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BANGLADESH

(Updated on Sept. 2006¹)

1.  ENERGY, ECONOMIC AND ELECTRICITY INFORMATION

The People's Republic of Bangladesh is located in South-east Asia between latitudes 20°34' and 26°34' north and longitude 88°01' and 92°31' east. The country is bordered by India on the east, west, and north and by the Bay of Bengal on the south. There is also a small strip of frontier with Myanmar. The land is a deltaic plain with a network of numerous rivers and canals. The delta landmass comprise mainly of three mighty rivers the-Ganges, the Brahmaputra and the Meghna, with a network of numerous rivers and canals. The total area of the country is 147.57 thousand sq km in which about 15% is forested. There are a few hilly areas in the southeast and the north east of the country. Except the hilly regions in the northeast, some areas with high lands in the north and northwestern part, the country consists of low, flat and fertile land. The alluvial soil is thus continuously being enriched during the rainy season by heavy silts deposited by rivers. The country has about 2734 km of railroad, 17554 km of paved road and roughly 5968 km of perennial and seasonal waterways.

Bangladesh is located in the sub-tropical region with a strong dominance of monsoon with a hot and rainy summer and a pronounced dry season in the cooler months. January is the coolest month of the year, with temperatures averaging near 26 deg C, and April the warmest month, with temperatures ranging between 33 deg and 36 deg C. The climate is one of the wettest in the world; most places receive more than 1,525 mm of rain a year, and areas near the hills receive 5,080 mm. Most rain falls during the monsoon (June - September) and a little during the dry season (November - February). The Padma-Jamuna-Meghna river system divides Bangladesh into two zones, east and west.

Bangladesh is one of the densely populated countries in the world. According to the national population census 2001, the total population of the country was 129.9 million, with the growth rate of 1.48%. A significant decline of the growth rate has occurred during the past few decades due to government’s extensive family planning program across the country. The urban population is about 20% of the total population. Table 1 shows the data of population from 1970 to 2004. Here and the followings, the year stands for the Financial Year (July 31 to June 30). At present Bangladeshi's average life expectancy is 60 years, which is well above 51.7 years average for LDC's but significantly below the average of 64.5 years for all developing countries. The country's adult literacy rate is 60.41%, compared to 72.9% for all developing countries and 51.6% for LDC's. Infant mortality has been estimated at 58 deaths per one thousand live births, compared to 61 for all developing countries.

TABLE 1. POPULATION INFORMATION

 Source: World Bank World Development Indicator

1.1.1.  ECONOMIC OVERVIEW

Bangladesh is an agricultural country. More than 70% people are employed in the agriculture sector and this sector contributes to about 32% of total GDP. Over the last several years, Bangladesh experienced bumper crops and strong growth in the agricultural sector. Recently, the country is attempting to diversify the national economy away from agriculture to industry. A new industrial policy was announced in 1999 to create friendly environment for industrial expansion based on participation of private sectors including foreign investors.

The GDP growth rate of Bangladesh was relatively faster during the 1990s (4.6%linear growth) in comparison to the 1980s (3.6% linear growth). In 1990’s decade, the GDP growth momentum was higher during the second half of the decade in comparison to the first half. The linear growth rate of GDP during the period of FY 1991-1995 was 3.95%, while during the next five year (FY 1996-2000); it grew at a faster rate of 4.79%. Following a decline in the GDP growth rate from 5.9% in FY 2000 to 4.4% in FY 2002, the national economy repositioned itself at a five percent plus growth trajectory during the subsequent two years (FY 2003 and FY 2004).

TABLE 2. GROSS DOMESTIC PRODUCT (GDP)

Source: World Bank World Development Indicator

1.1.2.  ENERGY SITUATION

The main energy resources of Bangladesh are commercial energy resources and noncommercial resources (biomass etc.). The available commercial energy resources in the country are indigenous natural gas, hydroelectricity, imported crude oil and other petroleum products, and the noncommercial energy resources mainly includes biomass resources such as trees (e.g. wood fuel), jute sticks, agriculture residues, rice hulls, and animal dung. The electricity consumption in the country has increased significantly over the decade; however, the per capita consumption is still very low. In 2004, per capita energy consumption and electricity generation of electricity were about 220 KGOE/year and 140 kWh/year, respectively. Biomass is the major energy source in the country. At present, about 55% of the total final energy consumption is met by different type of biomass fuels. The demand for commercial energy is increasing rapidly due to industrialization and socio-economic development of the country. The main reserve of indigenous energy resources are as follows:

Natural Gas

Natural gas is currently the only major indigenous primary energy resource of the country, which is being produced and consumed in significant quantities. It plays an active role towards economic growth of the country. Natural gas now accounts for about 70% of the country’s commercial energy supply.

Petrobangla, a government owned company, was only responsible for exploration of petroleum and mineral resources in Bangladesh until 1990. However, over the last few years, discoveries and development of the gas fields in the country have been taken under more than one organizations or government appointed bodies. According to the latest study conducted by the Hydrocarbon Unit of the Energy and Mineral Resources Division and Norwegian Petroleum Directorate, the initial gas in place (proven + probable) reserve of the 22 gas fields of the country is 28.4 TCF out of which 20.5 TCF is considered recoverable. Out of this recoverable reserve, 5.1 TCF has been consumed up to June 2003 leaving remaining recoverable reserve of 15.4 TCF. The government appointed committee of experts, the ‘National Committee for Gas Demand Projection and Determination of Gas Reserve and Resource Potential in Bangladesh’ hereafter referred to as ‘National Committee for Gas Demand and Reserve’ in this text, has done one of the comprehensive compilations of the up-to-date reserve data. In June 2002, the ‘National Committee for Gas Demand and Reserve’ concluded its report that the initial gas reserve (proved plus probable) is in between 16.64 and 20.42 TCF.  By December 2003, a total of 5.31 TCF gas has been produced in the country and accordingly the remaining reserve of the country in 22 gas fields stood in between 11.33 and 15.11 TCF by that time. On the other hand, besides the existing 22 gas fields, two more gas fields were discovered in 2004 and 2005 but their reserves are yet to be estimated. Preliminary surveys indicated that the reserves of these two fields could be in the range of 0.2 to 0.5 TCF each.

