year. All accounts for this center are not available. In the month of October last year, the price of coal used in the center fell by Tk 6.83 per unit. If you add the rent of the center to this, the average price of electricity in that month stands at Tk 11.55.
Adani and Barisal top in cost per unit
PDB engineers say that PDB is in danger to handle the cost of Adani’s power plant. The price of coal for electricity generated from the 2000 MW power plant has averaged Tk 15.69 paisa per unit in the last 10 months. If the capacity charge of the center is added at Tk4.55 paisa per unit, the cost of production stands at Tk 20.24. Those concerned say that the power generation of the center is high as coal is brought from its own coal mines of India’s largest industrial company Adani. Because of that, the loss of PDB is also high.
When asked why the price of coal-fired power plants is high, Consumers Association of Bangladesh (CAB) senior vice president and energy expert Professor M Shamsul Alam told that coal-based power plants were not cheap. These centers are still a burden for PDB. In response to a question, he said, the process by which the Center gave Adani should be made public. Because, Adani’s power plant has become a white elephant for Bangladesh. This center alone has caused great grief to the PDB.
The production cost of Barisal power plant is 61 paise more than Adani. This 307 MW plant remains closed for lack of coal. It has been going on for 7 months out of last 10 months. Average fuel cost of the center in seven months was Tk16.91 per unit. If you add the rent of the center Tk3.94, it stands atTk 20.85 per unit.
Talking to two top engineers of PDB, it is known that the Barisal power plant is not producing much due to lack of coal. This center cannot open LCs or import letters of credit due to dollar-crunch. They sometimes buy coal brought to the brick kiln from Bangladesh with Bangladeshi money. The condition of the center is so dire that they are approaching various domestic and foreign companies with proposals to sell the centre. Initial talks have also been held with a Chinese company to buy the centre. However, due to the court case regarding the land of this center, many people are showing less interest in buying it.
Anu Muhammad, a former professor of economics at Jahangirnagar University and an environmental activist told that coal-based power plants were never cheap. Basically, the government will give power plant work to some countries and companies; That’s why they preached. It was done under pressure from lobbyists. Now it is becoming clear that coal-based power plants cost much more than solar power.

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