Owners of many private oil-fired power plants, including the rental and quick rental ones, are lobbying hard with the government high-ups for extending the tenure of their plants.
If granted, the extension would be against the government's declared policy of shutting those down on expiry of their respective contracts.
Some gas-fired rental power plant owners are also seeking extension of their plants' tenure.
Besides, sponsors of some plants have also sought conversion of their units into Independent Power Producers (IPPs) along with the time extension.
Tenures of several such power plants have already expired, and many others are nearing expiry, a senior official of the state-run Bangladesh Power Development Board (BPDB) told the FE.
Sponsors of such plants have already written to the BPDB and the Power Division under the Ministry of Power, Energy and Mineral Resources (MPEMR) to consider their pleas.
In such a plea, the Energis Power Corporation Ltd (EPCL), the owner of a 55-megawatt (MW) power plant, sought extension of its tenure by two more years.
The EPCL also sought its conversion into an IPP, having a longer tenure.
The plant has been shut since July 11 on expiry of its tenure, and it is now awaiting the government's decision.
Another 53-MW power plant, owned by the United Energy Ltd (UEL), wrote to the MPEMR for extending its tenure, which expired on June 22.
The owner of 100-MW capacity unit-1 of the Khulna Power Company Ltd (KPCL) also sought extension of the plant's tenure that ended on October 12, 2018.
The BPDB Chairman Khaled Mahmood, however, said the government has a plan not to extend the tenure of 'expensive' oil-fired power plants after expiry of their respective contracts to bring down electricity generation cost and ensure sustainable future energy security.
The country currently has sufficient power plants to meet the present requirement, he added. Bangladesh now has around 60 operational oil-fired power plants, out of total 131, according to the BPDB statistics.
All the remaining power plants are gas-fired, excepting one coal-fired plant and one hydro-power plant.
A few more oil-fired power plants, awarded during the last tenure of the incumbent government, initiated commercial operation over the past one year, said a senior official.
Sources said in 2009 the government had launched a drive to install a significant number of oil-fired rental and quick-rental power plants as a 'short-term' solution to nagging electricity supply crisis across the country.
The government also awarded private sector sponsors several gas-fired power plants, set up on rental basis.
Most of these power plants were awarded on the basis of unsolicited offers under the Speedy Supply of Power and Energy (Special Provision) Act 2010. The law has a provision of immunity for the people involved with the quick-fix remedial process.
The government also allowed the private sector entrepreneurs duty-free import of furnace-oil to run their power plants with 9.0 per cent service charge along with import cost as an incentive, said a senior official.
Alongside the rental power plants, the government also had a plan to install a number of large coal-fired peaking power plants as 'mid-term' and 'long-term' measures.
The Power Division then also had planned to retire the rental and quick-rental power plants after expiry of their initial tenures, and bring down electricity tariffs as well.
But the large coal-fired power plants 'failed' to come up in time, which prompted the government to extend tenures of the rental and quick-rental power plants instead of retiring them.
As a consequence, electricity tariffs for the retail-level consumers were hiked by the energy regulator several times over the past one decade to cope with the rising electricity generation cost.
According to the BPDB, the countrywide electricity generation on July 24 was 11,643 MW during the evening peak hours and 10,289 MW during the off-peak hours against the total installed generation capacity of 18,825 MW.
