Khulna Power resumes production of two power plants

Khulna Power Company has resumed operation of two power plants on “No electricity No payment without any guaranteed off take” basis for 2 years effective from the date of resumption of operation.

In a stock exchange filing on Thursday, the company said, the Bangladesh Power Development Board (BPDB) has allowed to resume the operation of company’s two power plants -- KPC Unit II 115MW plant, Khulna and KPC 40MW Noapara plant, Jashore for two years.

However, the company did not disclose the date of resumption.

Last month, these two power plants were shut down as the tenure of power purchase agreement (PPA) with the government expired on March 24 this year.

Khulna Power is the first Independent Power Producer (IPP) of the country in the private sector jointly established by United Energy and Summit Corporation under the Private Sector Power Generation Policy of Bangladesh 1996 (Revised 2004), and has been in operation for the last 26 years.

Khulna Power Company has three electricity units -- KPCL-1 has a capacity to generate 110MW electricity, KPCL-2 115MW, while KPCL-3 has a capacity to produce 40MW electricity. The dual fuel-fired KPCL-1 was permanently shut down in 2018.

KPC Unit II 115 MW plant

KPC Unit-2 115 MW plant was formed on 22 June 2010 with a project cost of $75 million under a contract with BPDB signed on 23 June 2010 for supplying electricity on rental basis initially for 5 years.

The Power Purchase Agreement (PPA) had been extended for another 5 years with effect from 01 June 2016. Later on, the amended PPA was executed in April 2022 for another 2 years on ‘‘No Electricity No Payment’’.

KPC 40 MW Noapara plant

KPC 40 MW Noapara Plant (Formerly “Khanjahan Ali Power Company) was formed on 22 June 2010 with a project cost of $25 million under a contract with BPDB signed on 25 July 2010 for supplying electricity on rental basis initially for 5 years.

The Power Purchase Agreement (PPA) had been extended for another 5 years with effect from 29 May 2016. Later on, the amended PPA was executed on 28 April 2022 for another 2 years on ‘‘No Electricity No Payment’’ basis.

Due to closure of the power plants, the company’s losses widened by 67 per cent year-on-year to Tk 40 million in January-March quarter this year.

Listed in 2010, Khulna Power’s stock remained stuck at floor at Tk 26.60 since August 2022. Khulna Power is among the six companies, whose floor price remained in place.

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