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Siddhirganj 100 MW (Dutch-Bangla) HFO Power Plant

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Current Status: Retired

(Source: Orion)

Siddhirganj 100 MW Furnace Oil Power Plant, also known as Dutch-Bangla Rental Power Plant, is a reciprocating engine-based power plant situated in Alipara under Siddhirganj Upazila in Narayanganj District of Bangladesh (Location: 23.6714, 90.5293). It is sponsored by Dutch Bangla Power & Associates Limited (DBPAL), a Special Purpose Vehicle (SPV) of Orion Group, as a Quick Rental Power Plant (QRPP) for five years. DBPAL declared its Commercial Operation Date (COD) on 21 July 2011 and, as per schedule, the power plant was to retire on 20 July 2016. But it retired on 9 March 2022 after 11 years of operation. The power plant got another life of two years under a new Power Purchase Agreement (PPA) on a No Electricity No Payment (NENP) basis and it is scheduled to retire on 20 July, 2024. The Siddhirganj 100 MW (Dutch-Bangla) HFO Power Plant was officially retired on 18 August 2024 after completing its extended operational tenure. Consequently, the plant is no longer part of Bangladesh's active power generation fleet (BPDB, 2025).


Capacity

The installed (gross) and derated (net) capacity of the power plant was 106.80 MW and 100 MW respectively.


Context

On July 21, 2011, this venture commenced its commercial operations and has since been consistently providing electricity to the National Grid (Orion, n.d.). Initially, PPA was signed for a 5 year contract with Bangladsh Power Development Board (BPDB)  and set to phase out in 2016 but later it was extended to 13 years and it will phase out on 20 July 2024. The power generated is transmitted to the National Grid at the 132 KV level through the Siddhirganj Substation. According to the Power Purchase Agreement signed between the Bangladesh Power Development Board (BPDB) and Dutch Bangla Pack Ltd (DBPL) which is a Netherlands-Bangladesh joint venture company established in 2007, the power plant's expected Commercial Operation Date (COD) was  31 May 2011 (BPDB, 2010). However, the power plant started commercial operation on 21 July 2011. The  Bangladesh Energy Regulatory Commission (BERC) gave the license to DBPL for generating 106.3 MW of electricity from HFO commercially on 26 April 2018 (BERC, 2018).


The power plant completed its last tenure of operation on 20 July 2021 (Tuhin, 2021). In February 2021, DBPAL applied to Bangladesh Power Development Board (BPDB) for an extension of the tenure (Rahman, 2021a). Bangladesh Power Development Board (BPDB) sent a proposal to the Ministry of Power, Energy and Mineral Resources (MOPEMR) to extend the PPA tenure in the first week of July 2021 (Rahman, 2021b). Even the Bangladesh Energy Regulatory Commission (BERC) opposed the proposal of extending the PPA tenure (Rahman, 2021c). Civil Society representatives and the Chairman of BPDB also opposed the tenure extension of old and inefficient rental power plants (FE,  2021a).


DBPAL applied for an extension of the Power Purchase Agreement (PPA) to the Ministry of Power, Energy & Mineral Resources (MOPEMR) even after the completion of 11 additional years of operation (Rahman, 2022). According to the recommendation of MOPEMR, the Cabinet Committee on Government Purchase (CCGP) extended the period of the Power Purchase Agreement (PPA) for another two years on 23 March 2022 under No Electricity No Payment (NENP) method (FE,  2022a). Under the new agreement, BPDB will purchase electricity from the power plant at a rate of BDT 16.40 per kWh. As a result, it has to pay BDT 11.46 billion to Orion Group in the PPA period (FE, 2022b). The power plant also received a duty-free import of fuel with a 9 percent service charge along with import costs (Rahman, 2022).


Land Acquisition

DBPAL acquired 2.16 acres of land from Orion Pharma Limited (OPL) in Siddhirganj Mouza under Siddhirganj Upazila in Narayanganj District of Bangladesh.


Finance

No data was found about the finance of the power plant.

Sponsor

Dutch Bangla Power & Associates Limited (DBPAL), which operates as a Quick Rental Power Plant (QRPP), receives sponsorship from Orion Group through a Special Purpose Vehicle (SPV).


