Home ›› 07 Apr 2023 ›› Front
Bangladesh has reduced its total capacity of coal-based power generation at the pre-construction stage by 39 per cent last year but still technically has 6.7GW under consideration despite electricity system overcapacity, says a report.
The 39 per cent reduction happened because the country abandoned around 6GW of coal capacity in 2022, according to the report from Global Energy Monitor, a US-based non-governmental organisation. The report titled “Boom and Bust Coal” was released on Thursday.
It said Bangladesh abandoned 28.8GW capacity between 2014 and 2022. Besides, 2,855MW capacity of coal-based power is operational in the country, 6,700MW is in pre-construction and 5,724MW is in construction. The country has shelved 1,670MW so far.
The world needs to collectively reduce an average annual coal power capacity of around 117GW in order to phase out coal by 2040 to meet the global climate goal, the report noted.
It said global retirement needs to move 4.5 times faster and no new coal plants should be built in order to put the world on track to phase out coal by 2040.
An average of 60GW must come offline in the OECD countries each year to meet their 2030 coal phase-out deadline while this is 91GW per year for non-OECD countries, it added.
According to the report, Bangladesh Power Development Board’s Monthly Progress Report for February 2023 only listed 1.9GW of proposed coal: the Orion plant, with a comment about location uncertainty, and the Maheshkhali plant projected for June 2030.
“Bangladesh’s power system overcapacity problem continues to grow and is made worse by guaranteed power purchase agreements that have forced the country to pay for unused power,” Sharif Jamil, general secretary of Bangladesh Poribesh Andolon, said in a statement on Thursday.
“Capacity payments as well as fuel and foreign currency exchange costs at the existing coal-fired power plants have had a significant negative impact on the Bangladesh economy. It is unwise for Bangladesh to proceed with the construction of more coal plants that also harm public health and livelihoods.
“We need to rapidly transform these sites into renewable energy ones in order to enhance energy and economic security while doing our part to address climate change,” he added.
Construction at five plants was continued in 2022. If completed, the additional 5.7GW of coal power capacity would nearly triple the current capacity, the report said.
Included in this in-construction capacity is a Chinese-backed Phase II of Bangladesh-China Power Company (Pvt) Limited’s Payra plant, which was initially expected to be axed after China pledged it would not build new coal-fired power projects abroad.
Bangladesh Working Group on External Debt (BWGED) Member Secretary Hasan Mehedi told The Business Post the Global Energy Monitor report has two important findings.
“The first one is positive. We only have two coal plants in the pipeline, and those might be cancelled. This is good news. The other finding is that China invested in the Payra second phase coal-based plant violating its own commitment,” he said.
Chinese President Xi Jinping said in his address at the United Nations General Assembly in July 2021 that his country would not build new coal-fired projects abroad.
“But violating its own commitment, China made investment in the Payra second phase plant in 2022,” Mehedi added.
As fiscal pressures mount due to decreasing foreign currency reserves, Bangladesh must stop investing in new coal- and gas-fired capacity and instead shore up cost-competitive renewables, invest in its grid, and focus on energy storage to ensure energy security and affordability, the report said.
It mentioned that 14 countries commissioned new coal power in 2022. Of them, 59 per cent of the newly commissioned capacity was in China (25.2 GW), followed by 16 per cent in South Asia (India, Pakistan, and Bangladesh), 11 per cent in Southeast Asia (Vietnam, the Philippines, Indonesia, and Cambodia), 9 per cent in East Asia (Japan and South Korea), and 5 per cent in other regions.
The annual capacity additions for many individual Chinese provinces topped that of the entire countries. 6GW in China’s Inner Mongolia surpassed India’s 3.5GW despite the latter being the country with the most coal commissioned in 2022.
In fact, Inner Mongolia nearly had more new capacity than the next two countries (India and Japan) after China combined.
Still, the gas crisis prompted seven countries to permit to restart or extend operations at 26 coal-fired units due to energy security concerns – 19 of those in Germany.
Flora Champenois, Global Energy Monitor project manager for the Global Coal Plant Tracker, said, “There is no room for new coal power or extending the life of existing plants when the world needs to retire about 117GW annually.”
In terms of new coal, while coal under development – or coal in pre-construction and construction – has collapsed by two thirds since the Paris Agreement, nearly 350GW of new capacity is still proposed across 33 countries while an additional 192GW of capacity is under construction.
