Shakhawat Hossain
The government on Wednesday allowed fuel oil import by private power producers for the first time to meet the demand for petroleum products of oil-guzzling quick rental power plants.
A meeting of the cabinet committee on purchase approved a proposal of the Power Division for allowing the independent power producers to import petroleum products for electricity generation.
The state-owned Bangladesh Petroleum Corporation is now the country’s lone importer and distributor of petroleum oils.
A senior Cabinet Division official said the private sector power producers would pay 9 per cent service charge in addition to import duties and others levies for fuel oil import.
They (the PPPs) will, however, enjoy the existing subsidy provided by the government, he said.
Power Division officials said they were forced to take such a decision as the BPC showed unwillingness to continue with fuel oil import as well as maintaining the oil storage facilities.
Besides, the cash-strapped BPC is facing problems to foot the growing oil import bills.
The government has already made upward price adjustments of fuel oils thrice in the current fiscal year. Yet, the projected losses of the BPC in this fiscal year will amount to around Tk 100 billion.
IPPs have set up 16 rental and quick rental power plants with a total production capacity of 1,372 megawatt. Most of the plants run on oil and diesel.
Nineteen more private-sector plants with a total generation capacity of 2,120MW electricity will come into operation next year.
The country’s fuel oil consumption had been hovering around 3 million tonne a year until it jumped to 4.8 million tonne in the last fiscal year. The amount is likely soar to 6.8 million tonne in the current fiscal year.
Power Division officials said the rental power plants required 500 tonnes of furnace oil a day for generating 100 megawatts of electricity.
The present government encouraged installation of quick rental power plants driven by fuel oils to increase electricity generation and tackle the nagging power outages.
The move has been widely criticised as the present government could have made a significant progress by now in establishing low-cost power plants in line with its policy paper.
The critics pointed out that the government was focusing more on expensive power plants which proved too costly for the economy.
They said the country’s macro-economy was now under severe strain due to the huge import liability of fuel oils for the quick rental power plants.
Source: newagebd.com/newspaper1
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