The government is now planning to introduce special benefit schemes for both residents living near coal-based power plant sites and upcoming privately-owned power plants in the sector.
Under the scheme, public-owned coal based power plants will have to contribute a minimum amount for a social development fund, which will be used for the benefit of residents living near the plant sites.
“We are now preparing a guideline to form a ‘social development fund’ for the residents living near coal-based power projects. A draft proposal has been finalised and will be soon placed before cabinet division for scrutiny,” said Power Secretary Monwar Islam while talking to the Dhaka Tribune.
Under the proposed draft, the new tariff for each unit of electricity will be set including an additional tariff of Tk0.03, which will donated to the social development fund. The additional tariff will be mentioned in the Power Purchase Agreement.
“Local people might be connected to the proposed power projects in many ways and their stake will be considered,” he added.
The fund will be used for various development activities, such as building roads, providing drinking water, electricity supply, establishing educational institution, awarding scholarship for students, medical facilities, and other cultural and social welfare for the residents.
“It is necessary to take up development projects as Corporate Social Responsibility to reduce public sufferings and mitigate environmental risks in the areas near the power plants.” he claimed. A five-member management committee will be formed to administer the fund.
Similarly, the government also plans to introduce a 15-year tax holiday for privately-owned coal-based power plants after they start their commercial production.
The benefit schemes for the private companies will be applicable only for those who will sign an agreement with the government within June 30, 2020.
The scheme would also allow the foreign employees of private power plants a tax holiday for the first three years. They will also be relieved from paying taxes on the interest of foreign loans.
In addition, the government also relaxed taxes on royalties, technical know-how and the technical assistance fees. With a target to generate around 20,000MW of electricity from coal-based power projects by 2030, the government pledged to set up 22 coal-fired power plants across the country under public, public-private partnership and independent power producer initiatives.
All of these power plants are expected to start production between March 2015 and 2020.
