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Such a huge power investment, such a poor sectoral ability

Jul 05, 2023

AN INVESTMENT of $39 billion — $29 billion by the government and joint ventures as well as $10 billion by the private sector — in the power sector in 2009–2022 has increased the installed power generation capacity of 24,143 MW, excluding 3,000MW of captive power, way beyond what is actually needed as there has been about a 50 per cent overcapacity, but the proposition has left the authorities still struggling the meet the demand. With such a huge generation capacity in hand, transmission capacity having almost double and distribution capacity having increased fivefold all because of such a huge investment as the authorities claim, power shortage now ranges between 3,000MW and 3,500MW with the production of about 11,500MW against the demand for 14,600MW. Such a huge investment, which the government claims has helped it to achieve a 100 per cent electrification in 2022, is also reported to have increased the per capital power consumption to 498kWh, almost double of what it was in 2009, as Our World in Data shows. Yet still, people continue to suffer for inadequate supply of power, industries continue to suffer in production and businesses struggle to remain competition although they now pay 200 per cent more for power than what they did in 2010.

Bangladesh still lags far behind in per capita power consumption compared with other countries. Per capita power consumption in India is 1,297kWh, in Bhutan 11,576kWh, in Sri Lanka 751kWh, in Pakistan 645kWh and in Vietnam 2,682kWh. Only Nepal with 204kWh, among the neighbours, has the per capita power consumption less than Bangladesh's while the per capital power consumption in Mali is 155kWh and in Congo 115kWh. Experts believe that an unhealthy reliance of the authorities on power from fossil fuel — goaded both financially and technologically by development partners and countries such as Japan, China, India and the United States — and the provision for capacity charges, a system whereby the government pays independent power producers irrespective of their power being produced or used, have been at the heart of power precariousness of Bangladesh. The government has so far neglected the renewable energy potential, which tapped properly could, as experts say, help the country to easily generate 24,000MW by 2041. Bangladesh, which now generates about 500MW in renewable energy, could save $1 million every day with the renewable supplanting 2,000MW from fossil fuel. The authorities have so far paid some $9 billion in capacity charges to independent power producers while the state-run Power Development Board has incurred more than Tk 1,000 billion in losses and the government had to count more than Tk 1,000 billion in power subsidy since 2010. All this could have been avoided by dispensing with excessive reliance on fossil fuels for power generation, ending the provision for capacity payment — which experts believe is an illogical, but wonderful innovation to transfer public money to private pockets — and balanced investment in power generation, transmission and distribution.

The government must, therefore, rework its energy policies without delay and aim for a good value for such a huge amount money in the power sector.

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