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Mar 94 min read

Banshkhali 600 MW (Beximco) Coal Power Plant

Current Status: Canceled

Representational Photo: Nupa Alam/TBS


Banshkhali 600 MW Coal Power Plant, also called Beximco Chittagong Coal Power Plant, is a cancelled Ultra-supercritical (USC) thermal power plant that was to be situated in Boalkhali under Banshkhali Upazila in Chattogram District of Bangladesh (Location: 22.3917, 91.9204) approximately. It was proposed by Beximco Power Company Limited (BPCL), a subsidiary of Beximco Group, to install and operate as a private Independent Power Producer (IPP) for 25 years. As per the plan, the power plant was to start commercial operation on 30 July 2019. But no progress was seen by 2021 when the Government of Bangladesh (GOB) declared not to build any more coal power plants in the country. Beximco Group also removed the information on the power plant from their website.


Capacity

The installed (gross) and derated (net) capacity of the power plant was 600 MW and 540 MW respectively.


Context

The Banshkhali Coal Power Plant, initially proposed by Beximco Power Company Limited (BPCL) in March 2012. With plans to generate a substantial 1320 MW of electricity, it promised to play a crucial role in meeting the country's growing power demands. However, over the years, the fate of this power project underwent significant changes. Originally conceived as a 1320 MW powerhouse, the project saw a transformation in its scope. The plan was altered, and it was decided that the power plant would instead be established with a capacity of 600 MW, further derated to 540 MW. These changes hinted at shifts in the energy landscape and perhaps challenges in the project's implementation. (MOPEMR 2018).


The most recent update on the Banshkhali Coal Power Plant indicates a state of uncertainty. It appears that the project has been shelved, as there is no mention of it in the Revisiting Power Sector Master Plan (PSMP 2018), a crucial document outlining the country's energy strategy. This omission raises questions about the viability and future prospects of the power plant.


The situation took a definitive turn when the State Minister for the Ministry of Power, Energy, and Mineral Resources (MOEFCC) revealed that the ministry had finalized an energy plan. This plan reportedly called for the cancellation of all coal plants, with the exception of five that were either under construction or already in operation. This declaration further casts doubt on the likelihood of the Banshkhali Coal Power Plant's revival (Roy, Pinaki 2020). The anticipated Commercial Operation Date (COD) was initially set for December 2018, but as of now, no actual COD has been reported. The power plant was expected to have a lifetime of 25 years, and there was no specified phase-out plan. However, with its current status listed as "Shelved," the project's future remains uncertain. (BEXIMCO 2020)


Land Acquisition

No information found on the land acquisition of the power plant.


Finance

The Banshkhali Coal Power Plant project had a total budget of USD 1437.65 million. Sponsors' investment amounted to USD 432.65 million, with key contributors including BPCL, PowerChina, and PCR. Domestic and overseas loans, particularly from ICBC and BOC, were part of the financing, but specific amounts remain undisclosed. The Government of Bangladesh's investment details are also undisclosed. (Mirdha, Refayet Ullah 2016).


Sponsors

The Banshkhali Coal Power Plant project featured a consortium of sponsors, with PowerChina (Power Construction Corporation of China) holding the majority stake at 50%, (Market Research 2017) while BPCL (Beximco Power Company Limited) and PCR (Power China Resources) each had a 25% stake.  (BEXIMCO 2020) (Mirdha, Refayet Ullah 2016)


Fuel Supply

If the Banshkhali Coal Power Plant had proceeded with operation, the plant would have used coal as its primary fuel and heavy fuel oil (HFO) as support fuel. Coal would have been imported from Indonesia, South Africa, and Mozambique. The plant would have employed Supercritical (SC) technology for efficient and environmentally conscious power generation.


Power Generation

In March 2012, a power generation project began, leading to agreements with sponsors signed in June and October 2016. It was designed for 600 MW, but operational constraints reduced its capacity to 540 MW. The expected Commercial Operation Date (COD) in December 2018 was marked "Not Applicable," suggesting potential delays. The project had a significant 25-year lifespan, and there was no predefined phase-out plan. With its status now shelved, the project's future remains uncertain. (BWGED n.d.)


Environment

According to Section 12 of the Bangladesh Environment Protection Act 1995, Environmental Impact Assessment (EIA) is obligatory for any industry (MOLJPA 1995). The polluting industries, such as power plants, have to go through an Initial Environmental Examination (IEE) and EIA as directed in the Environmental Conservation Rules 2017 (MOEFCC 1997). 


The Banshkhali 600 MW Coal Power Plant, was a cancelled Ultra-supercritical (USC) thermal power plant. In the past, when it fell under ESS Category A and ECR Category Red, it signified a project with significant environmental impacts and specific regulatory challenges. However, there was no Environmental Impact Assessment (EIA) conducted for this project. The consequences included substantial environmental effects, potentially affecting air and water quality, soil, and local ecosystems due to emissions and waste management. (BWGED n.d.)


Criticism

The shelving of the Banshkhali 600 MW Coal Power Plant, despite its classification as an Ultra-supercritical (USC) thermal power plant, raised significant concerns in the past. The absence of an Environmental Impact Assessment (EIA) was a glaring oversight, especially for a project with the potential for substantial environmental impact. Falling under ESS Category A and ECR Category Red, it should have undergone rigorous assessment and mitigation measures, particularly concerning emissions and waste management.


This lack of due diligence regarding environmental impact assessment left room for uncertainty and cast doubts on the project's commitment to environmental responsibility. Shelving the project in the past only exacerbated concerns about its future, as it was unclear whether the necessary measures would ever be taken to address its potential environmental consequences. Inadequate attention to regulatory challenges and environmental impacts was a critical issue that should have been addressed comprehensively in future project planning.


References

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