BANGLADESH POWER MARKET OUTLOOK TO MARKET TRENDS, REGULATIONS AND COMPETITIVE LANDSCAPE

Transcription

1 REFERENCE CODE GDPE0688ICR PUBLICATION DATE SEPTEMBER 2013 BANGLADESH POWER MARKET OUTLOOK TO

2 Executive Summary Gas-Based Thermal Power Dominates the Bangladesh Power Sector Gas-based thermal power generation is the dominant technology in Bangladesh. In 2012, gasbased power generation capacity accounted for XX% of the country s total power generation capacity. Oil-based capacity accounted for a XX% share in 2012, while coal and large hydro capacity accounted for respective XX% and XX% shares. Renewable technologies, including onshore wind, solar Photovoltaic (PV), and small hydropower capacity, accounted for a XX% share of the total installed capacity in the country in Power Market, Bangladesh, Cumulative Installed Capacity Breakup by Type of Power Plant (%), 2012 Large hydropower including pumped storage Coal (thermal) Oil (thermal) Other renewable technologies and small hydropower Continued Increase in Electricity Consumption and Generation Annual electricity consumption in Bangladesh amounted to XX Terawatt hours (TWh) in 2000 and increased at a Compound Annual Growth Rate (CAGR) of XX% to reach XX TWh in Annual power generation also increased during this period, from XX TWh in 2000 to XX TWh in 2012 at a CAGR of XX%. Power consumption in the country has been growing in parallel with the growth of the economy. Power Market, Bangladesh, Annual Power Consumption and Generation (TWh), Total generation (TWh) and consumption (TWh) Gas (thermal) Annual consumption (TWh) Annual generation (TWh) Source: GlobalData, Power etrack, Capacity and Generation Database [Accessed on: June 11, 2013] Source: GlobalData, Power etrack, Capacity and Generation Database [Accessed on: June 11, 2013] 2

3 Table of Contents 1 Table of Contents 1 Table of Contents List of Tables List of Figures Introduction GlobalData Report Guidance Bangladesh, Power Market, Snapshot Bangladesh, Power Market, Macroeconomic Factors Bangladesh, Power Market, Supply Security Bangladesh, Power Market, Generation Infrastructure Bangladesh, Power Market, Transmission Infrastructure Bangladesh, Power Market, Opportunities Bangladesh, Power Market, Challenges Bangladesh, Power Market, Capacity and Generation Overview Bangladesh, Power Market, Cumulative Installed Capacity, Breakup by Type of Power Plant, Bangladesh, Power Market, Cumulative Installed Capacity and Annual Power Generation, Cumulative Installed Thermal Capacity and Annual Thermal Power Generation, Cumulative Installed Hydro Capacity and Annual Hydropower Generation, Cumulative Installed Nuclear Capacity and Annual Nuclear Power Generation,

4 Table of Contents Cumulative Installed Renewable Capacity and Annual Renewable Power Generation, Bangladesh, Power Market, Transmission and Distribution Overview Bangladesh, Power Market, Transmission Overview Bangladesh, Power Market, Distribution Overview Bangladesh, Power Market, Grid Interconnection Electricity Import and Export Trends, Bangladesh, Power Market, Electricity Trading Bangladesh, Power Market, Market Analysis Bangladesh, Power Market, Supply Structure Bangladesh, Power Market, Key Market Players Financial Performance Key Financial Ratios and Inference Bangladesh, Power Market, Financial Deals Deal Volume and Value Analysis, Deals, Split by Type, Deals, Split by Technology, Bangladesh, Power Market, Demand Structure Breakdown of Consumption by Sector, Bangladesh, Power Market, Regulatory Scenario Bangladesh, Power Market, Key Electricity Policies Electricity Market Reforms Power System Master Plan

5 Table of Contents Renewable Power Policy Nuclear Power Policy Bangladesh, Power Market, Foreign Direct Investment Scenario Bangladesh, Power Market, Competitive Landscape: Snapshot of Leading Power Generation Companies Key Company in the Bangladesh Power Market Bangladesh Power Development Board Company Overview Business Description SWOT Profile Appendix Market Definitions Power Installed Capacity Active Installed Capacity Electricity Generation Electricity Consumption Thermal Power Plant Hydropower Plant Nuclear Power Renewable Energy Resources Abbreviations Bibliography GlobalData s Methodology

