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Payra coal-fired 1320 MW power plant at Kalapara, Patuakhali, at the southern coast of Bangladesh, has started production from January 13, 2020. Initially, 100 MW power was generated and supplied to the national grid. The first Unit (660 MW) of the power plant is expected to reach full production capacity this month. The Second Unit (660 MW) is expected to start production within next four months. Tthe cost of generating a kilowatt-hour of electric energy is currently $ 0.070-0.075 US dollars and the cost would come down once the power plant starts production with full capacity, according to the State Minister for Power, Energy and Mineral Resources.
North West Power Generation Company Ltd. (NWPGCL), a subsidiary of Bangladesh Power Development Board (BPDB) and the China National Machinery Import and Export Corporation have built the Payra power plant under 50:50 joint venture ownership. The construction of the power plant commenced in 2016 with a total cost of approximately US$ 2.0 billion. The Chinese Exim Bank provided 80 per cent loan for the project. The power plant will continue to use imported coal using ultra super critical technology for power generation expecting minimum emissions and greater efficiency of fuel use. Currently, small coal carrying vessels have been used to transport coal from Indonesia to the Payra power plant. The ongoing dredging works at the river channel adjacent to the power plant is expected to be completed within next few weeks which should enable the coal carrying vessels with 30,000 tonne capacity to enter the Payra power plant jetty. The Payra coal-fired power plant will require annually 4.12 million tonnes of coal annually if it operates on full capacity.
Bangladesh has been trying to make a balance in primary energy mix for power generation. As per the existing plans, the government intends to increase its power generation capacity to 24,000 MW by 2021. Within 2030, the government plans to increase power generation capacity to 40,000 MW with a share of 35 per cent power from coal-fired power generation units. The current power generation capacity (installed) in the country stands at 22,562 MW using natural gas, liquid fuel, coal, renewable and import sources. Before the Payra coal-fired power plant started operation, country's coal-based generation capacity (installed) was only 525 MW at Barapukuria, Dinajpur. There are a number of coal-fired power plants under construction in the country. Among them construction of 1,200 MW Matarbari Coal-fired Power Plant in Cox's Bazar and 1,320 MW Rampal Coal-fired Power Plant in Bagerhat are progressing fast. As reported, approximately 60 per cent works for construction of Rampal power plant (Bangladesh-India Friendship Power Company) has been completed and officials expect to commence test run of the power plant by the end of this year. The construction of Matarbari Coal-fired Power Plant (under Japanese cooperation) along with works on Maheshkhali channel development to facilitate large coal-carrying vessels to import coal for the plant are progressing on schedule. Project implementation sources expect to bring the power plant in operation in 2023. Several more coal-fired power plants with cooperation from China, Malaysia, South Korea, Singapore are being planned in the near future.
Environmentalists and many civil society activists express their concern that increasing use of fossil fuel, especially coal for power generation, will cause environmental degradation in the country. Coal alone contributes 40 per cent of carbon dioxide emissions from fossil fuels. Reduction of fossil fuel (especially coal) use is directly linked to reduction of climate change and global warming. On the other hand, coal is cheap and developing economies can not ignore low-cost fuel for power generation and for other commercial uses. Coal remains the largest source of energy for electricity generation in the world.
Environmentalists have been repeatedly protesting against Rampal coal-fired power plant as its location is close to the mangrove forest Sundarban in the southwestern part of the country. Operation of the import-based coal-fired power plants will involve increased river traffic, regular dredging of the river channels, increased air pollution etc. The environmental activists often suggest that the European Union (EU) countries have been shutting down coal-fired power plants to increase their reliance on renewable sources for power generation. The recent decision of the German government to shut down major Coal-fired power plants to fight climate crisis must have encouraged many. However, it is to be noted that the German government has decided to pay billions of Euros to its utility companies as compensation for incurring losses due to early shutdown of coal-fired power plants. Germany has been relying on mining lignite (brown coal), steam coal, and import of coal for power generation. Coal provides nearly 40 per cent of electric energy in Germany and is considered a major contributor of greenhouse gases. As reported in The Guardian (January 16, 2020), German Foreign Minister Olaf Scholz said that the operators of Coal-fired power plants in western Germany would receive 2.6 billion Euro and 1.7 billion Euro in eastern Germany in compensation for switching them off early. RWE, the largest German power producer and utility company, was offered around 3.5 billion Euro. RWE would cut approximately 6,000 jobs or nearly a third of the current workforce as the country has decided to phase out lignite production as a major primary energy source. The government's promised compensation to coal mining regions in Germany is more than 40 billion Euros. The German government targets to generate 65 per cent of the country's electricity requirement from renewable sources and for that the country will require 'a massive expansion of wind and solar energy'. The German government intends to review in 2026 and in 2029 to determine whether Germany can exit from Coal-fired power generation in 2035. Earlier Germany wanted to exit from coal based power by 2038.
On the other hand, India continues to rely (nearly 70 per cent) on coal-based power and its reliance on coal for power generation will continue for several more years. Published reports suggest that in 2030 India will still be dependent for 50 per cent of its power generation from coal. Indian experts and media report that the country's economic growth can not be continued ignoring coal and coal-fired power, at least not until the time renewable energy becomes an affordable and reliable alternative to thermal power.
Mushfiqur Rahman, a mining engineer, writes on energy and environment issues.