Limping power projects hinder distribution

Although the government has taken up several projects in the power sector, they remain incomplete due to complications at the implementation stage due to a number of reasons. 

Delays in making designs, appointing consultants and contractors, land acquisitions and a lack of implementation capacity of the respective agencies are to blame.

This means there are still lots of deficiencies in the distribution system despite Bangladesh's success in power generation.

A tripartite meeting has begun today to identify challenges in six World Bank-financed projects in the power sector and discuss measures, said officials at the World Bank's Dhaka office and the Economic Relations Division (ERD).

Representatives of the Power Division and implementing agencies concerned will also attend the two-day meeting.

The multilateral lender has a loan commitment of $1.68 billion for the projects and the Power Grid Company of Bangladesh (PGCB) is providing a $59 million loan from the World Bank 

The projects are the Bangladesh Power System Reliability and Efficiency Improvement Project; Enhancement and Strengthening of Power Network in Eastern Region; Scaling-up Renewable Energy Project; Ghorashal 4th Unit Re-Powering; Rural Electrification and Renewable Energy Development II (RERED II) Project; and Electricity Distribution Modernisation Programme.

The objective of the Bangladesh Power System Reliability and Efficiency Improvement Project is to improve the reliability and efficiency of the power system in Bangladesh through the optimisation of dispatch operations.

Although its implementation has been going on for five years, its main work has not been started yet.

Project Director Md Arifur Rahman told The Business Standard, "The main work hasn't started yet. A consultant has been appointed who is now designing the project.

"The next job will be appointing a contractor. But it is impossible to say when - it depends on the work of the consulting firm," he added.

Enhancement and Strengthening of the Power Network in the Eastern Region is among the slow-moving projects under the PGCB. The multilateral lender will lend $450 million to the project.

The objective is to meet the growing demand of power in industrial, commercial and residential points of the Cumilla, Chattogram, and Noakhali regions, by enhancing and strengthening the existing grid networks of the eastern region.

According to the PGCB data, the physical progress of the project is only 47.30% in the last four years. The loan agreement was signed in 2018 and will remain valid until next year.

According to the World Bank, it will provide new electricity connections to 275,000 households and 16,000 agricultural consumers, and reduce power interruptions. The project will expand the existing grid network by building 13 new substations and rehabilitating an existing one.

The establishment of a 50MW solar power plant faces a delay. Electricity Generation Company of Bangladesh started work in July 2019 to set up the plant at Sonagazi in Feni with World Bank funding with a target to complete the work by June 2022. 

But in reality, its land development work has not been completed yet.

The Sonagazi plant is one of the three segments of the World Bank's Scaling-up Renewable Energy Project with a loan of $185 million.

Project Director Mohammad Anwar Hossain said the implementation had been delayed due to the Covid-19 pandemic.

"After completing the tender process eight months ago, the contractor has been appointed. The design has also been prepared. Now land development work is in progress. The plant is expected to go into production next year," he added.

Meanwhile, the production was supposed to be raised to 409MW by re-powering the 210MW Ghorashal 4th Unit with World Bank financing. But the generation increased only by 30MW.

Commissioning began in 2020 after the main work of re-powering is completed. It shows that the power generation is 240MW. That means 169MW less electricity is being produced.

According to a report of the Power Division, the engineering, procurement, and construction (EPC) contract do not include any work on steam turbines. As the required equipment for steam turbines is not installed, the production is not going as per the target.

Now the project is being revised afresh.

Officials of the ERD said apart from speeding up the implementation of the ongoing projects and ensuring quick disbursement, the projects awaiting loan agreements will be discussed in the tripartite meeting.

ERD officials said due to a lack of preparation of the project, it takes time to secure the loan from the World Bank. Due to this, the project preparation will be discussed to secure the World Bank loan. Eight projects in the pipeline have been listed for discussion this time.

The projects include Bay Terminal Project; Program on Agricultural and Rural Transformation for Nutrition, Employment, and Resilience; Bangladesh Green, Resilient and Inclusive Development Policy Credit; Gas Sector Efficiency Improvement and Decarbonisation project.