Rampal power station

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The Rampal power station, also known as the Maitree Super Thermal Power Project, is a proposed 1320-megawatt (MW) coal-fired power station at Rampal in Khulna, Bangladesh. It is sponsored by the Bangladesh-India Friendship Power Company (BIFPCL).[1]

Although also known as the Khulna South power station, the plant is different from the Orion Group's Khulna power station (Orion).

Location

The map below shows the project site in Rampal Bagerhat, Khulna, according to Wikimapia.[2][3]

Loading map...

Background (Phase I)

The Rampal power station would involve the government acquiring 2000 acres of farm land to install the plant under a Memorandum of Understanding (MoU) signed between Bangladesh`s Power Development Board (PDB) and India`s state-owned National Thermal Power Corporation (NTPC) in August 2010; they have been designated to implement the project by 2016.[4]

On January 29, 2012, the India Power Development Board (PDB) signed an agreement with NTPC to build the 1,320-megawatt Rampal plant. The PDB and the NTPC will implement the $1.5 billion project on a 50:50 equity basis. The NTPC will set up and operate the plant.[5]

According to a July 2014 report, the project will start commercial generation by December 2018.[6] Three companies – Marubeni Corporation from Japan, Harbin Electric International Company from China and Bharat Heavy Electricals Limited from India – have submitted bids to construct the project. The contract is planned to be awarded by January 2016.[7]

In July 2016 Bharat Heavy Electricals Ltd (BHEL) was awarded the contract to build the plant, at an estimated cost of US$1.68 billion. BHEL has until July 2019 to have the power plant installed and ready for operations. BHEL won the tender at the beginning of this year but, according to local media sources, the official signing of the deal dragged on to July due to BHEL holding out for exemptions from taxes and duties as well as from the mandatory insurance process. Negotiations are also reportedly under way between the project promoters and Coal India on the supply of 4 million tonnes of Indian coal per year to fuel the plant.[8]

According to local images, work at the site was underway in March 2016. UNESCO has urged Bangladesh to cancel the coal plant, saying it endangers the nearby Sundarbans.[9]

In April 2017 it was reported that construction on the project had begun, and will take an estimated 41 months. Groups continue to oppose the plant.[10] The construction report followed the Ex-Im Bank of India confirming its US$1.6bn loan for the plant.[11] India-owned BHEL received the US$1.5 billion order to build the Rampal Power Plant.[12]

Background (Phase II)

The sponsors have anticipated a potential second phase for the project, comprising an additional 2 x 660 MW units. No date has been specified for the second phase.[13]

In October 2016, in response to widespread public opposition and global pressure, officials within the power ministry began making statements that they would pursue natural gas and renewables over coal. Plans for the Phase II of the project appear to be on hold or cancelled.

Project Details

  • Sponsor: Bangladesh-India Friendship Power Company Pvt Ltd. (BIFPCL)
  • Parent company: Bangladesh Power Development Board, NTPC
  • Location: Khulna, Bangladesh
  • Coordinates: 22.5924582, 89.556427 (exact)[3]
  • Status: Phase I: Construction; Phase II: Shelved
  • Gross Capacity: Phase I: 1320 MW (2 x 660 MW); Phase II: 1320 MW (2 x 660 MW)
  • Type: Ultra-Supercritical[14]
  • Projected in service: 2021
  • Coal Type:
  • Coal Source:
  • Source of financing: BPDB and NTPC (30%), Exim Bank India (70%)[15]

Agreements

In August 2010, a 'Memorandum of Understanding was signed between Bangladesh Power Development Board (BPDB) and India's state-owned National Thermal Power Corporation (NTPC) in which they agreed to implement the project by 2016.[16] On January 29, 2012, the Bangladesh Power Development Board signed an agreement with NTPC to build the plant.[17] The joint venture company is known as Bangladesh India Friendship Power Company (BIFPC).[18] The BPDB and the NTPC agreed to implement the project on a 50:50 equity basis. The NTPC will set up and operate the plant.[19] Bangladesh and India will equally share up to 30 per cent of the equity of this project. The remainder of the equity, which might be equivalent to USD 1.5 billion, will be taken as bank loans with help from the NTPC. According to the sources in the Bangladesh Power Division, the joint venture company will enjoy a 15-year tax holiday.[20]

