Damodar Valley Corporation keen to sell power to Bangladesh

The Damodar Valley Corporation (DVC), a three-way joint venture of the West Bengal, Jharkhand and Indian governments, is exploring export of power to Bangladesh.

India Correspondentbdnews24.com
Published : 13 Dec 2016, 05:09 AM
Updated : 13 Dec 2016, 05:09 AM

DVC officials told bdnews24.com that the Bangladesh power market at the moment offers

better returns than selling power in India.

"We are looking to sell at least 500MW to Bangladesh. Our team gave this proposal to Bangladesh during a recent visit to Dhaka," said a top DVC official.

DVC's current surplus stands at 1200MW . A new DVC unit with an installed capacity of 500 MW at Bokaro in Madhya Pradesh will soon get commissioned as well.

In 2013, when Bangladesh first expressed intent to import power from India, DVC was not in the fray. The National Thermal Power Corporation (NTPC) and the West Bengal Power Development Corporation (WBPDC) did the bidding.

Now India is exporting 500MW of power through the Behrampur-Bheramara grid link.

"Another 500MW can be easily exported through this grid link. And our power will work out much cheaper for Bangladesh," the DVC official said.

Bangladesh is also keen to import power from India and slowly get rid of the expensive diesel-fuelled generation units.

"The power demand in Bangladesh is growing and the demand-supply gap is widening. So we have a chance to export more power. It will be a win-win for both," the DVC official said.

Damodar Valley Corporation (DVC) has been plagued with rising debt in recent years.

Last year, the DVC management sought a debt recast from the Reserve Bank of India (RBI), as its debt servicing capacity came under severe pressure with low returns on investment.

DVC chairman and managing director Andrew WK Langstieh had said at that time that the restructuring could involve getting more time to repay and also be given to pay lower interest rates.

He disclosed that DVC's debt now stood at around Rs 300 billion with projects funded in a debt-equity ratio of 70:30.

That means that the DVC has to pay Rs 12 billion every year to service the debt, even as its income from power sales is being hit with 1,500 MW out of its total capacity of 6,300 MW lying idle.

“There have been no power purchase agreements (PPAs) in the last one year. All power sales have been short-term from the spot market,” CMD Langstieh had told the media last year.

This crisis has forced DVC to give up on its ambitions to become a 10,000MW power company in immediate future and concentrate on finding steady buyers paying a competitive price.

What's better than having a promising market next door in Bangladesh!