Realism to guide statements about power sector developments
Friday, 8 January 2010
Kamal Ahmed
Key functionaries in Bangladesh energy sector have been felling the media that there will be no energy crisis by 2012. They also said natural gas production will be doubled in two years. Bangladesh is suffering from the most severe energy crisis in its history due to an acute supply shortage in the national power and gas grids. Bangladesh generates over 4000 MW of power against the demand for 5500 MW. It produces about 1950 MMCFD of gas against the demand of 2400MMCFD. In three years, the demand for power is expected to reach 7000MW and for gas 3000 MMCFD. To meet power shortage, Bangladesh needs to produce an additional 3000 MW of power and at least 1000MMCFD of gas a year. The statement of the energy functionaries calls for an objective analysis.
It took Bangladesh 38 years to develop the capacity what it to produces now. The question is how far it would be realistic to plan doubling power and gas production in three years?
What the government could achieve in last one year? Could it ink any substantive contract for new power generation? Could it yet undertake a fresh exploration for spotting new gas fields? Could it take a decision to extract coal? A major power plant installation and commissioning would take at least three years. Setting up of a 450MW power plant at Nabiganj, beside Beanibazar gas field, is still under evaluation. The government is also evaluating the bids for setting up a number of high cost liquid fuel contingency power plants to feed the national grid by June next. But no developer can install and commission such plants in such a short time. According to media reports, some not so experienced bidders, with apparently non-reliable documents, have been identified as successful bidders. The possibility of the planned contingency power plants coming to production by June is remote. The government could not do much to address the power shortage during the irrigation season and summer of last year. The people leniently viewed bad management to tackle the inherited crisis. With the irrigation season knocking the at door again, the government is left with no option but to repeat load management. Hours of load shedding in the cities to divert power supply for irrigation, would be a source of embarrassment for the government.
The ruling party is pledge bound to add 1700 MW of power by 2011 and 3400 MW by 2014. Overenthusiastic energy functionaries of the government, after several brain storming sessions, announced the decision to set up several large power plants. For the planned liquid fuel-based, coal-based as well as nuclear power plants, they said the government would depend on public-private partnerships (PPPs), independent power producers as well as donor funding. But the record of poor management, bureaucratic hassles and the influence of energy syndicates hardly help to create any optimism. The donors want establishment of transparency and accountability before funding the projects.
The private sector is yet to invest anew, to any substantial extent, in the power sector. The public sector, which has otherwise a near monopoly in production and distribution, is weak and sick. Fuel shortage is major problem. New gas field discovery for commercial production will require at last five years. Laying the transmission lines would also need three to five years.
The coal option is alsoin a mess. The underperforming Barapukuria coliery is facing the adverse impacts of inappropriate mining. The government is planning to go for surface mining at Barapukuria after 2011. Full scale extraction awaits a decision, following feasibility study. The past government and the emergency caretaker administration wasted four years in unproductive exercises for coal policy formulation. Now, the incumbent government is also sitting on it. Extraction of 65 Tcf equivalent of coal awaits a decision, though it can produce 10,000MW of power for 50 years. Environmental and social impacts could be minimised by using modern extraction technology.
Fulbaria and Borapukuria coal could be useless, once climatologists prohibit coal burning.
Road shows in London, New York and Singapore, cannot attract investors so long red tape is allowed to mess up the investment climate of Bangladesh. The road shows abroad provide some bureaucrats to make unproductive foreign trips. In this era of teleconference, investors could be reached sitting in Dhaka.
It is good to be optimistic. But it is no good to nurture unrealistic dreams. How far it would be realistic to think that power shortage can be solved and gas production doubled in two years is anyone's guess. Those who say so only befool the people. Planning must be realistic. The exercise must start without further delays.
Key functionaries in Bangladesh energy sector have been felling the media that there will be no energy crisis by 2012. They also said natural gas production will be doubled in two years. Bangladesh is suffering from the most severe energy crisis in its history due to an acute supply shortage in the national power and gas grids. Bangladesh generates over 4000 MW of power against the demand for 5500 MW. It produces about 1950 MMCFD of gas against the demand of 2400MMCFD. In three years, the demand for power is expected to reach 7000MW and for gas 3000 MMCFD. To meet power shortage, Bangladesh needs to produce an additional 3000 MW of power and at least 1000MMCFD of gas a year. The statement of the energy functionaries calls for an objective analysis.
It took Bangladesh 38 years to develop the capacity what it to produces now. The question is how far it would be realistic to plan doubling power and gas production in three years?
What the government could achieve in last one year? Could it ink any substantive contract for new power generation? Could it yet undertake a fresh exploration for spotting new gas fields? Could it take a decision to extract coal? A major power plant installation and commissioning would take at least three years. Setting up of a 450MW power plant at Nabiganj, beside Beanibazar gas field, is still under evaluation. The government is also evaluating the bids for setting up a number of high cost liquid fuel contingency power plants to feed the national grid by June next. But no developer can install and commission such plants in such a short time. According to media reports, some not so experienced bidders, with apparently non-reliable documents, have been identified as successful bidders. The possibility of the planned contingency power plants coming to production by June is remote. The government could not do much to address the power shortage during the irrigation season and summer of last year. The people leniently viewed bad management to tackle the inherited crisis. With the irrigation season knocking the at door again, the government is left with no option but to repeat load management. Hours of load shedding in the cities to divert power supply for irrigation, would be a source of embarrassment for the government.
The ruling party is pledge bound to add 1700 MW of power by 2011 and 3400 MW by 2014. Overenthusiastic energy functionaries of the government, after several brain storming sessions, announced the decision to set up several large power plants. For the planned liquid fuel-based, coal-based as well as nuclear power plants, they said the government would depend on public-private partnerships (PPPs), independent power producers as well as donor funding. But the record of poor management, bureaucratic hassles and the influence of energy syndicates hardly help to create any optimism. The donors want establishment of transparency and accountability before funding the projects.
The private sector is yet to invest anew, to any substantial extent, in the power sector. The public sector, which has otherwise a near monopoly in production and distribution, is weak and sick. Fuel shortage is major problem. New gas field discovery for commercial production will require at last five years. Laying the transmission lines would also need three to five years.
The coal option is alsoin a mess. The underperforming Barapukuria coliery is facing the adverse impacts of inappropriate mining. The government is planning to go for surface mining at Barapukuria after 2011. Full scale extraction awaits a decision, following feasibility study. The past government and the emergency caretaker administration wasted four years in unproductive exercises for coal policy formulation. Now, the incumbent government is also sitting on it. Extraction of 65 Tcf equivalent of coal awaits a decision, though it can produce 10,000MW of power for 50 years. Environmental and social impacts could be minimised by using modern extraction technology.
Fulbaria and Borapukuria coal could be useless, once climatologists prohibit coal burning.
Road shows in London, New York and Singapore, cannot attract investors so long red tape is allowed to mess up the investment climate of Bangladesh. The road shows abroad provide some bureaucrats to make unproductive foreign trips. In this era of teleconference, investors could be reached sitting in Dhaka.
It is good to be optimistic. But it is no good to nurture unrealistic dreams. How far it would be realistic to think that power shortage can be solved and gas production doubled in two years is anyone's guess. Those who say so only befool the people. Planning must be realistic. The exercise must start without further delays.