Although Tk2,202 crore allocated this year to the Power, Energy and Mineral Resources Ministry remains unspent, the government has doubled its allocation to the ministry in the proposed FY2015-16 budget.
In his budget speech, Finance Minister AMA Muhith announced a total budgetary allocation of Tk18,540 crore for the sector, a 99% increase from the revised budget of Tk9,338 of the current fiscal year.
The budgetary allocation for the ministry in the current fiscal was Tk11,540 crore, but was later revised down to Tk9,338 crore.
The allocation, including development and non-development sectors for FY2015-16, is 4.3% of the total budget outlay.
Of the amount, the Power Division will get Tk16,503 crore while the Energy and Mineral Resources Division will receive Tk2,037 crore.
The government has reduced subsidy allocations for the power and energy sectors by 8.3% for FY2015-16, with a proposed allocation of Tk8,800 crore compared with Tk9,600 crore in FY2014-15.
Muhith described the subsidies as loans to the Power Development Board (PDB) and Bangladesh Petroleum Corporation (BPC).
Muhith said in his budget speech yesterday that power generation capacity had been increased to 13,675MW from 4,942MW in 2009, including 2,000MW captive and 175MW solar power.
“We have been able to generate an additional 6,323 MW electricity from January 2009 to March 2015. In addition to increasing the power generation capacity, our target is to ensure supply of at least 80% of the production capacity by 2018,” Muhith said.
“Significant progress has taken place in the energy sector due to our relentless efforts. At present, 2,700 million cubic feet gas is being produced and supplied daily from 20 gas fields of the country.
“We have installed pre-paid meters in different places on a pilot basis to increase efficiency in the household use of gas and have stopped giving new household connections.
“As a long-term solution to the power crisis, we have undertaken a plan to generate 2,000MW and 4,000MW electricity from nuclear energy by 2022 and 2030, respectively.
“We have, meanwhile, started installing pre-paid meters in all households in phases over the next three years to ensure the economical use of electricity,” the finance minister said.
Besides the expansion of energy production, he said the government emphasised saving energy by 10%, 15% and 20% by 2016, 2021 and 2030, respectively, through efforts in the industrial, commercial and residential sectors.
Muhith said the Energy Efficiency and Conservation Master Plan was being formulated.
“Steps are under way to implement energy auditing and energy management programmes in industry. Alongside this, we have undertaken an Energy Star labelling programme to encourage the use of efficient appliances,” he said.
Muhith said coal will be the main fuel after 2015 and establishing coal-based power plants is a priority job.
Energy expert and BUET Professor M Tamim said: “Work on coal-based power plants is behind schedule. The Rampal power plant, expected to begin production in 2016, won’t start operating until 2019.”
Muhith said: “Inflation is likely to decline … in 2015 due to reduced oil prices. Taking advantage of this, we will strive to bring discipline to the subsidy management system.”
But energy expert Ijaz Hossain said: “It is frustrating that the price of fuel oil was not decreased. At least the price of furnace oil could have been reduced by the government.”
The finance minister said: “We have targeted imports of 6,500MW electricity by 2030.”
Discussions on hydro-electricity imports from Nepal, Bhutan, Myanmar and the Indian north-east are in progress, which Tamim described as “positive.”
Muhith said the government intended on generating 2,000MW electricity from renewable sources by 2020, including a programme to produce 500MW electricity from solar energy.
Ijaz said: “It is a good thing the government has decreased taxes in this sector.”
