Govt power plant cost doubles as executing agency drags its feet

FHM Humayan Kabir The government has to spend nearly double the fund in actual cost for installing a 240-megawatt power station due to delay in project implementation by a government power generation company, officials said Friday. Power Division officials said the cost for the 240mw capacity Asian Development Bank-supported power station at Siddhirganj, close to Dhaka city, has doubled to Tk 12.46 billion from its original Tk 6.85 billion estimate. The state-owned Electricity Generation Company of Bangladesh (EGCB) has sought Tk 1.13 billion in extra funds from the Planning Commission for completing its installation, although it received Tk 5.60 billion more funds in 2007 in additional to the original project cost. "It is very unfortunate that a public company cannot construct a power plant in seven years. Moreover, it has sought two years' more time demanding additional funds for completing the scheme," a senior Power Division official said. The whole thing has not only swelled the public expenditure, but also created a supply shortage to the national grid from the planned electricity supply, he told the FE. The official said it is very interesting that the EGCB has sought more government funds through cutting down the allocation from the earmarked foreign aid for the project amid constraints of local resources. The EGCB has requested the Planning Commission to cut the project aid by Tk 214.6 million from its Tk 7.91 billion outlay, while it sought Tk 1.34 billion additional funds from the government's own resources. The government's highest economic policy-making body, Executive Committee of the National Economic Council (ECNEC), in February 2004 approved installation of the 240mw power station at Siddhirganj at a cost of Tk 6.85 billion by the 2005-06 fiscal. The state-owned company has failed to set up the power plant by the stipulated time of FY 2006 due to delay in tender process and start-up hiccups. In May 2007, the ECNEC revised the project allocating Tk 5.60 billion more funds coming to Tk 11.33 billion and extended the project execution deadline to 2008-09 financial year as per request of the EGCB. The Planning Commission has extended the deadline by another year for the second time till 2009-10 fiscal as per request of the EGCB. With the state-owned power generation company failing to execute the project after extending its deadline several times, it has again sought two more years till 2011-12 fiscal and Tk 1.13 billion extra for completing the long-delayed project. A senior Planning Commission official said the government should punish such misdeeds as the project expenditure has not only shot up, it has also hit the country's ongoing energy supply situation. "The government agencies have been displaying this kind of inefficiency for decades, but the government has never taken any stringent measures against them," he said. Many important projects, including power generation schemes, had to go through bitter experiences due to the inefficiency of these government agencies, which can hardly implement development schemes on time, he added. All the operating power stations in the country generate nearly 4600mw to 5000mw of power daily against the demand for over 6000mw a day.