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RURAL ELECTRIFICATION IN BANGLADESH AND TARIFFS-ITS IMPORTANCE ON SUSTAINABILITY OF POWER SECTOR

PRESENTATION ON. RURAL ELECTRIFICATION IN BANGLADESH AND TARIFFS-ITS IMPORTANCE ON SUSTAINABILITY OF POWER SECTOR. SHAH ZULFIQAR HAIDER, PEng General Manager, Noakhali PBS

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RURAL ELECTRIFICATION IN BANGLADESH AND TARIFFS-ITS IMPORTANCE ON SUSTAINABILITY OF POWER SECTOR

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  1. PRESENTATION ON RURAL ELECTRIFICATION IN BANGLADESH AND TARIFFS-ITS IMPORTANCE ON SUSTAINABILITY OF POWER SECTOR SHAH ZULFIQAR HAIDER, PEng General Manager, Noakhali PBS Email. szhaider123@hotmail.com Cell. +880-1552-307218 23 January, 2008

  2. BRIEF INTRODUCTION OF RESOURCE PERSON • General Manager in Rural Electric Societies since 1989 • Garrison Engineer/Staff Officer-Military Engineer Services • Expert-Energy, Infrastructure, Engineering, EE,RE, TQM etc • Training- O&M of Utilities from USA & TQM in Japan • Facilitator/Member-Nepal, India, China, Bangladesh etc • Publications at International level • Member: • Guide Point Global Advisors, USA • American Council for an Energy Efficiency & Economy • International Association of Engineers • Global Village Energy Partnership (GVEP), UK • Infrastructure-India network, etc.

  3. OBJECTIVE OF THIS SESSION • 1. To have an idea about Rural Electrification programme of Bangladesh • 2. Importance of Tariff • 3. How to minimize Cost of electricity • 4. Tariffs for sustainable Power sector

  4. RURAL ELECTRIFICATION IN BANGLADESH HOW IT STARTED . . . • Bangladesh once Least developed country • Provision of electricity constitutional right • Electricity distribution was by state • How to provide electricity to rural masses? • Through Rural Electric Societies (RES) or Palli Bidyut Samities (PBS) • Rural Electrification turned it to a developing country.

  5. RURAL ELECTRIFICATION IN BANGLADESH HOW IT STARTED...(continued) • Rural Electrification Board (REB) formed • REB helped form RES or PBS WHAT IS RURAL ELECTRIFICATION PROGRAM? • To provide electricity to rural mass: • No-loss-no-profit basis • Sound financial basis & lowest cost • Area Coverage Rural Electrification • Poverty alleviation & minimizing disparity • Achieved through… • Efficient Management, TQM, Service/Training etc

  6. AREA COVERAGE RURAL ELECTRIFICATION PROGRAM

  7. CONSUMER SERVICE TOP MOST PRIORITY • CONSUMER – the only & main source of Income • Consumers GOOD LUCK for the organization • One Point Service (OPS) for the Consumers • The consumer submits his problem • OPS staff moves & gives solution to consumer.

  8. PERFORMANCE TARGET AGREEMENT (PTA) • PTA executed between REB & RES • Rewards & Financial Penalty • Competition developed The PTA Targets are . . . • System Loss • Accounts Receivable & Payable • Debt Service Coverage • Equity status • Annual Load Factor • Revenue per Km of line, etc.

  9. OTHER FACTORS FOR SUCCESS OF RE PROGRAMME • DEDICATION • MOTIVATION • VILLAGE ADVISORS • DELEGATION OF AUTHORITY • JOB DESCRIPTION • THE RES (PBS) BOARD

  10. CONSUMERS’ PARTICIPATION IN PBS ACTIVITIES CONSUMER BOARD DIRECTOR RES (PBS) CONSUMER VILLAGE ADVISOR VILLAGE ELECTRICIAN CONSUMER CONSUMER

  11. CONSUMER PARTICIPATION-BOARD RES (PBS) DEMOCTARIC INSTITUTION 1. The RES/PBS divided in Areas-Elaka 2. Max 15 Board Directors 3. Selection through democratic process 4. Consumers Annual General Meeting (AGM) 5. Financial Balance Sheet and Accounts 6. Executive Committee 7. Lady Directors selection

  12. TARIFF IN R.E PROGRAMME No-loss-no-profit & Sound financial basis Tariffs to support these concepts Electric Extension on Revenue criteria Line extension on Area Coverage basis Power purchase rate=Actual cost of Power Revenue from Electricity sale-main income Financial picture of RES- Form 550

  13. IS OUR TARIFF RATIONAL? The concepts of R.E program are in conflict Free Electricity (!) Who will pay? Lower Domestic vs. Higher Industrial Tariff Profit by Industrial based cooperatives What happens to Industries?

