Bangladesh is set to seek over $13bn loan from China to produce 24,000mw electricity by 2021.
Prime Minister Sheikh Hasina has recently given her consent to go ahead with 15 power generation projects proposed by the Power, Energy and Mineral Resources Ministry in last September.
The proposed projects under concessional loan of Exim Bank of China will be discussed during the upcoming visit of China’s Premier Li Keqiang to Bangladesh to mark the 40th anniversary of the two country’s diplomatic relations at the invitation of his Bangladesh counterpart.
The proposed projects are the part of the government plan to produce 24,000mw electricity by 2021 and 40,000mw by 2030, which will require $30bn to implement.
“It is important to look for new source of financing for investment in power sector as the existing foreign financing in power sector is inadequate,” said the ministry in a letter to the Economic Relations Division.
The 15 projects are $16m-extension and augmentation of power distribution system, $1.6bn-coal-fired power plant for producing a 1,320mw electricity, $450m-Gazaria 350mw coal-fired thermal power plant, $155m-Mollahat 100 solar PB power plant, $255m-wind power plant to produce 100mw power, $105 pre-payment metering priority project for the Bangladesh Power Distribution Board’s six distribution zones (phase-2), $468m-reduction in system loss by replacing five million electro-mechanical energy meters with electronic meters, $1.4bn project to strengthen the power grid network under Power Grid Company of Bangladesh, $3bn-expansion and strengthening of power system network in the Dhaka Power Distribution Company Limited, $64.57m design supply and installation, testing and commissioning of 33/11 KV substations on a turnkey basis in the Dhaka Electric Supply Company Limited area, $1bn Payra 1,320mw thermal power plant project (second phase) and $3.4bn coal-based power plant project at Pekua, Cox’s Bazar of 2x600MW capacity or above.
Of the projects, Chinese company Guangdong Power Engineering Co. Ltd (GPEC) has already showed its expression of interest in signing a Memorandum of Understanding, according to a letter of the company sent to the Power Division.
The three projects are coal-fired power plants in Cox’s Bazar and in Patuakhali and combined cycle power plant in Khulna or Chittagong.
GPEC wrote that its proposal is to construct these power plants on a government-to-government preferential export buyers’ credit/soft/concessional loan.
The expected interest rate will be less than 2% per annum with more than 20 years repayment period, it said.
Implementing agencies of Bangladesh do not need to arrange finance for the implementation of the projects or to share or invest their portion of finance from other financial institutions or sources mentioned in the EOI, GPEC said.
The proposed projects will be implemented with the latest technologies of the world to reduce adverse impact on the environment, it said.
