Assignment

ME 403: Power Plant Engineering

Name: Arghya Kamol Roy

Roll: S201310159
Department: ME
Sec: C2
Topic: PSMP16 and PSMP10

Date of Submission: 23-04-2018

 Power System Master Plan

 Introduction:
Bangladesh is undergoing rapid transition, which is propelling the economy towards greater
growth and diversification. Fueled by rampant urbanization, development and infrastructure
development, the economy is moving towards a middle income country. The Government’s vision
is to elevate the country to a developed economy by 2041, and as such has developed a “Vision
2041” policy. A key focal point of the policy is on the power sector of Bangladesh. In previous
years, Bangladesh had faced significant problems in the power sector. The mismatch in demand
and supply had resulted in frequent load shedding which hampered business activities. In recent
years, however, the frequency of load shedding has gone down significantly. Higher domestic
power generation coupled with exports from neighboring country has resulted in an improving
condition of the power sector. However, it has come at a cost as electricity tariff has gone up in
recent years leading to dissent from the masses and business sector.

The “Power Sector Master Plan (PSMP) 2016” is a key document detailing the roadmap of the
power sector of Bangladesh. The road map provides a comprehensive analysis of the current
scenario of power consumption and production in Bangladesh. The road map focuses on how
Bangladesh can facilitate sustainable economic growth by diversifying its power generation
capability. The Master plan puts up 5 key viewpoints which is in tandem with the overall economic
growth of Bangladesh and also the Sustainable Development Goals (SDGs) as developed by the
World Bank.

PSMP16:
Objective: To show the targets and approach in the Energy and Power Sectors in order to achieve
Bangladesh’s national goal: to achieve VISION2041 and become a high-income country by 2041

The entire PSMP16 is developed keeping in mind these five broad goals. The Master Plan also
lays out a roadmap on how to successfully achieve the five key targets.

1. Enhancement of imported energy infrastructure and its flexible operation:

Any country that goes through sustained economic development needs a robust supply of primary
energy, particularly for industrial and transport sector. At present, Bangladesh is overly reliant on
gas based primary energy, but in order to sustain development, the need for diversification is
significant. Investment in increasing domestic generation is a long term process and as such, viable
short term alternative, such as import from neighboring countries are crucial.

2. Efficient development and utilization of domestic and natural resources (gas and
coal):

Bangladesh has a decreasing reserve of natural gas and as such it is important to utilize the
remaining reserve with maximum efficiency. The current mining and extraction technology of
Bangladesh is rudimentary and greater reforms are required to enhance mining and extraction
ability.

3. Construction of a robust, high quality power network:

In order to achieve greater economic growth, Bangladesh cannot solely rely on labor intensive
industries. The need for investment and expansion of high value capital intensive industries is a
logical progression in the development of an economy. As such, the demand for high quality power
is imperative. To ensure high quality power supply, massive investment is required to develop
infrastructure.

4. Maximization of green energy and promotion of its introduction:

Bangladesh is susceptible to the adverse effect of climate change. Therefore, it is important to

develop environmentally friendly power generation policy. There needs to be investment in
renewable energy as it will help in reducing green-house emission and also result in cheaper
electricity for rural people.

5. Improvement of human resources and mechanisms related to the stable supply of

energy:

Investment in power sector shouldn’t be focused on infrastructure and increased capacity only.
The need for more trained human resource as well as ancillary infrastructure and industry is
important. The pricing of electricity is a sensitive issue and it requires a comprehensive policy
which won’t put the burden on the consumers or the producers.

 Related Organization:
1) Power Division
Ministry of Power, Energy and Mineral Resources
2) Japan International Cooperation Agency
3) The Tokyo Electric Power Co. Inc.

