Adani Electricity
Export to Bangladesh Faces Payment Issues
·
In
$1-billion Exports to Bangladesh, Adani Power Occupies 9.3% Share
·
Govt
now amends rules to allow the Adani Group plant to also sell in India
·
2018
Ministry of Power regulation for ‘import/export (cross border) of electricity’,
made through an office memorandum dated August 12, came less than a week after
Sheikh Hasina flew to New Delhi in the wake of spiralling protests.
·
Connection
of such generating station to the Indian grid to facilitate sale of power
within India in case of sustained non-scheduling of full or part capacity” and
clears the decks for the sale of power domestically if there is a delay in
payments.
·
Four
companies currently exporting electricity to Bangladesh: two power traders NTPC
Vidyut Vyapar Nigam Ltd (NVVN) and PTC India Ltd, and
two generating units of Sembcorp Energy India Ltd and Adani Power.
·
Electricity
exports, at over 90 per cent, comes from a single plant: the coal-fired plant
located at village Motia in Jharkhand.
·
In
the last financial year, the exports of diesel came in second at $829.59
million (7.5 per cent of total exports) while cotton was third at $595.81
million (5.38 per cent).
The
Only power plant in India contracted to export its entire output to Bangladesh,
but now allowed to sell in India, accounts for a bulk of $ 1 billion of power
exports in 2023-24.
With
electricity exports surging, power accounted for 9.3 per cent or over $1
billion of India’s total exports ($11 billion) to Bangladesh in 2023-24, up
from a little over 3 per cent two years ago ($498 million).
Following
uncertainty in Bangladesh after Prime Minister Sheikh Hasina fled Dhaka to
India, a new interim government is in place. But New Delhi recently amended its
power export rules to derisk the only plant,
belonging to the Adani Group, in India that is currently contracted to export
its entire output from its 1,600 MW (mega watt) plant
in Jharkhand to Bangladesh.
As
per records available with the Kolkata-based Eastern Regional Power Committee
(ERPC), the APJL’s Godda plant exported at least
7,508 million units (MU) of power — or 63 per cent of the total exports
11,933.83 million units— to Bangladesh in April-March of 2023-24.
The
move to amend a 2018 Ministry of Power regulation for
‘import/export (cross border) of electricity’, made through an office
memorandum dated August 12, came less than a week after Sheikh Hasina flew to
New Delhi in the wake of spiralling protests. The amended regulation
pertains to generation utilities supplying electricity “exclusively to a
neighbouring country” and the tweak is essentially aimed at derisking
plants such as Adani’s unit in Jharkhand’s Godda
district. It states that the “Government of India may permit connection of such generating station to the Indian grid
to facilitate sale of power within India in case of sustained non-scheduling of
full or part capacity” and clears the decks for the sale of power domestically
if there is a delay in payments.
Adani
Power, however, said Thursday it was committed to supplying electricity to
Bangladesh, and that the recent amendment to power export rules does not affect
its existing contract.
There
are four companies currently exporting electricity to
Bangladesh: two power traders NTPC Vidyut Vyapar Nigam Ltd (NVVN) and PTC India Ltd, and two generating units of
Sembcorp Energy India Ltd and Adani Power. The majority of these electricity
exports, at over 90 per cent, comes from a single plant: the coal-fired plant
located at village Motia in Jharkhand Godda district that is operated by Adani Power (Jharkhand)
Ltd (APJL). Bangladesh had contracted to buy 100 per cent electricity produced
by AJPL’s Godda plant, which was declared an SEZ
(Special Economic Zone) by the Centre in March 2019 and uses 100 per cent
imported coal to produce power.
According
to trade data available on the Department of Commerce portal, from April 2023 to
March 2024, India exported 11,933.83 million units (MU) of power worth $1.03
billion — 9.3 per cent of total exports of $11.06 billion — to the neighbouring
country. In the last financial year, the exports of diesel came in second at
$829.59 million (7.5 per cent of total exports) while cotton was third at
$595.81 million (5.38 per cent).
In
2022-23, power exports to Bangladesh stood at $1.075 billion or 8.8 per cent of
the total export volume of $12.21 billion. The value of cotton exports in
2022-2023 was $495.97 million (4 per cent), and $423.03 million (3.46 per cent)
for diesel.
In
the fiscal before that, cotton was at the top, the most-exported item by value
exported to Bangladesh, at $1.58 billion (10 per cent of total value of $16.15
billion). It was followed by $1.18 billion (7.36 per cent) for wheat, while
power, with exports worth $498.25 million (3 per cent), stood at the sixth
spot.
Adani’s
Godda plant started operating two years ago and
became fully operational in June last year. All the power generated by the
1,600-MW plant (comprising two 800 MW supercritical units commissioned in April
and July 2023) is wheeled to Bangladesh.
The
APJL’s monthly share in power exports to Bangladesh has been surging over
recent months. In January and February this year, the ERPC data show, the Godda plant’s share was over 90 per cent of the total
electricity exported to Bangladesh. In March, it accounted for 75 per cent of
the total electricity exported to Bangladesh.