In FY 2003-2004, total consumption of natural gas was 12105 MMCM of which power generation plants and fertilizer industry consumed 5274 MMCM and 2716 MMCM respectively. Their combined consumption was 68.36% of total consumption of that year. Remaining 31.63% of the produced gas is used in industrial, commercial and domestic sectors. Presently, the system loss in gas sector is about 5%. In recent years, usage of compressed natural gas (CNG) as an alternative fuel for automobile has started in small scale and is being popular in the major cities, Dhaka and Chittagong. According to the National Committee for Gas Demand and Reserve, the total projected gas demand for all sectors of the country for the period 2001 - 2030 is about 26.7 TCF.

Coal

Coal exploration program in Bangladesh is still going on. About 2086 million metric tones of coal reserve were discovered until 2004. Out of these reserve 724 million tones is recoverable. This quantity of coal can make significant contribution in meeting country’s primary energy demand as well as electricity generation. The coal production in Bangladesh began with the opening of Barapukuria coal mine in Dinjapur district of Bangladesh. The project is expected to produce about one million short tons of coal per year, primarily for running a 250 MW first coal power plant in Bangladesh. Before opening this coalmine, all of the coal demand in Bangladesh mainly for brick clines was met by importing from neighboring country India.

Another coal mine is located at Phulbari region of Dinaspur district, which is approximately 12 milesfrom the Indian border. Annually 7 million Mt of coal is expected to be recovered by 2007 from this mine. Australia's Asia Energy Corp. submitted a $1.4 billion plan to develop the coalmine in the Phulbari region.

According to official statistics-2004, Bangladesh consumes about 600 to 700 thousand tons of coal per year. Presently, the coal consumption in the country is mainly limited to the brickfields. However, in near future the potential uses of coal will increase extensively to brick industries, power generation, and cement industries. The National Energy Policy (NEP) clearly identified role of indigenous coal for power production, and NEP also projected 5150 GWh and 7210 GWh of electricity would be generated by coal in 2010 and 2020, respectively. This projection indicates that the share of coal for power generation will be about one third and half of the share of natural gas by 2010 and 2020, respectively. Recently, it is discussed in the national level that indigenous coal would be another vital proportion of energy supply mix for long-term energy development in the country; the coal reserves of the country is sufficient to fuel more than 3000 MW coal-based power plants; however, necessary justification on availability of these resources is yet to make.

RENEWABLES

Hydroelectricity

Bangladesh has a hydroelectric plant with 230 Mw generation capacity which is located at Kaptai in the south east region of the country. On average annually 833 GWh electricity is generated from this plant by 5 units. This plant has a potentiality of extending capacity by one hundred MW by utilizing spill water. In addition, the country has two potential sites for constructing two medium size new hydro plants across the rivers Matamuhuri and Sangu at the same region. The feasibility study shows that on average 500 GWh of electrical energy could be produced from the proposed two plants. The terrain of the country being flat, there is no realistic prospect for building additional hydro units.

Biomass

Biomass includes fuel wood, agricultural residues, tree twigs, animal dung, and charcoal. Presently, most of the villagers in Bangladesh solely depend on biomass for cooking and other needs. The consumption pattern of biomass fuel is about 71% for cooking and agro-products processing at households, 28.5% for industries, and 0.5% for commercial level. In year 2000, biomass supplied 560 million GJ of energy or 55.4% of total energy supply. Research studies show that the share of biomass in national energy consumption has decreased gradually from 83.8% (1980) to 55.4% (2000); however, the supply in volume has increased 25% over the last 20 years [13]. In the foreseeable future, the share of traditional fuels in percentage terms may decrease, but the absolute magnitude will increase.

The agriculture residues are the major supplier of biomass, and the animal dung is the second largest supplier. But the agricultural residues and animal dung are supposed to be utilized for maintaining soil fertility. The immense pressure on biomass fuels without proper plan is causing massive deforestation and decline in soil fertility.

Solar Energy

Solar power uses sun's energy to produce electricity. Solar energy is plentiful in Bangladesh. Solar energy in Bangladesh is mainly utilized for processing of agro products. The average solar radiation varies from 4 to 6.5 kWh per square meter per day. The yearly direct solar energy available in the country of Bangladesh is estimated to be 25610 million tones of coal equivalent. Solar electricity is environmentally friendly; however, it is still quite expensive. Many government organizations and NGOs have started photovoltaic project to provide electricity in remote areas of Bangladesh. With an increase in energy demands and with an invention of more efficient technologies in the future, the production costs and price of solar power is expected to decline.

Wind

Generation of electricity using wind requires high wind speed and available open space. Valleys within mountains can funnel winds at high speed, and are suitable locations for wind turbines that can generate electricity. Parts of Chittagong and Hill Tracts might be feasible for generation of electricity using wind power. Prospects of developing wind energy are still difficult to gauge mainly due to the lack of sufficient wind speed data in the country. Although it is too early to tell whether wind energy will be a viable option in Bangladesh, there is every reason to continue to explore this option in the hope of coming up with cost-effective generation particularly in the coastal areas.

It is realized through above discussion that the country’s resources can only meet a portion of total energy demand in short and long term future. Therefore the assessment of the indigenous primary energy supply alternatives along with the imported fuel options for long-term power development is required. Planning about alternatives in case of scantiness of resources should also be made a matter of concern.

TABLE 3. ESTIMATED ENERGY RESERVES

(*) Sources: 20th WEC Survey of Energy Resources, 2004 and Uranium 2005: Resources, Production and Demand ("Red Book")                                                                                                    

(1) Coal including Lignite: proved recoverable reserves, the tonnage within the proved amount in place that can be recovered in the future under present and expected local economic conditions with existing available technology                 

(2) Crude oil and natural gas liquids (Oil Shale, Natural Bitumen and Extra-Heavy Oil are not included): proved recoverable reserves, the quantity within the proved amount in place that can be recovered in the future under present and expected local economic conditions with existing available technology

(3) Natural gas: proved recoverable reserves, the volume within the proved amount in place that can be recovered in the future under present and expected local economic conditions with existing available technology

(4) Reasonably Assured Resources (RAR) under < USD 130/kgU

(5) Hydropower: technically exploitable capability, the amount of the gross theoretical capability that can be exploited within the limits of current technology

Source: IAEA Energy and Economic Database

The limited indigenous energy resources of the country are insufficient to meet the national demand targets, which have been affecting the national development efforts over the last decades. The country needs a high growth of energy supply, especially electricity for its socioeconomic development.

