Power purchase from India: Bangladesh pays Tk 16102cr as capacity charge
Staff Reporter :
The past Awami League government, in addition to building power plants in both public and private sectors, also pursued the option of importing electricity from India.
Electricity imports from that country began in the 2013-14 fiscal year and have gradually increased over time.
Apart from fuel costs for imported electricity, Bangladesh also incurs capacity charges, totalling around Tk 16,102 crore over the past 11 years.
According to the Power Development Board (PDB), from 2013-14 to 2023-24, Bangladesh imported a total of 6,638.30 crore kilowatt-hours of electricity from India at a total cost of Tk 41,713.81 crore.
Of this, Tk 16,101.87 crore was spent on capacity charges, accounting for 38.6 per cent of the total cost.
This figure excludes the 1,496 MW of electricity imported from Adani.
The first agreement to import 500 megawatts of electricity from India was signed in the 2013-14 fiscal year.
That year, Bangladesh imported 226.50 crore kilowatt-hours, costing Tk 1,145.74 crore, with Tk 500.62 crore allocated for capacity charges.
By the following fiscal year, imports had increased to 337.99 crore kilowatt-hours, costing Tk 1,900.37 crore, with Tk 921.91 crore in capacity charges.
When contacted, renowned energy expert Professor Dr. Ijaz Hossain told The New Nation on Friday, “In case of purchasing partial power from any power plant the government has to give capacity charge.
In case of buying power from Adani’s plant this condition has been added.
But in the other cases of buying power from India why and in how account the government has paid capacity charge it should be scrutinized.”
Contacted, energy expert M Tamim told The New Nation, “Purchasing power from India was not so high costing so far I know.
There is nothing to be separated of costing of energy price and capacity charge as both the matters are added in such thing.”
Electricity imports from India reached a record high in 2022-23, with 891.73 crore kilowatt-hours imported at a total cost of Tk 6,982 crore. Of this, Tk 2,636.54 crore was spent on capacity charges.
However, due to non-payment issues in the previous fiscal year, the supply from Indian plants was reduced, and imports fell to 829.77 crore kilowatt-hours in 2023-24.
Despite this, the total cost rose to Tk 7,255.49 crore, with Tk 2,450.81 crore paid as capacity charges, largely due to the increase in the dollar exchange rate.
Currently, Bangladesh imports electricity from various Indian sources, including 250 megawatts and 300 megawatts from NTPC VidyutVyapar Nigam Limited (NVVN), a subsidiary of NTPC; 250 megawatts from Sembcorp India; 200 megawatts from PTC; and 160 megawatts from Tripura.
The agreement to import 160 megawatts from Tripura, signed in 2016 for five years, was renewed in 2021 for another five years, expiring in 2026.
As the Tripura plant is hydroelectric, it does not incur capacity charges, although its electricity is priced higher than other sources.
In 2014, a government-to-government (G2G) agreement was signed with NVVN to import 250 megawatts for 25 years, expiring in 2039.
Additional agreements in 2018 secured 300 megawatts from NVVN, 200 megawatts from PTC, and 250 megawatts from Sembcorp for 15 years, expiring in 2033.