Power, energy sector gets Tk 28,051cr

The government has proposed allocation of Tk 28,051 crore for the Power Division and Energy and Mineral Resources Division in FY2019-20, which was Tk. 26,503 crore in FY2018-19. The Finance Minister AHM Mustafa Kamal came up with the proposal while placing his maiden and the Awami League government’s 20th budget in parliament on Thursday.

Of the new allocation, the Power Division occupies the lion’s share of Tk 26,065, with the rest proposed for the Energy and Mineral Resources Division.

For the 2018-19 fiscal, the government had proposed allocating Tk 24,920 crore for the power and energy sector, which was Tk3,803 crore or 18% higher than the allotment given in the FY2017-18.  The power and energy sector was allocated Tk 21,118 crore in the fiscal 2017-18, a 45% increase from the revised budget of the earlier fiscal. By next year, each upazila of the country will have 100 per cent access to electricity, AHM Mustafa Kamal said in his budget speech. The financial decision maker of the country, Mustafa Kamal, said there are targets to generate 10 percent of the total electricity from renewable sources by 2020. In order to promote electricity generation at the roof-tops of private buildings using solar home system, a “Net Metering Guideline” has been prepared. 

“Power generation capacity was 4,385 megawatts in 2005, which has now increased to 21,629 megawatts. When we began our journey in 2009, the amount of power in the national grid was 3,200 megawatts, against which the generation today is 12,893 megawatts. The share of the population enjoying electricity connection was 47 percent, which has now gone up to 93 percent. Gas supply was 1,443 million cubic feet, which has now increased to 2,746 million cubic feet per day,” he added. To accelerate oil and gas exploration and extraction, new bidding rounds will commence after the approval of the model production sharing contract, both for offshore and onshore. Bearing in mind the slogan of Prime Minister Sheikh Hasina for ensuing electricity in all households, the government has set targets to generate 24,000 megawatts by 2021, 40,000 megawatts by 2030, and 60,000 megawatts by 2041 respectively.

The construction of 53 power plants with capacity to generate 14,202 megawatts of electricity is underway. Alongside, signing contracts for the establishment of 18 new power plants with a capacity to generate 5,801 megawatts of electricity, is in progress (LOI and NOA has been given). It is expected that the plants will begin to function shortly. 

Moreover, invitation for tender for 7 power plants with a capacity to generate 1410 megawatts of electricity is in process. Plans have been made to establish 17 power plants with a capacity to generate 19,650 megawatts of electricity in the near future. Besides, there are plans to generate extra electricity through BMRE of the existing old power plants.

“In order to ensure energy security and sustainable energy supply system, we have plans to reduce the use of fuel to 15 percent by 2021 and to 20 percent by 2030. Fuel diversification has been adopted as a strategy to reduce dependency on natural gas for electricity generation and for energy security,” the finance minister said in his budget speech. 

According to the speech, the present government has implemented various projects to set up coal based power plants as an alternative for natural gas. The mega projects that are worth mentioning include Rampal 1,320 MW, Matarbari 1200 MW and Payra 1320 MW coal power plant. Steps have been taken to establish 10,000 megawatts coal based power plant at Moheshkhali through Joint Investment. Besides the natural gas and coal based power plants, setting up of a nuclear power plant at Rooppur with a power generation capacity of 2,400 megawatts is in progress.

In order to import Liquefied Natural Gas (LNG), an alternative to indigenous natural gas, to ensure energy security in the country, two Floating Storage and Regasification Unit (FSRU) with a daily capacity of 1000 million cubic feet have been installed, which currently adds around 650 million cubic feet LNG daily to the national grid.

The government has taken a series of actions in the last two terms to improve the transmission infrastructures and to support the additional generation capacity of the nation.

As a result, the total transmission line has now increased to 11 thousand 493 circuit kilometers and the distribution line to 5 lakh 8 thousand kilometers. To ensure uninterrupted power supply, the government has been implementing a plan to install 28,000 circuit km. transmission lines and 6 lakh 60 thousand km distribution line through different projects by 2030.

The Finance Minister said “We have undertaken short, medium and long term plans to explore and extract unexplored gas and oil in land and sea areas. The excavation work of 24 oil wells has been completed. After gaining new maritime boundary from India and Myanmar, Production Sharing Contracts (PSCs) have been signed with international oil companies for 4 offshore blocks to explore oil and gas in the sea areas of Bangladesh. To accelerate oil and gas exploration and extraction, new bidding rounds will commence after the approval of the model PSC for both offshore and onshore.