6 Table of Contents Coverage Secondary research and analysis Primary Research and Analysis Disclaimer

7 Table of Contents 1.1 List of Tables Table 1: Power Market, Bangladesh, Gross Domestic Product ($bn), Population (million), and Annual Power Consumption (TWh), Table 2: Power Market, Bangladesh, Cumulative Installed Capacity Breakdown by Type of Power Plant (%), Table 3: Power Market, Bangladesh, Cumulative Installed Capacity (GW) and Annual Power Generation (TWh), Table 4: Power Market, Bangladesh, Leading Active Thermal Power Plants (MW), Table 5: Power Market, Bangladesh, Leading Active Thermal Power Plants(MW), Table 6: Power Market, Bangladesh, Cumulative Installed Thermal Capacity (GW) and Annual Thermal Power Generation (TWh), Table 7: Power Market, Bangladesh, Leading Active Hydropower Plants (MW), Table 8: Power Market, Bangladesh, Cumulative Installed Hydro Capacity (MW) and Annual Hydropower Generation (GWh), Table 9: Power Market, Bangladesh, Active Wind Power Projects (MW), Table 10: Power Market, Bangladesh, Leading Upcoming Solar Parks (MW), Table 11: Power Market, Bangladesh, Cumulative Installed Renewable Capacity (MW) and Annual Renewable Power Generation (GWh), Table 12: Power Market, Bangladesh, Transmission Line Length (Ckm), Table 13: Power Market, Bangladesh, Distribution Line Length (Ckm), Table 14: Power Market, Bangladesh, Planned Interconnectors with Neighboring Countries (MW), Table 15: Power Market, Bangladesh, Market Share of the Leading Power Generation Companies (%), Table 16: Power Market, Bangladesh, Deals Market by Value ($m) and Volume (Units), Table 17: Power Market, Bangladesh, Annual Power Consumption (TWh),

8 Table of Contents Table 18: Power Market, Bangladesh, Breakdown of Electricity Consumption by Sector (%), Table 19: Power Market, Bangladesh, Total Foreign Direct Investment Inflow and Share of the Power Sector in Total FDI Inflow ($m), 2000 June, Table 20: Power Market, Bangladesh, Bangladesh Power Development Board, SWOT Profile Table 21: Abbreviations

9 Table of Contents 1.2 List of Figures Figure 1: Figure 2: Figure 3: Figure 4: Figure 5: Figure 6: Power Market, Bangladesh, Gross Domestic Product ($bn), Population (million), and Annual Power Consumption (TWh), Power Market, Bangladesh, Cumulative Installed Capacity Breakdown by Type of Power Plant (%), Power Market, Bangladesh, Cumulative Installed Capacity (GW) and Annual Power Generation (TWh), Power Market, Bangladesh, Cumulative Installed Thermal Capacity (GW) and Annual Thermal Power Generation (TWh), Power Market, Bangladesh, Cumulative Installed Hydro Capacity (MW) and Annual Hydropower Generation (GWh), Power Market, Bangladesh, Cumulative Installed Renewable Capacity (MW) and Annual Renewable Power Generation (GWh), Figure 7: Power Market, Bangladesh, Market Share of the Leading Power Generation Companies (%), Figure 8: Power Market, Bangladesh, Deals Market by Value ($m) and Volume (Units), Figure 9: Power Market, Bangladesh, Annual Power Consumption (TWh), Figure 10: Power Market, Bangladesh, Breakdown of Electricity Consumption by Sector (%),