 Need for PSMP16 from PSMP10:

The energy source of the People’s Republic of Bangladesh (hereinafter “Bangladesh”) mainly depends
on Domestic Natural Gas. The Government of Bangladesh formulated the Power System Master Plan
2010 (PSMP2010) targeting, among others, for a long term energy diversification due to the foreseen
decrease in the production volume of Natural Gas. However, energy development is not on track compared
with the PSMP2010 plan, because various assumptions about expected sources for base load energy have
subsequently changed. In particular, a review is needed reflecting namely exponential increasing of oil
based rental power plants and development constraints of domestic primary energy. Currently, many of
power plants in Bangladesh cannot generate electricity as specified in terms of power, thermal efficiency
etc. for each unit. Daily shortage of power does not allow to stop facilities and to undertake periodical
maintenance in a planned way. Legal framework does not stipulate preventive maintenance works as an
obligation for plant owner. Low financial soundness of public generating companies due to low electricity
tariff does not permit to purchase in advance necessary spare parts. In order to secure a stable electricity
supply, we need to find out solutions to all of these issues and to establish a comprehensive institutional
framework. Moreover, hydro power generation studies (on small scale hydropower plants of 30 kW ～
5MW and a pumped storage power plant as a regulator between demand and supply) have become an urgent
issue through the government’s renewable energy promotion policy. Based on the aid policy of the
Government of Japan for Bangladesh, the Japan International Cooperation Agency (JICA) is considering
the power sector as one of priority areas assisting Bangladesh not only by Yen Loans to the construction of
power plants (gas combined cycle, super-critical using import coal and hydropower), transmission and
distribution lines and development of renewable energy but also by Technical Assistance such as the master
plan for energy efficiency. JICA is thus supporting the entire power and energy sector. It was under such
circumstances that JICA decided to undertake the Power System Master Plan 2016 (PSMP2016) in order
to grasp middle to long term development issues and risks and to formulate a comprehensive and result-
oriented aid strategy for the energy sector by examining effective approaches for each issue. After the start
of this survey, however, the Government of Bangladesh announced, in its new policy “Vision 2041”, an
important target of becoming one of the developed nations by 2041. Consequently, for the power and energy
sector which receives quite dominant development budget, it has become newly necessary to secure the
consistency between the economic development strategy of the country toward joining the developed
countries and the master plan of the power and energy sector (PSMP). With such consistency only, JICA
will be able to make the best use of the result of this survey as basic information for the future cooperation.
To study consistency between an economic growth strategy and PSMP, an additional survey on estimated
changes of the industrial structure that will be brought by the coming strategy and a precise forecast of
future demand of primary energy and corresponding supply policy must be added to this survey, since the
power sector is one of the largest sectors which consume primary energy. It was therefore decided to
estimate in this survey the most rational and probable demand and supply scenarios of primary energy for
other sectors than power sector such as fertilizer, industry, commerce, and transportation. Moreover, the
power sector will be required to cope with the changes of industrial structure in line with the economic
growth as expected in order for Bangladesh to join the developed nations. Specifically, improvement of the
quality of electricity is indispensable given the view of the government that sophistication of industries is
generally essential for the nation to become one of the developed countries. After the commencement of
this survey, Bangladesh started considering also a specific plan to expand power import from neighboring
countries such as India, Bhutan and Nepal. Usually, international cooperation in power system is oriented
toward direct cooperation by means of alternate current and, to do so, quality of electricity is required to be
equivalent or better than that of counterpart countries. It is therefore necessary for the promotion of
international cooperation to improve the quality of electricity. Since this issue will be a concern to the entire
power sector in revising PSMP, it was also decided to add to this survey collection of additional basic
information and examination of feasible measures responding to the specific needs of quality improvement.
Therefore, the collection and analysis of the information on the plan for the supply and demand for primary
energy sources and the needs for the improvement of the quality of power supply were included in this
survey that had consisted of the revision of power development plan and the studies on the institutional
reform for the improvement of O&M and the introduction of hydropower generation. This inclusion of the
new survey subject enabled the formulation of a new master plan that covers not only the power sector but
also the energy sector comprehensively and describes the interface between the two sectors. The new master
plan is the output of the first joint survey of the two divisions in the Ministry of Power, Energy and Mineral
Resources (MoPEMR), Power Division and Energy Division, and this survey is expected to serve as a good
precedent of the cooperation between them in the implementation of policies in the power and energy
sectors.