Govt to offer recipe to set price of Indian electricity

The government will offer a method on how to determine the tariff of power to be imported from neighbouring India, instead of setting a fixed price.
A power purchase agreement (PPA) to be signed between Bangladesh and India will include the method.
However, officials in Bangladesh said the tariff could be Tk 5 per unit at the end-user level. That includes the transmission costs.
The Power Division will place a proposal along with a method at the meeting of the Cabinet Committee on Economic Affairs on Sunday for determining the tariff of the power to be imported from India.
If the draft PPA is approved by the economic affairs committee, the two countries will sign the final agreement.
The Power Division said article 10 of the PPA has described the method for determining the energy tariff. As power will be imported from India in December this year, no specific tariff can be finalised in the PPA at the moment.
The proposal also said the tariff will be set in line with the method when India will start supplying electricity.
The Power Division also said, if the government pays the power bill quickly, Bangladesh will be entitled to a rebate.
However, an indicative price has already been mentioned in the proposal. India will supply 250 megawatt power from its 13 coal-based power plants and the average price of the electricity was Rs 2.40 per kilowatt hour which equals around Tk 4.
Power Secretary Abul Kalam Azad at a press conference early this month said India will supply electricity at Tk 4 per kw/hour.
However, Power Development Board (PDB) Chairman ASM Alamgir Kabir told the same press conference that Indian electricity price may be at around Tk 5 at end user level after inclusion of the transmission cost.
Earlier in August last year, the Power Division sent a draft proposal to the economic affairs committee on signing of the PPA agreement, but till date the committee did not give any decision in this regard.
In the committee meeting yesterday, a proposal was placed for purchasing surplus electricity from two private power producers. Of those, the government will purchase 216 megawatt power from Beximco Power Co Ltd.
The amount is 40 percent of the total production of the company.
The price of electricity from Beximco Power will be Tk 4.97 per kw/hour, while Chittagong Power Company will provide 15 mw electricity at Tk 4.51 kw/hr.
Both the power plants are coal-based. The rate of these two companies is higher than the rate at which the government is purchasing power from other coal-based plants.