1 week ago
India Proposes New Charge Affecting Bangladesh Electricity Imports
India wants to add a very small fee to some electricity sold to Bangladesh.
The fee would be Rs 0.005 for each unit of electricity.
It would help pay for organizing electricity deliveries, reading meters and handling payments.
Bangladesh is considering an agreement with an Indian company to manage these transactions.
The agreement could make billing simpler because one agency would handle several payments.
It relates to 1,160 megawatts of electricity imports.
Bangladesh imports 2,656 megawatts from India under several agreements.
Officials say the extra cost would be small, but delays in approving the agreement could complicate some electricity imports.
India has proposed a charge of Rs 0.005 per electricity unit supplied to Bangladesh.
The fee would support scheduling, metering, payment settlement and other grid-related services.
Bangladesh is considering a Settlement Nodal Agency agreement with NTPC Vidyut Vyapar Nigam Ltd.
The proposed agreement covers 1,160MW of Bangladesh’s electricity imports from India.
Bangladesh currently has agreements to import 2,656MW from India, including 1,496MW from Adani Power.
- Who
- India, Bangladesh’s Power Division and Bangladesh Power Development Board, and NTPC Vidyut Vyapar Nigam Ltd.
- What
- India has proposed a Rs 0.005-per-unit charge and Bangladesh is considering a Settlement Nodal Agency agreement.
- Where
- The proposal concerns cross-border electricity transactions between India and Bangladesh.
- When
- The Bangladesh Power Division sought the Finance Division’s opinion on August 18; no implementation date was stated.
- Why
- The charge would cover transaction management, grid operations and settlement of electricity payments.
Officials’ assessment
Potential concern
Effect of the charge
Officials’ assessment
Bangladesh Power Division and Bangladesh Power Development Board officials said the fee is separate from the electricity price and would create only a relatively small additional burden.
Potential concern
The fee would still increase Bangladesh’s electricity import costs, while a delay in finalizing the agreement could complicate imports covered by the arrangement.
Payment arrangements
Officials’ assessment
The Settlement Nodal Agency system could simplify billing by allowing one agency to settle transactions with multiple power producers.
Potential concern
Until the new arrangement is finalized, electricity imported under different agreements may continue to require separate settlements with individual producers.
Key facts
- Proposed charge
- Rs 0.005 per unit of electricity
- Initial proposed charge
- Rs 0.01 per unit, later reduced by half following an application from the Bangladesh Power Development Board
- Electricity covered
- 1,160MW of Bangladesh’s imports through arrangements involving NTPC Vidyut Vyapar Nigam Ltd
- Bangladesh’s total contracted imports
- 2,656MW from India
- Adani Power supply
- 1,496MW from the Adani Power plant in Godda, Jharkhand
- Proposed settlement agency
- NTPC Vidyut Vyapar Nigam Ltd would act as the nodal agency
- Agreement status
- Bangladesh’s Power Division sought the Finance Division’s views on signing the agreement
Sources
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