The state-owned Power Development Board (PDB) signed a 20-year power purchase deal with local company Intraco Solar Power Ltd on Sunday.
The signing came 16 months after a letter of intent was submitted to Intraco that will construct a 30MW grid-tied solar plant at Gangachara in Rangpur.
According to the deal, PDB would purchase power from the solar company at the rate of $0.16 or equivalent to Tk12.80 per unit for the next 20 years.
The country has been witnessing a slow progress in renewable energy generation due to procrastination.
In order to fulfill its target, the government wants to raise the ratio of renewable energy to 10% of the total power generation by 2020.
PDB Secretary Mina Masud Uzzaman and Intraco Solar Power Limited Managing Director Mohammed Riyadh Ali signed the power purchase agreement (PPA) on behalf of their respective sides at the Biduyt Bhaban in the capital.
According to the deal, the company would supply electricity to the national grid within 13 months from the date of deal signed.
Intraco has bought a 143.3-acre of land in Gangachara upazila of Rangpur for the project, said Riyadh.
Speaking at the contract signing ceremony State Minister for Power, Energy and Mineral Resources Nasrul Hamid said the government will continue to provide incentives for expansion of renewable energy generation.
“The government is trying to produce and increase the use of green and clean energy despite the fact that they are comparatively costly.”
Some organisations and companies have already got approval for the purpose, added the junior minister.
Nasrul welcomed financing from the government-owned non-bank financial institution – Infrastructure Development Company Limited – and other local leasing companies in solar power or renewable energy projects.
He also said: “Such investments will help boost the capacity of power sector. The government encourages private sector investment in power and will continue to do so.”
The programme was also addressed by Power Division Secretary Dr Ahmad Kaikaus and PDB Chairman Khaled Mahmood.