10 Introduction 2 Introduction As a country, Bangladesh is still young, having gained independence from East Pakistan in A major part of the history of this young country has been marked by political instability. The very first government in power at the time of independence of the country was ousted in a coup in The new government was itself ousted in another coup in A period of military-backed rule lasted until Although Bangladesh has not had any more brushes with military-led government, with the exception of 2007 when a military-backed emergency caretaker government took over in an effort to reform the political process and root out corruption, the country has been affected by frequent political turmoil. Bangladesh has an open economy, and the government participates on a large scale in the economy through public sector enterprises, particularly in the infrastructure sector. Supported by international assistance, Bangladesh has been able to solve its food security problem to a large extent. However, as a result of its geographical location, lack of infrastructure, and natural disasters the country is faced with droughts in summer and floods during the monsoons the destruction of life and property is widespread every year. The Gross Domestic Product (GDP) of the country increased at an average rate of XX% per year between 2000 and 2012 (calculated at constant prices; at current prices, this rate comes to XX%). The country s GDP amounted to $XX billion in 2000, which increased to an estimated $XX billion in Up until 2017, GDP is expected to increase at a Compound Annual Growth Rate (CAGR) rate of XX% per year (IMF, 2012). More than half of the GDP of the country is generated by the services sector. In 2012, an estimated XX% share of GDP came from this sector, followed by the industrial sector with XX% and agriculture with XX%. However, the agriculture sector accounts for an average XX% share of employment in the country (CIA, 2013). The Bangladeshi government is focusing on increasing the supply of energy in the country in order to support further economic growth. The majority of the electricity generated in the country comes from natural gas. There is only one coal-fed power plant in Bangladesh, and this too is operating at half capacity due to an inadequate supply of coal. Gas deposits are located primarily in the eastern half of the country, while the north-western part of the country contains coal reserves. XX onshore and offshore gas fields are known to exist in the country, of which only XXare currently operational. XX million cubic feet per day (mmcfd) of gas produced in the country. Actual demand amounts to XX mmcfd. 11

11 Introduction 2.1 GlobalData Report Guidance This report begins with an executive summary covering the key growth trends in the Bangladesh power market. Chapter two provides an introduction to Bangladesh s macroeconomic scenario and the Bangladesh power market. Chapter three provides an insight into the key performance areas of the power sector in Bangladesh. Chapter four covers capacity and generation trends by type of plant. This section also includes information on the upcoming power plants in the country, as well as information regarding decommissions and an analysis of how they would affect capacity and generation growth in the country. Chapter five provides information regarding Bangladesh s power infrastructure, including existing and planned developments in transmission, distribution infrastructure, and crosscountry interconnections. The section also includes information on electricity imports and exports by Bangladesh and the status of electricity trading in the country. Chapter six includes a market analysis for the Bangladesh power market, including an overview of the basic structure of the power sector in the country, an analysis of the market shares held by companies in the power generation and retail market, an analysis of the financial situation of the power market in the country, and analysis of deals from 2004 to The chapter also describes trends in electricity consumption, a breakdown of electricity consumption in 2012, and a forecast of the consumption of electricity up to Chapter seven describes the power regulatory structure and prominent policies expected to influence the future of the power market in Bangladesh. Chapter eight provides complete descriptions and SWOT analysis for the leading companies in the country s power market. Note: the report provides actual or estimated data for 2012, depending upon the information available at the time of writing the report. 13

12 Bangladesh, Power Market, Capacity and Generation Overview 4.2 Bangladesh, Power Market, Cumulative Installed Capacity and Annual Power Generation, The cumulative installed capacity in Bangladesh increased from XX GW in 2000 to XX GW in 2012 at a CAGR of XX%, and is expected to increase from XX GW in 2013 to XX GW in 2030 at a CAGR of XX%. Electricity generation in Bangladesh is particularly dependent upon natural gas. In 2012, XX% of the installed capacity in the country was derived from gas-based capacity. During the forecast period, this dominance of gas-based power generation capacity is expected to persist although, as a result of the government s focus on the diversification of the power mix in the country, the shares accounted for by coal and oil are expected to increase. Bangladesh possesses large reserves of coal that have not been utilized until now. The large generation projects that the Bangladesh government has been announcing, would make it imperative for these reserves to be used. The coal reserves in Bangladesh have not yet been used extensively, due primarily to the absence of a comprehensive coal policy in the country. Bangladesh does not possess much hydropower potential, especially large hydropower. This is because the terrain of the country is mostly flat. In addition, the majority of the rivers in Bangladesh originate outside the country and the utilization of these resources requires time-taking diplomatic procedures with neighboring nations. Bangladesh possesses substantial solar potential, given its geographical proximity to the equator. Wind potential is also expected to be good, although wind mapping is yet to be carried out. Biopower is yet to take off on a large scale in the country. Bangladesh does not currently possess any installed nuclear power capacity. The country s first nuclear power plant is expected to be commissioned by Annual power generation in Bangladesh amounted to XX TWh in 2000 that increased to XX TWh in 2012 at a CAGR of XX%. It is expected to increase from XX TWh in 2013 to XX TWh in 2030 at a CAGR of XX%. 23

