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Power overcapacity now economic burden

bluesky

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https://www.newagebd.net/article/109312/power-overcapacity-now-economic-burdem

Power overcapacity now economic burden
Emran Hossain | Published: 16:30, Jun 24,2020 | Updated: 00:30, Jun 25,2020




The government must review its power sector master plan in order to stop or delay any further expansion of power capacity for wrong economic growth forecast has already resulted in huge overcapacity, experts told a virtual dialogue on Wednesday.

Predicting a drastic fall in economic growth because of COVID-19 impacts in the coming days, the experts suggested that the power division should cut costs in every possible way, including cancellation or deferral of power plant projects under implementation or in the pipeline.

They warned that lack of industrialisation may lock power demand to lower than expected for some time and urged the government to consider cancelling or delaying all power projects, especially coal-based ones.

‘The government must review its demand forecast. Future demand must be looked into realistically,’ M Tamim, professor at the Department of Petroleum and Mineral Resources Engineering, BUET.

He said that the demand forecast must be compatible with industrial and GDP growths, which is likely to drastically fall because of COVID-19 impacts this year and a recovery from it might take a while depending on how the crisis ends.

‘Keeping huge power capacity unused will bear disastrous consequences for the country’s economy,’ said Tamim at the dialogue hosted by Centre for Policy Dialogue.

The keynote paper, presented by CPD research director Khondaker Golam Moazzem said that the revenue generation is likely to fall because of COVID-19 impacts, making the power sector subsidy a financial burden for the government, which was almost Tk 9,000 crore last year.

The paper said that the subsidy is equal to capacity charge paid to idle power plants, which was Tk 8,929 crore in 2019, a 398 per cent increase since 2010, when Tk 1,790 was paid as capacity payment.

The paper said that overcapacity was so large that only about 10,000 MW of 20,514 MW capacity could be used during peak demand.

Up to 63.3 per cent power remains unused during January and at least 40 per cent during summer, said the paper.

Data shows that the government tend to use private power plants more as only 45 of 147 IPPs remained out of operation even during the time when power demand is sluggish.

CPD chairman Rehman Sobhan said that rental power plants should immediately be retired for they are the costliest energy source.

‘Why rental power plants are still there when we have overcapacity?’ asked Rehman Sobhan. He also questioned the deal with rental plants that makes it mandatory for the government to pay them even when they are not supplying electricity. ‘How good is such deal?’ he asked.

The governmental proposed to set aside Tk 26,758 crore in its budget for 2020-21 fiscal year for the power and energy division.

CPD suggested that the power division followed a ‘go-slow’ policy.

It said that there are at least five power plants allocated significant amount of money this fiscal but it could be deferred given the pandemic situation requiring the government to spend more on health and food.

Muhammad Fouzul Kabir Khan urged the government to move away from IPPs following the global trend as countries seek to reduce their liabilities in the power sector.

He said that it was time the government reviewed its power policy formulated in 2009 against the context of a severe power crisis.

Power and energy state minister Nasrul Hamid said that he did not think the country had an overcapacity and called it a miscalculation.

He said that renewable energy such as solar power was still not an option for Bangladesh for many reason including its high cost.

‘We however think there is the scope of reviewing coal power policy,’ said Nasrul.

He said that LNG price was declining and gas-based power plants performed better than coal-based ones.

He said that the government planned to produce 5000 MW of 41,000 MW from coal but many critics talked in a way it looked like whole Bangladesh would be filled with coal power plants.

Power Cell director general Mohammad Hossain, Sustainable and Renewable Energy Development Authority member Siddique Zobair, Bangladesh Independent Power Producers Association Imran Karim and CPD executive director Fahmida Khatun also participated in the dialogue.
 
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They warned that lack of industrialisation may lock power demand to lower than expected for some time and urged the government to consider cancelling or delaying all power projects, especially coal-based ones.
So, the Hasina's power station building plan was based on a faulty thinking of "Putting the cart before the horse". This stupid woman thought that private people, not industries, are the main consumers of her power. Why such a person should be sitting in the govt?

Power station construction should be just a little ahead of industrialization efforts. I heard there will be a power glut of more than 50%. General people consume more when they have more and more income and that does not happen without people being in jobs created by heavy industrialization. On the other hand, it is industries that consume much more power than general people in a poor country.
 
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So, the Hasina's power station building plan was based on a faulty thinking of "Putting the cart before the horse". This stupid woman thought that private people, not industries, are the main consumers of her power. Why such a person should be sitting in the govt?

Power station construction should be just a little ahead of industrialization efforts. I heard there will be a power glut of more than 50%. General people consume more when they have more and more income and that does not happen without people being in jobs created by heavy industrialization. On the other hand, it is industries that consume much more power than general people in a poor country.
Overcapacity was barely over demand during peak industrial production. I can’t understand the point of this article. Would like someone of expertise to elaborate on this matter
 
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Overcapacity was barely over demand during peak industrial production. I can’t understand the point of this article. Would like someone of expertise to elaborate on this matter
Simply speaking, BD has been building more and more power stations without a good knowledge of future demands. Demand remains low because industries are absent. Industries consume most of the power in an advanced country and only a limited units of a power station operates in the nights for the household consumption.

