Indo-Bangla Power Plant
Cabinet okays PPA
The cabinet committee on economic affairs yesterday approved a power purchase agreement (PPA) to buy electricity from the proposed 1,320 megawatt coal-fired power plant in Khulna to be built by a joint venture of Bangladesh and India.
The $1.5 billion private power plant will be built by a company equally owned by the Power Development Board (PDB) of Bangladesh and the National Thermal Power Company (NTPC) of India. The plant may come into operation in 2016-17.
Finance Minister AMA Muhith chaired the cabinet committee meeting yesterday.
The PPA now paves the way for formal launching of the joint venture company within this month, officials said.
According to the PPA, the company will be exempted from paying corporate tax for 15 years like other private power companies.
But after 15 years, the PDB would pay the tax on behalf of the joint venture company. This raised eyebrows of industry insiders as this is absent elsewhere.
The PDB will sign the PPA with the joint venture company for purchase of power for 25 years from this plant.
The PPA does not have a power tariff profile. Instead, it spells out a formula to fix the tariff annually.
The PDB has acquired 1,800 acres of land for the project. The Environmental Impact Assessment of the project is now at its final stage.
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