Exemplary Indeed

There is a global concern that coal-fired power plants badly pollute the environment. Wherever there is a plant, it destroys the climatic condition as well as creates havoc to the public life. But a power generation plant in Bangladesh has largely disproved such concern. There is hardly any sign of environmental degradation and public suffering in and around the site of 1,320 MW coal-based Payra power plant, which is set up and being operated in Patuakhali district of Bangladesh for around last six months, belying the critics of dirty-fuel based power generation facilities. The new generation plant that deployed most modern environment-friendly technologies also set another milestone in the country in terms of implementing a mega project well ahead of the schedule.

“It could be a demonstration plant of modern age ... you come and see what is happening there,” said State Minister for Power, Energy and Mineral Resources Nasrul Hamid, who seemed feeling proud about the plant while talking at a recent webinar in Dhaka. The event was also graced by Professor of Bangladesh University of Engineering and Technology (BUET) Dr. M Tamim, a well-acclaimed energy expert and who often criticizes the country’s energy policy and development plans, also praised the imported coal-based plant but from different perspective – implementation of the project and its utilities. “It’s a well implemented project. It’s a project that can be followed by others,” he said, appreciating the initiative that developed the skills of 75 engineers to construct a coal-fired power plant. To describe another aspect, the special assistant to the chief adviser of last caretaker government said: “I’m impressed at the measures taken to rehabilitate the affected ones.”

Energy & Power magazine organized the virtual talks titled “Payra Power Plant: An Example of Timely Execution” as part of a series of discussion on the country’s energy sector issues. Relevant project and power sector officials, energy sector researchers, academics and non-resident energy experts participated in the webinar. 

Payra 1320 MW Power Plant at a Glance

Payra 1320 MW Power Plant Project (1st Phase)

Financial Progress:

Total Financial progress: 80%

EPC Payment progress: 88%

EPC Work progress:

EPC Overall Work Progress: 99.5%

Engineering work progress: 100%

Procurement work progress: 100 %

Construction Work Progress: 98.8 %

Construction Progress:

Unit-1 has achieved Initial Operation Date (IOD) on 15^th May. Commercial Operation of Unit-1 is going on.

Synchronization of Payra 1320 MW TPPP (Unit-2) was accomplished with National Grid on 26.08.2020. Expected COD of unit 2 is November, 2020

52^th Shipment of Coal has been discharged at Payra.

Major Challenges for Payra 1320 MW Thermal Power Plant

Unavailability of Required Draft at Rabnabad Channel

Presently available draft in Rabnabad channel is around 6.2 m. which will be less than 6 m in November and December.

As per the Coal Transportation Agreement between BCPCL and Oldendorff, Germany, minimum required draft for a ship is 6.5 m.

So, if dredging in the channel is not started immediately by Payra Port Authority, Coal transportation will not be possible in the upcoming months and the Power Plant will be shut down in scarce of coal.

Moreover, we are facing high transportation rate because of low draft. the following chart describes the scenario:

Unavailability of Power Evacuation Facility

Because of the unavailability of Power evacuation facility of PGCB, full load evacuation is not being possible from Payra 1320 MW TPP. PGCB’s present evacuation facility can evacuate only from 1 unit (660 MW). BCPCL achieved IOD (commercial operation of 1^st Unit) on 15^th May 2020 with much hardship because of the inadequate evacuation facility of PGCB. Now, BCPCL is facing problem to Complete Reliability Run Test (RRT) of both units and achieve COD (commercial operation of both units) as the evacuation facility from PGCB is not allowing to run both the units.

Taking part in the discussion, experts pointed out eight factors contributing to the timely implementation of the Payra thermal power plant project which are considered to be the game changer in bringing it ahead of the other projects those started implementation before the Payra plant that have competitive generation cost. The cost could have been possible to reduce further had the Payra Port Authority been able to construct the coal import infrastructure, commensurate with the plant’s progress. Another dark side is that the utility of the plant could not be derived due to lack of evacuation facilities – the transmission line could not be put in place at the right time, which the experts said ‘not acceptable’. They stressed the need for integrated development of the power sector in future.                                 

Eminent energy experts from home and abroad appreciated the successful implementation of the mega power project that used Ultra Super Critical Technology. The implementation process had to confront challenges with exemplary managerial flairs and visionary leadership. They agreed that the project would help get away from the misperception about the environmental and social impacts of coal power projects. The experts, however, stressed on exploitation of local coal resource as one of the priority options for confronting the challenges of transportation of imported coal.

Nasrul Hamid, who was the chief guest at the webinar, said that those who have created issues and mislead people by giving wrong information about coal project, putting a lot of strain should be invited and welcomed at the plant site to let them experience how it is running through maintaining the environmental aspects.  

The webinar was also addressed by Professor Firoz Alam, BPDB Chairman Eng. Belayet Hossain, Director General of Power Cell Engr. Mohammad Hossain, North-West Power Generation Company Ltd (NWPGCL) CEO A. M. Khurshedul Alam, Australia-living energy expert Khondkar Saleque Sufi, mining engineer Dr. Mushfiqur Rahman and Dr. Kazi Bayzid Kabir of BUET.

Shah Abdul Moula Helal, Project Director of Payra Coal-Fired Power Plant made a presentation on the issue while Mollah Amzad Hossain, Editor of Energy & Power, chaired and moderated the webinar.

Initiating the discussion, Mollah Amzad Hossain said that it is a usual trend in Bangladesh that large infrastructure development projects are delayed for various reasons ranging from land issues and timely financial closure to local challenges. However, the Payra power project is an exception and has set a milestone for timely implementation.

