NTPC to trade power with Bangladesh

THE Ministry of External Affairs will grant permission to NTPC's nodal agency for power trading to commence transactions with Bangladesh next week. NTPC Vidyut Vyapar Nigam (NVVN) will serve as the conduit for all power trading which will occur between India and Bangladesh as the neighbors strengthen ties over power generation.

The two sides are slated to sign a slew of formal agreements and a joint venture between NTPC and the Bangladesh Power Development Board (BPDB) in the coming months. "This is to improve the relationship between the two countries," Ministry of Power joint secretary M Ravi Kanth told that during today's joint working group meeting between India and Bangladesh. "So far, transmission is moving very smoothly, now the power generation MoU between NTPC and BPDB will soon be signed."

The MoU between the state-run Maharatna and BPDB will ultimately produce a joint venture company this year, which will be charged with collecting bids for a 1,240 mega watt (MW) supercritical power plant subject to international competitive bidding. Bangladesh will be responsible for fueling the coal-fired plant which will require less coal than subcritical plants to run at critical plants to run at optimal efficiency. "NVVN will authorize cross-border trade with Bangladesh and we are prepared if Bangladesh wants to sell power to India once 2x600 MW plant is complete," said a source in the Ministry of Power source on condition of anonymity. Bangladesh would join Bhutan as India's only neighboring nations with power trading policies with NVVN. Although NVVN and Bhutan signed an MoU in 2009, the agreement has yet to result in the transmission of a single megawatt of power, according to an NVVN official. "We want to improve our relationship and create an open market for power trading in the region," said the official who did not want to be quoted.

Finalisation of a transmission service agreement between Power Grid Corporation of India (PGCIL) and BPDB will occur in July so the bidding process can begin for a 130 kilometer transmission line connecting West Bengal to Bheramara in Kushtia District. The total project cost is estimated at about rs 920 crores with the Indian side slated to cover rs 170 crores while BPDB will pay the remaining rs 750 crore. "In due course a agreement between NVVN and BPDP will be drafted for the trade of 250 MW from central government stations to Bangladesh," added the ministry source."Bangladesh will purchase another 250 MW from Indian power markets."