Power Sector Development: Present and Future Scenario A S M Alamgir Kabir Chairman, BPDB 1 22 March, 2012 1 1

Present Power Generation Scenario 2

Bangladesh’s Power Sector: At a Glance Electricity Growth : 14 % (July-Jan FY-2012) (Av. 7 % since 1990) Generation Capacity : 8005 MW (March, 2012) Total Consumers : 13 Million Transmission Lines : 8,600 km Distribution Lines : 2,78,000 km Per Capita Generation : 265 kWh (incl. Captive) Access to Electricity : 53 % 3

Present Generation Capacity (March, 2012) Generation Capacity (MW) Public Sector SL. Generation Capacity (MW) 1. BPDB 3483 2. APSCL 662 3. EGCB 210 Subtotal 4,355 (54 %) Private Sector IPPs 1272 SIPPs (BPDB) 99 SIPPs (REB) 226 4. 15 YR. Rental 168 5. 3/5 YR. Rental 554 6. Quick Rental 1331 3,650 (46 %) Total 8,005 Considering 20 % Maintenance and Forced Outage, Available Generation Capacity is about 6400 MW without fuel constraint 4

Demand Supply Situation Generation: 5000 – 5600 MW (Capacity- 8005 MW) Highest so far: 5569 MW ( March 16, 2012) Gas shortage causes 600 - 800 MW less Power Generation Peak Demand: 6400 MW (with DSM) Load shedding up to 1000 MW during hot summer days (with DSM) Shortage and unreliable power supply has constrained economic growth 5

Average Peak Power Generation Av. Peak Power Generation in August’ 2011 : 4956 MW Av. Peak Power Generation in February’ 2012 : 4941 MW Av. 1300 MW more Peak Generation in Jan’12 compare to Jan’11 6

Energy Generation by Fuel Type: July-Jan, Comparison in FY 2011 and FY 2012 Energy Growth in FY12 (July11-Jan.12) is about 14 % 7

Planning Perspective

Primary Fuel Supply Scenario Gas: No significant gas discovery in recent years; Depleting gas reserve restricts gas based generation Coal: Near term option; Indigenous or Imported; Base Load; Oil: Volatile market; High price; For peaking duty LNG: Necessary to ensure secure and reliable gas supply Nuclear: Safe technology; No pollution; Expected to be future Base Load option 9

Generation Expansion Plan Immediate: 6 -12 Months - Rental Plants (liquid fuel) Short term: 18 - 24 Months - Peaking Plants (liquid fuel) Medium term: 3 - 5 years - Combined Cycle Plants (Gas or dual fuel) - Peaking Plant (Gas or dual fuel) - Coal fired steam plants Long term: beyond 5 years - LNG based Combined Cycle Plants - Domestic/Imported Coal Power Plant - Gas/Oil based Peaking Plant - Nuclear Power Plant - Renewable Energy 10

Power Generation Addition From Jan 09 to Feb. 12 Gen Addition Jan 09 – Dec 09 : 356 MW Gen Addition Jan 10 – Dec 10 : 775 MW Gen Addition Jan 11 – Dec 11 : 1763 MW Gen Addition Jan 12 – Feb 12 : 392 MW Total Gen. Addition (Jan 09 – Mach 12) : 3286 MW Gas based: 1400 MW; Oil based: 1900 MW; Total: 3300 MW Av. 1300 MW more Peak Generation in Jan’12 compare to Jan’11 Details 11 11 11 11

Gen Project Implemented Since 2009 and Plan for 2012 - 2016 Plants Commissioned During 2009 - 2011 YEAR 2009 (MW) 2010 (MW) 2011 (MW) TOTAL (MW) Public 255 800 1055 Private 356 270 125 751 Q. Rental 250 838 1088 Total 775 1763 2894 In 2011, 1763 MW commissioned against plan for 2194 MW; 80 % success rate Calendar Year Wise Projects Completion (From 2012 to 2016) YEAR 2012 (MW) 2013 (MW) 2014 (MW) 2015 (MW) 2016 (MW) TOTAL (MW) Public 632 1467 1660 1410 750 5919 Private 1354 1372 1637 772 1600 6735 Power Import 500 Total 1986 3339 3297 2182 2350 13,154 Plan: January, 2012 Details 12

