Fresh initiative to set up 17 small power plants

According to the decision, power entrepreneurs will be given permission to install 17 small power plants in different parts of the country to provide electricity to the national power grid.

"Initially, we planned to install 12 such plants in different places -- Chittagong Port, Boro Aulia of Chittagong, Feni, Choumohoni, Comilla, Tangail, Habiganj, Bogra, Rajshahi, Naogaon and Moulvibazar," said an official.

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He said the process is underway to make a list of the entrepreneurs who intend to install the plants.

Against the backdrop of acute power crisis in mid 1990s, the then government decided to quickly open up the power generation to private sector when several foreign and joint venture companies installed 100 to 110 mw plants called "independent power plants" or IPPs.

The state-owned Power Development Board has been paying the IPPs in dollars under a decision which later was criticised because of massive draining out of foreign currency due to gradual devaluation of taka.

But in line with a recent government decision, the new plants would be paid in Bangladesh currency while only Bangladeshi entrepreneurs will be allowed to install the plants, the officials said.

Under an earlier plan taken during the previous government, the Rural Electrification Board (REB) was to purchase electricity from proposed 10 small power plants with 10 mw capacity each.

The initiative, however, was stalled after three of the plants were installed at Ashulia, Comilla and Narsingdi.

State Minister for Power Iqbal Hassan Mahmud said recently that the fresh initiative was also a bit different from the earlier decision. Under the new initiative, PDB would buy the power directly from the plants for the national grid.

So far, 118 enterprises took the enlistment forms for setting up the power plants although only four to five of them have experience in the power sector, said an official.

"Some of them, however, are working on developing partnerships with the experienced ones," he added.

Currently, 23 power plants, including the IPPs, are in operation with 61 units having a total of 4710mw capacity. But due to the dilapidated conditions of many of the state-owned plants, the production does not exceed 3600 mw while the demand for power is nearly 4,000 mw.