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Upcoming Adani plant in Jharkhand to sell power to Bangladesh, will make its economy suffer: Report

The report also alleged the Adani Group forcibly acquired the land to build the plant from local farmers, without payment of proper compensation

 
By Zumbish
Published: Tuesday 07 June 2022

Photo: Twitter Handle of Gautam AdaniThe Adani Godda ultra-supercritical coal power plant being built in Jharkhand’s Godda district by the Adani Group will sell its power to Bangladesh. But a new Indo-Bangladesh report accessed by Down To Earth has claimed that Bangladesh’s economy will suffer in the process, even as Adani will get richer.

The report also alleged the Adani Group forcibly acquired the land to build the plant from local farmers, without payment of proper compensation.

The report was published June 7, 2022 by the Bangladesh Working Group on External Debt (BWGED), a forum of activists and India-based Growthwatch, a voluntary research and advocacy institution that protects natural resources from being grabbed by powerful groups.

The report stated that Bangladesh Power Development Board (BPDB) signed an agreement with the Adani Group in November 2017 to offtake 1,496 megawatt power from Godda Coal Power Plant under a cross-border electricity trade arrangement.

The BPDB agreed to pay 3.26 Bangladeshi taka (Rs 2.72) per kilowatt hour as capacity charge, which is higher than any other power plant in Bangladesh.

“The BPDB will have to pay Tk 3,657.23 crore (approximately Rs 3,053.79 crore) in capacity charges annually and Tk 108,360.60 crore (Rs 90,470.265 crore) over the plant’s 25 years operational lifetime”.

This, the report states, will lead to Adani making more profits, without benefitting Bangladesh citizens.

The capacity charge is more than enough to build three bridges over the Padma river in Bangladesh or nine Karnaphuli river tunnels or four metro railways in Dhaka, the report stated.

According to the report, the Padma Bridge was built at a cost of Rs 3,00,84,56,73,000 while the construction of metro railways in Dhaka cost Rs 2,01,34,11,61,000 and the Karnaphuli River tunnel cost Rs 94,83,15,15,000.

Moreover, according to the report, in the best scenario, the annual capacity charges payable to the Adani Godda power plant would stand at Tk 2,865.55 crore (Rs 2,392.16 crore), while the lifetime capacity charges would reach Tk 84,903.72 crore (Rs 70,877.62 crore).

“Since Bangladesh doesn’t need any more power, the amount spent will only benefit the Adani Group, not the people of Bangladesh,” Hasan Mehedi, member secretary of BWGED and one of the authors of the report, was quoted as saying. 

“So, the people and the Bangladesh economy particularly, will have to suffer for the luxury of a billionaire company who is getting richer every year,” Mehedi added.

The coal-fired Adani Godda plant being built in Jharkhand may be commissioned in August. However, the transmission line required by Bangladesh in order to import power from the Indo-Bangla border is likely to not be ready by December.

“BPDB will have to pay Tk 1,219.10 crore (Rs 1,017.70 crore) in capacity charges for the waiting period of four months even though no power will make its way to Bangladesh,” the report said.

The report noted that the power plant may emit 221.1 million tonnes (MT) of carbon dioxide in its lifetime, with an average emission of 9.35 MT annually.

“India is the third-largest country in the world which is committed to achieving net zero by 2070, instead of 2050. The position is highly criticised by the global community. This power plant will only help to establish India as a climate denier,” it said.

The environmental and social cost of the emissions of hazardous air pollutants and carbon dioxide will be Rs 5,569.34 crore per year and Rs 188,708.29 crore over the plant’s lifetime.

The report went on to recommend that in the light of the statements made during the 26th Conference of Parties to the United Nations Framework Convention on Climate Change in Glasgow, both Delhi and Dhaka should explore ways of annulling the existing bilateral agreement and replacing it with an agreement in line with the 2015 Paris Agreement and 2021 Glasgow commitments.

“Both of the governments should cancel the Power Purchase Agreement and create a flexible supply regime for renewable energy. Since it involves commercial agreements, a joint committee can be formed to resolve any issues arising out of the change,” it said.    

Kazi Maruful Islam, convener of BWGED and professor of the development studies department at the University of Dhaka, was quoted as saying, “Considering energy security, Russia-Ukraine war and global economic crisis, there is no other way than cancelling these types of agreements and building a renewable energy based electricity system in Bangladesh.”

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