Master plan frequently changed for 'wrong projection'

The government’s Power System Master Plan 2005, highlighting natural gas-based power generation, did not work. The coal-centric Power System Master Plan 2010 was amended in 2016 to reduce dependency on coal. Now, the authorities have taken a fresh attempt to provide the nation with a new master plan by December.

Experts have observed the transmission network did not expand in keeping with the increased power generation capacity in Bangladesh. Besides, the demand of electricity did not grow and sources of cost-effective energy could not be created as per projection.

They suggested that short-and-mid-term plans, rather than a master plan, on power and energy will work in Bangladesh, as rapid changes in technologies as well as demand and supply of energy are evident.

The master plans of 2005 and 2010 hardly considered environmental issues. However, the new master plan would include energy sector beside the power system and be focused on lower carbon emission, said Japan International Co-operation Agency (JICA)–the sponsor of the particular planning–on its website. JICA also sponsored formulating the 2010 Master Plan.

Mohammad Hossain, director general of the Power Cell, the power generation related policy and research wing of the government, told Prothom Alo that the new master plan will direct the pre-production and post-production of electricity. The pre-production segment will cover the energy sourcing while the post-production part will chalk out the transmission.

The master plan in 2005 was focused on natural gas. However, the master plan became ineffective within two years as the country witnessed gas shortage.

The Power System Master Plan 2010 projected 50 per cent of power generation by coal (30 per cent from domestic source and 20 per cent imported), 25 per cent by imported liquefied natural gas (LNG), 5 per cent by liquid fuel and 20 per cent by nuclear including renewable and cross-border trade.

In reality, the master plant failed to lead development. Sourcing coal from domestic pits halted in 2012 following a decision by the government. On the other hand, building infrastructures for imported coal did not attract investment.

The government amended the master plan in 2016, reducing the percentage of coal from 50 to 35 per cent (coal import rose to 35 per cent), while increasing percentage of LNG from 25 to 35 per cent and of nuclear, renewable and cross-border trade from 20 to 30 per cent.

On 27 June this year, the government cancelled 10 coal-fired power plant projects. Hence, the revised master plan is deemed unimplemented.

Currently, the energy mix in the power sector is: LNG covers 52 per cent, liquid fuel 33 per cent (furnace oil 27 per cent, diesel 6 per cent), coal 8 per cent, and hydro and solar 1 per cent. The remaining 5 per cent electricity is imported from India, according to power division data.

The Power Cell presents its comparative analysis between potentials of power generation by coal and LNG, as the LNG is taking the lion’s share of energy mix. According to the Power Cell, power generation by imported coal costs Tk 7.78 per unit at the Payra power plant. On the other hand, the cost of a unit power generation by a mix of locally extracted natural gas and the imported LNG will vary between Tk 5.77 and Tk 6.20.

Apart from this, a coal-fired power plant requires 15 times more land than a LNG-based plant. The Power Cell officials find LNG less polluting than coal. Currently there are 10 LNG-based power plants–both public and independent–with a total 12,155MW power generation capacity.

Bangladesh Independent Power Producers Association president Imran Karim, is not hopeful about the growth of renewable energy use because of land scarcity. He finds LNG as a dependable fuel for power generation. However, he thinks Bangladesh can import hydropower from Nepal also.

The governments of United Kingdom and Germany are investing on environment-friendly initiatives to increase renewable energy-based power generation capacity to 65 per cent by 2030. Bangladesh’s closest neighbour India too has set a target to increase power generation by renewable energy from 86MW to 450MW by 2030.

Then what about renewables in Bangladesh?

According to the Centre for Policy Dialogue (CPD), several proposals of foreign investment on renewable energy cannot see light in Bangladesh.

Currently eight projects among 36 on renewable energy have been implemented here, covering less than 3 per cent of electricity demand. The government is planning to meet 40 per cent of electricity demand from renewable sources by 2041.

CPD thinks that the government should empower its Sustainable and Renewable Energy Development Authority (SREDA) to implement big projects on renewable energy.

CPD analysed the master plans and said projecting the future demand for electricity–based on the investment opportunities and economic growth–was faulty.

According to CPD, real-time electricity demand remained 30-38 per cent low in the years during 2010-11 and 2020-21 fiscals.

If the power sector develops following the existing master plan, 11,000MW or 30 per cent of the total generation capacity would remain unused in 2025, and it will be a huge burden for the national grid regulator–Bangladesh Power Development Board (BPDB).

Distinguished fellow of CPD, Professor Mustafizur Rahman, told Prothom Alo that failure in a single sector impacts on the others in a macro-economy. “Foreign investment did not come to the country as the forecast. There was no growth of private investment too. That is why the projection on electricity demand did not match.”

He said more investment in industrialisation will narrow the gap between projection and real-time demand.

Some experts recommend that the government estimate the short-term electricity demand and ensure uninterrupted power supply.

Professor Mohammad Tamim, teacher of petroleum and mineral resources engineering at Bangladesh University of Engineering and Technology, told Prothom Alo, “The government should take a maximum five-year plan instead of making repeated amendments in the master plan. Besides, a two-year plan for the shortest and a 10-year plan for the longest period might be taken. By this, the deficits in demand will reduce. A special taskforce can be established to monitor the demand and supply.”

*This report appeared in the print and online edition of Prothom Alo and has been rewritten for the English edition by Sadiqur Rahman