Spending Tk2,000cr on Ghorashal power plant does not pay off

Highlights:

• Goals are not being achieved due to project design flaws
• Production increased only 30MW against the target of 199MW
• Purchase of new parts to achieve target has been proposed
• Additional cost will be Tk100 crore to Tk150 crore
• The duration of the project has increased by two times

Massive spending on the repowering of the fourth unit of the Ghorashal power station is not paying off due to flawed design.

The government took the repowering project at a cost of Tk2,072 crore to increase the capacity of the 4th unit of the plant from 210MW to 409MW.

From a pre-commissioning test on 95% completion of the physical work, the authorities have now come to know that the production capacity has increased by just 30MW, against the target of 199MW.

The project implementing authorities say the desired capacity cannot be achieved as the design of the project does not include steam turbines. As the consultancy did not recommend replacing the steam turbine, it was dropped from the design, they added.

Now, if a new steam turbine is installed, the authorities believe that it is possible to generate electricity from this unit as per target. However, an additional Tk100 crore to Tk150 crore will have to be spent on it.

Energy experts have blamed mismanagement and poor planning for the failure to achieve the target. With the money spent on repowering, it was possible to set up a new power plant of 200-250MW – including land acquisition.

The 210MW 4th unit went into production in 1989. As generation capacity fell to 180MW, its repowering project started in 2016 with World Bank funding. The project was scheduled to be completed in June 2019.

In a report, the World Bank said the project would more than double the generation output with only a 30% increase in gas requirement. Consequently, specific fuel consumption will be reduced by 44%.

According to the Power Division, a contract was signed with China Energy Engineering Group in June 2016 for the repowering of the 4th unit.  A new turbine model having an advanced gas path with a capacity of about 240MW has been installed by the engineering, procurement and construction (EPC) contractor and the plant has been running in simple cycle mode since 30 October 2018.

Under the project, the EPC contractor supplied a new gas turbine, a generator, a heat recovery steam generator and associated auxiliaries. The existing 210MW turbine is used for a combined cycle. After finishing the pre-commissioning work, the combined steam turbine was put into rolling mode and reached 3,000 revolutions per minute but failed to synchronise due to high shaft vibration.

The turbine was synchronised on 23 July 2020.  But it was shut down due to high shaft vibration. After checking, the EPC contractor again started commissioning on 9 October 2020. But the vibration was still high.

After completion of the pre-commissioning work of the combined cycle of the project, when the existing steam turbine was set rolling, it stopped due to high shaft vibration.

It showed that the power generation is 240MW. That means 169MW less electricity is being produced.

According to a Power Division report, the EPC contract does not include any work on a steam turbine. As the required equipment for steam turbines is not installed, production is not going on as per target.

In this situation, two new portions are being added to the rectification works of the existing steam turbine, spare parts, and consumable items of GT under LTSA (Long Term Service Agreement) by correcting the project of the desired power production.

When the project was approved in 2016, its cost was estimated at Tk2029 crore. In the first amendment in 2019, the project time was extended by two years and the cost was increased to Tk2072 crore. The project was again extended by another year.

According to sources in the Bangladesh Power Development Board, it has so far paid Tk1,465 crore for the project.

In the new amendment proposal, the cost of the project is further being increased by Tk99.45 crore to Tk2171 crore. At the same time, the deadline is being extended by one and a half years.

Power Division Secretary Md Habibur Rahman said due to vibration, the steam turbine of this unit could not be synchronised yet. Therefore, even if electricity production is less than the target, production will be as per target once it is synchronised.

Seeking anonymity, a senior official involved with the project said since the feasibility study did not suggest the replacement of the steam turbine in their report, it was not included in the project.

"But the fault of the steam turbine was found while running the power plant after the physical work. Without fixing the problem, it will not be possible to achieve the desired capacity," he added.

He said the feasibility of the project was carried out in 2012 when the existing steam turbine was 23 years old. But now it has risen to 33 years.

Generally, the economic life of machinery is only 25 years. Naturally, the existing steam turbine cannot ensure output now.

However, if the steam turbine is replaced with a new one, it will be possible to generate electricity from the plant at the desired capacity, he said, adding an additional Tk100 crore to Tk150 crore will be needed for this.

But energy experts say the feasibility study might not have been done properly. For this reason, the report did not mention what equipment was required. 

Professor M Shamsul Alam, energy adviser to the Consumers Association of Bangladesh (CAB), told The Business Standard the EPC contractor will have to take responsibility for this.

"Because the contractor will do whatever is required to increase the power generation capacity of the 210MW unit to 409MW. There is scope to realise compensation for their failure. The Power Division should take action in this regard," he added.

After a lengthy discussion with the EPC contractor, the Power Division took the initiative to include the new portions in the project. Proposals for the extension of the project cost and duration have been sent to the Planning Commission.

At present, there are 154 government and private power plants in the country, with a total production capacity of 22,512MW, although production is 11,000MW to 13,000MW at present.