TABLE 4. ENERGY STATISTICS

1.2.  ENERGY POLICY

In recognition of the importance of energy in socio-economic development, the government has given continuing attention to the overall development of the energy sector. The government formulated and adopted the National Energy Policy (NEP) of the country through a gazette notification in January 1996 to ensure proper exploration, production, distribution and rational use of energy sources to meet the growing energy demand of different zones, consuming sectors and consumers groups on a sustainable basis. The main objectives of the NEP are as follow:

1. To provide energy for sustainable economic growth so that the economic development activities of different sectors of economy are not constrained by shortage of energy.
2. To meet the energy needs of different zones of the country and socio-economic groups.
3. To ensure sustainable operation of the energy utilities.
4. To ensure rational use of total energy sources.
5. To ensure environmentally sound and sustainable energy development programs causing minimum pollution to the environment.
6. To ensure public and private sector participation in the development and management of the energy sector.

The policy document provides specific policy related to issues like development of the energy sector, augmentation of resources, pricing, technological options, fuel and technology mix, conservation, environment, investment, area based planning, bio-mass development rural energy research and development, human resource development, institutional issues and legal issues. The needs and priorities of involving the private sector in development of energy have also been emphasized in the policy. A separate Petroleum Policy was also adopted at that time, which defines various issues related to exploration, exploitation, use and pricing of hydrocarbons. The National Energy Policy is now being reviewed. The need for early implementation of the Nuclear Power Project is identified in the NEP.

1.3.  THE ELECTRICITY SYSTEM

1.3.1.  POLICY AND DECISION MAKING PROCESS

The utilities of electric power sector are divided into three major groups according to their services that they provide and these are generation, transmission and distribution. Previously, Bangladesh Power Development Board (BPDB) under the Ministry of Energy and Mineral Resources (MOEMR) was responsible for all activities related to planning, generation, transmission, distribution and marketing of electricity. The MOEMR has overall responsibility for the country's energy sector, with policy formulation and investment decisions under its control.

The first shift in policy had taken place through the formation of the Rural Electricity Board (REB) in 1977, which was given the mandate to bring the rural areas of the country under electricity supply through the establishment of Consumers' societies. The second milestone was the formation of the Dhaka Electricity Supply Authority (DESA) during the mid-nineties.

The involvement of the independent power producers in electricity generation is gradually replacing the concept of public sector monopoly in the development on the energy sector of the country and within the MOEMR, the "Power Cell" acts as a single point of contact to facilitate the electricity reform and restructuring process, such as the development of Independent Power Producers (IPPs). For system loss reduction in power sector, the government envisages special measures in the transmission and distribution network and retrofitting of plants with move on improved devices for technical losses and good management through administrative measures. In the meanwhile, a separate corporation, namely the Power Grid Company of Bangladesh Limited was formed to gradually take the responsibility of the electricity transmission network. In spite of several deficiencies and constraints on part of the BPDB (such as dual responsibility of regulation and promotion, administrative tariff in place of economic operation, lack of financing and above all unacceptable system losses) it has been possible to maintain a moderate growth at an annual average rate of 8.5% and the energy generation at an average annual rate of 10.7% over the last three decades.

Moreover, the government declared its vision “Twenty-Twenty” that means that the government would ensure electricity for all by the year 2020.

1.3.1.1.  PROJECTED DEMAND FOR ELECTRICITY

Considering the growth of the individual end-user sectors the projection of demand for energy should ideally be made. A projection made on this basis can help ensuring proper linkages between the micro and macro projections and hence reflect the demand driven needs for energy on a long-term perspective. On the other hand, a large number of data on individual end-use sectors are required for this purpose. Unfortunately, data of such extent with the desired level of accuracy is not available. Therefore, in the National Energy Policy the estimation of future demands for energy and electricity (up to the year 2020) was made by considering the energy-coefficient, i.e. the ratio of the energy growth rate and the growth rate of the economy. Projections on electricity demand have been made in the National Energy Policy in two scenarios. The low scenario is shown in Table 1.3.1.1(a), while the reference scenario is given in Table 1.3.1.1. (b). It is interesting to note that, even according to the Reference Scenario, the per capita generation of electricity in the year 2015 will reach a level, which is lower than the present consumption in the neighboring countries like India and Pakistan.

Table 1.3.1.1 (a) Projected Demand for Electricity (Low Economic Growth Scenario)

Table 1.3.1.1 (b) Projected Demand for Electricity (Reference Economic Growth Scenario)

1.3.1.2.  ELECTRICITY DEMAND AND SUPPLY

Per capita generation of electricity in Bangladesh is now about 140 kWh. In view of the prevailing low consumption base in Bangladesh, a high growth rate in energy and electricity is indispensable for facilitating smooth transition from subsistence level of economy to the development threshold. The average annual growth in peak demand of the national grid over the last three decades was about 8.5%. It is believed that the growth is still suppressed by shortage of supply. Desired growth in generation is hampered, in addition to financial constraints, by inadequacy in supply of primary energy resources. The strategy adopted during the energy crisis was to reduce dependence on imported oil through its replacement by indigenous fuel. Thus, almost all plants built after the energy crises were based on natural gas as fuel. Preference for this fuel is further motivated by its comparatively low tariff for power generation. Its continuation however has adversely influenced evolution of a judicious energy-mix for the country in the following ways:

1. Allocation of gas to other value added end-use sectors was reduced;
2. Technologies having lower efficiency often became economic, thereby reducing overall efficiency of the system;
3. Location of power plants often failed to take into consideration the need for equitable distribution of energy; and
4. Growth of the power sector was forced to be linked with the programmes of development of a particular fuel type.

