Electricity import from India is an economic option for Bangladesh as it is cheaper than all the other options including coal fired power plants, says a report.
The report, published on Monday, said that importing of power will need less domestic power generation capacity. The money which was supposed to be invested in improving power generation capacity and fuel infrastructure development thus can be used for the development of non-energy sectors like agriculture, manufacturing or for consumption expenses.
Titled ‘Economic Benefits of Bangladesh-India Electricity Trade,’ the study was carried out under the South Asia Regional Initiative for Energy Integration (SARI/EI) project supported by the USAID. It was released on Monday at a city hotel.
It said that electricity trade between two countries was a win-win option for both. The import can bring larger microeconomic benefits for Bangladesh and for India, there are some beneficial impacts, although they may not be highly visible because of the size of India’s power system and economy.
Gowher Rizvi, international affairs advisor to the prime minister, spoke as the chief guest at the inaugural session. He said that India started lending a helping hand in the power sector in 2010 when Bangladesh was in acute power shortage.
“It was such a big problem that questions were raised if Bangladesh government could survive the extreme power shortage. That’s when the power sector people began to think outside the box and began to talk about importing power from India,” he said.
The small quantity of electricity import of 600MW from Indian began in 2013 to give some temporary relief to deal with power shortage that had been causing economic losses and difficulties in daily life.
The country’s extraordinary success in attaining production capacity from a little under 4,000MW to around 15,000-16,000MW makes it evident that the target of producing 23,000MW by 2021 is not impossible, he added.
He said that all of the countries in the sub-continent suffer from power shortage. As a result, power trading within the countries is a tremendous idea.
“We all are now moving from an era of extreme power shortage to near self-sufficiency,” he added.
Speaking on the occasion as guest of honor High Commissioner of India to Bangladesh Harsh V Shringla said India is already supplying power to Bangladesh.
“We are a partner of Bangladesh in reaching its goal in the power sector by 2021.”
The high Commissioner cited some of the areas where the two countries are working together and have made progress, and some areas currently in focus.
He said by September or October this year the broiler unit of the Rampal power plant will be set up. Within 42 months of the contract the project will be completed.
Addressing the criticism of the location of Rampal, he said for Bangladesh land is limited and much land is needed for agriculture.
“So whenever setting up a power plant, it involves sacrifices — either sacrificing cultivable land or lands which are environmentally in some senses sensitive,” he said.
Farooq Sobhan, president of Bangladesh Enterprise Institute (BEI), said in the nine years’ Bangladesh’s one of the biggest achievements was producing power more than before. The main increase came through number of initiatives in private sector.
“One very important initiative has been taken by the present government, which is to promote the idea of importing power from our next door neighbor,” he said.
The power sector will be most important in the future for the country in terms of achieving vision 2021 and 2041.
The country is looking to generate almost 25,000MW electricity by 2021. The power trade with India and expanded power trade with Nepal and Bhutan will be critically important to achieve this ambitious goal, Farooq said.
Integrated Research for Action and Development (IRADe) Chairman Dr Kirit Parikh delivered the welcome address while among others Dr Kerry Reeves, deputy director of Environment and Economic Growth Office of USAID Bangladesh also spoke at the occasion.