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Power & Energy - June 13, 2024

Shortage in energy focus on electricity

Factories able to utilize only 40 pc of capacity due to lack of gas

Mohiuddin Farazi: Energy crisis has been going on in the country for several years. New gas connection to houses closed due to lack of gas. Factories are utilizing only 40 to 50 percent of their production capacity Imports of liquefied natural gas (LNG) are being increased as domestic gas production declines. This is exacerbated by the ongoing dollar crisis.
At the time of this crisis, Finance Minister Abul Hassan Mahmud Ali proposed to allocate Tk 1,870 million to the energy sector in the budget of 2024-25 Allocation of Tk 29,230 crore has been proposed for the power sector. In the financial year 2023-24, Tk 994 crore has been allocated for the energy sector, but in the revised budget it has increased to Tk 1,143 crore. And in the outgoing budget, Tk 33,825 crores were allocated to the power sector. In the revised budget it is reduced to Tk 27,175 crores.
BTMA worried
In every fiscal year budget allocation for energy sector is very less than that for power sector Meanwhile, the production of factories is being disrupted due to lack of gas Bangladesh Textile Mills Association (BTMA) has written a letter to Chairman of Bangladesh Oil, Gas and Mineral Resources Corporation (Petrobangla) Janendra Nath Sarkar on June 4. The letter signed by BTMA president Mohammad Ali Khokon said that textile mills have not been able to carry out normal production activities for the past three years and more due to acute gas and power shortage. For several months, the mills have been able to utilize an average of 40 to 50 percent of their production capacity. As a result, fabric processing costs have increased along with reduction in yarn and fabric production and increase in production cost, which is seriously undermining the competitiveness of the sector.
Despite repeated requests to the relevant government departments to ensure regular supply of gas to the mills, no progress has been made. Rather, there is almost no supply of gas in the mills for several days The letter also mentions that BTMA is deeply worried about how long it will be possible to continue the mills if this situation continues.
The government plans to drill and workover 48 wells under Petrobangla by BAPEX from January 2023 to December 2025 for onshore oil and gas exploration and extraction to meet the growing gas demand of the country.
Imports of Liquefied Natural Gas (LNG) and Petroleum Gas (LPG) are increasing as domestic gas production is declining. This year’s budget proposal has also said about increasing the capacity of LNG import. But for a long time, experts have been suggesting to reduce the import trend and focus on increasing domestic gas exploration and production.
Tk 32 thousand cr capacity charge
Due to the lack of energy, the government has to pay a huge amount of capacity charge (rent) by keeping some power plants According to the information provided by Bangladesh Power Development Board (PDB) officials, the capacity charge for the current financial year was Tk 32 thousand crore.
According to a Center for Policy Dialogue (CPD) survey last year, most of the subsidy money in the power sector is spent to meet the capacity charges of private power plants. That is, even if the power plants do not produce electricity, they have to pay a certain fee based on their production capacity This fee is fully borne by the government
According to the study, the capacity payment reached Tk 28,000 crore in FY 2022-23, which was Tk 5,600 crore in FY 2017-18.
On March 30, after a meeting with the officials of various gas and energy supply companies, State Minister for Power, Energy and Mineral Resources Nasrul Hamid said, ‘We import 30 percent of our gas supply. We have a 10 percent gas shortage due to lack of Floating Storage Regasification Unit (FSRU). Besides, our local gas production is also decreasing.
Analyzing the daily gas extraction report on the website of Petrobangla, it can be seen that on May 9, the amount of gas produced in the country from Jalalabad gas field was 156.7 cubic feet, 17.3 cubic feet from Moulvibazar and 1016.5 cubic feet from Bibiana. A month after this, i.e. on June 9, the report shows that 155.3 cubic feet of gas has been extracted from Jalalabad gas field, 17.2 cubic feet from Moulvibazar and 1008.7 cubic feet from Bibiana. It can be seen that gas production has decreased within a month
Plan to import 9,000MW of electricity
Finance Minister Abul Hassan Mahmud Ali, while presenting the budget for the financial year 2024-25 in the National Parliament on June 6, said that plans have been made to increase the power generation capacity to 40,000 MW by 2030 and 60,000 MW by 2041. There are plans to increase the amount of power transmission lines to 24 thousand circuit kilometers by modernizing the grid. Besides, the master plan has been prepared as an integrated master plan for the power and energy sector.
The finance minister said that as part of the long-term master plan for power generation, a plan to import about 9,000 megawatts of electricity from neighboring countries has been adopted by 2041 and a target of 40 percent of the total power generation from renewable energy has been set.
The finance minister said that as part of the long-term master plan for power generation, a plan to import about 9,000 megawatts of electricity from neighboring countries has been adopted by 2041 and a target of 40 percent of the total power generation from renewable energy has been set. Considering the importance of renewable energy, a special allocation of Tk 100 crore has been proposed to encourage its development and use Rooppur nuclear power plant construction project at Ishwardi in Pabna is under implementation. After its implementation, a total of 2,400 MW of electricity will be connected to the national grid in two units, which will accelerate economic development as the main driving force of the country’s economy, the finance minister said in his budget speech in Parliament.
What experts said
Regarding the energy crisis, energy expert Professor M Shamsul Alam said that due to lack of energy, electricity can’t be produced Common people are deprived of electricity, village people are suffering from load shedding There is no money to develop that energy sector or increase power generation by increasing energy supply The same situation prevails in the energy sector in continuation of the past Power generation is disrupted due to lack of fuel. This naturally increases the price of electricity
Bangladesh University of Engineering (BUET) Faculty of Chemical and Materials Engineering Faculty Dean, Energy Expert Prof. Dr. M. Tamim said, “Big electricity projects have decreased. Due to this, the allocation to the power sector has decreased compared to last year If the fuel can be bought at a lower price, and the production efficiency can be increased, then it will be possible to reduce the price of electricity The government has set a target for digging wells, it will also require money. Allocation of fuel is very inadequate.

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