India has prevailed upon negotiators to keep transmission charge "variable" for using its line to transmit electricity from Nepal into Bangladesh which the finance division finds irrational.
The Power Division negotiated with India that it will get Tk 0.76 per unit for trans-border transmission of electricity from Nepal into Bheramara of Bangladesh in addition to Tk 0.09 as 'trade-in' margin.
Trade-in margin is a fixed charge and has to be paid in Indian rupee while the transmission charge will remain flexible and be paid in US dollar.
Nepal will get Tk 7.32 as hydropower price in US dollar for selling 40-megawatt electricity from its two power plants.
In June this year, the power division got tariff approval from the cabinet committee on government purchase for importing electricity from the Himalayan country.
Officials concerned told the FE that power adviser M. Fouzul Kabir Khan Monday approved a power-division proposal to go forward making a tripartite deal among Nepal Electricity Authority, NTPC Vidyut Vyapar Nigam Limited, and Bangladesh Power Development Board to begin inflow of electricity.
The five-year agreement is expected to be completed in a few weeks, according to Power Division officials.
Before advancing for the tripartite agreement, the Power Division sought opinion from the Finance Division, Financial Institutions Division, the National Board of Revenue, and the central bank, as payment in foreign currency and duty and taxes are involved with the power trade.
Sources have said the power division has so far received opinion from the finance division where the custodian of the coffer insisted that the transmission charge should be fixed one like the other charges.
Unless the transmission charge is fixed, India can raise it "arbitrarily at any time, causing trouble in cost estimation for the finance division".
The finance division suggested the power division to renegotiate the charge and make it fixed instead of variable.
Power Division Senior Secretary Habibur Rahman could not be reached for a comment in this regard despite repeated attempts.
However, a senior Power Division official told the FE that the transmission charge has been kept flexible in line with the rules of the Central Electricity Regulatory Commission of India that was enacted in 2018.
"We have to follow Indian rules if we want to use its transmission line,' said the official, seeking anonymity.
The official thinks the tripartite deal will open a new avenue for Bangladesh for cross-border power trade, creating scope to import more low-cost electricity from Nepal and Bhutan.
However, a finance official has said so far India has no deal for cross- border electricity transmission and Bangladesh had enough scope to negotiate and fix the transmission charge instead of keeping it changeable.
"If we sign the deal keeping the transmission charge flexible, India will take the advantage and raise the charge as and when it wants," he says.
According to purchase committee's approval, Bangladesh will have to spend Tk 1.30 billion annually to import power from Nepal. Of the total sum, India will get Tk 120 million as transmission charge and Tk 14 million as trade-in charge.
If the transmission charge is increased any time during the deal tenure, the cost will go up further, a Finance Division official says.
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