Bangladesh: Analyzing Hasina era Adani Power Deal

[UKBengali]

Well thanks to Adani deal the average is lower!

Otherwise those 20tk generators would have pushed the average closer to 18.

Look at what Adani is replacing instead of comparing it to the cheapest ones.

BD doesn’t have many cheap options. Otherwise it wouldn’t pay 20tk, would it?

This poster is well intentioned but the others just have an agenda that NO-ONE with any power or hope of getting into power agrees with.

 

[BananaRepublic]

1. Garments is the biggest export but remittance is still the biggest source of income.

2. Bangladesh's development path is not at all flawed, in fact any least developed nation ought to pick up garments as its easier to master followed by light industrial manufacturing before moving up the value chain, India has not done that and instead jumped up in heavy industries but that leaves a significant part of its population unemployed. Since only high tech jobs are readily available

3. For sure Bd needs to improve in its education sector, thanks to Indian puppet... the last 15 years have produced more duds than actual capable individuals

4. I lived in Khaleej most of my life, what you describe about middle east and bangladeshis were true about 20 years ago when most people were street cleaners and construction workers... nowadays a majority of that market is provided for by indian labours followed by egyptians.... There aren't many bangladeshis in the middle east like it used to be, most bangladeshis are involved in business, IT,medicine or army/ police nowadays... at least in the kuwait, saudi, qatar and UAE.

Education and health definitely needs reform in Bangladesh but FDI also need to increase and its reform work has already started under Dr. Yunus... he's calling Bangladeshi Talent from abroad back home to fix important criteria for further development and with the rate of recovery in the last 2 months. I am optimistic we will do really well.

BAL’s education policy has had no impact on the 35+ age group. 40+ and 50+ all education under military dictatorships. Story is even worse there.

So, what’s the excuse there?

And, in fact, the BAL generation speaks better English and more of them going abroad for higher studies.

Facts and prejudice, Eh!

 

[BananaRepublic]

This poster is well intentioned but the others just have an agenda that NO-ONE with any power of hope of getting into power agrees with.

But his facts are wrong!

See my response to him re education.

They have all been brainwashed by the anti-Indian keyboard warriors!

 

[BananaRepublic]

@UKBengali

BD could also potentially export power to India and Nepal at times when demand in BD is low

Well, that is the whole point of having a grid. The locality which has a surplus exports, the deficit part imports.

Regards

@SoulSpokesman

When people don’t understand that 12-14tk from Adani is cheaper than 20tk from existing petro power stations - they either cannot do basic maths or have India derangement syndrome. Probably both!

Their illiterate jibe about coal is another hilarious diversion. They genuinely think they are clever when they parrot that point lol

 

[SoulSpokesman]

@Michael Corleone

Adani Power supplies 1,600MW at a cost of Tk14 per unit, adding to the total generation of 14,000MW, which costs Tk8 per unit on average.

You must compare the cost of Adani power not to the average cost, but to the marginal cost. In short, is it cheaper than what the next best alternative would cost. When you speak of the average cost of BDT 8, do be mindful of the fact that:

1. Some of the low cost power plants maybe fully depreciated and cannot be replaced by new more expensive power plants.
2. They maybe getting domestic natural gas at below market prices- hence their are opportunity costs (of selling the NG to other industries which maybe able to absorb a higher price) which are not being accounted.

C-14 isotope and Bananarepublic have already shown beyond doubt that there are many power plants which are even more expensive than Adani Godda.

@Fallstuff

What Bangladesh needed was a new petroleum refinery or upgrading the capacity of the existing refinery.

Sure, but how would that address BD's power scenario?

Regards

 

[Michael Corleone]

@Michael Corleone

Adani Power supplies 1,600MW at a cost of Tk14 per unit, adding to the total generation of 14,000MW, which costs Tk8 per unit on average.

You must compare the cost of Adani power not to the average cost, but to the marginal cost. In short, is it cheaper than what the next best alternative would cost. When you speak of the average cost of BDT 8, do be mindful of the fact that:

1. Some of the low cost power plants maybe fully depreciated and cannot be replaced by new more expensive power plants.
2. They maybe getting domestic natural gas at below market prices- hence their are opportunity costs (of selling the NG to other industries which maybe able to absorb a higher price) which are not being accounted.

C-14 isotope and Bananarepublic have already shown beyond doubt that there are many power plants which are even more expensive than Adani Godda.

@Fallstuff

What Bangladesh needed was a new petroleum refinery or upgrading the capacity of the existing refinery.

Sure, but how would that address BD's power scenario?

Regards

no i am not taking into account the 8 tk average that it cost's people.... I am looking at the 11 tk it takes Bangladesh to produce electricity from its gas and oil powered plants compared to the more expensive coal generated @ 14.xx that it costs in payra, mongla plants... compared to those coal-powered ones... Adani's option is cheaper but compared to installed capacity in the country or alternate source from India... it is expensive....

end users pay about 8.xx taking into account the sum average of all in the power grid taking into account the cost to produce it all....

 

[SoulSpokesman]

@Michael Corleone

I am looking at the 11 tk it takes Bangladesh to produce electricity from its gas and oil powered plants

Your BDT 11 is merely the average of all oil and gas based units. It conceals the wide range of value from BDT 4 (domestic gas based) to BDT 25 plus (imported FO). Then again you omit the fact that your domestic gas based plants are cheaper because they are getting gas at lower than market prices so the opportunity cost is being ignored- that gas could have been used for producing fertiliser or running your textile units.

