Washington Post analysis of Bangladesh’s power purchase agreement with Adani

Bangladesh is buying electricity from India’s Adani Group. US media published a report on Adani Group’s coal-based power plant and its 163-page ‘secret power deal’ with Bangladesh. The Washington Post.

Published on December 9 In the Washington PostThe report mainly focuses on Adani Group’s coal-based business. A major part of this is the Adani Group’s coal-based business, which has a Godda power project. The electricity generated from this project located in the Indian state of Jharkhand will be exported to Bangladesh.

Latest news on The Daily Star Bangla Google News Channel.

In the Washington PostAccording to the report, in June 2015, Indian Prime Minister Narendra Modi visited Bangladesh for the first time and signed a contract worth 4.5 billion dollars for Indian government and private companies to sell electricity to Bangladesh.

After Narendra Modi’s visit, India’s power authority signed an agreement with Gautam Adani to build a 1,600 MW coal-based power plant in Godda for $1.7 billion.

The Washington Post According to their report, this power deal initially appears to be ‘beneficial’ for both Bangladesh and India, but in reality it is ‘very less beneficial’ for Bangladesh.

Reports said it was an opportunity for Narendra Modi to reinforce the ‘neighbourhood first’ policy and promote Indian business.

Citing sources in the Indian Ministry of External Affairs, the report said that Narendra Modi had asked Bangladeshi Prime Minister Sheikh Hasina to “facilitate the entry of Indian companies into the power generation, transmission and distribution sectors of Bangladesh”.

According to the report, copies of the 163-page ‘confidential memorandum of understanding’ on India’s electricity imports with Bangladesh have been reviewed by three experts. The Washington Post.

Review the contract The Washington PostTim Buckley, an energy analyst based in Sydney, said that even if no electricity is produced after the Godda power plant goes into production, Bangladesh will have to pay about 450 million dollars a year to Adani as a capacity charge. Which is ‘high value’ by global power sector standards.

It is also said that it is not clear when Bangladesh will get electricity as the transmission line work is not completed.

The report was published in the Washington Post on December 9.

“>

The report was published in the Washington Post on December 9.

However, on November 20, the Parliamentary Standing Committee on the Ministry of Power, Energy and Mineral Resources discussed the latest progress in the power generation process and it was revealed that electricity will start coming to Bangladesh from the Adani Power Plant in Jharkhand, India on December 16. On that day, the Commercial Operations Date (COD) of the first unit of the 1,600 MW power plant of 2 units has been fixed. Besides, the commercial operation date of the second unit is set for March 26 next year.

However, on December 16, electricity department officials said that electricity is not coming The Daily StarWho confirmed

According to Bangladesh government data, coal and gas-fired power plants now have 40 percent more power generation capacity than peak demand. In the Washington PostAccording to the report, India may not need this electricity in Bangladesh.

According to the agreement with other companies, Bangladesh pays a certain amount to the power plant regardless of the price of coal in the international market. However, according to the agreement with Adani, Bangladesh will pay the price of coal required for this power plant according to the international market rate. Coal prices have nearly tripled since Russia’s invasion of Ukraine began last February.

As Adani has its own coal business, its company can supply coal to this power plant. 7 million tonnes of coal annually will be supplied here from other countries, the report said citing the project’s environmental clearance documents.

Experts analyze the contract The Washington PostWho said this coal could arrive at a port in eastern India owned by Adani. Then from there it will reach the power plant by rail built by Adani. The generated electricity will come to the Bangladesh border through Adani high-voltage lines. And Bangladesh will bear the transportation cost of all this.

Tim Buckley has worked as an energy specialist at several major energy companies in South Asia. he The Washington PostWho said, according to this agreement, Bangladesh will buy electricity from Adani at a price more than 5 times the wholesale electricity market price of the country. Even if coal prices were to return to pre-Ukraine war levels, the government would have to buy this electricity at a price at least 33 percent higher than the cost shown by the government for domestic coal-fired power plants. Adani’s electricity will cost 5 times more than Bangladesh’s Kaptai solar power plant.

“This deal with Adani is definitely a fraud,” said Tim Buckley.

Bangladeshi environmental activist Hasan Mehdi The Washington PostWho said that 60 percent of Bangladesh’s power plants are usually idle. The Godda power plant will lock Bangladesh’s energy future to coal.

He said, ‘This power plant will reduce the scope of low-cost solar. On the other hand, more money will be spent on unnecessary electricity due to coal.’

According to the report, Bangladesh canceled 10 out of 18 planned coal power projects in 2021 due to high power generation. Mohammad Hossain, director general of Power Cell, Bangladesh’s electricity department, told reporters that the decision was taken due to ‘global concerns’ over coal and the low cost of renewable power generation.

But, even then Adani’s project is going on.

BD Rahmatullah, former Director General of Power Cell, reviewed the contract with Adani The Washington PostWho said, ‘Sheikh Hasina cannot anger India even if the agreement is not in favor of Bangladesh. He knows what is bad and what is good. He also knows that if Adani is happy, Modi will be happy too.’

For comments on these allegations The Washington Post A spokesman for Prime Minister Sheikh Hasina and Bangladeshi energy officials were repeatedly contacted, but they did not respond.

On November 5, 2017, Adani Power Limited signed an agreement with the Bangladesh Electricity Development Board. According to the agreement, the power plant was supposed to be commissioned in December last year. The overall progress of the project to be launched after more than 1 year is 93.52 percent.

Commissioning of 105.9 km transmission line from this power plant to Bangladesh border and 29.5 km from Bangladesh border to national grid has been completed. Backfeed power was provided from Bangladesh grid on August 15.