The Ministry of Power, Energy and Mineral Resources has hinted that the coal price of India's Adani Godda Power Plant is likely to be adjusted slightly.
However, the government officials are unwilling to make any comment about the final price of coal, claiming that it is highly sensitive issue.
But it is clear from the hints they are dropping that the benchmark price of coal used in Bangladesh's Payra and Rampal power plants will not be fixed finally.
Energy and power analyst Prof M Tamim said if Adani is offered the coal price beyond the benchmark price of Payra or Rampal, it will undermine the state’s interest.
Power Division officials claiming to be the highest policymakers of the state are tight-lipped about Adani. Even they are also wary of sharing information about Adani’s Jharkhand power plant.
An official in a recent meeting with Adani Group hinted that the coal price may see downward adjustment. The decision in this regard can be finalised before March 26, he said.
India's controversial business conglomerate Adani Group has built a 1,600 MW coal-fired power plant in Godda district of Jharkhand state to export electricity to Bangladesh. Adani Group recently demanded $400 per tonne of lower grade coal used in this power plant. But this coal price in the global benchmark is below $160.
As a result, the Bangladesh Power Development Board (BPDB), the electricity buyer, on behalf of Bangladesh expressed its inability to pay the higher coal price. Since then, BPDB and Power Division are continuing discussions with Adani Group on reducing coal prices.
BPDB officials told the media that Adani Group has agreed to supply coal at the price ($153) at which coal is being purchased for Payra and Rampal power plants.
Besides, Adani Group started electricity supply to Bangladesh on an experimental basis from March 9 before the finalisation of controversial coal prices. BPDB says if the trial run becomes successful, the first unit's full-scale import of 750 MW will start from March 26.
Power Division Secretary Habibur Rahman declined to make comment when he was asked about the Adani’s coal price. On the other hand, a Power Division official told The Business Post that Adani group has imported coal from its own Carmichael coal mine in Eastern Australian state of Queensland.
It is located on the shores of the Tasman Sea near New Zealand. As a result, its distance is much more than Indonesia and coal carrying cost will be higher than Indonesia.
Besides, after coal unloading at Dhamra Port of Indian Odisha state, another 598 km route will have to be taken by rail to Godda Power Station. It will cost more. Considering these, Adani Group will not be able to supply coal at the benchmark price of Payra or Rampal power plants.
Bangladesh is also taking these issues into consideration. However, it is not possible to say what the final price will be until a decision is made, said the official.
Recently, Director (Public Relations) of BPDB Shameem Hassan told The Business Post that during the trial period till March 25, 30-50 MW of electricity will come to Bangladesh every day. If the trial run is successful, a delegation will visit India to finalise some issues, including coal prices.
BPDB says if Adani Group pays $400 per tonne of coal, the per unit electricity cost will stand at Tk 25-26. Adani Group has committed to capacity payment at Tk 5.11, no private power plant in Bangladesh has been given such a large amount capacity payment.
Apart from this, Adani has been given several benefits in power purchase agreement, including coal system losses, which are not given to anyone else.
The government started importing electricity from India since 2013 to ensure uninterrupted electricity supply. Currently, 1160 MW of electricity is being imported from Indian government and private sector. But there is a controversy over Adani Group's electricity import at high cost despite the domestic over power generation capacity.
Energy expert Prof Badrul Imam said Adani's power purchase agreement is by no means in public interest. The government did this for political interest.
