The Power Division has taken steps to halt installation of the proposed rental power plants that, the division estimates, will cause financial loss worth Tk 79.20 billion in 15 years of their lifespan.
"State Minister of the Power Division M Anwarul Kabir Talukder has planned to brief the Prime Minister (PM) about the possible effects of installation of these rental power plants from the government exchequer within a few days," a senior Power Division official told the FE Sunday.
He said the Power Division under the Ministry of Power, Energy and Mineral Resources (MPEMR) is preparing a note to be placed to the PM, who is also the minister of the MPEMR, on the rental power plant issues.
Power Division sources said the government must have to count loss over Tk 5.0 billion annually to generate only 160 mega-watt (MW) of electricity from five rental power plants as the government will have to purchase electricity from rental power units at higher rates and sell those to the clients at subsidised rates.
The purchase committee of the government has so far approved five proposals for installation of rental power plants by private sector that include Shahjibazar 80 MW, Kumargaon 20 MW, Bogra 20 MW, Katakhali 20 MW and Thakurgaon 20 MW.
But the government is yet to sign agreements with concerned private entrepreneurs to purchase electricity from their rental power plants, Power Division sources said.
The nagging electricity crisis across the country pushed the government, last year, to approve a policy to install eight barge-mounted or skid-mounted rental power plants across the country.
But the Power Division now feels the state-owned power entities might face huge financial drawbacks if the government allows installing the power plants.
Besides generation of mere 160 MW of electricity will not contribute much to improve the power supply situation, said the Power Division official.
As per the tender documents of rental power providers the state-owned Bangladesh Power Development Board (PDB) will have to purchase electricity between Tk 2.62 and Tk 3.01 per kilowatt-hour.
But the selling price of the PDB's electricity to the Dhaka Electric Supply Authority (DESA) is Tk 1.89 per kilowatt-hour, to the Rural Electrification Board (REB) is Tk 1.84, to the Dhaka Electric Supply Company (DESCO) for Tk 1.94 and to the West Zone Power Distribution Company for Tk 1.94.
Besides, if finally approved by the government it will take at least six months for installing rental power plants.
Power Division sources said the state minister of the power division will try to convince the Prime Minister for installing new power plants in place of purchasing rental powers at higher prices.
Talukder pointed out the conditions set by the bidding companies of the rental power projects and said those are 'unviable' considering the country's economy.
Power sector sources said the PDB is currently reeling under a financial crisis over non-payment of outstanding power bills worth around Tk 6.0 billion to the independent power plants (IPPs), as different power distribution agencies do not pay it regularly.