13 Bangladesh, Power Market, Capacity and Generation Overview Figure 3: Power Market, Bangladesh, Cumulative Installed Capacity (GW) and Annual Power Generation (TWh), Cumulative installed capacity (GW) Annual generation (TWh) Cumulative installed capacity (GW) Annual generation (TWh) Source: GlobalData, Power etrack, Capacity and Generation Database [Accessed on: June 11, 2013] 24

14 Bangladesh, Power Market, Capacity and Generation Overview Table 3: Power Market, Bangladesh, Cumulative Installed Capacity (GW) and Annual Power Generation (TWh), Year Cumulative installed capacity (GW) Annual generation (TWh) Source: GlobalData, Power etrack, Capacity and Generation Database [Accessed on: June 11, 2013] 25

15 Bangladesh, Power Market, Market Analysis 6.2 Bangladesh, Power Market, Key Market Players BPDB is the largest power generation company in Bangladesh and, according to data obtained in June, 2013, the company accounted for a XX% share of total installed capacity in the country. Other companies such as Ashuganj Power Station Company Ltd (APSCL), EGCB, and (Strategic Business Unit) SBU are subsidiaries of BPDB. These three subsidiaries accounted for a combined XX% share of total installed capacity of the country in June IPPs accounted for XX%, while other SIPPs and rental power plants accounted for the remaining XX% of the country s total installed capacity in June, Figure 7: Power Market, Bangladesh, Market Share of the Leading Power Generation Companies (%), 2013 Others Strategic Business Unit (SBU), BPDB Electricty Generation Company of Bangladesh (EGCB) Bangladesh Power Development Board (BPDB) Ashugunj Power Station Company Ltd. (APSCL) Source: GlobalData; BPDB, 2013 Independent Power Producers (IPPs) Table 15: Power Market, Bangladesh, Market Share of the Leading Power Generation Companies (%), 2013 Company name Share (%) Bangladesh Power Development Board (BPDB) IPPs Ashugunj Power Station Company Ltd. (APSCL) EGCB Strategic Business Unit (SBU), BPDB Others Source: GlobalData; BPDB,

16 Appendix 9 Appendix 9.1 Market Definitions Power The rate of production, transfer, or energy use, usually related to electricity. Measured in watts and often expressed in kilowatts (kw) or Megawatts (MW). This is also known as "real" or "active" power Installed Capacity Installed capacity refers to the generator s nameplate capacity, as stated by the manufacturer, or the maximum rated output of a generator under given conditions. Installed capacity is given in MW on a nameplate affixed to the generator Active Installed Capacity Active installed capacity refers to the component of electric power that actually performs work. It is given kw or MW Electricity Generation Electricity generation is something producing electric energy by transforming other forms of energy. This term also refers to the amount of electric energy produced, expressed in Gigawatt hours (GWh) Electricity Consumption Electricity consumption is the sum of electricity generated, plus imports, minus exports, minus transmission and distribution losses. It is measured in GWh Thermal Power Plant This is a plant where the turbine generators are driven by burning fossil fuels Hydropower Plant This is a plant where the turbine generators are driven by falling water. 65

17 Appendix Nuclear Power This is the electricity generated by the use of thermal energy, released from the fission of nuclear fuel in a reactor Renewable Energy Resources These are naturally replenishing energy resources that are limited in the amount of energy that is available per unit of time. For example, biomass, geothermal, solar and wind energy are all renewable resources. 9.2 Abbreviations Table 21: ADB APSCL BERC BPDB BRAC CAGR CCGT Ckm DESA DESCO DPDC EA & CEI EGCB EMG FDI GDP GW GWh IFDR IPP kv kw kwh LGED mmcfd Abbreviations Asian Development Bank Ashugunj Power Station Company Ltd. Bangladesh Energy Regulatory Commission Bangladesh Power Development Board Bangladesh Rural Advancement Committee Compounded Annual Growth Rate Combined Cycle Gas Turbine Circuit kilometer Dhaka Electric Supply Authority Dhaka Electric Supply Company Ltd. Dhaka Power Distribution Company Electrical Advisor & Chief Electrical Inspector Electricity Generation Company of Bangladesh Ltd. Emerging Markets Group Foreign Direct Investment Gross Domestic Product Giga Watt Gigawatt hour Instituto Financeiro para o Desenvolvimento Regional Independent Power Producer kilovolt kilowatt kilowatt hour Local Government Engineering Department millions of cubic feet per day 66