In his presentation, Shah Abdul Maula Helal discussed about the innovative approaches that have helped achieving various milestones of the project on time and without hassles. He said that the key to success were: strategic partnership, meaningful and effective support of the government and all stakeholders, effective management of resources and schedule, thinking outside the box and creating a difference, careful consideration of environmental impacts, exceptional quality and safety management plan implementation and setting of a new benchmark of resettlement. The project manager mentioned about coal transportation and power evacuation challenges. He also informed about four different options for managing the challenges of coal transportation.

Dr. Kazi Bayzid Kabir, Associate Professor of BUET, said that this project has set a successful stepping stone for coal-fired power plant in the country. The example set can act as the guiding principle for implementation of the other similar coal-fired power projects. He underlined the importance of dissemination of the success story properly to eliminate unnecessary concerns about coal. There should be no debate on coal once people understand the contribution of coal-fired power in the economy of the country, he added.

Prof. Firoz Alam from RMIT University of Australia, shared his opinion about the power plant construction quality, rehabilitation and resettlement of affected people and Bangladeshi engineering personnel engaged in Payra power plant as he witnessed first-hand during his visit to Payra power plant in late December last year. He highly praised the settlement arrangement and suggested using it as a model for all future projects in Bangladesh. He also opined that Payra resettlement model can be used as benchmark model not only for Bangladesh but also for other countries. He also praised the selection of talented young Bangladeshi engineers from various universities across the country who have strong commitment, patriotism, ‘can do’ and learning attitudes, and ready to take the responsibility. Prof Alam suggested that all power plants in Bangladesh should follow this Payra engineering recruitment model.

Prominent mining engineer and environment writer Dr. Mushfiqur Rahman observed that Bangladesh will need to import 20 million tonnes of coal annually within few years for the under-construction coal-fired power projects. However, insufficient import infrastructure coupled with tendency of rapid siltation in the Bangladesh coastal areas is going to make this a costly venture. He suggested focusing on own coal to keep open an alternative supply chain. “We need to take immediate initiative for extraction of the high-quality coal deposits in the northern region of the country; otherwise, we will risk falling into the trap of international coal trade and import infrastructure barriers.” 

Energy expert Engr. Khondhkar Abdus Saleque Sufi termed Payra as a benchmark project. Those who have different views on coal-fired power plant must have got most of their concerns addressed. He thought expanding the capacity of Matarbari coal port and using it as transit port for imported coal for power plants at Payra and Rampal would be the most cost-effective option. If coal cost increases due higher transportation cost, it wouldn’t be possible to get low cost power from coal. He stressed on the requirements of integrated implementation of relevant segments of power value chain for deriving the benefits of power generation increase.

Engr. Mohammad Hossain said that eight factors have acted as the game changer for timely implementation of Payra project – appropriate leadership and choosing right kind of partners were the main factors behind the success. He pointed out that a project cannot be implemented timely unless it gets a right financing partner. For example, Siddhirganj power plant took eight years to implement with the World Bank’s financing.   

Engr. Belayet Hossain, Chairman of Bangladesh Power Development Board, said that although the capacity cost of Ultra Super Critical coal-based power plant is relatively higher, it will become profitable in the long run. While the energy cost for oil-based power plant is BDT 8.0-8.50 per unit, the same for coal-fired plant is Tk 2.50. As our proven reserve of gas is depleting fast and also the energy is import-dependent, it will not be the right approach to depend on mono-fuel. Therefore, along with LNG-based power, the coal-based power project is the best alternative.

Engr A. M. Khurshidul Alam said the state-of-the-art power plant could be implemented timely due to the Prime Minister’s direction and proper coordination. Experience acquired from the previous ECA financing that the financial closure takes 12-18 months time. Considering this experience, the Payra project in its tender imposed a condition that the EPC contractor will have to arrange financing for the 15 percent work of the project. As a result, the contractor implemented 19 milestones out of the total 74 with its financing. By then, the financial closure was finalized, resulting in the implementation of the project 18 months ahead of the schedule.

He also pointed out that the coal for plant is being imported using half the capacity of the ships due to low draft of the sea. The authorities are now considering Andaman and Matarbari to import coal through literage. The plant is maintaining a coal stock for 52-55 days to avoid interruptions in power generation.

We had to appoint an O&M contractor for five years as we do not have the experience to operate coal-fired power plant. During this period, they will have to operate and maintain the plant as well as train our manpower to improve their skills. We hope that by then we will be able to operate and maintain the plant.    

Prof. Dr M. Tamim emphasized that it would be more appropriate to establishing coal-fired power plant at the mine mouth if Bangladesh decides extraction of own coal. Import infrastructure will be a big challenge for the government to implement its plan for coal-fired power projects, he added.

In response to extraction of own coal, State Minister Nasrul Hamid said, “we have recently completed a feasibility study of Dighipara coal field. The study shows only 10% of coal can be extracted using underground mining method, which is not feasible.”

In Barapukuria, he said, the government is slowly extracting coal of about 4-5 thousand tonnes and it would not be possible to extract more than that. “So, I think, considering these studies the hope is slim to establish large coal-based power plants at the mine mouth based on own coal. It is also almost impossible to transport own coal extracted by underground mining method using the railway system and better not to consider. We are now planning for future how to generate low-cost uninterrupted power by using a mix of fuels.”

The general consensus of the webinar was to disseminate the success story of the plant to dispel the myths and controversies over coal-fired power projects. It was also suggested integrating implantation plan for relevant segments of the power value chain ensuring that generated power does not remain stranded for absence of evacuation facilities.

Experts suggested considering the best option for coal transportation as approaching the traditional coal-carrying vessels directly to plant terminal at Payra would continue to remain a big challenge. Expansion of Matabari coal port is considered to be the best option.