Government extends contracts with four gas-run rental power plants

The government has extended contracts with four gas-run rental power plants that have courted controversies with staggering losses.

The Cabinet Committee on Government Purchase (CCGP) cleared the proposal to extend the contracts on Wednesday.

Cabinet Division’s Additional Secretary Mostafizur Rahman said three of the power plants are of Aggreko International Project Limited and the other is of Energy Prima Limited.

The contract with Aggreko for the Brahmanbarhia 85-megawatt power plant and Ashuganj’s 95MW plant has been extended by a year.

Aggreko’s Ghorashal 145MW plant and Energy Prima’s Fenchuganj 50MW have got three more years.

The government will buy power at Tk 3.26 per megawatt from these plants in the extended period.

When the contracts were signed for three years, the government agreed to buy power at Tk 4.8 per MW from the plants at Brahmanbarhia and Ashuganj, Tk 4.75 from Ghorashal, and Tk 4.65 from Fenchuganj.

“The price of power has dropped, as the overhead cost decreased,” Secretary Rahman said.

The Awami League government preferring the quick rental power plants to ease power crisis after it had assumed office in 2009 has drawn much criticism.

The critics have pointed finger at the large amount of subsidies for raw materials of the plants. 
 
The government, however, has been defended itself saying there had been no other way to improve the situation.

On Wednesday, the CCGP cleared 13 projects, according to Secretary Rahman.

Finance Minister AMA Muhith chaired the meeting attended by LGRD and Cooperatives Minister Khandker Mosharraf Hossain, Commerce Minister Tofail Ahmed, Agriculture Minister Matia Chowdhury, Housing and Public Works Minister Mosharraf Hossain, State Minister for Power and Energy Nasrul Hamid, and State Minister for Labour Mujibul Haque Chunnu.

The committee gave nod to the proposal to buy commercial off-the-shelf software, hardware, networking , and managed services under the VAT Online Project.

The project aims at implementing the Value Added Tax and Supplementary Duty Act, 2012. The Act will be enforced from July 2016. The project is being trialled on a limited scale.

The Internal Resources Division will spend over Tk 2 billion on the project that will be implemented by Vietnamese FPT Information System Corporation.

The CCGP cleared a Tk 1.1 billion project to extend Dhaka, Rajshahi-Rangpur, and Chittagong zones of Bangladesh Rural Electrification Board.

Two projects to develop the board’s Dhaka, Chittagong and Sylhet zones were also passed at an estimated cost of Tk 3 billion.

The committee cleared the Development of ICT Infra-Network for Bangladesh Government Phase-3 project. Chinese Exim Bank will help to finance the project.

The estimated cost of the project is Tk 13.19 billion. Goods and services will be bought from Chinese state-owned Railway Group Limited fir the project under a government-to-government agreement.

The other projects sanctioned on Wednesday include construction of a bridge and a road in Uttara.

Rahman said a proposal to build 10 apartment buildings in Uttara Section 18 was sent back for revaluation.