When Rooppur starts in a few years, the glut (excess production) will be 70% unless thousands of industries are built. I think money that could have been used to establish many factories to produce consumer goods have been wasted to build many power stations. It is like putting the cart in front of the horse.

BD govt should examine the situation and immediately stop the purchase of Indian power.
 
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Simply speaking, BD has been building more and more power stations without a good knowledge of future demands. Demand remains low because industries are absent. Industries consume most of the power in an advanced country and only a limited units of a power station operates in the nights.

When Rooppur starts in a few years, the glut (excess production) will be 70% unless thousands of industries are built. I think money that could have been used to establish many factories to produce consumer goods have been wasted to build many power stations. It is like putting the cart in front of the horse.

BD govt should examine the situation and immediately stop the purchase of Indian power.
True that and old coal power Can be shut
 
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Third World Problems : Inadequate development of Energy sector to match local needs, leading to Power outages, Load shedding and poor quality of life overall.


First World Problems : Energy mostly generated through sources that adversely affect the environment, destroy local biospheres and ecosystems as well as adding to adding carbon dioxide to the atmosphere thereby leading to global warming. Big energy corps not wanting to lose market share to green energy and therefore actively hindering, inhibiting sabotaging their growth.


Shonar Bangla Problems : More power generated than needed and yet people in some rural areas lack reliable connections to the nationwide grid. Even so government is adamantly continuing its drives to add more energy to the grid by constructing and starting more powerplants.



You know you're living in a Shonar Bangla when your problems don't belong to either criteria (FW or TW) but instead have a league of their own.
 
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Simply speaking, BD has been building more and more power stations without a good knowledge of future demands. Demand remains low because industries are absent. Industries consume most of the power in an advanced country and only a limited units of a power station operates in the nights.

When Rooppur starts in a few years, the glut (excess production) will be 70% unless thousands of industries are built. I think money that could have been used to establish many factories to produce consumer goods have been wasted to build many power stations. It is like putting the cart in front of the horse.

BD govt should examine the situation and immediately stop the purchase of Indian power.

Relying on Indian power is suicide, got any idea what they did to is over onions?
 
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Third World Problems : Inadequate development of Energy sector to match local needs, leading to Power outages, Load shedding and poor quality of life overall.


First World Problems : Energy mostly generated through sources that adversely affect the environment, destroy local biospheres and ecosystems as well as adding to adding carbon dioxide to the atmosphere thereby leading to global warming. Big energy corps not wanting to lose market share to green energy and therefore actively hindering, inhibiting sabotaging their growth.


Shonar Bangla Problems : More power generated than needed and yet people in some rural areas lack reliable connections to the nationwide grid. Even so government is adamantly continuing its drives to add more energy to the grid by constructing and starting more powerplants.



You know you're living in a Shonar Bangla when your problems don't belong to either criteria (FW or TW) but instead have a league of their own.
Shona bangla is digestive friendly
 
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Relying on Indian power is suicide, got any idea what they did to is over onions?
Onion issue is not here to be compared. BD has built overcapacity of power. Hence, Indian supply should be stopped. Not only India, you will see many news on building hydroelectric power stations in Nepal and bring power here. It is so when the country's industrial sector is limited that consumes a limited amount of power.

Borrow foreign money and build power stations-this is Hasina's policy as if there is no another day. She lacks foresight as usual in every planning. BD will have to pay back the money in dollars when credits mature. So, again it will borrow in order to pay back arrears.

This situation can only be averted if thousands of industries are built. They will consume this excess power and pay bills to the power stations. This money can be used to pay back loans.
 
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@bluesky Industries are clearly struggling to keep up with raging economic growth stats of BBS.
Cannot fudge power demand into existence.
A country really growing in excess of 8% without exporting oil/gas would be industrialising in every corner which would make going from power shortage to power over-capacity so quickly impossible.
 
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@bluesky Industries are clearly struggling to keep up with raging economic growth stats of BBS.
Cannot fudge power demand into existence.
A country really growing in excess of 8% without exporting oil/gas would be industrialising in every corner which would make going from power shortage to power over-capacity so quickly impossible.
GDP data does not always shows the reality. It is possible that BSS makes false data but I cannot really be sure. But, manufacturing sector is not alone to constitute the GDP figure. It also includes agriculture and service industries such as transport of goods or people by truck, bus, launch or rickshaw, or say, shopping centers or small shops, auto workshops, etc.

GDP is actually the total of economic activities by a country's people. Many activities mean the money keeps on changing from one hand to another and in the way the GDP goes up. Currently, the activities are down because of the pandemic. Textile exports are down, people's income is also down, people do not want to spend money and the transport sector suffers. All these low activities cause a slowing of GDP growth.
 
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I don’t remember when I typed that, I was most probably talking to my mom about digestion while typing that


download.jpeg
 
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So, the Hasina's power station building plan was based on a faulty thinking of "Putting the cart before the horse".

Its all about looting. Even with overcapacity, expensive rental power plants which were given to Awami League leaders and patrons are still operational. But people in some cases are getting electricity bill with fake amount 10 times more than actual consumption.
 
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