GE Gas Power, a world leader in natural gas power technology, services and solutions, is focused to generate electricity that is reliable, affordable and sustainable for the people in Bangladesh, said a senior official of the company.
The company is confident that its highly efficient and record setting gas turbine technology is a suitable fit to replace old and inefficient power generation units in Bangladesh, thus offering increased power output with lowest cost of electricity.
“In Bangladesh, we are offering our latest and most advanced gas turbines that would reduce the overall generation cost to a single digit, despite using imported LNG as fuel”, said Deepesh Nanda, the Chief Executive Officer of GE Gas Power for the South Asia region, in an exclusive interview with UNB.
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He said that Bangladesh has set a target to supply uninterrupted electricity to the people at an affordable cost with highest reliability.
“We’re ready to take the challenge as GE Gas Power’s 9HA.02 gas turbine can generate electricity at more than 64 percent net efficiency in combined-cycle mode while Bangladesh’s average efficiency level is 47 percent”, said the GE top official.
GE has been engaged in Bangladesh for more than 40 years now and has its presence in most of the gas-based power stations that use GE’s gas turbines and other power generation equipment.
At present, the portfolio of 38 GE gas turbines is capable of generating more than about 3 GW of electricity.
Not only as an equipment supplier, but GE Gas Power is also making significant contributions to the country’s power and gas sectors.
“We invested as an equity partner in the 341 MW Summit Bibiyana power plant, 335 MW Summit Meghnaghat Power Plant and also partnered with other key players in the sector,” Deepesh said.
GE had invested in Summit’s FSRU (floating storage and regasification unit) in Moheshkhali of Cox's Bazar.
“Now we’re planning to increase our presence further across the Bangladesh market through foreign direct investment (FDI) while keeping the focus on transforming the power sector.” he said.
Referring to GE’s own analysis on Bangladesh’s power sector he said that as per our estimates for using HFO (furnace oil) vs. Coal vs. LNG as a fuel in power generation - the cost of electricity by using HFO is Tk 16-15 per kilowatt hour (each unit) while coal costs Tk 12 and gas Tk 9.7 per kWh.
There is a significant gap between the cost for using HFO and gas.
“The government did a remarkable job in ensuring energy security and using HFO-based engine plants for power generation”, he said adding that as the fuel prices went up, engine plants saved the day.
However, the LNG costs $13 per mmbtu under the contracts with Qatar and Oman and by using this LNG to generate electricity the levelised cost of electricity (LCOE) would be Tk 9.7 per unit.
LCOE even accounts for the maintenance cost of the power plant for 22 years and all that cost is included in the current price.
“And if the fuel price comes down to earlier levels, or if we are using domestic gas then the LCOE will be reduced further.” he added.
He said that the net efficiency of GE’s 9H.02 gas turbine is 64.1 percent in a combined-cycle mode, which means that more than 64 percent of the fuel energy is efficiently converted to electricity using GE’s technology. But it is difficult to change all the plants overnight, he noted.
“That’s why there should be a long-term plan to replace the old power plants, where the local gas is burnt inefficiently, with new and efficient combined-cycle gas power plants. The focus should be on upgrading the power generation equipment in these older plants”, he mentioned.
“If you take the worst-case scenario of higher fuel prices today, the cost of electricity by using GE’s 9HA gas turbines will be Tk 8.5 to Tk 9 per kWh”, he added.
That’s almost half of the HFO price. And it is almost 40 percent lesser than coal-based power plants,” the GE top official claimed.
Deepesh said that GE Gas Power is committed to resolve the energy trilemma in Bangladesh. “The first part of the energy trilemma deals with affordability, the second with fuel security and the third part relates to sustainability”.
Switching to gas-based power generation from coal reduces carbon-emissions straight by 50 percent.
GE believes that the accelerated and strategic deployment of gas power and renewables can change the near term trajectory of climate change, enabling substantive reductions is emissions quickly.
"This is how, you can take care of the environment, burn fuel efficiently, save money, ensure benefits to the government - as subsidy burden comes down, pass on the lower cost of electricity benefit to the public, and the industry benefits as well – by getting continuous supply of reliable power.” he said.
He said if for instance the cost of electricity for the textile units increases in Bangladesh, then other countries in South Asia will become more competitive and that will impact the foreign exchange revenue of the country.
He further claimed that emerging electricity markets such as Bangladesh which are regulated should always keep the focus on the long-term transformation of the power sector.
Bangladesh is on the right track by signing long-term LNG contract with Qatar. Because in the long term, the price of gas will always be below $10 whereas in the short term there can be spikes in prices, Deepesh said.