18 Appendix MPEMR MW NWZPDCL PBS PG PGCB PSMP PV QRP REB SBU SEDA SIPP SZPDCL TE TWh USAID V WZPDCL Source: GlobalData Ministry of Power, Energy, and Mineral Resources Megawatt North West Zone Power Distribution Co. Ltd. Palli Bidyut Samity Gravity Dam Power Grid Company of Bangladesh Power Sector Master Plan Photovoltaic Quick Rental Power Rural Electricity Board Strategic Business Unit Sustainable Energy Development Agency Small Independent Power Producer South Zone Power Distribution Co. Ltd. Earth Fill Tera Watt Hours United States Agency for International Development Volt West Zone Power Distribution Co. Ltd. 67

19 Appendix 9.3 Bibliography BPDB (2013). Owner Wise Daily Generation Report [Database]. Bangladesh Power Development Board. Available from: 0 [Accessed on: June 11, 2013] Chowdhury, NR et al. (2012). Present Scenario of Renewable Energy in Bangladesh and a Proposed Hybrid System to Minimize Power Crisis in Remote Areas. International Journal of Renewable Energy Research. Vol.2, No.2 (2012). Available from: CIA (2013). Bangladesh: The World Factbook. Central Intelligence Agency. Available from: [Accessed on: June 10, 2013]. EMRD (2013). Energy and Mineral Resources Division (EMRD): Coal. Energy and Mineral Resources Division, Ministry of Power, Energy and Mineral Resources. Available from: [Accessed on: June 10, 2013]. IMF (2012). World Economic Outlook Database [database]. International Monetary Fund. Available at: tries [Accessed on June 10, 2013] REB (2013). PBS's Website. Rural Electrification Board. Available from: [Accessed on: June 12, 2013]. Roy, P (2011). Bangladesh Power Sector: Overview & Regional Integration. Power Grid Company of Bangladesh Ltd. Available from: nsmission/presentations/bangladesh.pdf Statistics Department, Bangladesh Bank (2012). Foreign Direct Investment in Bangladesh: Survey Report, January June, Statistics Department, Bangladesh Bank. Available from: [Accessed on: June 10, 2013] 68

20 Appendix The Financial Express (2013). BERC moves to set Feed-in-Tariff for renewable energy firms. The Financial Express. Available from: [Accessed on: June 10, 2013] UK Trade & Investment (2011). Sector briefing: Power Sector Opportunities in Bangladesh. UK Trade & Investment. Available from: GlobalData s Methodology GlobalData s dedicated research and analysis teams consist of experienced professionals with backgrounds in marketing, market research and consulting in the power industry, and advanced statistical expertise. GlobalData adheres to the codes of practice of the Market Research Society ( and the Strategic and Competitive Intelligence Professionals ( The following research methodology is followed for all country outlook reports Coverage This report gives detailed information on the country s power market. It examines the country s power market structure and provides historical and forecast numbers for generation, capacity and consumption up to The report provides insights on the market s regulatory structure, import and export trends, competitive landscape and leading active and upcoming power projects Secondary research and analysis The capacity, generation and consumption data is collected and validated using a number of secondary resources including but not limited to: Government agencies, ministerial websites, industry associations, the World Bank, statistical databases Company websites, annual reports, financial reports, broker reports and investor presentations Industry trade journals, market reports and other literature GlobalData s proprietary databases like the Capacity and Generation Database, Power Plant Database and Transmission and Distribution Database. 69

21 Appendix Further to this, the following secondary information is collected and analyzed to project the country s power market scenario through to 2030, analyzing factors such as the following: The country s macroeconomic scenario Government regulations, policies and targets Government and private sector investments Contract and deal announcements Utility expansion plans The sector s historic track record Other qualitative insights built through secondary research and analysis of company websites, annual reports, investor presentations, industry and trade journals, and data from industry associations Primary Research and Analysis Secondary research is further complemented through primary interviews with industry participants to verify and fine-tune the market numbers obtained through secondary research and get first-hand information on industry trends. The participants are drawn from a diverse set of backgrounds, including equipment manufacturers, industry associations, government bodies, utilities, distributors, and academia. The participants include, but are not limited to, C-level executives, industry consultants, academic experts, business development and sales managers, purchasing managers, plant managers, government officials, and industry spokespeople. 70

22 Appendix 9.5 Disclaimer All Rights Reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher, GlobalData. This report is a licensed product and should not to be reproduced without prior permission. 71