  14. SUBSIDIES • Rich countries provide subsidy • Developing countries discouraged • Subsidies: • a. Lower electric bill- 50 to 100 KWH usage • b. Irrigation consumers • c. Subsidy to the Utilities • How long? • Who will pay?

  15. COST OF ELECTRICITY • Cost & Tariff not in harmony • Cost of Electricity may be higher: • Higher Plant & equipment cost • Lack of expertise - Inefficient procurement • Improper planning, No Master plan • Inadequate remuneration • In efficient management, Lack of commitment • High losses & pilferage • Transparency & Accountability

  16. HOW TO LOWER COST OF ELECTRICITY-1 Energy Efficiency (EE)& Energy Audit Lower Generation cost & Improve Transmission Plant Factor & Load Factor Power Factor- Consumer to Generation point Load management Administrative cost & losses-reduce Technical & Managerial skills Reduction of Technical/Non Technical losses.

  17. HOW TO LOWER COST OF ELECTRICITY-2 Reward, punishment Transparency & Accountability Minimum Political interference Consumer awareness-misuse reduce & EE Minimum Disconnected consumers Minimum illegal consumers Maximum New connection in existing facility

  18. POWER QUALITY IMPROVEMENT • Electricity - Service & again Goods • Just in Time Product • Improve Power Factor, minimum 95% • Intelligent Power Factor controller • Minimize Total Harmonics • Standardize Electrical products • Minimize GHG emission • Phase balance, Voltage improve & Lines Clear • Adequate grounding

  19. POWER SUPPLY RELIABILITY Europe - 99.95+% supply efficiency • Load Management • Market closure - evening • Industries holiday staggering • Peak hour heavy use restriction • Multi Tariff/TOU/Prepaid meter • Consumer education & motivation • Demand side management • Energy saving lamp & Electronic ballast • Efficient equipment & Variable speed motor • Industrial cooling, Technical losses reduce etc

  20. METERING • Cash Box • Meters always best quality • Meters should read at lowest wattage • 3 phase meters - 3 element • System adequately grounded • Multiple Tariff Meter - Demand management • Prepaid Meters • Tariffs vary for each cooperative • Tariff on geo - economic condition • No-loss-no-profit concept for tariff

  21. RENEWABLE ENERGY • Renewable energy expensive than Fossil fuel • It should be cost effective & competitive • Higher tariff will discourage it • One time subsidy • No alternate to expansion of R E • Minimize GHG emission

  22. PRIVATIZATION OF POWER SECTOR • Why privatization? • Government owned Utilities inefficiency • Huge losses • Lack of accountability • Lack of commitment • Privatization with sufficient protective rules • Privatization is not transfer of Government losses to private entity

  23. NOAKHALI RES TARIFF • Sl.CategoryKWH SlabUS CentEuro cent • 1 Domestic 000-100 4.0 2.78 • 2 Domestic 101-300 4.1 2.85 • 3 Domestic 301-500 5.8 4.04 • 4 Domestic Above 500 8.4 5.85 • 5 Commercial 7.3 5.08 • 6. Irrigation 4.1 2.85 • 7. Industry 5.7 3.97 • 8. Large Industry 5.6 3.90 • 9. Other 4.7 3.26 • 10 Cost of Electricity 5.5 3.83

  24. NOAKHALI RES EXPENSES (%)

  25. CATEGORY WISE CONSUMPTION (%)

  26. INFRASRTUCTURE AND ENERGY • Infrastructure: • Electricity-Generation-Transmission-Distribution • Energy- Conventional, Renewable, Gas etc. • Communication-Road, River, Train and Air • Telecommunication & Internet • Water supply • Rural Infrastructure. • (Accountability and Transparency)

  27. COST AFTER MANAGEMENT • Analyze cost • Consumer mix and consumption. • Formulate Tariff “No-loss-no-profit basis” • If Losses exist, enhance Tariff or Subsidy. • Analyze economic effect due to electricity • If losses continue, analyze the whole system

  28. CONCLUSION • Cost of electricity up to consumer-Minimum • Use Superior quality products • Renewable, One time subsidy • Human Resources Development • Adequate remuneration • Reward and Punishment • Power Factor improvement • Load & Demand Side Management • Energy efficiency & Energy Audit

  29. CONCLUSION … continued • Reduction of losses • Extensive motivation • Minimum Political interference or influence • Consumer education • Pilferage proof good quality meters • Infrastructure, Energy master plan • Accountability and transparency • Cost analysis for tariff fixation • Subsidy as required

  30. THANK YOU FOR ATTENDING THE SESSION SHAH ZULFIQAR HAIDER, PEng szhaider123@hotmail.com General Manager, Noakhali PBS

  31. Q&A We welcome your feedback . . .

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