1.3.1.3.  ROLE OF INDIGENOUS FUEL IN POWER GENERATION

The average annual growth in peak demand of the national grid over the last three decades was about 8.5%. Desired growth in generation is hampered, in addition to financial constraints, by inadequacy in supply of primary energy resources. Presently exploited indigenous primary energy resources of Bangladesh for power generation include natural gas and hydro electricity. The lone viable hydro electricity site is being exploited with an annual generation in the range from 800 to 1000 GWh per year. Natural gas now accounts for about 90% of the total generation. A coal deposit is being developed, which will attain an annual output of 1 million ton at its peak. The allocation of natural gas for different end-use sectors, including power production has been indicated in the National Energy policy. The role of indigenous fuel in power generation is given in Table 1.3.1.3. This shows that after the year 2000, the gap between demand for electricity and the generation with indigenous fuels will rise sharply.

Table 1.3.1.3.  Generation of Electricity with indigenous fuels (in GWh)

1.3.1.4.  OPTIONS OF IMPORTED FUELS FOR POWER GENERATION

In the National Energy Policy, the options of imported fuel for power generation are limited to oil,coal and nuclear.

1.3.2.  ELECTRIC POWER SECTOR

The strategy adopted during the energy crisis was to reduce dependence on imported oil through its replacement by indigenous fuel. Thus, almost all plants built after the energy crisis was based on natural gas as fuel. Preference for this fuel is further motivated by its comparatively low price for power generation. Presently, indigenous energy sources (e.g. natural gas, hydro) are used for the generation of electricity in the East Zone. The East Zone contains nearly all of the country's electric generating capacity while imported petroleum fuels (e.g. Furnace Oil (FO), Light Diesel Oil (LDO), Superior Kerosene Oil (SKO), High Speed Diesel (HSD)) are used to generate electricity in some areas of the West Zone. As a result, the energy demand is strongly suppressed in the West Zone which only accounting 22% in present days. In order to minimize the effect of fuel cost on power generation, electricity generated in the East Zone is transferred to the West Zone via East West Electrical Inter-Connector established in 1982. The transfer capacity of the Inter-Connector has almost reached its limit (450 MW). Gas is already available at Baghabari - Serajganj in the West Zone through Jamuna Bridge and there is a plan to extend gas network all over the West Zone. It is logical and economical to install gas-based power plants in the West Zone.

1.3.2.1.  GENERATION

The responsible authorities for generation of electricity in Bangladesh are: Bangladesh Power Development Board (BPDB), Rural Power Company and Independent Power Producers (IPPs). The total installed capacity of the all power plants was about 4680 MW including 1260 MW of the IPPs. In the fiscal year of 2003-2004 the maximum available generation capacity was 3592 MW. The total installed capacity including IPP consists of the following types of plants (according to FY 2003-2004): Hydro: 230 MW (4.91%); Steam Turbine: 2228 MW (47.61%); Gas Turbine: 994 MW (21.24%); Combined Cycle: 990 MW (21.15%); Diesel: 238 MW (5.09%). The peak generation increased to 3592 MW compared to previous year's 3428 MW. The total net generation in that year was about 20062.13 GWh, which was 8.90% more than that of the previous year. The share of the IPPs in total net generation was about 7478.17 GWh, which increased by about 18.72% than that of the previous year. Total electricity generation by types of fuels was as follows: hydro (4.91%), natural gas (84.53%), petroleum fuels (6.195.78%) and diesel (4.371.33%). Among the total generation 87% was in the East zone. Low cost electricity generated in the east zone is transferred to the west through the 230 kV East-West Inter-connector. The energy transferred in FY 2003-2004 was 2135.55 GWh, which was a decrease of 1.60% over the previous year.

1.3.2.2.  TRANSMISSION AND DISTRIBUTION

Bangladesh Power Development Board (BPDB), Dhaka Electric Supply Authority (DESA), Rural Electrification Board (REB), Power Grid Company of Bangladesh (PGCB) are responsible for transmission and distribution of electricity. The total length of 230 kV and 132 kV transmission lines were 682.5 km (1365 circuit km) and 2658 route km (4641 circuit km), respectively. The total length of BPDB and REB distribution lines comprising of 33 kV, 11 kV and 11/0.4 kV lines stood at 60232 km at the end of 2003-2004, which was 1973 km higher than the previous year.

During the last twenty-five years the overall transmission and distribution losses that includes the technical and non-technical loses varied between 27.2% and 40.2% of the net generation. A high proportion of losses at T&D level include non-technical losses (e.g. theft, pilferage etc.). In the year 2004, the transmission and distribution (T&D) loss of BPDB system in the country was 10.16% of the net generation, which was 11.35% in 2003. The system loss in this financial year was reduced due to extensive drive and proper monitoring in commercial operation. The distribution loss including REB also reduced to 10.90% during 2003-2004 compared to 14.81% in the previous year. Also the distribution loss in BPDB’s own distribution has decreased to 21.33% in 2004 from 22.35% in 2003.

TABLE 5. ELECTRICITY PRODUCTION AND INSTALLED CAPACITY

1.3.2.3.  CONSUMPTION

The per capita consumption of electricity is very low. The per capita consumption of electricity is increasing almost steady over the years. The one-fifth population of the country either in urban and rural have been suffering from the benefit of electricity. The total consumption of electricity was about 18024 MkWh in 2004, which was 7% higher than the previous year. The consumption patterns in different end-user categories were as follows: DESA (50.95%), REB (19.43%), domestic (12.21%), industrial and commercial (15.77%), agriculture (0.46%) and others (1.18%).

TABLE 6. ENERGY RELATED RATIOS

1.3.2.4.  OPERATING EXPENSES

The total sale of electricity including bulk sales to DESA, DESCO and REB in 2004 was 18,023.61 GWh, which was 10.36% increase over the previous year. The total operating income in 2004 (sale of electricity and other operating income) was 776.11 million USD. The operating expenses (fuel cost, cost of electricity purchases from IPPs, generating expenses, transmission and distributions expenses and others) was about 743.74 million USD. The gross operating profit was about 32.37 million USD and the rate of return on the fixed assets was 2.14%. The average billing rate stood at 4.2 cents per Kwh. In the year 2004, the conversion rate of 1 USD was BD Taka 57.50.

1.3.3.  SOME OTHER ISSUES

1.3.3.1.  Low consumption pattern

The average annual growth in peak demand of the national grid was not up to the level of projected demand. The gap between projected demand and supply is increasing day by day. If present trend of consumption continues, the gap will increase sharply in future. As a consequence, the socioeconomic development will tremendously be hampered.

