The Power Division is frustrated over implementation of 24 public and private sector power projects having capacity to generate around 3197MW of electricity by 2014, due to fund shortage.

Of the power projects, nine are under public sector, officials said.
13 out of 15 power projects under the private sector are yet to mobilise the funding to implement the projects. Besides, a public sector project has also failed manage its fund, they added.

In a letter to the Prime Minister’s Office (PMO) recently, Power Division Secretary Md Abul kalam Azad said the private sector sponsors have failed to open letter of credits (LC) to import equipments for the projects due to liquidity crisis in the commercial banks and complexity regarding the exposure limit of foreign currency.

Following the letter, Prime Minister Sheikh Hasina has decided to sit with Power Division to discuss the issues.
The government earlier decided to implement the private sector power projects with 70 percent of foreign funding.

“We need support from the Finance Division, Banking Division and Bangladesh Bank to implement the power projects with 70 percent foreign funding to ensure sovereign guarantee and financial closing,” Azad said in the letter.

In the letter, the power secretary also sought help from Bangladesh Bank and commercial banks so that the private sector investors can open LCs to import equipments for the proposed power plants.

“If the concern authorities fail to address the issues, implementation of the power projects under private sector would be uncertain in the next two years,” the letter said.

Prime Minister’s Power and Energy Adviser Dr Tawfiq-e-Elahi Chowdhury told daily sun that the government is still stick to its plan to produce more electricity in the private power.

The PM’s adviser also said the government would assist the private sponsors to mobilise foreign fund to implement the power projects.

“The Independent Power Producers, sponsors by private sector, would be charged with liquidated damage (LD) if they fail to generate electricity in time,” he added.

The World Bank has already refused to finance two mega power projects at Bibyana, sponsored by local Summit Group, a concern of Tourism Minister Faruk Khan’s family.

Meanwhile, two other Power plant projects owned by Aslamul Huq, a ruling party lawmaker from Dhaka-14 (Mirpur), are yet to mobilise fund, concern officials of BPDB said. The lawmaker has no previous experience in power sector.

Besides, three mega coal-based power projects owned by Orion group have also failed to manage funds.
According to Power Division, the government has so far added 3330MW of electricity in the last three years from 47 power projects.

The daily demand of electricity is recorded 6500MW against the supply of 5000-5500MW.
The government also targeted to generate around 13000MW of electricity between 2012-2016.

The power division officials said the electricity generation was only 3268MW against the demand of 4200MW when the AL government took office.

“I think it’s a failure of Bangladesh Power Development Board (BPDB) to sign contracts with private sponsors without ensuring foreign funding to implement the projects,” said Professor M Tamim, former special assistant on power, energy and mineral resources to the chief adviser of a caretaker government.

The Daily Sun/Bangladesh/ 6th June 2012