Why delays in commissioning of rental power plants
Abul Hossain | Monday, 16 June 2008
THE Bangladesh Power Development Board (BPDB) handed over the land of the sites in workable condition at a date later than the expected time. As a result, the commercial operation of the three rental power plants, among the would-be six, are going to be delayed. Under the terms of the contract signed between the BPDB and the related power companies, the former did not hand over the land of the site in workable condition to the later in due time. Hence, it was not possible for 50 MW Rental Power Plant at Kumargaon, 50 MW Rental Power Plant at Shahjibazar, and 50 MW Rental Power Plant at Fenchugonj, i.e. a total of three power plants, to go on commercial operation on time. It is known that among these, 50 MW Kumargaon Rental Power Plant will soon go into commercial operation.
The Power Cell issued letters on January 15, 2008 in favour of eight selected technically competent and financially qualified lowest bidders -- rental power companies -- with a request to sign the contract within next fortnight for setting up power plants. But it reportedly telephoned all rental power companies to sign the contract on the same day. At its request, five power companies signed the contract, though six power companies were present. Energy Prima Limited signed the contract for 50 MW Kumargaon, 50 MW Fenchugonj and 50 MW Shahjibazar Rental Power Plant and Ventura Energy signed the contract for 30 MW at Bhola on the same day. On the other hand, Agrico signed the contract for 40MW at Khulna on January 28, 2008.
The main condition of setting up the rental power plant was to go into commercial operation within 120 days from the date of signing the contract. On the other hand, the BPDB was supposed to hand over the land of the site in a workable condition within 30 days from the date of signing the contract to the rental power companies. The BPDB handed over the land of the sites at Bogra, Khulna and Bhola on time. For technical reasons, 40 MW Power Plant at Khulna did not receive the permission to go into commercial operation within the stipulated time.
In the selected area of the 50 MW Rental Power Plant at Kumargaon, four units of go-down, scrapped materials and debris were scattered and spread out at the entire site. At first, the site was made clear and clean at the initiative of the rental power company by doing 306 numbers of piling works, having a depth of 60 feet each to make the site workable for the installation of the power plant. This work was done until March 16, 2008. As per contract, the land of the site was supposed to be handed over to the power company by February 15, 2008. For not handing over the land in time, there had been an unwanted delay of 60 days from date of signing the contract.
The power company did not agree to take over the land of the site at Shahjibazar because the land was marshy and had sloping of 10 feet to 15 feet. This meant that all the rainwater and floodwater would pass through the drainage that went through the middle of the site from the hilly area. Therefore, on February 29, 2008, the new allocated site was handed over to the power company. This newly allocated site was also low land, having a depth of five feel to six feet in paddy land. The power company filled the site with sand and rammed it up to make the site workable by spending 30 days and on March 30, 2008 the site was in a workable condition for installation of the power plant. So the responsibility of delay for setting up this plant should rest upon the BPDB and it cannot avoid it.
The first allocated land of the site for 50MW Power Plant Project at Fenchugonj was marshy and low, having a depth of 15 feet from road level. The low land of the site was to be filled up by the BPDB within 30 days but it failed to do so. Later on, new land of the site was allocated, and handed over, to the rental power company on April 20, 2008. The power company made the site workable by doing 106 numbers of piling works, each having a depth of 80 feet. This took much time up until June 10, 2008. So, getting the site in a workable condition was delayed by 120 days from the date of signing the contract. Besides, for the devastating cyclone named Nargis, 10 to 15 days were delayed for shipment of goods and materials due to freight congestion at the sea-ports in Malaysia and Singapore.
The 20 MW Rental Power Plant at Bogra was supposed to go into commercial operation on May 24, 2008 but the concerned power company failed to do so because the Chittagong Port is not capable to release goods having weight of 70 tons. As a result, the goods remained undelivered at Singapore Port for one month. But these spare parts of the machinery arrived at Bogra on June 12, 2008. The 30 MW Power Plant Project at Bhola may reportedly go into commercial operation by the first week of August, 2008.
