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    • May 19
    • 5 min read

Malancha DEPZ 82 MW (United) DFG Power Plant

Current Status: Shut Down

Source: United Group


DEPZ 82 MW Gas Power Plant, also known as United Power Generation and Distribution Company Limited (UPGDCL) Dhaka EPZ Power Plant, is a reciprocating engine power plant situated in Dhaka Export Processing Zone (DEPZ) under Savar Upazila in Dhaka District of Bangladesh (Location: 23.9473, 90.2838). It is sponsored by United Power Generation and Distribution Company Limited (UPGDCL), a subsidiary of United Group, as a commercial private power plant for 30 years. The sponsor declared its Commercial Operation Date (COD) on 26 December 2008, and, as per schedule, the power plant is to retire on 25 December 2038 (UPGDCL 2022). However, there is no generation from the power plant in 2023 (BPDB 2023). 


Capacity

The installed (gross)  and net (derated) capacity of the power plant is  82 and 34.5 MW respectively.


Context

On January 15, 2007, a significant milestone was achieved when United was formally incorporated as a Private Limited Company. Subsequently, on May 6, 2007, UPGDCL DEPZ entered into a crucial Power Supply Agreement with Bangladesh Export Processing Zones Authority (BEPZA), solidifying its commitment to providing power to the Export Processing Zone (DEPZ). Simultaneously, another pivotal agreement was reached on the same day, as UPGDCL DEPZ entered into a Land Lease Agreement with BEPZA, paving the way for the construction of the DEPZ plant (UPGDCL, 2020). On 2 April 2009 UPGDCL DEPZ entered into a Power Supply Agreement with its first private customer, Oli Knitting & Fabrics Ltd and on May 2009 UPGDCL DEPZ entered into a Power Supply Agreement with Rural Electrification Board (REB).


United Power Generation & Distribution Co. Ltd (UPGDCL) initially operated a 35 MW unit in 2008, later adding a 6 MW unit in DEPZ (2010) and a 44 MW unit in Chittagong Export Processing Zone (CEPZ). To meet growing demand, UPGDCL undertook expansion projects in Dhaka Export Processing Zone (DEPZ) and Chittagong Export Processing Zone (CEPZ), increasing production capacity from 41 MW to 86 MW in DEPZ and from 44 MW to 72 MW in CEPZ. These projects, mandated by BEPZA, elevated UPGDCL's total production capacity from 85 MW to 160 MW by December 2013 (UPGDCL, 2016).


Financial support for the project was facilitated by the Investment Promotion and Financing Facility (IPFF) of Bangladesh Bank which is financed by the World Bank Group, Standard Chartered Bank, and a consortium of local banks. Neptune Commercial Ltd. (NCL), a subsidiary of the United Group did the entire Engineering, Procurement, and Construction (EPC) of the project. Beyond electricity generation, the plant plays a pivotal role in enhancing efficiency by commercially producing steam for neighboring industries through Exhaust Gas Boilers (EGB). (UPGDCL, 2023)..


Land Acquisition

The power plants took 1.51 acres (DEPZ) as a lease for 30 years from the Bangladesh Export Processing Zones Authority (BEPZA) (UP, 2023).


Finance

The sponsor does not disclose the total budget of the power plants. Still, Dhaka Bank Limited (DBL) and Industrial and Infrastructure Development Finance Company (IIDFC) Limited jointly financed USD 13.20 million under the Investment Promotion and Financing Facility (IPFF) of Bangladesh Bank which is financed by the World Bank Group (BB 2022). Infrastructure Development Company Limited (IDCOL) also provided BDT 200 million for the project (IDCOL 2022).


Sponsor

United Power Generation & Distribution Company Limited (UPGDCL) formerly known as Malancha Holdings Limited (MHL) was incorporated as a private limited company on January 15, 2007. The Company changed its name from Malancha Holdings Limited to United Power Generation & Distribution Company Limited on October 01, 2009. Subsequently, UPGDCL was converted into a 

Public Limited Company on December 22, 2010. United Mymensingh Power Limited (UMPL), a subsidiary of United Group, owns 90% shares of Generation and Distribution Company Limited (UPGDCL), while 2.82% is owned by the Investment Corporation of Bangladesh (ICB) and 7.18% by the general shareholders (UPGDCL  2023).


Contractors

The power plant was built by Neptune Commercial Limited (NCL), a subsidiary of United Group, using Reciprocating Engines and generators of Wartsila Corporation (Finland), MTU (Motoren-und Turbinen Union), Germany and Rolls-Royce Power Systems (Germany). Khan Associates (Pakistan) supplied Exhaust Gas Boilers (EGB) for the power plants (UP, 2023).


Fuel Supply

On 16 November 2008 UPGDCL DEPZ entered into a Gas Supply Agreement with TGTDCL (A second GSA was signed on 27 February 2014 to supply necessary DFG for the power plants which was  effective from 1 August 2009 (UPGDCL  2023).


Power Generation

As per the Power Purchase Agreement (PPA) and Power Supply Agreements (PSA) signed with BPDB and BEPZA, 10% of generated electricity is to be taken by BPDB while 10% by CEPZ, 74% by Karnaphuli Export Processing Zone (KEPZ) and 6% by Private Companies. The power plant is equipped with European Reciprocating Engines. It delivers power to industries within the Export Processing Zone (EPZ), with surplus energy supplied to the Dhaka Palli Bidyut Samity (PBS-1), Savar, of the Rural Electrification Board (REB).


Environment

The power plant operates on DFG, primarily composed of methane and potentially other hydrocarbons, falling under the fossil fuel category. This mode of electricity generation leads to the release of harmful pollutants like CO2, NOx, CO, VOCs, and PM, posing health risks and contributing to air pollution. In adherence to Section 12 of the 1995 Bangladesh Environment Protection Act, it is mandatory for industries, including pollution-causing entities like power plants, to undergo both an Initial Environmental Examination (IEE) and an Environmental Impact Assessment (EIA) as specified in the 2017 Environmental Conservation Rules  (MOLJPA 1995; MOEFCC 1997). The absence of an EIA report for the power plant is a cause for concern. To address environmental issues, a more conscientious approach involves implementing a carbon tax and transitioning towards renewable energy sources. UPGD DEPZ holds certifications for ISO 9001:2015, ISO 14001:2015, and ISO 45001:2018, underscoring its commitment to quality, environmental management, and occupational health and safety  (UPGDCL 2023). According to the environmental conservation rule 2023, the project falls in the “Orange” indicating it is a slightly harmful project for the environment (MOEFCC 2023).


References

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