Financing

Loans are expected to fund up to 70% of the US$1.5 billion project, while India and Bangladesh will fund the remaining 30% equally (15% each). However, the Bangladesh Planning Commission refused approval, saying the project was not compliant with the country’s existing policy nor was the funding and ownership of the plant clear. This leaves even the 15% Bangladesh stake in the project uncertain.[21]

In 2014-2015 French banks Crédit Agricole, BNP Paribas, and Société Génerale said they would not fund the Rampal power station, after sustained public opposition to the project over its social and environmental effects.[21]

In December 2014, the council on ethics of Norway released its assessment of the country’s government pension fund global’s investment, valued at US$56 million, in the thermal plant. It recommended the fund exclude the project from its portfolio “due to an unacceptable risk of the company contributing to severe environmental damage”. In March 2015 the Guardian reported that the Norweigan pension fund would likely pull funding from the Rampal plant.[22]

In April 2017 the Ex-Im Bank of India confirmed it is providing a US$1.6 billion loan to Bangladesh-India Friendship Power Company (BIFPCL) for development of the Rampal coal plant.[11]

Economic Analysis

According to a 2016 report by the Institute for Energy Economics and Financial Analysis, the Rampal power station will produce electricity that will cost 32% more than the average electricity costs in Bangladesh, despite multiple subsidies from Bangladesh and India. The financial think tank argues the project amounts to US$3 billion in public subsidies: "First, a below-market-rate loan by Indian EXIM Bank represents a US$988m subsidy effectively paid by Indian taxpayers to Bangladeshi consumers. Second, the Bangladesh government is proposing a 15-year income tax exemption for the plant, an exemption worth US$936m. Third, Bangladesh would be granting an effective annual US$26m subsidy by conducting maintenance dredging to assure coal delivery to the plant."[23]

Environmental issues

It has been alleged that the Rampal station is against The Ramsar Convention because the plant is to be built in a forest and sensitive wetlands area. The Ramsar Convention is the only global environmental treaty that deals with preservation of wetlands. Bangladesh signed the convention in 1992.[24]

The plant will need to import 4.72 million tons of coal per year. This massive freight will need about 59 ships each having 80,000-ton capacity that would be taken to the port on the bank of Poshur river. The 40 kilometers from the port to the plant cuts through the Sundarbans and it includes the river flow path. Environmentalists claim these coal-carrying vehicles are not often covered as they scatter large amounts of fly ash, coal dust and sulfur, and other toxic chemicals are released through the entire life of the project. The predictions made by environment and ecology experts are that the plant will release various toxic gases such as carbon monoxide, oxides of nitrogen and sulphur dioxide, thereby putting the surrounding areas and, most importantly, Sundarban at grave risk.[25]

According to a report published in New Age, in past few years the Indian central and state authorities which deal with environmental concerns in India denied the proposal of NTPC to set up a similar coal-fired thermal power plant at Gajmara in Gadarwara of Madhya Pradesh for a number of reasons. NTPC failed to get approval of the Indian Central Green Panel (Green Tribunal) in 2010 for the construction of that coal-fired thermal power plant because a vast portion of agricultural land would have been impacted. Similar issues exist with the Rampal project.[26]

Government response

The Bangladesh government has rejected the allegations that the coal-based power plant would adversely impact the world’s largest mangrove forest. The energy adviser of the Bangladeshi prime minister said that the controversy over the power plant and its impact on the Sundarbans was “not based on facts”. He has also stated that the plant will not negatively affect the mangrove forest because the emission of greenhouse gas will be kept at the minimum level. The government also stated they will import high quality coal, build a 275 metre high chimney, employ state-of-the art technology and other steps to keep its impact on the Sundarbans at a negligible level.[27]

