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BD minister visits India plant

Adani readying for power supply across border

First foreign plant to receive capacity charge


FE REPORT | January 04, 2023 00:00:00


India's Adani conglomerate is readying for cross-border electricity supply to Bangladesh from its Godda coal-fired power plant in Jharkhand, beginning with around 750 megawatts.

The electricity will start to be transmitted from the plant's first unit in March, State Minister for Power, Energy and Mineral Resources Nasrul Hamid said Tuesday while visiting the under-construction power plant.

"A dedicated power-transmission line has already been constructed to supply electricity from India to Bangladesh," he said.

Adani Power Ltd is constructing the power plant following an agreement signed with the state-run Bangladesh Power Development Board (BPDB), while the government was on a desperate search for additional power to feed into burgeoning demand.

Sources say Adani's will be the lone overseas power plant to get capacity payment from BPDB if the latter fails to import a certain quantity of electricity.

The power board currently imports around 1,160MW electricity from India sans any capacity payment, they adds.

US-based Institute of Energy and Economic Financial Analysis (IEEFA) in a report several months back predicted that the electricity to be supplied from  Adani's plant be 'very expensive' energy to Bangladesh.

The IEEFA report stated that Bangladesh would not be able to afford this expensive electricity for long.

The original plan for Godda power plant was to use local coal mined in Jharkhand state. The plan was later changed to use Carmichael coal of Australia and lock the BPDB into a power- purchase agreement that allows Adani to import coal into an Indian coal-mining state from Australia and pass the full cost onto Bangladesh, the report pointed out.

"It is even clearer now that the Godda power plant deal with Bangladesh was aimed primarily at propping up the development of the Carmichael coalmine," the report stated.

The electricity price from Adani's plant will be two and a half times the price at which the BPDB sells power to distributors, the IEEFA report maintained.

Another report prepared by Bangladesh Working Group on External Debt (BWGED) and Growthwatch revealed that the Godda Coal Power Plant of Adani Group will take US$ 11.01 billion as capacity charge from Bangladesh in its 25 years of lifetime.

According to this report, Bangladesh could have built three Padma Bridges with the amount to be spent to foot capacity bill.

The amount for the capacity charge is nine times the budget of Karnaphuli River Tunnel and more than four times the Dhaka Metro Rail, Hasan Mehedi, an author of the report and member- secretary of BWGED, said several months back.

According to the report, the Adani Group may take US$ 423.29 million as capacity charge every year.

According to the estimation in the report, the cost of electricity from the Godda power plant will be at least Tk 9.09 per kWh, which is 56-percent higher than the other imported electricity and 196-percent higher than solar power in India.

The Bangladesh Power Development Board signed the agreement with Adani Group in November 2017 to offtake 1,496MW power from Godda Coal Power Plant under cross-border electricity-trade arrangement.

In the meantime, the government hired private rental and quick-rental power plants under unsolicited deals with provision for much-debated capacity charge.

Azizjst@yahoo.com


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