Adani Godda Coal Power Plant: An Achilles Heel of the Power Sector of Bangladesh

7 June 2022 | Tuesday | Bangladesh 
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The Adani Godda Ultra-Supercritical Coal Power Plant is located in Godda district of the state of Jharkhand, India. The 1600 MW power plant has been built under a cross border power purchase agreement signed with the Bangladesh Power Development Board (BPDB) to supply 1496 MW of electricity for 25 years from the commercial date of operation (COD).

In cooperation with Growthwatch (India), the Bangladesh Working Group on External Debt (BWGED) published a report on the negative impact of Adani Godda Coal Power Plant on both Bangladesh and India. 

Media Release: Bangla | English | Hindi

Findings 

  1. Adani Power Limited, a subsidiary of the Adani Group, acquired 1,255 acres of land from the local farmers by force and without payment of proper compensation. The company also tortured the poor land owners by using musclemen and law enforcing agencies. 
  2. The power plant may emit 221.1 million tones (minimum 193.6 - maximum 277.7 Mmt) of carbon dioxide in its lifetime with an average emission of 9.35 million ton annually. India is the third largest emitting country in the world which is committed to achieve net zero by 2070, instead of 2050. The position is highly criticized by the global community. This power plant will only help to establish India as a climate denier.
  3. Cost of electricity from Godda coal power plant may reach USD 0.105 (BDT 9.09) per Unit (kWh) in 2022 and BDT 36.41 (USD 0.33) in 2047 which is 56.2% higher than imported power, 56.5% higher than the domestic solar power and 196.1% higher than Indian solar power. 
  4. BPDB will have to pay a maximum BDT 10.124.75 crore (USD 1.17 billion) and minimum BDT 7,933.04 crore (USD 918.18 million) per year to buy electricity from Godda Power Plant which will only add to the growing burden caused by excess power capacity in Bangladesh.
  5. BPDB will have to pay BDT 3,657.23 crore (USD 423.29 million) for the annual capacity charge and BDT 1,08,360.60 crore (USD 11.01 billion) over its lifetime which will only benefit the billionaire Adani Group to make more money. The power plant should be ready to supply electricity by August 2022. But the transmission line to export electricity will be ready only after December 2022. BPDB will have to pay BDT 1,219.10 crore (USD 141.10 million) in capacity charges for the waiting period of 4 months even though no power will make its way to Bangladesh.
  6. The environmental and social cost (e.g. Hospitalization, Agriculture, Fishing) of the emissions of hazardous air pollutants and carbon dioxide is INR 5,569.34 crore (USD 729.64 million) per year and INR 188,708.29 crore (USD 24.72 billion) over its lifetime.

Recommendations

  • In the light of the statements made during COP-27, both the Government of Bangladesh (GOB) and the Government of India (GOI) should explore ways of annulling the existing bilateral agreement and replacing an agreement in line with the Paris Agreement and Glasgow commitments.
  • Both of the Governments should cancel the PPA and create a flexible supply regime for Renewable Energy (RE). Since it involves commercial agreements, a joint committee can be formed to resolve any issues arising out of the change.

As the PPA cannot be cancelled unilaterally, the Government of Bangladesh:
  1. Must impose a No Electricity No Payment (NENP) policy on Adani Power (Jharkhand) Limited consistent with the new PPAs for Rental Power Plants and importing electricity.
  2. Must instruct Adani Power Limited to supply at least 12% electricity from RE sources by 2025 and 30% by 2030 in line with the SDGs and Mujib Climate Prosperity Plan (MCPP).
  3. Should adopt Emission Standards (ES) and Human Rights Standards (HRS) for imported products and services to ensure international standards in importing power from neighboring countries.
  4. Should propose importing only RE based electricity from India keeping in mind that imported electricity will not cross 10% of the total generated power.

As GOB is not in position to cancel the PPA, the Government of India:
  1. Must cancel the Adani Godda Coal Power Plant to protect the indigenous and affected communities from consequences of emission and pollution.
  2. Try APL for human rights violation and forceful acquisition of land and other natural resources.
  3. Compensate the affected indigenous people with the same size and quality of land and other resources they lost to the Godda Coal Power Plant.
  4. Withdraw all false court cases filed against the affected communities and Human Rights defenders.
  5. Impose carbon tax on Adani Godda Coal Power Plant at a rate defined by IPCC and other UN agencies.
  6. Force APL to provide financial resources as environmental and social damage compensation which is not less than the estimation of the independent scientific and economic research findings.