360 MW Haripur unlikely to get extension despite low cost 

Haripur 360 MW combined cycle power plant (CCPP), which generates electricity at the lowest cost, is unlikely to get extension after completion of its 22-year initial contract period.

According to official sources, the power plant, established by leading US company AES Corporation in 2001, completed its successful operational period in November 2023. Since then, the government has not taken electricity from the plant.   

The AES Corporation developed two large base-load power plants—Haripur 360 MW CCPP in 2001 and Meghbaghat 450 MW CCPP in 2002—with the highest efficiency, but lowest cost.  

As per the power purchase agreement (PPA), state-owned Bangladesh Power Development Board (BPDB) had been purchasing electricity from the two first generation independent power producer (IPP) plants.

BPDB officials said that initially, Haripur's power tariff was Tk.1.56 per unit, which is the lowest not only in Bangladesh, but also in the world.

According to a World Bank document publicly disclosed on June 24, 2014 which compared the power generation cost of different IPPS, shows that when the Khulna Power Company Limited was selling electricity to the BPDB at Tk 16.03 per unit in 1998, NEPC at Tk 20.20 per unit in 1999, Haripur was selling it at Tk 1.56 per unit and Meghbaghat was selling power at Tk 2.33 per unit.

Currently, the average generation cost is over Tk 10 per unit. Through a gazette notification issued on March 1, the government set the retail tariff of electricity at Tk 8.95.

Officials said, until last year BPDB was buying electricity from the plant at Tk 3.32 per unit which was the lowest among all other private power plants.

But in November 2023, the PPA expired and BPDB suspended purchasing electricity from the plant.

The BPDB’s such move surprised many as it was unlikely on the part of the government that it unilaterally stopped buying electricity from the most efficient and lowest cost power when it continued purchase of electricity from high cost plants belonging to Summit Group and other plants.