The New Nation - Internet Edition

BSS, Dhaka

About three billion US dollar is needed to implement the government's robust plan to increase power production at a satisfactory level, Power Development Board (PDB) has assessed.

PDB, the state run agency in its proposal to the power division said this amount is needed to install 4 big coal-fired power plants excluding other options to install 21-35 power plants with a generation capacity of 25 to 100 MW, based on furnace oil or diesel.

At the same time it said it needs another two to three billion US dollar to add power to the national grid.

"We are going to present the proposal to the Prime Minister, who is also in charge of the Power Division. According to our assessment we need another amount of 600 million US dollar to implement the small power plant projects", Alamgir Kabir, Acting Chairman of PDB told BSS yesterday.

Under this plan PDB has set to address the gap between the power generation and supply which now stands around 2,000 MW. It also plans to add 2,500 MW fresh generation.

The power division identified that it needs a huge fund to address three crucial things (i) ensure subsidy from the government to pay the bills of the IPPs (independent power producer) for purchasing power (ii) ensure budgetary allocation on regular basis for the payment for purchasing power from the rental power plants and (iii) mobilize a 3 billion US dollar for setting up new power plants to address the nagging power crisis which was a major election pledge of the government.

To address the financial constraint in implementing the plans of the government, Tawfiq-e-Elahi Chowdhury BB said the government is taking initiative for raising funds for the power sector by issuing bonds and offloading shares of the state owned power entities in the stock market.

He said the government is now planning to establish a financing company. "We could raise money from public-private- leasing agency and also from the stock market that could help us reduce the burden from budgetary allocations", he added.

"The state owned energy companies including DESCO, PGCB, Meghna, Padma and Jamuna Oil have already enlisted themselves in the capital market and we have a plan to issue bonds at home and abroad to raise more funds," he said.

The report of the PDB said that if it goes to install 500 MW rental power plants then it might need a subsidy of Taka 6,000 crore per year, however, PDB is now paying Taka 1,000 crore as subsidy per year to purchase power from the rental power plants and Taka 500 crore subsidy per year to the IPPs.