Dhaka, Sept 13 (UNB) A 200 MWp solar power plant is likely to be installed in Teknaf by US-based solar power firm SunEdison as part of the government’s mega plan to give a further boost to power generation.

This will be the country’s largest grid-connected solar project to be implemented as independent power producer (IPP) project.

According to official sources, the Power Division has already completed negotiations with the US firm’s Singapore-based subsidiary allowing it to set up the plant on build-own-operate basis.

The per-unit cost (each kilowatt hour) of electricity of the project will be $0.17 which is equivalent to Tk 13.26. The plant will be set up on about 1,000 acres of non-agricultural land in the tourist district of Cox’s Bazar.

The state-owned Power Development Board (PDB) will purchase electricity from the project for 20 years on ‘No Electricity, No Payment’ basis which means the project does not need to have any capacity payment guarantee which is an obvious provision for other IPP projects like rental and quick rental plants.

“We’ve already sent our proposal to the Cabinet Purchase Committee for approval. Once it is approved, SunEdison will sign a contract with the PDB and start implementing the project,” said a top official at the Power Division. The Cabinet Purchase Committee has been the highest Cabinet body to approve such projects.

Initially, two locations Teknaf of Cox’s Bazar and Tentulia of Panchagarwere selected for the project. But finally, as per the Prime Minister’s instruction, Teknaf point has been chosen.

Power Division’s joint secretary and convener of the technical negotiation committee of the project Siddique Zobair said the Teknaf land is mostly non-useful for agricultural purpose. That is why the committee has recommended the land for the solar project.

Official sources said the SunEdison, having experience of 2000+MWp solar power project in 25 countries across the world, will implement the Teknaf project on 75:25 debt-equity basis.

The US company has submitted its proposal with financing commitment from the Asian Development Bank and International Finance Corporation (IFC) of the World Bank Group for the project.

Zobair, who is also member (energy efficiency and preservation) of the newly created Sustainable and Renewable Energy Development Authority (Sreda), informed that the government has been negotiating with a number of firms for implementing similar project on BOO basis.

Two firms have offered to generate 20 MWp power from solar energy, he added.

Official sources said the Power Division has processed the SunEdison project under the Speedy Power and Energy Supply (Special Provision) Act in order to implement it in an expediting manner.

According to them, the recent success in power generation under this provision prompted the government to go for implementing such solar IPP projects under an unsolicited offer.

They said the government in the last few months received IPP solar offers from as much as 30 local and international firms to set up grid connected solar projects. But after scrutiny, it finally selected the five firms for negotiation to implement the IPP solar projects.

The sources said total investment of these firms will be between $280-300 million as normally production of each grid connected megawatt solar power needs $1.3-1.5 million while each megawatt of solar power needs about 3.5 acres of land. The private investors will arrange the required lands for their respective projects.

The move for allowing IPP solar plant has been part of the government mega plan on power generation that would reach the total generation to 24,000 MW by 2021, the sources added.

Under the plan, a special emphasis has been given to power generation from non-conventional sources. The plan aims to increase the total solar power generation by 5 percent by 2015 meaning 800 MW and 10 percent by 2020 meaning 2000 MW.

But on the ground level, the progress was very poor as solar power generation could not yet cross the benchmark of 200 MW though it was supposed to reach over 500 MW by 2015.