India restricts power supply due to arrear

Nepali electricity provides hope

Farhad Chowdhury: Bangladesh officially imports 1,160 MW of electricity from India. Out of this, 1000 MW is imported through West Bengal and 160 MW through Tripura. Bangladesh Power Development Board (BPDB) buys this power from Tripura State Electricity Corporation Limited (TSECL). But due to Rs 100 crore due to TSECL, the company has limited the power supply.
In an interview to Indian news agency ANI, TSECL Managing Director (MD) Debashish Sarkar said that PDB is unable to pay the bill due to financial problems.
The government has finalized the matter of import of hydroelectricity worth Tk 650 crores from Nepal while the electricity bill of Tk 100 crore is owed to India. PDB will buy electricity from the country for the next five years. The proposal regarding electricity rates was finalized in the company’s board meeting last month. The Power Department has sent this proposal for power purchase to the Cabinet Department for presentation to the Cabinet Committee on Government Purchase.

At present, all the electricity imported in the country is coming from India. Out of this, there is a government power purchase agreement with the country for 1,160 MW and 1,496 MW of electricity is coming from Jharkhand power plant of private power plant Adani.
Adani’s arrear Tk 4,140 crore
However, according to the sources of the power department, till January this year, the bill of import of electricity from India under the JTUG agreement was over Tk 1,900 crore. And in Jharkhand, the electricity bill purchased from the Adani Group’s power plant is Tk 4,140 crore.
According to TSECL, the company is currently supplying 100 to 110 MW of electricity as per the agreement to supply 160 MW of electricity from Tripura. The head of the organization says that so far, they have received the bill for the month of January. Still three to four months of bills are outstanding. Which is affecting the financial condition of the organization. Because of this, electricity supply in Bangladesh has been limited.
On the other hand, the discussion of importing electricity from Nepal is quite old. In 2014, Bangladesh and Nepal signed a memorandum of understanding for cooperation in the power sector. Under that agreement, the two countries discussed the matter of electricity import at the public-private level. Even the issue of Bangladesh’s investment in hydropower projects in Nepal came up. However, despite these discussions going on for a decade, their implementation has not been done so far.
On January 31, State Minister for Power, Energy and Mineral Resources Nasrul Hamid informed about the progress of importing hydropower from Nepal in a courtesy meeting with Ambassador of Nepal to Bangladesh Ghanshyam Bhandari at the Secretariat. He said that all the processes of importing 40 megawatts of hydropower from Nepal through India are almost at the final stage. Progress on import of another 500 MW of hydropower is visible.
If the import of electricity from Nepal to Bangladesh starts, the total amount of imported electricity in the country will be about 2700 megawatts. Which is about 11 percent of Bangladesh’s grid-based power generation capacity.
This 40 MW electricity will come to Nepal through a tri-party agreement. As the country does not have a direct border with Bangladesh, the Indian transmission line will be used in this case. This electricity will come to the country using the HVDC station (sub-station) at Bheramara in Kushtia. In this case, trading margin and transaction charges will have to be paid by the neighboring country.
According to the sources of the Electricity Department, the price of electricity imported from Nepal has been fixed at 6.40 US cents per kilowatt hour. And NVVN (NTPC Vidyut Vapar Nigam) trading margin for use of transmission line is INR 595 decimal zero (per KW). A transaction charge will be added to this. Although the transmission charge per kilowatt is not mentioned in the PDB documents, this charge will be added as per the calculation of the Central Electricity Regulatory Authority of India.
However, the question arises as to how much import of electricity from Nepal will be justified in such a financial situation of PDB. Bangladesh Electricity Development Board usually buys electricity at a high price and sells it at a low price. In this, the organization’s deficit is more than Tk 3,600 crore every month. A huge subsidy is needed every month to meet this shortfall. However, the Ministry of Finance is not releasing the subsidy regularly. Due to this, the company is not able to pay the bills of various government and private power plants. In total, till last January, PDB owed more than Tk 41 thousand crore by various organizations.
PDB has to pay an average bill of Rs 8700 crore to Rs 8800 crore every month. However, the average revenue in this sector is Tk 5,000 crore to Tk 5,000 crore. That is, there is a deficit of Tk 3,600 crore per month. So far Tk 10,599 crore bonds have been issued. Still, the amount of subsidy due to the Ministry of Finance stands at Tk 35,912 crores.
Although for the last financial year, the Ministry of Finance has already paid Tk 29,510.69 crores subsidy. However, the subsidy still receivable includes partial arrears from February to June of the last financial year, amounting to Rs.14,900 crore. And the amount of subsidy received from July to January of the current financial year is Tk 21,903 crores.
PDB is increasing the amount of imports even in this financial situation. No one from PDB agreed to speak on the question of whether it is possible to handle this new pressure.
But experts say Nepal’s hydropower imports could turn into a positive if the financial woes are overcome.
Energy expert Dr. Ijaz Hossain said that the financial problems that PDB is going through, it is expected to be overcome after some time. We have always been saying, to get out of coal based and import dependency. Now as the process of importing power under contract with India is going on, so the matter of payment of dues is urgent.
However, Nepal’s electricity is falling into renewable energy sources. It is positive. PDB should bring the whole thing into a harmonious state – said this energy expert.