Estimated Demand Supply Gap up to 2016 (Calendar Year) January, 2012 13

Fuel Mix up to 2017 27 36 35 24 19 15 CY Gas + LNG Hydro Coal (Dom + Imp) Power Imp + Renewable Oil Total (MW) Capacity (MW) % 2011 5107 67% 220 3% 200 0% 2086 27 7,600 2012 5707 60% 2% 3432 36 9,600 2013 7283 58% 512 4% 4339 35 12,000 2014 9278 62% 1% 766 5% 630 4027 15,000 2015 10206 61% 1538 9% 24 16,000 2016 10956 3138 17% 3395 19 18,000 2017 11557 57% 4938 24% 3095 15 20,000

Generation Capacity by Fuel Type 15 15

Project Implementation

Successful Contract Signed since Jan 2009 Sl. No. Description No. of Plant Capacity (MW) Commis. (MW) 01. Rental 3 265 02. Quick Rental 17 1388 1338 03. IPP 14 1870 -- 04. Public Sector 18 2010 733 Total 52 About: 5,500 About: 2,300 Out of 5500 MW, 2300 MW (28 Plants) already commissioned 24 Projects with capacity 3,200 MW under construction 17

Projects Under Construction Sl Description No. of Projects Capacity (MW) 01 Quick Rental 1 50 02 IPP 14 1870 03 Public Sector 9 1277 Total 24 About: 3,200 Expected Commissioning of above Under Construction Projects January – June 2012 : 707 MW July – December 2012 : 1010 MW January – June 2013 : 150 MW July – December 2013 : 1226 MW January – June 2014 : 18 MW July – December 2014 : 428 MW Details u/c 18

Private Sector (IPP’s) Projects Under Tendering Process: Contract within Next 6 Months Sl. Description No. of Projects Capacity (MW) 01 Public Sector 10 2785 02 Private Sector (IPP’s) 20 2859 Total 30 About: 5,600 19

Public Sector CC Conversion Projects (Energy Efficiency Improv.) Sl No Name of the Power Plant Capacity (MW) Owner Fuel Est. Project Cost (Million US $) Expected COD 1. Conversion of Ghorashal 4x210 MW (3,4,5,6 Unit) Steam into 2290 MW CCCP 1450 BPDB Gas 1800 2015 2. Conversion of Baghabri 171 MW GT into 250 MW CCPP 85 65 2013 3. Conversion of Sikalbaha 150 MW Peaking Plant into 225 MW CCPP 75 Gas/ Liquid Fuel 60 4. Conversion of Shahjibazar 2x35 MW into 105 MW CCPP 35 40 Total (Public) 1,645 2,000

Renewable Energy Projects 21

Renewable Energy Projects Sl. NO. Location of the Project Capacity Type of Project 1 Parki Beach, Chittagong [Pilot Basis] 20 MW Wind Power 2 100-200 MW 3 Moghnamoghat, Cox’s Bazar 10 MW 4 Hatia, Sandwip, St. Martin and Monpura Islands 4 MW 5 Kaptai, Rangamati 5 MW Grid Connected Solar PV 6 Sarishabari, Jamalpur 2-4 MW 7 RTC, Rajshahi 1 MW 8 Rajabarihat Goat Development Farm, Rajshahi 9 Kaptai Grid S/S [Pilot basis] 500 kW 10 St. Martin Island 200 kW Wind and Solar Hybrid 11 Wind Mapping Study for Coastal Region - FS 22

Tariff

Tariff Adjustment: Proposal Cost reflective tariff to make sector entity viable Lifeline tariff to lessen burden on poor customers Multiyear tariff proposal to make proper budget and investment plan Fuel pass-through in tariff to tackle volatile fuel market 24

Tariff Adjustment Average Cost in FY 2012 : 6.01 Tk/kWh Average Fuel Cost: HSD – 16 Tk/kWh; FO – 14 Tk/kWh; Coal- 3.5 Tk/kWh; Gas: 0.7-1.2 Tk/kWh High cost liquid fuel based power plants will get less dispatch (according to merit order); Bulk Tariff Increased since Oct 2008 From Feb 2011: 11 % and from Aug 2011: 6 % From Dec 2011: 16 % and from Feb 2012: 14 % Retail Tariff Increase since March 2007 - In 2009 and 2010 nominal 5 % each year - From Feb 2011: 5 % - From Dec 2011: 13 % and from Feb 2012: 7% 25