Opposition

Political opposition

On March 1, 2011, a High Court bench asked the government why the construction of the plant should not be declared illegal. The senior BNP leader also claimed that acquiring 4,000 acres of land in the area beside the Pashur River, mostly arable, would be environmentally disastrous. High Court lawyer Manzill Murshid stated during the hearing that the government was planning to acquire 1,834 acres of land.[28][29]

The National Committee on Protection of Oil, Gas, Mineral Resources, and Power-Port, environmentalist groups, bodies of the left-leaning parties and general people of Bangladesh vowed to resist the planned inauguration of the Rampal Power Plant scheduled on 22 October 2013.[30] On September 24, 2013 thousands of people in Bangladesh began a rally for 5 days and 400 kilometers to oppose the power plant. Their march began in the capital city of Dhaka and moved towards the Sundarbans.

In India too there has been some fragmented opposition of the power plant. In his interview with Siddharth Sivakumar of the Indian cultural website Tinpahar, Shayan Chowdhury Arnob said on this issue, "The Rampal Power Plant might become the biggest Power Plant, but it would cost the world its largest mangrove forest, the Sundarbans. Sundarbans has its life in numerous intertwined organic chains. When a chain is broken everything would fall apart, one after the other. Money has nothing to do with development or happiness; it's about our attitude to life."[31]

Citizen opposition

Save Sundarbans protesters dismantal police barricades on in Dhaka on July 28, 2016 (Daily Star photo)

Environmental experts have expressed concerns that the proposed plant at Rampal in Bagerhat could destroy Sundarban, one of the world’s largest mangrove forests. Faridul Islam, chief coordinator of Save the Sundarbans, pointed out that the selected location of the project was only nine kilometres from Sundarban. About 2.5 million people depend on the Sundarban region, such as wood-cutters, fishermen, and honey gatherers. An official said the Power Development Board would submit an environment impact assessment report to the Bangladesh environment department.[32]

On July 9, 2011, the police foiled protests at two places in Rampal upazila in the Bagerhat district demanding cancellation of the proposed plant near Sundarban. The police arrested two participants. Five organizations active in the country’s south-western region at a joint news conference at Khulna Press Club demanded immediate exemplary punishment of the policemen involved, saying the police engaged in attacks against the protestors.[33]

On July 18, 2011, the BNP acting secretary general Mirza Fakhrul Islam Alamgir asked the government to shelve the proposed coal project at Rampal in Bagerhat, fearing that it might harm the Sundarbans. He also expressed solidarity with the locals who had been protesting the government move to set up the 1300MW plant at Satmari Katakhali of the upazila in collaboration with NTPC, which will use Indian coal that contains high sulphur.[34]

In April 2013 environmentalists rejected an environment impact assessment report on the proposed plant, saying it did not take into account prior studies showing the project would have a large negative impact on the environment.[35]

In March 2016 an estimated 1,000 Bangladeshis began a four-day, 250-kilometer march from the capital to the Sundarbans in opposition to the plant.[36]

On July 28, 2016, police using barricades, teargas shells, and batons blocked a "Save the Sundarbans" march toward the Prime Minister's Office. Six people were arrested. The protest was organized in response to the signing of an agreement to build the coal plant in the world's largest mangrove forest. Two layers of police barricades were dismantled by protesters before police deployed teargas shells and charged the demonstrators with clubs. According to Baki Billah, former president of Bangladesh Chhatra Union, 16 activists were hospitalised.[37]

2015 report raises human rights concerns

A fact-finding mission by South Asians for Human Rights found numerous flaws in the environmental impact statement and resettlement process for the proposed 1320 MW power station. The investigation also found that local people and activists “have been constantly harassed by powerful quarters through threats, intimidation, assaults and filing of false cases.”[38]