Regional Imbalance

In is seen in Bangladesh that the indigenous reserves of primary energy resources influenced the development of energy sector. In the country all most all-commercial energy resources are located in the Eastern Zone and it has more than 90% of total generating capacity of the country and consumes about 75% of total generation. The Western Zone depends on Eastern Zone for electricity for meeting not only the peak demand but also a part of the base load. As a result, electricity demand of the western zone is strongly suppressed due to lack of supply. The gap in energy use between the two zones is widening day by day that has been hampering proper industrialization and urbanization of the west zone. This should be realized by increasing the generating capacity in the western zone, which is adequate to meet its base load from the power plants located there.

Area Based Planning and Rural Energy

National economy is agriculture based and its development is dependent on expansion of modern agriculture. Area based planning on demand supply balancing should be encouraged. This would help equitable development reflecting needs, priorities, weaknesses and strength of each individual planning unit. Adequate measures have to be initiated to enhance the quality of rural life; fruitful basic needs and achieve equitable income distribution. Importantly supplying of electricity for irrigation purpose will help to attain self-sufficiency in food production and in production of basic materials.

Energy Pricing

It is observed that tariff of energy is often fixed without considering the realities like the need for internal revenue generation and economic operation of the concerned utilities. Often the pricing is such that the conversion facilities such as power plants of fertilizer factories can afford to install machinery with lower efficiency without sacrificing the profitability of the industry. The gas tariff of the energy sector may be mentioned here. According to tariff structure, the cost of gas per MCF was (Tk. 78.40) for the power sector, Tk. 68.15 for the fertilizer production, Tk. 243.67 for the commercial uses, Tk. 162.45 for the tea industry, Tk. 211.1817 for the brick manufacturing and Tk. 134.00 for the domestic burners. On the other hand, power and the fertilizer sector consume about 80% of total gas supplied annually and they have to pay about one third or less of the highest tariff. If willingness to pay is an indicator of economic price of gas, then the gas sector is being deprived of the desired revenue generation.

2.  NUCLEAR POWER SITUATION

2.1.  HISTORICAL DEVELOPMENT AND CURRENT NUCLEAR POWER ORGANIZATIONAL STRUCTURE

Peaceful uses of Nuclear Technology were initiated in Bangladesh in early 1960's under the framework of the then Pakistan Atomic Energy Commission (PAEC). After independence, Bangladesh became a Member State of the Agency in 1972. Bangladesh Atomic Energy Commission was formed in 1973 by the Presidential Order No. 15 with the goal of utilization of Nuclear Science & Technology for national development.. Nuclear establishment in the country however existed and concerned activities were carried on even before its independence from Pakistan. The Commission was entrusted with the following charter of duties: "Promotion of the peaceful uses of atomic energy in Bangladesh, the discharge of International obligations connected therewith, the undertaking of research, the execution of development projects involving nuclear power stations and matters incidental thereto." Since then, three decades have elapsed and the Commission pursued various research and development projects, established a number of research and service providing centres with necessary laboratory facilities and equipment, trained working scientists and developed supporting facilities that can be used to meet the fast changing trends of scientific and technological pursuits of the modern world.

BAEC's overall R&D programs are formulated in two distinct trains, namely (a) problems addressing the needs of national development and (b) basic R&D. Of these, the first group of projects is now being given higher priority. This will also be evident from the fact that vertical linkage of BAEC is provided through the Ministry and the Planning Commission, which ensures that national goals and development targets are featured in its programs and projects.

Over the years, the Agency has been a partner-in-development in most of the leading BAEC institutes. This has meant a continuing relationship with various institutes at Savar and at AECD. Broadly speaking, the program at Savar covers research reactor commissioning and its utilization for isotope production, 1.85 PBq Co-60 irradiator, neutron activation analysis, and neutron radiography. Nuclear analytical facilities, and laboratories for repair and maintenance of nuclear instruments, have been established both at Savar and at AEC, Dhaka. Utilization of Van de Graaff accelerator at AECD was also supported by the Agency. NDT program at AECD and isotope hydrology at Savar, and food preservation, pest control, radiation sterilization of pharmaceuticals, tissue banking and agrochemical residue analysis at the Institute of Food and Radiation Biology, have also been well supported.

The Law on Nuclear Safety and Radiation Control was enacted in 1993. Considering that BAEC is the only national institution that has expertise and trained human resources needed for the enforcement of the law, it was also given nuclear regulatory responsibility. In future, a separate regulatory organization will be set up in order to separate promotional responsibilities from the regulatory ones. When this is implemented, it will be possible to attain the required transparency in nuclear safety and radiation control especially in all stages for licensing and inspection of nuclear facilities and radiation sources.

In addition to making excellent use of opportunities under the country TC program, Bangladesh has been an active partner in the Regional Cooperation Agreement (RCA) program. According to a recent review of the Technology Transfer through RCA program, the country participated in different areas of RCA activities. Through the devotion, dedication and hard work of scientists, engineers and technicians, sustained support from the Government, and a judicious combination of IAEA country projects with the RCA program the country has attained a high level of technology transfer. This is a good achievement and reflects the growing maturity of Bangladesh's nuclear program.

2.2.  NUCLEAR POWER PLANTS: STATUS AND OPERATIONS

2.2.1.  HISTORICAL DEVELOPMENT OF NUCLEAR POWER PROJECT IN BANGLADESH

The proposal for building a nuclear power plant in the western zone of the country was first mooted in 1961. Since then a number of feasibility reports had been prepared which established that the plant was technically and economically feasible. The Rooppur site was selected in 1963 and 292 acres (118.3 hectare) of land (105.3 hectare for plant and 13 hectare for residential purposes) was acquired for the project. Physical infrastructures like residential quarters, site office, rest house, internal road, electric sub-station, pump house etc. were established in the project area. The then Pakistan government gave formal approval for 70 MW, 140 MW and 200 MW Nuclear Power Plant (NPP) in 1963, 1966 and 1969, respectively. Following liberation the ECNEC had approved the pp for a 125 MW nuclear power plant in 1980. A number of suppliers had submitted proposals for the project both before and after liberation. However, the project could not be implemented due to several problems with financing as the main obstacle.

