Bangladesh had made a deal to import 500MW of electricity from India this year, but the neighbouring country has yet to finalize its sales policy. A lack of policy support has complicated the import process for Bangladesh, preventing implementation of the deal.
According to several Power Division officials, the Indian government enacted the “Cross Border Trade of Electricity Act” in 2017. However, policies needed to properly implement the act are yet to be formulated.
“This delay in making related policies could possibly halt several ongoing processes of electricity import from India,” officials said.
The power system master plan shows that the demand for electricity in Bangladesh is going up by 10% each year. If this rate does not decrease, the country will have a demand for at least 24,000MW of electricity by the year 2021.
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The government plans to meet this demand with electricity generated in both domestic and foreign sectors. Bangladesh has increased the production of electricity to tackle the increasing demand, and started the process of importing power from neighbouring countries.
India is the largest exporter of electricity to Bangladesh, currently exporting 660MW. The process of importing another 3,100MW of electricity is currently underway.
Of this projected target, 500MW of electricity was set to be imported from India this year. There was also a plan to import another 1,000MW of electricity, through a gridline going through Bihar and Assam.
Bangladesh also has plans to import 1,600MW of electricity from a power plant built by Adani Group in India. However, as the sales policy has yet to be finalized, Bangladesh is unable to reach an agreement with India for the electricity import.
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Under the circumstances, a tender for importing 250MW of electricity from the private sector of India has already been cancelled. Bangladesh is trying to extended the contract term with Power Trading Corporation of India (PTC) under a special provision while also considering alternative ways to import electricity to meet domestic demand. At the moment, 250MW of the total imported electricity from India comes from its private sector, under the supervision of PTC. The PTC and Bangladesh Power Development Board (PDB) signed a Power Purchase Agreement (PPA) in this regard on November 14, 2013. However, the agreement expired on July 31, 2017. Bangladesh invited new tenders, but could not open them as India’s policies for the Cross Border Trade of Electricity Act have yet to be finalized. “With no other viable option left, Bangladesh is making an effort to extend the term of the PPA with the PTC,” a recent letter from Power Division Secretary Ahmad Kaikaus read.This article was first published on banglatribune.com
