The global rise in the installation cost of power plants has been a major concern for the Power Development Board (PDB) as it is struggling to meet the country''s growing electricity demand, reports UNB.

In 1998-2000, installation of a one-megawatt plant cost US$ 0.6 million and it shot up to 0.8 million internationally within a decade, according to official sources. For instance, they said, 450MW Meghnaghat Power plant was installed at a cost of US$ 290 million.

Now the cost of installing similar capacity power plants like Bibiyana and Sirajganj is being estimated at US$ 400 million. The cost of 80MW Tongi peaking power plant was US$ 45 million in 2004. Now a similar capacity power plant is said to cost US$ 65-70 million.

PDB officials said the installation cost of power plant has gone up by 30-40 percent internationally in recent years. They said the booming economies like India, China, Brazil, Russia and some African and Middle East countries have driven up a huge demand for power plants, pushing up the prices of power plant equipment, particularly that of gas turbine. Besides, the global rise in the steel products has added to the rise in the power plant equipment prices, he said.

They said famous power plant equipment manufacturers like GE, Mitsubishi, Alstom and BHEL are not taking any order for near future, as they are already booked until 2009 to supply equipment. The recent rising trend in the cost of power plants has been a big concern for the PDB.

Because when it plans to install a power plant it has to estimate a cost and have that approved for that cost from the government''s highest authority. But, after a long process when they go to invite tender for the project, it is commonly found that the received offer from the bidders crosses the estimated cost. In such a case, the PDB has to either go for re-tender or cancel the project or has to get approval for the enhanced project cost.

CA''s Special Assistant Dr M Tamim also gave a hint about such a problem. In a recent press briefing, he said the per megawatt power plant project cost is one million US dollar. It was found that inordinate delay in its implementation pushes up the cost in most cases. Realising the situation, the sources said, the present caretaker government started laying emphasis on timely implementation of the projects.

Despite that push from the highest policymakers, the progress in implementation of the pending power plant projects is very slow, the sources said. According to them, at least 6 power plant projects remained pending at different stages of their implementation.

Those are 100 MW Shikalbaha plant, Sylhet 100 MW plant, 300 MW Shidddirganj peaking plant (150x2), 150 MW Sirajganj Power plant and 150 MW Khulna power plant and 150 MW Chandpur plant. Experts said the unusual delay in implementation of the projects would only push up their implementation costs, intensifying the PDB''s concern.

"Because international bidders are losing their interest in participating in the tendering process for the inordinate delay in decision making and repeated cancellations of tenders," said one of the experts.

The country''s demand for power generation is increasing by 8-10 percent a year, widening the gap between the demand and supply which now stands at more than 1,500 MW as the country generating 3500 MW against the demand for over 5000 MW.

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