Cost of Supply at Different Voltage Level   Voltage Level Cost of Supply 2009 – 2010 2010 – 2011 2011 – 2012 Cost of Supply for Bulk (Utility) A Generation (Net Gen) 2.526 4.057 5.80 B Transmission(132 KV Bulk : DPDC ) (Excl wheeling charge) 2.598 4.173 5.97 C Distribution (33 KV Bulk : DESCO, REB, etc) (Excl wheeling charge) 2.625 4.215 6.03 D Average (Bulk) Supply Cost 2.62 4.20 6.01 E Bulk Tariff 2.37 2.61 3.74 F Difference 0.25 1.59 2.27 26 26

Payment Requirement for each unit in FY-2012: 6.01 Tk/kWh 15 % 11 % 0.66 Tk/kWh 5 % 0.30 Tk/kWh 69 % 4.15 Tk/kWh Estimated Av Supply Cost: 6.01 Tk/kWh BPDB Payments to others: 5.35 Tk/kWh Present Av Bulk Tariff: 3.74 Tk/kWh Proposed Av Bulk Tariff: 4.14 Tk/kWh (Increase 0.40 Tk/kWh; 11 %) 27

BPDB’s Non Fuel Cost for each unit for Bulk Supply Cost: Components of 0.66 Tk 0.11 Tk/kWh 0.05 Tk/kWh 0.23 Tk/kWh 0.02 Tk/kWh 0.11 Tk/kWh 0.09 Tk/kWh 0.05 Tk/kWh 28

Comparison of Retail Tariff in Terms of US Cents Category 2000 (Effective from November) 2011 (Effective from December) Taka/kWh US Cents/kWh (1 US $=Tk 54.00) (1 US $=Tk 81.95) Residential from 00 unit to100 unit from 101 to 300 unit 2.15 3.30 3.98 6.11 2.73 3.81 3.33 (- 16 %) 4.65 (- 24 %) Agricultural 1.75 3.24 2.03 2.47 (- 24 %) Commercial (low Voltage) 4.65 8.61 6.80 8.30 (- 4 %) Small Industrial 3.50 6.48 5.27 6.43 (- 1 %) 70-75 % cost of investment and full cost of Oil incurred in Foreign currency 29

Electricity Tariff (Res & Agri) in Neighboring Countries Sl Countries/Area Residential (0-100 unit) Agriculture 1 Bangladesh Tk 2.73 Tk 2.03 2 West Bengal WBSEDCL Tk 3.88 (Rural) Tk 3.88 (Urban) Tk 2.34 (Off Peak) 3 KESC, Pakistan Tk 3.56 Tk 5.25 (Off Peak) 4 Nepal Tk 6.38 Tk 3.46 7 SriLanka Tk 7.43

Transmission Sub-Sector

Transmission at a Glance Transmission Operator Power Grid Company of Bangladesh (PGCB) Transmission Line 230 kV : 2647 Circuit km 132 kV : 5969 Circuit km Substations Capacity 230/132 kV : 7,225 MVA (No.15) 132/33 kV : 10,492 MVA (No.99) 32 32

Key Transmission Projects of PGCB in Near Future Power Evacuation for Two Mega Coal Projects at Chittagong & Khulna (2X1300 MW) Power Evacuation for Bibiyana 2x341 MW and 1X450 MW Power Plant Power Evacuation for Bhola 2X 225 MW Power Plant Power evacuation from other planned power plants Sub station capacity enhancement 1st Cross Border Inter connection with India 33 33

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Distribution Sub-Sector

Distribution Scenario (FY-2011) Total Distribution Lines : 2,78,000 Km Irrigation Consumer : 2.76 Lac Village Electrified : 53,925 (64 % of Total village) Per Capita Consumption : 220 kWh (incl. captive) Distribution Loss : 12.66 % Account Receivable : 2.37 Eq. months

T & D Loss

Distribution Loss

Pre-Paid Metering Scheme to Reduce Demand and Loss Existing Pre – Paid meters: 56,000 Under implementation: 200,000 Requirement (except rural areas): 4 Million Cost involvement: 3200 Crore (460 M US $) Implementation Time: By 2014 Benefits: demand reduction: 200 – 250 MW loss reduction: overall 3 % improved accounts receivable help in peak load management

Demand Side Management (DSM) and Energy Efficiency Improvement Program

DSM Measures to Reduce Demand Shifting peak load by changing shop closing times: has reduced demand by 350 MW Staggering holiday has reduced demand by 150 MW Energy efficiency improvement program

