PDB wants Tk 30b as subsidy to pay IPP bills

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The Power Development Board (PDB) has sought Tk 30 billion from the finance ministry as subsidy to provide fuel to liquid-fuel-based rental power plants and pay the bills of Independent Power Producers (IPP) for the remaining three months of the current fiscal. "We need the amount for purchasing furnace oil or diesel for rental power plants through Bangladesh Petroleum Corporation (BPC) and pay IPP bills up to June this year," a senior PDB official told BSS Monday. He said an extra amount was needed as subsidy for the power sector as several of the rental power plants which came into operation since August last year are run by relatively expensive furnace oil or diesel, instead of low-cost natural gas. "These liquid fuel based plants ultimately increased the electricity production cost requiring the extra subsidy despite the increase in power tariff last month", the official said. The "quick rental" and two "rental" power plants added some 650 megawatt (MW) power to the national grid using diesel or furnace oil. The energy ministry officials supplemented the PDB official's comments saying the BPC needed to increase its import by more than 40 percent as the government planned to generate or get 1350 MW of electricity from the liquid oil-based rental power plants by 2015. "We need around US$ 3.0 billion to import 4.5 million tonnes of fuel to implement the plan," he said. The country currently generates 3900 mw electricity against the officially estimated minimum demand of 5,500 mw. "But we need about US$3.0 billion to implement the government's robust plan for power sector" targeting the production of 6000 mw power by this year, the official said. PDB needed Tk 6.0 billion per month as subsidy to pay electricity bill to the five IPPs alone.