Power plan massive, allocation poor

To achieve double-digit growth rate for the economy within seven years, the new budget continues to hammer away at the government's old plans to massively expand the power sector using coal, nuclear, renewable and other sources.
However, most of these bold plans intended to take the nation to the next level of the economy do not have any specific allocations.
The large projects are all subject to getting money from international agencies, such as the Asian Development Bank (ADB) and Japan International Cooperation Agency (Jica), which are currently in negotiation with the government.
Officials said if the loans with international donors were ensured within the new fiscal year, the government would divert funds from its block allocation, which is over TK 5,500 crore in the Annual Development Programme, to kick-start the projects.
All projects initially begin with the appointment of a consultant, which requires a small amount of government funds.
The new budget has allocated Tk 11,540 crore to the power and energy sector, a figure close to that of last year's.
Among the new schemes, the finance minister has proposed allocating Tk 400 crore for an ambitious plan to produce 800 megawatts of electricity by next year using renewable energy.
Only a few countries have actually gone for such a large renewable energy project as it requires a lot of land compared to conventional power plants. But if such power plants are built, it would improve the country's energy security while delivering power to the remotest areas.
With a number of power projects already in progress, the finance minister yesterday promised the nation that by 2017 the country's power generation capacity would shoot up to 18,162MW from the present 10,000MW (the actual electricity supply hovers around 7,200MW). A large chunk of this electricity comes from the private sector.
Most of this new electricity will come from coal-fired plants to reduce the burden on gas-burning electricity plants, which contribute the lion's share of the electricity produced.
More than a dozen, mostly large power projects, did not get any funds this year, including the Rampal 1,320MW plant to be built by the India-Bangladesh Friendship power company.
This plant is by far the biggest single power project. According to sources, the construction of this plant was expected to begin in October-November this year. The power company was supposed to arrange international financing.
The budget also did not allocate any fund for the 1,200MW Matarbari coal-fired power project to be financed by Jica. This would be the costliest infrastructure project as Jica determined its cost at $4 billion, which is more than the cost of two 1,000MW nuclear power plants.
Sources said Jica was expected to sign the loan agreement for the Matarbari project this month with the aim of completing the project by 2021.
As per the budget presentation, Moheshkhali island is set to become the centre of the country's economic engine. It will have the deep-sea port nearby, a Liquefied Natural Gas (LNG) terminal, five coal-fired power plants and an LNG based 1,000MW power plant.
However, there have been no specific allocations for these in the budget.
The budget also mentioned importing unspecified megawatts of electricity from India, Bhutan and Nepal.
In developing the gas sector, the government will continue to enhance the capacity of Bapex to help it discover new gas and oil fields.
However, the lone national company's success had been limited due to lack of efficient manpower, even though the government in recent years had given good allocations to Bapex to purchase exploration and drilling equipment.
Many of the new gas discoveries announced by Bapex through surveys were political rhetoric, as surveys do not ensure actual gas discovery.
For instance, Bapex had claimed to have discovered a massive gas field in Sunamganj-Netrakona on the basis of a study. But upon drilling, all Bapex could get was sand.