Bids for rental power plants get nod today
The power ministry today seeks the nod of the caretaker government's purchase committee on seven rental power bids of 250 megawatt capacity with three local and foreign entities that submitted offers in October.
The ministry is not presently forwarding any proposal for another 50MW rental plant for Fenchuganj where two bidders submitted proposals last month.
Sources say the proposal evaluation committee (PEC) of the ministry's Power Cell has recommended in favour of a consortium named Energy Prima that did not produce documents substantiating its experience in at least 20MW rental power generation in the last three years.
But this condition is the basic pre-requisite for the rental power schemes.
The PEC also recommended in favour of a US rental power company Alstom Power Company that did not specify exactly when it would be able to avail power plant equipment.
The committee has also recommended for another foreign and local consortium Kaltimex and GBB Power which is not exactly a rental power entity.
The sole objective of the government in this rental power bid is to augment 300MW power supply by April. The government is ready to pay more for this power which can be brought online very quickly and uninstalled effortlessly, according to a top power ministry official.
In contrast, small power plants and Independent Power Plants are set up on a long-term basis and charge lesser power tariff.
The PEC headed by the director general of Power Cell recommended a consortium of Indonesian Kaltimex and local GBB Power Ltd for the Bhola 34.5MW gas-fired rental power plant.
The consortium sought a price of 5.198 US cents for per kilowatt-hour of power. However, Kaltimex's experience documents don't clearly show that it has implemented any power project on rental basis.
For the Shahzibazar 50MW gas-fired rental plant, the PEC recommended local EnergyPrima, a joint venture with Russian Geo-Spectrum Group, Energy Prima and Hosaf Meter Industry that offered 4.517 US cents.
The legal documents of this joint venture have not been registered under the Companies Act, and therefore it lacks the legal basis as a bidder.
The same Energy Prima consortium was again recommended for Kumargaon 50MW power plant with a tariff offer of 4.148 cents and for Bogra 20MW plant with a tariff offer of 3.607 cents.
Energy Prima and Hosaf Meter are both owned by Moazzem Hossain. Energy Prima's business has been shown as "Local Agent", without explaining who it represents and how it is related to the power sector.
Geo-Spectrum, on the other hand, is a Russian power plant manufacturer, and not a rental power developer.
The Power Cell's bidding criterion demanded that in addition to being experienced in rental power operation, the bidder will state the plant's location, capacity, owner, power purchaser and commissioning date.
It further says the bidder must possess barge/skid/trailer-mounted power plants in ready stock, either through ownership or "other arrangement". Energy Prima's bid documents don't comply with these requirements.
The Power Cell recommended two petroleum-fired power plants for Alstom in Khulna 40MW with a tariff offer of 21.52 cents and for Bheramara 20MW with a tariff offer of 21.77 cents.
Alstom has also been recommended for the Ashuganj 50MW gas-fired power plant with a tariff offer of 7.255 cents.
Sources say the Power Cell had many clarifications to ask from the selected bidders before making its recommendations. These clarifications, once accepted, should be seen and signed by the 10 members of the PEC.
But in reality, most of the clarification replies from the bidders received by the Power Cell has only one signature.
"This goes to show that the PEC may have not seen all the documents that qualify the bidders. For instance, Energy Prima did not specify if it had gas generators ready for rental power installation," says a source.
"Upon seeking a clarification, it sent a document saying that it has signed a deal with a German company Power International to supply a 55.8MW power plant, now located in 'Europe'.
"Interestingly, the letter says that in case of any dispute between Energy Prima and Power International over their agreement, there will be a 60 days period for amicable settlement and then it will be sent to the arbitration court in Singapore."
The source goes on to explain: "This means, in case of any dispute between Energy Prima and its power equipment supplier, Bangladesh may have to wait for a unpredictable time line.
"This is unacceptable. Again, the letter itself does not fully clarify the power plant location by just saying it's located in so and so countries of Europe."
The Power Cell floated the rental power bids in October, drawing 13 offers from five companies in seven locations.
On November 19, the cell held another tender to draw offer for the eighth location and received two more such offers.
Once awarded a power contract, the contractor must start power generation within 120 days.