Considering the changed circumstances in national and international level the government of Bangladesh expressed its firm commitment to implement the Rooppur nuclear power project (RNPP). It may be mentioned that the inordinate delay in project implementation has brought about a number of changes in the planning process. For example since grid size is growing, it will eventually grow to a size where accommodation of a larger plant of 600 mw with advantage of economy of scale would be required. The growth of the grid to such a size incidentally matches the time needed for implementation of such a plant. Such changes would necessitate updating data, information and some of the past studies.

2.2.2.  DECISION MAKING PROCESS

Nuclear power projects are very complicated and any decision on it, unless taken at an appropriate level of the government, might be rendered ineffective. Continuity of decision over a long time is also an important requirement. In the case of Bangladesh, a Cabinet Committee, chaired by the Head of the Government, has the responsibility to take decision on the project. This Committee includes Ministers and Permanent Secretaries of all relevant Ministries as well as the government agencies related to the project, the Planning Commission of the government and the energy sector in general. It takes all policy decisions based on the information and analyses made available to it. This has also facilitated establishing proper linkages between the macro and micro level planning. A Sub-Committee, headed by the Principal Secretary is also formed to monitor implementation of the decision taken by the Cabinet Committee. The Bangladesh Atomic Energy Commission has been given the responsibility for implementation of the policy decisions.

It is equally important for a developing country to convince relevant foreign governments on the priority of the project, because these are the sources for technology and finance. This may be accomplished through the contacts made at appropriate levels of the foreign government.

2.2.3.  PRESENT STATUS OF NUCLEAR POWER PLANTS

The need of early implementation of the Nuclear Power Project at Rooppur in the Western Zone of the country identified in the NEP and also in the last fifth five year plan and also proposed in the 6th five year plan. A supporting project for implementation of the Rooppur Nuclear Power Project was approved by the Government in 1999 to carry out the necessary pre-implementation works identified for the successful implementation of the project. A number of initial activities, such as updating the Site Report and preparation of Site Safety Report of 600 MW(e), promulgation of a Nuclear Power Action Plan, Human Resource Development, preparation of Bid Document, etc. have been initiated to facilitate the implementation of the project. In this regard, the Government has adopted the National Nuclear Power Action Plan (2000).

Presently the Government of Bangladesh is looking for sources of foreign soft loan for nuclear power reactor and related technology.

2.2.3.1.  BANGLADESH NUCLEAR POWER ACTION PLAN (BANPAP)

A blanket administrative provision is essential to ensure efficient implementation of a government decision on the national nuclear power programme. Its overwhelming role is evident from the wide range of national as well as international agencies, whose concerted participation is essential for the success in realizing the decision effectively. Such a provision is best served through a National Nuclear Action Plan, adopted at the appropriate level of the government. The main purpose of this document is to identify:

1. Various activities needed for implementation of the nuclear power programme;
2. The agencies responsible for each of these activities;
3. Enabling measures like funding, for conducting the activities.

The government of Bangladesh adopted the National Nuclear Action Plan (BNPAP) for meeting the above-mentioned purposes for early implementation of the nuclear power project in the country in 2000.

The Table of Contents the BANPAP are as follows:

2.2.3.2.  SITE SAFETY REPORT OF THE PROPOSED 600 MW(E) ROOPPUR NUCLEAR POWER PROJECT

The contents of the Site Safety Report of the proposed 600 MW(e) Rooppur Nuclear Power Project are as follows:

2.2.3.3.  DATA COLLECTIONS AND ANALYSIS

2.2.3.4.  FACTORS TO BE CONSIDERED IN PLANNING FOR NUCLEAR POWER

Several factors may be identified that deserve attention in planning for nuclear power. They include the following:

• Convincing the decision makers, both internal and external;
• Establishing a human resource development programme;
• Developing legal instruments;
• Establishing an institutional framework;
• Providing public information and obtaining public acceptance;
• Meeting the conditions of the international non-proliferation regime.

With respect to the need for nuclear power as a component of the overall energy mix, it should be born in mind that building one single unit of a nuclear power plant is often not profitable in view of the large fore-cost involved in it. Therefore, the intending developing country should aim at a nuclear power programme and not a mere nuclear power project. A programme would fetch many tangible, intangible and spin-off benefits from a nuclear power programme, thereby making contributions to not only the energy sector but also the overall economic activity.

The relative importance and priority of the above broad issues are, of course, dependent on the socio-economic and political system of the particular country. The salient features of experience of Bangladesh in planning for nuclear power over an extended period are enumerated in the following paragraphs.

2.2.3.5.  LINKAGE OF NUCLEAR POWER PLANNING WITH THE MACRO LEVEL PLANNING

In Bangladesh, the medium to long-term and short-term (annual) macro planning are conducted under term plans (Five Year Plan) and Annual Development Programmes, respectively. The Term Plan is divided into various sectoral plans. Development targets of electricity generation, transmission and distribution over a plan period are set under the energy sector. Thus, any decision on nuclear power programme is taken by considering the overall programme for the sector. Various studies are conducted to assess energy demand during the plan period and on the supply side the technologies for generation are identified by considering the relevant factors such as economics, fuel option, environmental dimension, project gestation period, availability of finance, etc. The National Energy Policy, with a perspective period of 25 years is also consulted for the purpose. In the case of Bangladesh, the need for introducing nuclear power is identified in all these macro-level plans and policy documents. The existing executive framework for the project, which is discussed in a later paragraph, has been proved useful in establishing the linkage with the macro level planning.

It is also equally important to assess the economic aspects of nuclear power as a component of a least cost generation plan. The environmental impact of various options should also be assessed properly as one of the tools for decision-making.

In many developing countries, the new trend is to deregulate the electricity sector. Private entrepreneurs are attracted to invest in the entire range of activities, including generation. Of late, entrepreneurs have established generating plants in Bangladesh under Power Purchase Agreements. In the transitional phase, extreme care has to be taken in choosing the technology and fuel options for evolving the optimum generation plan. In particular, the conditions of power purchase agreement for the private sector generation may upset overall optimization of the system. Other factors deserving attention include the administered price of indigenous fuels and energy tariff. Centralized planning for generation may thus need some structural changes and review of strategies by considering the above changes.

