Current Status: Announcement
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| Representational Photo |
Rampal 300 MW Solar Power Plant, also known as Bagerhat Solar Power Plant or ACWA Bagerhat Solar Power Plant, is a photovoltaic solar power plant to be situated in Rampal Upazila in Bagerhat District of Bangladesh (Location: 22.6057, 89.5454). It will be sponsored by a Joint Venture Company (JVC) of ACWA Power Company Limited Kanchan in partnership with Bangladesh Power Development Board (BPDB), Youth Group and Viyellatex Group of Bangladesh as an Independent Power Producer (IPP) for 20 years. As per the plan, the sponsor will declare its Commercial Operation Date (COD) by 31 December 2025, and, as per schedule, the power plant will retire by 30 December 2045.
Capacity
The power plant's derated (net) capacity will be 300 MW.
Background
According to the Eighth Five-year Plan (8FYP), the Government of Bangladesh (GOB) planned to install 10% Renewable Energy (RE) by 2025 (GED, 2020). The Mujib Climate Prosperity Plan (MCPP) directs the Government to ensure 30% renewables by 2030 and 40% by 2041 to achieve 100% renewable energy by 2050 (MCPP, 2021). During the construction of the Rampal Coal Power Plant, environmental activists also demanded a solar power plant instead of coal (Daily Star, 2017). In response, the Government proposed installing a 100 MW Solar Power Plant under Bangladesh-India Friendship Power Company Limited (BIFPCL), the sponsor of the Rampal Coal Power Plant (Imtiaz, 2016). However, the initiative was not materialized.
In November 2022, Saudi giant ACWA Power signed a Memorandum of Understanding (MOU) with BPDB to install 1,000 MW of Solar Power in Bangladesh (TBS, 2022). In February 2022, ACWA Power proposed installing a 300 MW solar power plant in the leftover land of the Rampal Coal Power Plant. It is also looking for suitable places in Mirsarai (Chattogram) and Payra (Patuakhali) to establish another 700 MW solar power plant (Islam, 2023). According to the proposal, the power plant will start commercial operation in 2025 and supply electricity for 20 years from COD at USD 0.1020 (BDT 11.067) per kWh based on No Electricity No Pay (Islam, 2023). The Cabinet Committee on Government Purchase (CCGP) approved the proposal on 30 August 2023 (Business Post, 2023). The CCGP also set a standard of 18.5% Plant Load Factor (PLF), 12% discount factor and 6% income tax at source.
Land Acquisition
The Bangladesh Power Development Board (BPDB) will provide 900 acres of land adjacent to the Rampal Coal Power Plant for this project (Kashem, 2023). In 2010, BPDB acquired 1,834 acres of land from small and marginal farmers to install the coal power plant in the area. Some landowners have not received compensation, and around 40 displaced families are still waiting for their resettlement.
Sponsor
Saudi-based ACWA Power Company Limited, in partnership with BPDB, Comfit Composite Knit Limited, Viyellatex Spinning Limited and Midland East Power Limited, will sponsor the power plant under a Joint Venture Company (JVC). ACWA will hold 45% of company shares, BPDB will hold 25%, and Comfit Composite and Viyellatex Spinning will hold 15% each (TBS, 2023). Comfit Composite is a subsidiary of Youth Group, and Viyellatex Spinning is a subsidiary of Viyellatex Group.
Tariff
At USD 0.1020 (BDT 11.067) per kWh, the Government will have to pay at least USD 991.81 million (BDT 10,761.60 crore at BDT 108.50 per USD) in 20 years. However, the tariff in Bangladesh Taka might be increased according to the dollar price in Bangladesh.
Finance
Newspapers reported that the project will cost around USD 430 million (Kashem, 2023). No source of finance has been disclosed till August 2023. According to the newspaper report, BPDB will convert the land price into equity. It will also get the annual rent of land. ACWA Power will arrange 60% of the investment, while the remaining 40% will be equally split between Youth Group and Viyellatex Group (TBS, 2023b).
Contractors
No information about the Engineering Procurement and Construction (EPC) contractor or other suppliers has been disclosed till August 2023.
Power Generation
The sponsors are expected to sign the Power Purchase Agreement (PPA) with BPDB by February 2024 and start commercial operation by December 2025 (TBS, 2023b). At a PLF rate of 18.5%, the power plant will generate 486.18 gWh (million units) of electricity annually and 9.72 TWh (billion units) in 20 years of its lifetime.
Carbon Footprint
According to the proposal, the power plant will reduce 450,000 tonnes of carbon emissions annually. But no baseline has been given. Currently, the average emission from solar power is 52.13 grams per kWh. So, the power plant may emit 25.34 thousand tonnes of carbon annually and 0.51 million tonnes in 20 years of its lifetime.
Criticism
The tariff rate has been the highest ever in recent years (DT, 2023). It is a serious issue since solar power production costs are quite low (USD 0.02-0.03) in other regions, such as the Middle East, Africa, and several Asian nations, including India (TBS, 2023b). In January 2023, BPDB signed a PPA with Bangladesh-China Renewable Energy Company Limited (BCRECL) at USD 0.102 per kWh, where the sponsors arranged the necessary land for the project (TBS, 2023a). As BPDB provides the land for the Rampal Solar Power Plant, the tariff should be lower than other projects. There is a demand for proper compensation and resettlement of the people who lost their lands for the Rampal Coal Power Plant.
References
- Business Post. 2023. “Tariff approved for Bagerhat solar plant”. The Business Post: 30 August 2023
- Daily Star. 2017. ‘Use solar cells or relocate Rampal plant’. The Daily Star: 22 March 2017
- DT. 2023. “JV company gets nod to set up 300MW solar power plant at Rampal”. The Dhaka Tribune (DT): 30 August 2023
- GED. 2020. Eighth Five-year Plan 2020-2025. General Economic Division (GED), Planning Commission of Bangladesh: December 2020
- Imtiaz, H. 2016. "রামপালে ১০০ মেগাওয়াট সৌরবিদ্যুৎ প্রকল্পের চিন্তা". The Samakal: 12 July 2016
- Islam, S. 2023. “ACWA Power to build 300 MW solar plant in Bangladesh”. The PV Magazine: 31 August 2023
- Kashem, A. 2023. “Saudi firm to partner in Bangladesh’s largest solar plant”. The Business Standard (TBS): 30 August 2023
- MCPP. 2021. Mujib Climate Prosperity Plan (MCPP). Global Center on Adaptation (GCA), Climate Vulnerable Forum (CVF), International Renewable Energy Agency (IRENA) and Infrastructure Development Company Limited (IDCOL): December 2021
- TBS. 2022. “Saudi firm signs MoU to set up 1GW solar plant in Bangladesh”. The Business Standard (TBS): 29 November 2022
- TBS. 2023a. “BPDB to buy power from Sirajganj 68MW solar park at $0.102 per kWh”. The Business Standard (TBS): 9 January 2023
- TBS. 2023b. “Govt to buy power from country’s largest solar plant at Tk11/unit”. The Business Standard (TBS): 30 August 2023