Bangladesh signs fast-track deal to tackle power crisis

21st April 2010, Comments 0 comments

Bangladesh said Wednesday it had signed a 150-million-dollar power-supply deal in a bid to ease the country's acute electricity crisis.

Under the agreement with Scotland-based Aggreko, the power rental company will set up a series of fast-track plants, the chairman of the Bangladesh Power Development Board (BPDB) told AFP.

"Aggreko will supply 200 megawatts of power a day by August," Alamgir Kabir said, adding that the deal would run for three years.

Bangladesh is reeling from the worst power cuts in its history with shortfalls reaching 2,000 megawatts a day, or half the country's daily production.

Temporary power plants, which are usually fired by diesel, use pre-fabricated buildings and can be set up on barges or on waterlogged land, the BPDB said.

Specialist companies such as Aggreko say they can establish a fast-track power station in a matter of weeks.

However, the power is more expensive than conventional sources, with local media reporting that the BPDB will be paying 14.35 taka (21 US cents) a unit, seven times higher than power from permanent gas-fired plants.

The BPDB declined comment on how much Aggreko would charge for the 200 megawatts of power.

Aggreko said the deal would have a "noticeable impact" in Bangladesh, where power cuts and severe shortages of gas and water have prompted street protests across the nation of 144 million people.

"Power demand is now exceeding supply, with the result that widespread power cuts are inhibiting economic development," Rupert Soames, chief executive of Aggreko, said in a statement Tuesday.

"Ensuring that industrial, agricultural and domestic users have a reliable power supply is vital to any economy."

Bangladesh has suffered increasing power outages due to demands imposed by its booming economy, which has grown at around six percent a year since 2004.

The International Monetary Fund last week said the country's economic growth would slide to five percent this year -- the worst performance in eight years -- largely due to the energy crisis.

© 2010 AFP

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