2.2.3.6.  THE NEED FOR AN INTEGRATED APPROACH TO PLANNING

The macro-micro linkage is an important pre-requisite for the integrated approach to nuclear power project planning. However, the other important facet is the need for integration among various elements of micro planning of nuclear power programme. The two broad strings of activities that have to be addressed with equal earnestness and seriousness right from the inception of a nuclear power programme are:

(a)  Technical, economic and financial management of the nuclear power programme; and
(b)  Safety and regulatory aspects.

Since the above two categories of functions are to be ultimately conducted independent of each other, the planning for nuclear power, including capacity building and human resource development activities as well as the necessary legal frameworks for each of these, need to be addressed properly. Issues like management of radioactive waste including a policy on ultimate disposal of high level wastes also require attention at the early stage. Other issues, like capacity building in quality management, identification of codes, guides and standards, project management, etc., also deserve due consideration. In particular, the human resource development programme should be developed in such a way that the core manpower acquires at least working knowledge in the above-mentioned key areas of the nuclear power programme.

2.4.  SUPPLY OF NPPS

At present time, there is no nuclear power plant in Bangladesh.

2.5.  FUEL CYCLE AND WASTE MANAGEMENT

Bangladesh is not operating any NPP. The country has a research reactor and there is a facility for isotope production, however, presently, there is no program on nuclear fuel cycle. Program on waste management is focused to that related to research reactor and industrial uses of radiation/nuclear sources.

BAEC has established the Central Radioactive Waste Processing and Storage Facility (CWPS) in the campus of AERE, Savar under the Govt. Annual Development Project (1997-2004 of the Govt. Cost at US$1.15 millions (BDTk. 6.60 cores) and the IAEA Technical Co-operation Project (BGD/4/022, 2001-2004). The objectives of this facility are: collection, segregation, packaging, conditioning, treatment, and storage of low and intermediate level radioactive wastes from different nuclear facilities.

The design of the facility was based on the IAEA generic reference design. The main building is a single storey building (total area 1163 m²; size: 40 m x 35 m), divided internally into a number of rooms and areas for different purposes. The main building consists of a suitable combination of mainly two areas: one for receiving and processing waste from the generators, includes the necessary equipment, machinery and support services for treating and conditioning the waste, the second one for storing radioactive wastes.

Main operating area is divided into three parts: (1) an enclosure for solid wastes sorting, compaction (9m x 10.98m x 4.88m h); (2) Conditioning (cementation) enclosure sub-divided into cementation area 6.6m x 6.0m (active room); grout preparation room: 3.65m x 6.0m (non-active) & pulverization room: 3.65m x 6.00m; and (3) liquid effluents treatment (LET) enclosure (6m x 7.3m) having provisions for treatment of aqueous liquid wastes by combined technique (Ion-exchange + ultra-filtration).

The following major equipments are available in the CWPSF for segregation, treatment, conditioning storage and transportation of low and intermediate level liquid and solid wastes within the facility:

(1)  Aqua-Express (liquid waste treatment plant): For treatment of low and intermediate level liquid radioactive waste.

(2)  In drum-mixer: The electrically driven mixer unit for the cementation of small volume of liquid wastes, sludges, an ion-exchange resin, etc.

(3)  Solid waste sorting box: The sorting cabinet has been set-up to segregate the different types mixed solid low level wastes.

(4)  In drum compactor: An in-drum compactor operates on the compactable waste drum to give compacted waste drum (expected volume reduction factors are in the range between 2 to 5).

Radioactive wastes are being generated through the operation and maintenance of 3MW(t) TRIGA MARK-II Research Reactor, Radioisotope production labs, 14 MeV Neutron Generator, research and commercial irradiators; and from different industries, research labs (such as INST, AECD, IFRB, ICDDRB, etc), universities, agricultural applications etc.

There are eighteen Nuclear Medicine Centres (NMC) including two private and one Nuclear Medicine Institute (NMI) in Bangladesh. Nuclear Medicine Facilities (NMF’s) are using radioisotopes such as: I-131, Tl-201, P-32, Cr-52 and I-125. Most of the NMFs use Sr-90 for eye applicator. In addition, there are ten industrial radiotherapy facilities and three gamma irradiator facilities are using Co-60, Cs-137 and Ir-192 radioisotopes for a variety of purposes in research, industry and other fields. There are ten radiotherapy installations with ten Co-60 Teletherapy units, one linear accelerator, 3HDR and 2LDR brachytherapy units.

The radioactive wastes arising are generally spent ion-exchange resins, graphite, lead and polythene plugs, resistance temperature device, solid trashes, contaminated vials, hand gloves, plastic syringes, tissue papers, shoe-covers, protective cloths, plastic and metallic wares, contaminated apparatus/equipment, aqueous and organic liquids, spent and disused SRS, activated carbon, gaseous discharges, etc. The radio nuclides involved are e.g., Co-60, Cs-134, CS-137, Sr-90, Ir-192, Tc-99m, I-131, I-125, C-14, H-3, Ra-226, Am-Be neutron sources, Cm-244, Am-241, Cr-51, Mn-54, Zn-65, P-32, Sc-46, etc. Moreover, if the proposed nuclear power plant is established in the country, more anthropogenic radionuclides will be involved in these wastes in future.

Approximately 6.61m³ of LILW have been collected and safely stored at CWPSF. For the storage of these wastes the facility has earned approximately Taka 16,72,299 in the last financial year. For improvement and strengthening in terms of operational capability, safety and security of RW including spent radioactive sources and overall security of the facility. CWPSF is expected to serve waste management need in the country and, in the course of time, it may be turned into an International level training centre in the field of radioactive waste management. It is essential for safe conduction and culture of research and application in nuclear science and technology maintaining the relevant safety of man and environment and future generations to come. The facility is expected to be helpful in piloting waste management tasks in large scale in the near future. The Safety Analysis Report (SAR) of the facility has recently been prepared in collaboration with the International Atomic Energy Agency (IAEA) and it is expected that the facility will be licensed very soon.

2.6.  INTERNATIONAL CO-OPERATION AND INITIATIVES

2.6.1.  MEMBERSHIPS IN INTERNATIONAL ORGANIZATIONS

Bangladesh became a Member State of the Agency in 1972.

2.6.2.  INTERNATIONAL AGREEMENTS

Bangladesh is a party to a whole range of commitments to the international nuclear non-proliferation and verification regime, such as NPT, Bilateral Safeguard Agreement with the IAEA, the Protocol Additional to Safeguards Agreement, and the Comprehensive Test Ban Treaty (CTBT). Please see Appendix 1.

