RURAL ELECTRIFICATION IN BANGLADESH

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PRESENTATION ON

RURAL ELECTRIFICATION IN BANGLADESH AND TARIFFS-IT
S IMPORTANCE ON SUSTAINABILITY OF POWER SECTOR
SHAH ZULFIQAR HAIDER, PEng
General Manager, Noakhali PBS
Email. szhaider123_at_hotmail.com

Cell. 880-1552-307218
23 January, 2008
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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- OM 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.

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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
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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.

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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

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AREA COVERAGE RURAL ELECTRIFICATION PROGRAM
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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.

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PERFORMANCE TARGET AGREEMENT (PTA)

• PTA executed between REB RES
• Rewards Financial Penalty
• Competition developed

The PTA Targets are . . .

1. System Loss
2. Accounts Receivable Payable
3. Debt Service Coverage
4. Equity status
5. Annual Load Factor
6. Revenue per Km of line, etc.

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OTHER FACTORS FOR SUCCESS OF RE PROGRAMME

1. DEDICATION
2. MOTIVATION
3. VILLAGE ADVISORS
4. DELEGATION OF AUTHORITY
5. JOB DESCRIPTION
6. THE RES (PBS) BOARD

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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. Consumer
s Annual General Meeting (AGM) 5. Financial
Balance Sheet and Accounts 6. Executive
Committee 7. Lady Directors selection
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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 rateActual cost of Power
• Revenue from Electricity sale-main income
• Financial picture of RES- Form 550

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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?

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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?

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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

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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.

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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

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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

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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

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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

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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

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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

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NOAKHALI RES TARIFF

• Sl. Category KWH Slab US Cent Euro
  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

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NOAKHALI RES EXPENSES ()
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CATEGORY WISE CONSUMPTION ()
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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)

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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

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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

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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

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THANK YOU FOR ATTENDING THE SESSION
SHAH ZULFIQAR HAIDER, PEng szhaider123_at_hotmail.com
General Manager, Noakhali PBS
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QA We welcome your feedback . . .