On its part, the BPDB has been trying for operationalising some rental power plants for the last three years. But it could not make the site for such plants ready for setting up the units following the signing of the contracts. This has raised many questions about the delays in setting up power plants, more so when the power company has to make the payment of the LD for delay in completing the project. Under such circumstances, a clarification is needed as to why handing over the land of the site took so much time and why the rental power company has to pay the penalty. If necessary, a rescheduling of the time for the commercial operation for the rental power plants may be necessary, considering all the factors affecting the progress relating to their implementation.
The Power Cell issued letters on January 15, 2008 in favour of eight selected technically competent and financially qualified lowest bidders -- rental power companies -- with a request to sign the contract within next fortnight for setting up power plants. But it reportedly telephoned all rental power companies to sign the contract on the same day. At its request, five power companies signed the contract, though six power companies were present. Energy Prima Limited signed the contract for 50 MW Kumargaon, 50 MW Fenchugonj and 50 MW Shahjibazar Rental Power Plant and Ventura Energy signed the contract for 30 MW at Bhola on the same day. On the other hand, Agrico signed the contract for 40MW at Khulna on January 28, 2008.
The main condition of setting up the rental power plant was to go into commercial operation within 120 days from the date of signing the contract. On the other hand, the BPDB was supposed to hand over the land of the site in a workable condition within 30 days from the date of signing the contract to the rental power companies. The BPDB handed over the land of the sites at Bogra, Khulna and Bhola on time. For technical reasons, 40 MW Power Plant at Khulna did not receive the permission to go into commercial operation within the stipulated time.
In the selected area of the 50 MW Rental Power Plant at Kumargaon, four units of go-down, scrapped materials and debris were scattered and spread out at the entire site. At first, the site was made clear and clean at the initiative of the rental power company by doing 306 numbers of piling works, having a depth of 60 feet each to make the site workable for the installation of the power plant. This work was done until March 16, 2008. As per contract, the land of the site was supposed to be handed over to the power company by February 15, 2008. For not handing over the land in time, there had been an unwanted delay of 60 days from date of signing the contract.
The power company did not agree to take over the land of the site at Shahjibazar because the land was marshy and had sloping of 10 feet to 15 feet. This meant that all the rainwater and floodwater would pass through the drainage that went through the middle of the site from the hilly area. Therefore, on February 29, 2008, the new allocated site was handed over to the power company. This newly allocated site was also low land, having a depth of five feel to six feet in paddy land. The power company filled the site with sand and rammed it up to make the site workable by spending 30 days and on March 30, 2008 the site was in a workable condition for installation of the power plant. So the responsibility of delay for setting up this plant should rest upon the BPDB and it cannot avoid it.
The first allocated land of the site for 50MW Power Plant Project at Fenchugonj was marshy and low, having a depth of 15 feet from road level. The low land of the site was to be filled up by the BPDB within 30 days but it failed to do so. Later on, new land of the site was allocated, and handed over, to the rental power company on April 20, 2008. The power company made the site workable by doing 106 numbers of piling works, each having a depth of 80 feet. This took much time up until June 10, 2008. So, getting the site in a workable condition was delayed by 120 days from the date of signing the contract. Besides, for the devastating cyclone named Nargis, 10 to 15 days were delayed for shipment of goods and materials due to freight congestion at the sea-ports in Malaysia and Singapore.
The 20 MW Rental Power Plant at Bogra was supposed to go into commercial operation on May 24, 2008 but the concerned power company failed to do so because the Chittagong Port is not capable to release goods having weight of 70 tons. As a result, the goods remained undelivered at Singapore Port for one month. But these spare parts of the machinery arrived at Bogra on June 12, 2008. The 30 MW Power Plant Project at Bhola may reportedly go into commercial operation by the first week of August, 2008.
On its part, the BPDB has been trying for operationalising some rental power plants for the last three years. But it could not make the site for such plants ready for setting up the units following the signing of the contracts. This has raised many questions about the delays in setting up power plants, more so when the power company has to make the payment of the LD for delay in completing the project. Under such circumstances, a clarification is needed as to why handing over the land of the site took so much time and why the rental power company has to pay the penalty. If necessary, a rescheduling of the time for the commercial operation for the rental power plants may be necessary, considering all the factors affecting the progress relating to their implementation.