Move to install new rental plants seen suicidal

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The total power generation in the country rose Monday to its peak of 3,880.1 megawatts, the highest in recent times, as all the power generation units got rolling, reports UNB.
According to a report of the Power Division, the maximum peak-hour demand for electricity on the day was 3,953 MW, and the power-hungry national grid was fed nearly to the full. Load shedding, a nagging problem for a long time, was only 124 MW, the lowest in recent years. It said the production of electricity is increasing gradually following maintenance and renovation of the power-production stations, and the strengthening of rehabilitation activities. The turnaround was an outcome of a crash course taken by the caretaker government with various initiatives, including close monitoring of the power sector.
The newly-installed third unit of the Rural Power Company has recently started generation of 70 MW electricity alongside full-steam operation of the Kaptai Hydroelectric Plant.
According to a concerned official, the present government, after assuming office, has given "the highest priority" to the power sector and taken a good number of pragmatic steps and programmes for its development.
Already, approval has been given for setting up a good number of small and big power plants in public and private sectors.
The activities for installing power stations, with 450-MW capacity each, in Sirajganj, Meghnaghat and Siddhirganj are going on. Another report adds: The Power Division's latest move to install more rental power plants might be suicidal for the power sector and hamper the government's efforts to buy electricity from the captive power plants set up by local entrepreneurs.According to industry insiders, power sector experts have raised questions about the Power Division's latest initiative for setting up more rental power plants in addition to the six having the total capacity of 260 MW, now under implementation process. They apprehended that the latest move was taken to help a certain quarter, now active behind the initiative, to gain benefits.
The sources said the Power Cell published a circular on July 12 last asking the interested parties to submit their expression of interest
(EoI) by July 26 to install rental power plants with capacity up to 300 MW by February 2008 and add power to the national grid. After this notice, the experts concerned raised questions about why the Power Cell gave only 14 days' time to submit the EoI for such huge capacity power plants.
They said the local investors could install such large power plants under joint venture with international firms but it is almost impossible for them to do that within such a short period of time. They said after such a notice from the Power Cell, questions genuinely could be raised whether the Cell has sought the EoI to allow a particular party to gain benefits that already reached a understanding with international firms who can install such plants within a short period of time.
They also questioned why the Power Division has become so interested in rental power plants despite knowing that the tariff of these plants would be very high since those would be either barge or skid-mounted or tailor-mounted ones.
In 1997, the then government installed four barge-mounted power plants to tackle the power crisis and their tariff was very high, even above Tk 5.30 per unit in some cases.
The Power Development Board (PDB) has to incur about Tk 13 billion (1,300 crore) a year for purchasing electricity at higher rates from those power plants.
Considering these issues, the industry insiders feel that some vested quarters are perhaps trying to take advantage by offering such costly power plants to the caretaker government in the name of tackling emergency power crisis.
When the caretaker government has been trying to purchase electricity from the captive power plants installed by local entrepreneurs to serve their industries, the move to install rental power plants is very mysterious, according to the sources.
Because, they think, the move to install more rental plants will discourage the captive power producers to sell their electricity to the national grid.
The power sector experts said the government could easily get more than 500 MW from the captive plants before the next summer if they allow them to extend their existing capacity by installing some new generations as the captive producers have already infrastructure to augment their production for the national grid.
When contacted, officials at the Power Division and Power Cell were unwilling to talk about the matter officially.