Diesel power plants to be phased out by June: Nasrul

The government has decided to shut all diesel-run power plants by next June, said State Minister for Power, Energy and Mineral Resource Nasrul Hamid on Saturday.

"The power plants run on other types of oil will also be phased out within the next two to three years. But, dual fuel – gas and diesel – based plants will remain in operation," he said at a seminar titled "Energy Transition: Global context and Bangladesh" at the capital's Bidyut Bhaban.

The Forum for Energy Reporters Bangladesh (FERB), a platform of journalists working in the energy sector, organised the seminar.

At present, there are 12 diesel-run power plants with around 1-gigawatt capacity, mostly owned by private companies.

These power plants have entered the power generation system on a rental basis for three to five years. But in the last decade, plants have secured multiple extensions for years to date, said sources at the Power Division.

Earlier in July, the authorities had suspended operations of diesel-run power plants to save dollars in the wake of a steep hike in oil and liquid gas prices in the international market.

However, the government was forced to backtrack as frequent load-shedding plagued the country disrupting goods production and daily lives.

Nasrul Hamid said the government is now preparing a guideline allowing the private sector to import oil and gas and retail the products to consumers.

"Private power-producing companies already import oil on their own. But now we are formulating a policy guideline allowing them to import other types of oil and gas and we want them to retail it up to consumers," he added.

Talking about the energy transition, he said, "Whatever and how many plans we are making – short term and long term – our main issue is whether it is less costly energy or not."

"Price will be hiked or not is not the issue, rather the issue is whether the transition is affordable. It has to be less cost affordable energy to the consumers and are we emitting less carbon to take the less cost energy?" he said.

Nasrul Hamid said that usage of electric vehicles in Bangladesh could save a large amount of fossil fuel and forex.

"An oil-run vehicle's energy efficacy level is only 20% whereas electric vehicles' energy generation efficiency using electricity is around 80%.  Shifting to electric vehicles will help us save huge foreign currency. To grab this opportunity, firstly, our public utility vehicles – our trains and buses – should immediately shift to this transition," he also said. 

Energy expert and former energy-related special assistant to the chief advisor of the caretaker government Professor M Tamim presented a keynote at the seminar where he said it will not be right to interrupt the economic growth of the country just because of the energy crisis.

"Therefore, along with the local supply of gas and coal, we must secure steady and sustainable sourcing of primary energy by importing – coal, gas, cross border electricity and nuclear fuel," he said.

"However, Bangladesh should not haste in decision-making based on the current crisis. Demand forecasts based on sector-wise bottom-up growth projections on 5-10 years of time frame should be undertaken," he added.

At the event, Md Mahbub Hossain, senior secretary at the Energy and Mineral Resource Division, said various work plans and initiatives taken in the last six and seven months to harness the indigenous gas would increase 300mmcf gas supply per day in the future.

Power Division Secretary Habibur Rahman said due to dwindling production and supply scarcity, the government is putting less priority on the gas and liquefied natural gas (LNG) in the upcoming master plan.

"Our major power generation capacity is built on gas and some upcoming projects are also gas based while the supply of this energy is depleting. Therefore, we are trying to put less emphasis on the gas and LNG in the upcoming master plan," he said. 

Among others, eminent geologist Professor Badrul Imam, Bangladesh Power Development Board Chairman Engineer Md Mahbubur Rahman and Director General of Power Cell Engineer Mohammad Hossain spoke at the programme.

Presided by FERB Chairman Md Shamim Jahangir, its Executive Director Rishan Nasrullah moderated the seminar.