Own coal or imported coal?

Bangladesh's energy sector, faced with the primary fuel constraint, appears to be in a dilemma over choosing between own coal and imported coal for its medium-term energy security. The country has five discovered coalmines in greater Dinajpur and Rangpur regions.  The coal reserve is of superior quality - low sulfur, low ash and higher heating-value. The shallow (120-500 metres) coal reserves buried under soft and silty earth in the two mines at Phulbari and Barapukuria favour open-pit mining because of their geological characteristic. Mining the coal by applying off-the-shelf method and setting up mine-mouth power plants can generate about 5,000 MW of electricity in 4-5 years. The feasibility reports including those on environmental and social impact management and mine water management have been lying with the government's desk for the Phulbari Mine since 2005. Line professionals, international experts and business communities are constantly calling for mining own coal. Still a democratically-elected government during its entire term from 2009 -2013 failed to initiate mining its own coal. Rather, it wasted the entire term chasing the rainbow of imported fuel - coal and LNG. In its second successive term the government now intends to further delay mining own coal on the pretext of further study. The government is advancing its initiative to generate power from imported coal. The risks and challenges concerning the use of own coal and imported coal have mainly been discussed here.

Present challenges of power generation: Bangladesh has to ensure sustainable energy security for maintaining its impressive GDP (gross domestic product) growth which can enable it to attain major millennium development goals (MDGs). The major challenge is arranging sustainable supply of primary fuel at affordable costs. The finite reserve of cheap natural gas is fast depleting. Over the last decade or so Bangladesh consumed its proven gas reserve for failure to discover any major gas resource. The present exploration initiatives also do not suggest any major addition to the natural gas resource. The government has rightly decided to diversify the fuel basket lessening the pressure on the depleting natural gas for power generation. For a short period the contingency measure like power generation from imported liquid fuel halted the alarming slide in energy security. True the nation had to pay through its nose for higher costs of power generation. Now the government is desperately trying to secure cheaper fuel for power. Whether or not imported coal or LNG (liquefied natural gas) would be cheaper than imported liquid fuel is now a matter of judgment. There is no denying the fact that exploration and exploitation of own coal can be the cheapest and most affordable option for Bangladesh. From the recent statements of the Prime Minister and the State Minister of Energy it now appears that the government now prefers imported coal to local coal. Experts may question whether the government has authentic comparative techno-economic analytical studies for opting for imported coal. If imported coal cannot make sure power generation is cheaper than that from imported liquid fuel, then the entire exercise will be futile.

Imported coal-based power generation: The government has included the imported coal-based Rampal thermal power plant, a joint venture between BPDB (Bangladesh) and the NTPC (India) in the list of its priority projects. The government has also signed an agreement with the local entrepreneur Orion Group for some medium-capacity imported coal-based power plants. Initiatives have been taken for another large power plant at Matarbari in Cox's Bazar. Some other plans on imported coal-based power projects in Anowara and Cox's Bazar are also maturing. The Rampal power plant in Bagerhat in the proximity of the world heritage site Sundarbans mangrove forest has created a controversy. The initiative for the plant at Matarbari has also been challenged in a court. We need not think about any probable and possible emission impacts from coal-fired power plants. Modern technology can ensure almost the zero emission level, if we are ready to pay for it. Our concerns are the lack of coal import facilities and the issues and challenges associated with them. In response to the concerns raised by experts, the government policy makers talk about import of higher quality coal, use of a desulfurisation plant and adoption of super critical pressure technology. Policy makers talk about transshipping coal by smaller covered vessels from mother vessels. Has anyone done any analysis of the costs involved? Is there any strong regulatory authority in Bangladesh to monitor all these? What will be the cost of power generation from imported coal, if all those remedies to control emissions and environmental impacts the policy makers are promising are taken into account? Global economic giants like India, China and, maybe, even Japan may go for massive coal hunt from the international market soon. Can Bangladesh compete with them? Indonesian coal will become costlier soon with new regulations expected to be in force. Coal from Australia, South Africa and Mozambique must be costlier. We have read about Bangladesh acquiring coal mines abroad. Before even thinking about it Bangladesh may talk with India about its experience of acquiring energy assets abroad.

We strongly believe that Bangladesh's efforts to rely on imported coal will soon prove uneconomic and mere waste of money, time and energy. Imported energy for Bangladesh can be a long-term strategy and necessary infrastructure for this must be created before going for it.

Why not own coal? What makes policy makers apprehensive of mining own coal? It is ridiculous to even think that Bangladesh can risk impacts on its world heritage site Sundarbans for an Indo-Bangla imported coal-based joint venture power plant while it hesitates to take a straight forward decision of mining own coal and using it for mine-mouth power generation. All those environmental and social impacts and water management issues can be credibly managed. Reputed international consultants have done extensive studies on the Phulbari mine. These reports have been gathering dusts at the concerned desk of the government for nine years. Yet, the government without any extensive techno-economic feasibility studies has jumped their guns for the imported coal-fired plant. This writer had an opportunity to look into an EIA of an imported coal-fired plant. Ridiculously true that it appears a mere copy-and-paste of the EIA of the Phulbari mine.

If government wants, it can engage the best international consultant to further review all documents included in the scheme of development of the Phulbari mine. Neither Bangladesh has any expertise nor does any NRB have any intellectual capability for evaluating the intricacies of coal mining methods and impact management. The government in its previous term wasted time doing water modeling with persons having no proven track records of mine water management. Some so-called experts talked about underground gasification. Nowhere in the world has anyone even thought about underground coal gasification because of the thick-seam and high-quality coal reserve that Bangladesh possesses. It is only applicable for marginal coal mines where any traditional mining method cannot be applied.

The PM talked about more research and studies prior to mining own coal. Coal mining has well-practised mining methods and technology. Nature designates the mining method for a particular mine. No policy dictates the mining technology or method. Policy makers appear confused.

Bangladesh's coal has low ash and low sulfur and is of higher heating value. Using this will cause much less concerns about environment. Using the coal for mine-mouth power generation will not require transportation and power generation using own coal will be much cheaper.

Some people talk about absence of a coal policy. Experts say if the absence of a coal policy impedes local coal mining, then under which policy the government is signing deals on imported coal-based power plants one after another. The Mines and Mineral Act and the Regulations and Environmental Act are more than enough for going ahead with own coal mining.

The government may survey land sales and purchase over the last few years in the mining areas. Vested quarters are reportedly purchasing land and manipulating documents with ulterior motives of getting compensations, when mining would ultimately commence. Any delay now in commencing mining will do favour to this vested group and mining will get costlier.

The government should go for mining own coal and setting up mine-mouth power plants as its topmost priority is to secure the most affordable primary fuel supply. One mine at Phulbari is almost ready for mining. If mining and mine-mouth power generation are given the go-ahead by the end of 2014, about 5,000 MW of power may be available by the end of 2018. Underground mining at Barapukuria will stop after the present phase. Future mining at Barapukuria must be done by applying the open-pit method. Mining at Khalaspeer and Dighipara must not also be delayed. The mining should be done as soon as possible after review of available studies and conducting new studies. A study on coal bed methane must start for the Jamalganj mine without delay.

Initiatives for imported coal-based power plants will soon prove that the cost of power generation in that case will be comparable with the cost of power generation from imported liquid fuel. For imported coal the government has to set up enabling coal import facilities. The private sector will find the challenge insurmountable. We know Bangladesh has to import coal and LNG eventually. But the country is not yet ready. We doubt that the present government in its present term will see completion of any imported coal-based power plant project.

The writer is an engineer. [email protected]