Contact details

Website: http://www.bpdb.gov.bd/

Articles and resources

References

  1. "Indo-Bangla joint company for power import" The Independent, March 8, 2011.
  2. "8 coal-based power plants still in pipeline" Aminur Rahman Rasel, Dhaka Tribune, August 18, 2013
  3. 3.0 3.1 "Rampal Thermal Power Plant Site, Wikimapia, accessed May 2016
  4. Manjurul Ahsan, "Experts denounce Bagerhat coal-fired power plant plan" New Age, May 14, 2011.
  5. "Coal-fired energy BD signs power plant deal with Delhi," Pakistan Observer, January 30, 2012.
  6. "Bangladesh India Friendship Power Company Ltd likely to award construction of 1,320 mega watt plant by April 2015," Economic Times, July 28, 2014
  7. Aminur Rahman Rasel, "3 int'l companies submit tender for Rampal project," Dhaka Tribune, Sep 22, 2015
  8. Greig Aitken,"Rampal coal plant: Indian coal dream fast becoming a nightmare for Bangladesh," BankTrack, 11th August, 2016
  9. "UNESCO urges Bangladesh to cancel massive coal plant in one of the world’s largest mangrove forests," Think Progress, Oct 20, 2016
  10. "Construction of Rampal power plant begins," daily-sun.com, Apr 25, 2017
  11. 11.0 11.1 Ex-Im Bank of India confirms $1.6bn loan for Rampal coal plant to bankroll Sundarbans destruction," BankTrack, Apr 11, 2017
  12. "India-owned BHEL gets $1.5 billion order to build Rampal Power Plant," BD News, Apr 26, 2017
  13. Jai Sharda and Tim Buckley, "Risky and Over-Subsidized: A Financial Analysis of the Rampa Power Plant," IEEFA, June 2016
  14. "Work on coal-based power plant at Rampal begins early next year," Financial Express 18 May 2014
  15. "Rampal Coal Based Thermal Power Plant Financiers," BankTrack, accessed Nov 2016
  16. New Age | Newspaper
  17. Final report on environmental impact assessment of 2x (500-660) MW coal based thermal power plant to be constructed at the location of Khulna - India Environment Portal
  18. Rampal Coal-Fired Power Plant - Who gains, who loses?
  19. Coal-fired energy BD signs power plant deal with Delhi
  20. Power Division seeks $302m for Rampal plant
  21. 21.0 21.1 "French banks say no to Bangladesh coal plant," Guardian, June 25, 2015
  22. "Norway may pull investment from Indian firm over Bangladesh coal plant," The Guardian, March 10, 2015
  23. "Bangladesh project exposes India EXIM bank to high risk," IEEFA Report, June 2016
  24. Death knell for Sundarbans Rampal coal power plant
  25. More reasons to stop Rampal power plant
  26. More reasons to stop Rampal power plant
  27. Rampal Power Plant - Govt to lay foundation stone Oct 22
  28. "No coal-run power plant in Bagerhat: BNP" BDnews, July 18, 2011.
  29. "Bangladesh rushes head-long into coal" MAC: Mines and Communities, February 20, 2012.
  30. Bangladesh begins import of power from India. The Hindu: Mobile Edition.
  31. Siddharth Sivakumar in conversation with Arnob. Tinpahar.
  32. Manjurul Ahsan, "Experts denounce Bagerhat coal-fired power plant plan" New Age, May 14, 2011.
  33. "Police foil demo against coal-fired power plant project near Sundarban" New Age, July 10, 2011.
  34. "No coal-run power plant in Bagerhat: BNP" BDnews, July 18, 2011.
  35. "EIA report on coal-fired power plant near Sundarbans rejected," New Age, Apr 13, 2013.
  36. "March in Bangladesh against Sundarbans plant," Asian Age, Mar 11, 2016
  37. "March to PMO filed, 6 held from 'Save Sundarbans' demo," Daily Star, 28 July 2016
  38. "Report of the Fact Finding Mission to Rampal, Bangladesh," South Asians for Human Rights, September 17 2015

External resources

Related SourceWatch articles

Wikipedia also has an article on Rampal power station. This article may use content from the Wikipedia article under the terms of the GFDL.