Tk390cr corruption at three power plants: TIB

Transparency International Bangladesh (TIB) has uncovered an estimated corruption of around Tk390 crore that allegedly took place at three power plants which are currently under construction.

The alleged corruption happened in land acquisition and providing compensation that involved some power plant officials, local public representatives, land acquisition officials, and middlemen. 

The power plants are the Barisal Coal-based 350MW power plant, the Banshkhali SS 1320MW power plant, and the Matarbari LNG based 600MW power plant.

TIB disclosed the information in a virtual press conference on Wednesday when they released a research report titled "Coal and LNG Power Projects in Bangladesh: Governance Challenges and Way Out".

Of the total estimated amount, a Tk15.59 crore corruption took place at the Barisal power plant, Tk255 crore in Banshkhali, and Tk119.45 crore in Matarbari, according to the TIB study conducted from February 2021 to April 2022.

The report recommended strict legal action against and punishment of people involved in corruption at various phases of project implementation. 

TIB's Senior Research Fellow (Climate Finace Governance) Md Mahfuzul Haque and Newazul Moula did the research and presented it jointly at the press briefing. 

The report found the implementation cost of coal-based power plants in Bangladesh is twice the global average.

"The price per unit of electricity generated at coal power plants in neighbouring countries like India, China, Pakistan, and Australia ranges from Tk3.46 to Tk5.15," reads the report.  

"However, the selected projects have been approved, allowing for the purchase of electricity at higher price, that is, Tk6.61 per unit at the Barisal Coal-based Power Plant, and Tk6.77 at the Banshkhali SS Power plant," it added.

Dr Iftekharuzzaman, Executive Director of TIB said the country's power sector has become dependent on domestic and foreign donors and investors which is a matter of concern. 

"Unethical benefits are being given to influential parties and the people are bearing the brunt of it," he said.

Dr Iftekharuzzaman said there are declarations of renewable energy, but no initiatives in implementation.

"We have become kind of hostage to this energy dependency. To get rid of this condition we have to go for renewable energy," he added. 

In recommendations, the research report suggested power sector policy should be formulated in an inclusive and participatory manner, excluding those with conflicts of interest in the power sector; and strategically prioritising renewable energy. 

It also recommended abolishing the Quick Enhancement of Electricity and Energy Supply (Special Provisions) Act, 2010. 

As section (9) of this act has revoked court jurisdiction if a project is approved under the act, some independent power producers (IPP) received capacity payments without generating electricity in the last ten years, and the government was unfairly obliged to pay out Tk43,170 crore. 

The report also said there is no action plan for raising renewable energy generation funds with a roadmap to implement projects for the reduction of carbon emissions. 

"Implementation of several coal projects, supposedly using supercritical and ultra-supercritical technology, continues. By 2030, coal based energy production will increase 63 fold with an estimated emission of 110 thousand tons of carbon per year from the 18 proposed projects," reads the report.

Among others, TIB Advisor (Executive Management) Professor Dr Sumaiya Khair, and Director (Research and Policy) Mohammad Rafiqul Hasan, were present at the press conference moderated by TIB Director (Outreach and Communication) Sheikh Manjur-E-Alam.