2.6.3.  PAST TECHNICAL CO-OPERATION WITH IAEA

BAEC operates under the Ministry of Science and Information & Communication Technology (MOSICT), and is thus an integral part of the scientific network of the country. BAEC has been the national focal point for the IAEA including its Technical Cooperation (TC) program and the Technical cooperation program with the Agency has, so far, covered almost the entire range of BAEC activities, especially those, which have direct relevance to the national development agenda. The total assistance provided during the last 10 years (1991-2000) amounted to approximately US$6.885 million. More than half of this assistance (53.87%) was devoted to the human resources development areas, namely Experts, Fellowships, Training Courses, and Scientific Visits. The reminder was provided in the form of equipment and subcontracts. Area-of-activity wise, 88% of the assistance was provided in five areas, namely, agriculture (24.2%), application of isotopes and radiation in medicine (21.2%), nuclear engineering and technology (20.3%), nuclear safety (13.1%), and industry and hydrology.

2.6.4.  ONGOING TECHNICAL CO-OPERATION WITH IAEA

The list of ongoing IAEA TC Projects is as follows:

2005-2006

2003-2004

2001-2002

2.7.  HUMAN RESOURCES DEVELOPMENT

The availability of trained professionals is a key parameter to the planning activities. Regional as well as inter-regional training courses on different aspects of nuclear power, including those related to the planning cycle, are organized by the IAEA as well as under the RCA. Since the positions available for these short-term training courses are limited, preference is usually given to the countries that have a known commitment to nuclear power.

It is expected that the required additional manpower will be trained in future in the form of classroom as well as on the job training through IAEA Technical Co-operation Projects at different stages of implementing the nuclear power project.

3.  NATIONAL LAWS AND REGULATIONS

3.1.  SAFETY AUTHORITY AND LICENSING PROCESS

BAEC is responsible to regulate use of atomic energy, radiological practices and relevant activities under the provision of the Nuclear Safety and Radiation Control (NSRC) Act, (No. 21 of 1993) and the NSRC Regulations 1997.

3.2.  LEGAL INSTRUMENTS

Various legal instruments are some of the pre-requisites for success in implementing a nuclear power programme in a developing country. They are to be formulated in conformity with the existing laws of the country. These instruments may include, among others, provisions for enforcing nuclear safety and radiation control, nuclear liability, establishing independent organizations for safety and promotional activities, deregulation and involvement of the private sector in activities related to nuclear power, etc. Additional legal provisions may be required if the country wishes to attract private entrepreneurs to invest in the nuclear power programme. This is necessitated by the fact that in most countries, at least in the initial phase of a nuclear power programme, all activities are vested in the public sector.

3.3.  INSTITUTIONAL FRAMEWORK

In many countries having an active nuclear power programme, the activities were initiated within the framework of the national agency responsible for nuclear research and development programmes. This strategy may be effective because of the multi-disciplinary nature of such an institution and also cost-effectiveness. As the programme grows, such an institutional arrangement may ultimately become less effective, especially in the areas related to commercial operation and safety. Thus, it becomes essential to establish separate institutions for Safety and Regulatory matters and for construction and operation of nuclear power plants. In Bangladesh, a separate Division of the Bangladesh Atomic Energy Commission (BAEC) with 20 professionals (3 senior level, 10 mid-level and 7 fresh graduates with training on nuclear technology) and other supporting staff conduct all the activities of the pre-implementation phase. A separate Division of BAEC is responsible for enforcement of the provisions of the law and regulations on Nuclear Safety and Radiation Control. The Government plans to establish a separate institution for future nuclear power plants in order to ensure better economic, financial and technological management. This new institution is envisaged to have adequate provisions for maintaining vertical linkage between the plant management and the decision makers of the government.

3.4.  TECHNOLOGY TRANSFER AND NATIONAL PARTICIPATION

It is important to decide at a very early stage the mode and extent of technology transfer that the country aims at. There is no doubt that the whole planning exercise will depend on this decision, especially as this would influence the size and nature of the HRD programme. The same is also true for the desired extent of national participation in project implementation. A very careful and intensive appraisal of national infrastructure and industrial experience is required in determining the nature and extent of national participation.

3.5.  INFORMATION TO THE PUBLIC

Public information and public acceptance may be considered as one of the key determinants for success of a nuclear power programme. Dialogues with the public, the people's representatives at various levels and the decision makers are considered to be important determinants in ensuring transparency and public acceptance. In the case of Bangladesh, the acceptance of nuclear power is in general favourable, especially in and around the site. This is evident from the fact that, in spite of the inordinate delay and land being a precious commodity for the villagers, it has been possible to retain the land for the project for about four decades. The general perception is that construction of a nuclear power plant would create job opportunities and have other spin-off benefits for the residents. Moreover, way back in the 1960's the families affected by eviction were offered attractive compensation packages. Nevertheless, it is apprehended that opposition groups may be encountered as soon as construction work starts. An effective public acceptance programme has to be designed and implemented in order to enhance public acceptance.

3.6.  INTERNATIONAL ACTIVITIES OF THE REGULATORY BODY

Up to the present time, the contact with international organization is only with the IAEA. Bangladesh is party to the Convention on Early Notification of a Nuclear Accident and Convention on Assistance in the Case of Nuclear Accident or Radiological Emergency.

The contact is based upon formal exchange information, and the contacts are made at Governmental level.

The participation of the Regulatory Body in the activities of international organizations are in the form of seminars, in training courses and in giving the opportunity to the IAEA's trainees to come to the Regulatory Body.

REFERENCES

Appendix 1

INTERNATIONAL, MULTILATERAL AND BILATERAl AGREEMENTS

BILETERAL COOPERATION AGREEMENT

Bangladesh has bilateral agreements on nuclear cooperation the Government of USA and France. Recently, Bangladesh made bilateral Cooperation Agreement with China on Peaceful Uses of Nuclear Energy.

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1. The statistical tables in this profile have been updated with data as of the end of 2007 from IAEA databases, namely the Power Reactor Information System (PRIS) and Energy and Economic Data Bank (EEDB), and the World Bank's World Development Indicators (WDI).