Energy Efficiency Initiatives Include Energy Conservation and Solar Power issues in the National Building Code Include Energy Conservation and Alternative Energy issues in the text book curriculum Installation of Solar Panel in the Govt., Semi Government and autonomous organizations within next 3 years Use of CFL bulb in all ministries and public sector entities. About 10.5 million CFL distributed in first phase and 17.5 million will be distributed soon Conventional street lights will be replaced by LED and solar subsequently Public awareness for energy conservation Discontinuation of incandescent bulb and electric heater subsequently

Energy Efficiency Initiatives Limited use of Air Conditioners keeping temp at 25 degree C Encouraging the business community for using solar energy Introduction of Energy Star Rating system in the electric appliances through BSTI Discouraging use of neon sign in the markets/ shopping malls at night Closing of markets and shopping malls within 8 p.m. Introduction of quality pre-paid and smart meters all over the country

PSMP-2010 (2011 – 2030)

Power System Master Plan (up to 2030) Updates of PSMP 2006: Due to change of planning perspective PSMP 2010 : Long term planning up to 2030 Study completion: February 2011 Findings: - Generation capacity requirement by 2021: 24,000 MW - Generation capacity requirement by 2030: 39,000 MW - Coal based generation capacity by 2030: 20,000 MW - Coal and Nuclear for base load power requirement - Cross Boarder Trade with neighboring countries 45

Probable Power Generation: Primary Fuel Sources by 2030 Sl. No. Description Capacity (MW) Probable Location (s) 1 Domestic Coal 11,250 North West Region at Mine Mouth 2 Imported Coal 8,400 Chittagong and Khulna 3 Domestic Gas/LNG 8,850 Near Load Centers 4 Nuclear 4,000 Ruppur 5 Regional Grid 3,500 Bahrampur - Bheramara, Agartola - Comilla, Silchar - Fenchuganj, Purnia-Bogra, Myanmar - Chittagong 6 Others (Oil, Hydro and Renewable) 2,700 Total 38,700

Road Map for Coal Power Development (as of 2030) Domestic Coal K-D-P 6x1000 MW USC K-D-P 8x 600 MW USC Import Coal Meghnaghat 2x600MW Zajira/New Meg 3x600MW Chittagong 3x660MW Moheshkhali/Matarbari 4x600MW Khulna 2x660MW (Dom Future) Railway Total 19,200MW (New) Coal Center Chittagong Matarbari Sonadia Island 　　: Potential Coal PS 　　: Potential Coal Center 　　: Ocean-going vessel 　　: Transship

Regional Power Exchange: Possibilities 1000MW 750MW THAKURGAON 1000MW SILCHAR FENCHUGANJ ALIDUARPUR BOGURA PURNIA BARAPUKURIA FENCHUGANJ 250MW PALLATANA COMILLA (N) BHERAMARA BAHARAMPUR 500 MW COMILLA (N) BAHARAMPURBHERAMARA 500MW [2013-]   500MW [2018-]   MYANMAR CHITTAGONG

Generation Plan: From 2017 to 2021 Sl Description Capacity (MW) Executing Agency Fuel Expected COD 1 Meghnaghat Large #4, 750 MW, CC 750 BPDB Gas 2017 2 Chittagong South 600MW #1ST 600 Coal-I 3 Karnafuli Hydro #6,7 100 Hydro 4 Megnagatt 600MW #1 2018 5 Keraniganj #1, 750 MW, CC 6 Power import from Myanmar 500 Import 7 Rooppur Nuclear # 1, 1000 MW 1000 BAEC Nuclear 8 B-K-D-P 1 600MW #1 Coal-D 2019 9 B-K-D-P 1 600MW #2 10 Peaking Power- 2019 200 HFO 11 B-K-D-P 1 600MW #3 2020 12 Rooppur Nuclear # 2, 1000 MW 13 Peaking Power -2020 2021 14 Power Import Bahra-Bhera Phase-2 15 Peaking Power-2021 Total: 8,100 49

Challenges Enhanced Gas Exploration, Production Primary Fuel Supply Enhanced Gas Exploration, Production Domestic coal development Coal Import (long term contract) and deep sea port for coal handling LNG import Safe Nuclear Technology Project Financing Ensuring financing for Public and Private sector projects Availability of foreign currency Transportation of fuel and equipment Infrastructure development by Railway and R&H Dredging of river routes by BIWTA Capacity build up of BPC, Railway, R&H and BIWTA etc. Human Resources Development Development of skilled manpower: adopt and operate new technology

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