But all this analysis will lead to paralysis. Now, just tell me if you were not to purchase Adani, what would be the cost of getting the same amount of power by restarting some of your shut down oil fired boilers?

Regards

 

[Michael Corleone]

Then again you omit the fact that your domestic gas based plants are cheaper because they are getting gas at lower than market prices so the opportunity cost is being ignored- that gas could have been used for producing fertiliser or running your textile units.

AFAIK none of the domestic gas production is used for electricity generation.... previous awami league government gave those supplies to garments and other industries and exported the rest to India... although the exact figure is not disclosed.... awami league members played middle men role for electricity generation needs....

But all this analysis will lead to paralysis. Now, just tell me if you were not to purchase Adani, what would be the cost of getting the same amount of power by restarting some of your shut down oil fired boilers?

I am not sure... but according to the article there were cheaper option in India itself.

 

[Michael Corleone]

BAL’s education policy has had no impact on the 35+ age group. 40+ and 50+ all education under military dictatorships. Story is even worse there.

So, what’s the excuse there?

And, in fact, the BAL generation speaks better English and more of them going abroad for higher studies.

Facts and prejudice, Eh!

35-50 age group lived in a different Bangladesh than today... the economy wasn't big to invest in this fields even if they wanted to... but I disagree with your sentiment.... particularly about quality of education being poor back then....

the revised curriculum that came with hasina in power has been criticised in academic circles within Bangladesh.... Speaking English doesn't corelate to better educated individuals... i would argue to say Bangladesh in Pakistan era spoke better english overall but that doesn't necessarily means they're educated....


yk the main reason bangladeshis go abroad to study is because of lack of opportunities.... people did it back then for economic reasons... but present day brain drain is because of nepotism.

 

[Michael Corleone]

Well thanks to Adani deal the average is lower!

Otherwise those 20tk generators would have pushed the average closer to 18.

Look at what Adani is replacing instead of comparing it to the cheapest ones.

BD doesn’t have many cheap options. Otherwise it wouldn’t pay 20tk, would it?

average cost to end consumers? that's higher according to that article above.... about 8.61 if I remember correctly.

 

[SoulSpokesman]

@Michael Corleone

AFAIK none of the domestic gas production is used for electricity generation.

Not true, sir, kindly go through this S&P report below. I am picking out certain extracts from the report

https://www.spglobal.com/commodityinsights/en/market-insights/latest-news/lng/030124-bangladesh-raises-domestic-natural-gas-and-electricity-prices

"Bangladesh has raised domestic natural gas tariffs for power plants"

"Despite the hike, the government will have to incur financial loss and pay a subsidy worth Taka 65.70 billion ($600 million) for gas for the financial year 2023-24 (July to June) due to the difference between the import and sale price of natural gas"

As you will agree, it is futile to compare subsidised power coming from your gas based stations with non subsidised power plant

but according to the article there were cheaper option in India itself.

Irrelevant. Because India itself is running into a tight power market and GOI wont allow export of cheap power irrespective of who is in power in BD.

Regards

@UKBengali @BananaRepublic

 

[UKBengali]

@Michael Corleone

AFAIK none of the domestic gas production is used for electricity generation.

Not true, sir, kindly go through this S&P report below. I am picking out certain extracts from the report

https://www.spglobal.com/commodityinsights/en/market-insights/latest-news/lng/030124-bangladesh-raises-domestic-natural-gas-and-electricity-prices

"Bangladesh has raised domestic natural gas tariffs for power plants"

"Despite the hike, the government will have to incur financial loss and pay a subsidy worth Taka 65.70 billion ($600 million) for gas for the financial year 2023-24 (July to June) due to the difference between the import and sale price of natural gas"

As you will agree, it is futile to compare subsidised power coming from your gas based stations with non subsidised power plant

but according to the article there were cheaper option in India itself.

Irrelevant. Because India itself is running into a tight power market and GOI wont allow export of cheap power irrespective of who is in power in BD.

Regards

@UKBengali @BananaRepublic

Electricity generated from BD domestic gas comes in at 2-3 Taka per kWh.

 

[SoulSpokesman]

@UKBengali

Thanks, UKB dada, you can safely assume that if the gas was sold to the power plants at import parity it would be close to BDT 8-10.

Regards

 

[BananaRepublic]

@UKBengali

Thanks, UKB dada, you can safely assume that if the gas was sold to the power plants at import parity it would be close to BDT 8-10.

Regards

Yep! Gas is not sold at market price.

So it’s stupid to compare their price with Adani.

Comparing subsidised power with market based power.

Apples and oranges!

 

[BananaRepublic]

35-50 age group lived in a different Bangladesh than today... the economy wasn't big to invest in this fields even if they wanted to... but I disagree with your sentiment.... particularly about quality of education being poor back then....

the revised curriculum that came with hasina in power has been criticised in academic circles within Bangladesh.... Speaking English doesn't corelate to better educated individuals... i would argue to say Bangladesh in Pakistan era spoke better english overall but that doesn't necessarily means they're educated....


yk the main reason bangladeshis go abroad to study is because of lack of opportunities.... people did it back then for economic reasons... but present day brain drain is because of nepotism.

How are you measuring the quality?

World was much less competitive in the 1970-1990s. What did our better educated people achieve? E.g. original research?

was it better, worse, or same?