Contractor

The power plant has several contractors for different parts like Infra and Engineering Private Limited (IEPL) for EPC Contractor, Wartsila (Finland) for engine, AVK (Germany) for Alternator, Hatlapa (Germany) for Starting Compressor, Kaeser for Air Compressor, Westfalia (Germany) for separator and purifier (Orion, n.d.). 


Fuel Supply

The facility boasts its own jetty for fuel tanker deliveries, capable of receiving between 10 to 20 lakh liters per tanker. A sizable storage capacity of 80 lakh liters is on hand. Daily fuel consumption stands at approximately 5 lac liters at maximum capacity (Orion, n.d.). The Heavy Fuel Oil (HFO) is being imported from Singapore (IEEE Power and Energy Society, 2022).


Power Generation

The Commercial Operation Date (COD) of the power plant was July 21, 2011. According to the Power Purchase Agreement (PPA), BPDB is liable to purchase electricity from the power plant for 5 years after COD but it was extended to 13 years so it will phase out on 20 July 2024.


Environment

According to Section 12 of the Bangladesh Environment Protection Act 1995, Environmental Impact Assessment (EIA) is obligatory for any industry (MOLJPA 1995). Polluting industries, such as power plants, must undergo an Initial Environmental Examination (IEE) and EIA as directed in the Environmental Conservation Rules 2017 (MOEFCC 1997). But, to date, an IEE or EIA report has yet to be conducted for the power plant. The combustion of heavy oil for generating electricity has detrimental effects on both the local and global environment, as well as human health. Depending on wind patterns and speeds, various regions could experience adverse effects from the emissions of black smoke and sulfur-related pollution resulting from heavy oil combustion. Anticipated local atmospheric consequences include elevated levels of sulfur dioxide (SO2) emissions, nitrogen oxides (NOx), and fine particulate matter.Dutch-Bangla Rental Power Plant also use heavy fuel to generate electricity. The Siddhirganj 100 MW (Dutch-Bangla) HFO Power Plant was estimated to emit approximately 122,233 tonnes of CO₂ annually, contributing to greenhouse gas emissions and climate change concerns (The Daily Star, 2024). No EIA is found for this powerplant. 


Criticism

Despite possessing ample electricity generation capacity, the government has granted approval on 23 March, 2022 to extend the tenure of five additional rental power plants, this powerplant is one of them. These power plants, which operate on heavy fuel oil (HFO), will continue to provide electricity to the Bangladesh Power Development Board (BPDB) for an additional two years, with a tariff rate of Tk 16.40 per unit, and the condition that they will only be paid for the electricity they supply, following a 'no-electricity, no-payment' policy (Financial Express, 2022). According to the environmental conservation rule 2023 the project falls in the “Red” indicating it as a potential harmful project for the environment (MOEFCC 2023).



Capacity Charge

According to Ali, BPDB had to pay USD 433.33 (BDT 30,766.43 when USD 1=BDT 71) to DBPAL as the capacity charge per day (Ali,2020). BPDB had to pay the sponsor a total of BDT 1,530.75 crore capacity charge till FY 2022-2023. Total generation was 4,194.44 gWh and per unit average cost was 13.09 BDT until FY 2022-2023.  

Year

Generation (gWh)

Total Cost (crore BDT)

Unit Cost (avg BDT)

Capacity (crore BDT)

FY 2022-2023

0.00

0.00

0.00

0.00

FY 2021-2022

162.34

307.93

18.97

8.30

FY 2020-2021

366.36

458.87

12.53

182.89

FY 2019-2020

188.22

278.58

14.80

139.59

FY 2018-2019

183.08

327.74

17.90

142.13

FY 2017-2018

399.65

442.36

11.07

133.29

FY 2016-2017

464.82

415.45

8.94

142.63

FY 2015-2016

487.02

437.81

8.99

169.72

FY 2014-2015

487.34

755.18

15.50

153.90

FY 2013-2014

535.05

877.69

16.40

151.08

FY 2012-2013

476.30

784.72

16.48

153.61

FY 2011-2012

444.26

686.67

15.46

153.61

Total

4194.44

5773.00

13.09

1530.75


References

 
 
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