DESCO takes Tk 2357.11cr project to expand power supply
Published : Wednesday, 29 September, 2021 at 12:00 AM Count : 401
The government is going to increase power supply in Dhaka city. Dhaka Electric Supply Company (DESCO) has taken a development project to this regard titled 'Expansion and Strengthening of Electrical Infrastructure' in DESCO area of the city.
It will cost Tk 2,357.11 crore including Tk 463.84 crore from the government's own funds and the remaining Tk 1,279.37 crore will be spent from project loans. The project is scheduled to be implemented between January 2022 and December 2025.
The Project Evaluation Committee (PEC) at the planning commission discussed the project on September 1 while the Planning Commission has recommended a new survey on the project because any project above Tk 25 crore needs feasibility survey.
Kawsar Amin, Managing Director, DESCO, said, "Substations and power lines in DESCO area are overloaded due to rise in demand for electricity in the city." It results in low-voltage and system losses at the customer level as well as it causes problems in providing quality electricity to new customers.
The project is being funded by the Asian Development Bank (ADB) to expand and strengthen DESCO's distribution system by constructing new grid and distribution substations and lines in view of the growing electricity demand. The scope of the project has been determined on the basis of a survey report by ZBD Engineering.
ADB will provide USD $ 150 million in loan to finance the project, DESCO managing director told the meeting. Masuda Begum, Deputy Secretary, Economic Relations Department (ERD), on the other hand said, "Although the project is part of the ADB pipeline, no loan agreement has been signed with the ADB to finance it."
ADB has proposed private financing of the project and DESCO's views have been sought. If the proposed project includes private financing, there will be significant changes in the mitigation schedule, financial and economic analysis, including changes in interest rates.
Sources said under the proposed project, 33 kV and 11 kV capacities 50 and 100 km underground lines will be laid respectively. Underground lines will be set up in Dhaka and surrounding urban areas which will cause great hardship to people.
For this, it has been requested to inform the meeting whether permission has been sought from the concerned authorities for digging roads on the proposed route for construction of underground lines in the City Corporation and Municipality area.
The meeting recommended that a separate and up-to-date feasibility study be carried out considering the scope of the project. The survey should be included in the DPP in the format framed by the NEC and ECNEC and Coordination Division.
In addition, the terms of the loan from ADB cannot be changed to finance the project. However, in case of emergency, the second PEC meeting will be held if the type of loan financing changes. For this DPP has to be restructured.