Cash crunch likely to impede coal-fired mega power projects

The ambitious 20,000 megawatt (MW) coal-fired power projects are likely to miss completion targets because of cash crunch, lawmakers observed.
Reviewing the all coal-based pipeline power projects, the Parliamentary watchdog on Thursday suggested the power generating companies to expedite the completion of these power projects on time as the upcoming National Election is set to be held by January 2019.
"The state-owned electricity companies and the private companies should have had submitted the financial closing on time, unfortunately it found that only three companies have submitted all documents in this regard," an official said.
Meanwhile, the Parliamentary Standing Committee on Power, Energy and Mineral Resources on Thursday sat with the public and private companies at Sangsad Bhaban to review the ongoing development work in the power sector.
As per Power Division statement, Matarbari 1,200 MW coal-fired power project, 1,320 MW Payra Coal-fired power project and Moitree super thermal (Rampal) power company were on track.
The Power Division enacted 22 coal-fired power projects having a capacity of 20,000 MW power in the last two-three years of it only three were approved but are yet to be completed.
Meanwhile, the mega project, targeted for completion by 2019, is facing many problems regarding fund and land acquisition.
Nine mega coal-fired power projects have been taken up between 2012 and 2015.
Of the nine projects, only one to be set up at Rampal near the Sundarban has got environmental clearance but seven other projects did not due to land dispute.
State Minister for Power and Energy Nasrul Hamid admitted that the private sector coal-fired power projects has so far failed as the per contractual agreements.
Insiders also expressed their doubts about the implementation of the coal-fired large power projects in the private sector.         
Against this backdrop, Rural Power Company Ltd is now working on a proposal of the Power China Hubei Hongyuan Power Engineering Co Ltd to set up a 350 MW coal-fired power project at Munshiganj under the government-to-government (G2G) deals.
The company has also shown interest to set up power plants under EPC (engineering, procurement and construction) contractors. The RPCL has sought policy level decision to sign memorandum of understanding to implement the power project.
China Hubei has already sent the draft of a memorandum of understanding (MoU) to this end.
As per the draft, RPCL agreed in principle to appoint the company for providing financing and services to set up 350 MW supercritical coal-fired power plant at Gazaria or elsewhere. The financial deal will be done between the two governments and credit will come through Economic Relations Division of Bangladesh.
Besides, the Electricity Generation Company of Bangladesh (EGCB) has also taken an initiative to set up 300 MW coal-fired project at Gazaria in Munshiganj. But only on papers.