Govt approves 5-year plan to import 40MW hydroelectricity from Nepal

The Cabinet Committee on Government Purchase has approved a proposal to import 40 megawatts of hydropower from Nepal at a per unit rate of Tk8.17, including transmission charges.

The decision was made during a meeting of the purchase committee on Tuesday (11 June), chaired by Finance Minister Abul Hasan Mahmud Ali. Cabinet Division (reforms and coordination) Secretary Mahmudul Hossain Khan informed journalists about the approval during a briefing after the meeting.

Mahmudul said, "Since electricity will be transmitted to Bangladesh through the Indian grid, we will have to pay India a trading margin of 0.059 rupees per unit. Additionally, Bangladesh will have to give transmission costs to India, however, that has not been determined yet."

He further said the agreement will be between the Bangladesh Power Development Board (BPDB) and the Nepal Electricity Authority (NEA).

Responding to questions from reporters regarding the signing of the contract, Mahmudul said the date for agreement signing has not been finalised yet. "There will be a tripartite agreement between Bangladesh, India, and Nepal since the electricity will come from Nepal via India's transmission lines."

Regarding the time required for the electricity to reach Bangladesh, he said that the prime minister's visit to Nepal is likely forthcoming, and the agreement might be finalised during that visit.

"The initial contract will be for five years, costing approximately Tk130 crores annually, totaling around Tk650 crores over the period. The power will be integrated into Bangladesh's national grid at Bheramara using the Indian grid."

Earlier, the Cabinet Committee on Economic Affairs had granted in-principle approval for importing 40MW of hydropower from Nepal using the Indian national grid. 

Following this, BPDB issued an international procurement proposal, to which NEA and India's NTPC Vidyut Vyapar Nigam Limited (NVVN) submitted proposals. NTPC is India's National Thermal Power Corporation.

The power price at India's Muzaffarpur substation is set at ¢6.40 per kilowatt, with NVVN's trading margin at Rs0.0595. Transmission charges will be according to the Central Electricity Regulatory Commission (CERC) of India.

According to sources in the power division, BPDB is ready to finalise the contract with Nepal within this month. Following the agreement, it will take up to two months to connect the power to Bangladesh's national grid. Nepal has prepared to supply 24MW from its Trishuli project and 16MW from another plant.

Other proposals approved in the meeting

In addition to the hydropower import proposal, the cabinet committee approved several other proposals yesterday.

Crude oil import: Approval was given to a Energy Division proposal for spending Tk13,876 crore on ship rentals for importing crude oil from July to December.

Cabinet Division Secretary Mahmudul Hossain said that from July to December, the amount will be spent on the freight costs for ships bringing in gas, jet fuel, furnace oil, mogas (motor gasoline), and marine fuel.

Sources said a decision has been made to import 15.80 lakh tonnes of fuel oil from Unipec Singapore Private Limited and Vitol Asia Private Limited by chartering ships. This includes 10 lakh tonnes of gas oil, 200,000 tonnes of jet fuel, 250,000 tonnes of furnace oil, 100,000 tonnes of mogas, and 30,000 tonnes of marine fuel.

Fertiliser purchase: The committee also approved the purchase of 165,000 tonnes of fertiliser from Tunisia, Canada, Morocco, Qatar, and Bangladesh's Karnaphuli Fertilizer Company Limited (KAFCO) for Tk688 crores. 

This includes 25,000 tonnes of TSP, 40,000 tonnes of potash, 40,000 tonnes of DAP, and 60,000 tonnes of urea.

Urea import: Meanwhile, the Cabinet Committee on Economic Affairs gave in-principle approval for extending the existing G-to-G (government-to-government) agreement with Muntajat-Qatar for importing urea fertiliser for another year. 

The existing contract with Muntajat is set to expire on 30 June. It also approved in-principle a proposal for a new one-year agreement with Saudi Basic Industries Corporation (SABIC). 

Purchase for TCB: The committee approved purchasing Tk332 crore worth of soybean oil and Tk205 crore worth of lentils for the Trading Corporation of Bangladesh (TCB). 

Secretary Mahmudul said that 20,000 tonnes of lentils will be purchased at Tk102.50/kg to sell at subsidised rates to one crore families holding TCB family cards. Moreover, 2.20 crore litres of soybean oil will be purchased, with each litre priced at Tk150.90.