The New Nation - Internet Edition

UNB, Dhaka

For procedural flaws one after another, many power-plant projects are being cancelled at the final stages of bidding and their costs are going sky-high while the country keeps smarting from nagging electricity shortages.

Problems are getting worse as none is being held responsible or punished for the intentional or unintentional wrongs, experts concerned said.

Such incidents are frequently happening in the country's power sector, which has been one of the root causes of staggering stagnancy in its development.

However, the Power Ministry, its subordinate body Power Development Board (PDB) and the Planning Ministry are blaming one another for the bungling to shift

one's own responsibility to others' shoulders.

"But, for such deliberate misdoing, the country has to pay and its people to bear the brunt of the crisis," says one of those in the know.

Two latest such instances are the cases of the 150-MW Chandpur Power Plant and 150-MW Sylhet Power Plant projects.

The PDB had invited tender for a 100-MW unit of the proposed 150-MW Chandpur combined-cycle power plant and a Chinese company, Harbin Power Engineering (HPE), came out to be a lowest responsive bidder.

Its offer was $ 45 million to install the plant on turnkey basis. As Harbin won the bid, PDB issued a notification of award (NoA) to it to proceed to sign contract to implement the project.

But, after waiting more than a year, the Harbin has not received the call for signing the final agreement despite repeated reminder by the Chinese company.

In the meantime, as worldwide power-plant equipment prices went up, Harbin raised the price of the offer by an additional $ 20 million-showing the genuine cause.

But the PDB declined to enter into the deal accepting the increased rate. The PDB had a ploy-it had delayed over a year as the development project proforma (DPP) was

not approved by the Planning Ministry.

Finally, the power board cancelled the tender and again invited a re-tender for the project. Now, another two Chinese companies staked their claim for the project-one having offered US$ 128 million while another US$ 188 million for implementing the power project as combined-cycle one.

While PDB was earlier unwilling to increase only by US$ 20 million the project cost, now it would have to increase the amount either by US$ 60 million or by US$ 123 million.

However, it's not clear which offer PDB could accept or if it would again go for canceling the project only to see further cost overruns.

Similar was the case with the 100-MW unit of the proposed 150-MW Sylhet combined-cycle power plant. After receiving an offer from responsive bidder-India's Bharat Heavy Electricals Limited (BHEL)--to install the plant at a cost of US$ 68 million, the PDB took one year to go ahead with the process.

But, at the final stage, the Cabinet Purchase Committee rejected BHEL's offer showing an excuse that its revised development project proforma (DPP) was not approved by the

Planning Ministry.

It also showed another excuse that the tender-invitation process was not in compliance with the public procurement regulations 2003.

But there is clear evidence that there was an approval from the offices of the Chief Advisor, the Finance Advisor and the Power Advisor for inviting tender under "one- State, two-envelop" system.

After the cancellation, PDB is taking preparation to invite re-tender for the project. But

industry-insiders are sure that the PDB in no way could get an offer of less than US$ 68 million to implement the project.

Rather, they said, now the PDB has to spend more than double on installation of the project as power plant's equipment prices have more than doubled internationally.

Now, question has been raised by the experienced quarters as to who should be blamed and punished for the procedural errors done in the cases of the two power projects for which the state would have to pay the penalty.

Talking over the issue, Power Secretary Dr. Fouzul Kabir Khan admitted to having the bureaucratic bottlenecks and said, "The government has limitations in increasing prices of any tender proposals."

When asked who should be blamed for such procedural flaws that create scope for price enhancement and finally the country has to pay for, he said, "The system is to blame."