http://www.thedailystar.net/newDesign/news-details.php?nid=169335
Energy boost forlocal industries
Import duty on furnace oil to go; power producers, industries allowed to import it
Sharier Khan
In a major policy decision, the government is withdrawing import duty on furnace oil to help local industries overcome the on-going energy crisis and resolve their problems on their own.
Private power plant developers and industry operators who will directly benefit from this will also be allowed to import furnace oil to meet their own requirements with permission from Bangladesh Petroleum Corporation (BPC).
All industries, except ship-breaking industry, will be allowed to import duty-free furnace oil for their needs. This is a major incentive, as the duty is now 37.5 percent.
Since furnace oil or Heavy Fuel Oil (HFO) is the cheapest commercially used oil, industries are now expected to solve their own energy problem by using it.
On the other hand, it is one of the most polluting petroleum products.
The prime minister’s energy adviser Towfiq-e-Elahi Chowdhury disclosed the government decision regarding furnace oil while exchanging views with four non-resident Bangladeshi (NRB) energy experts and officials of the Power Division and Power Development Board.
The Daily Star had invited the four NRBs to Dhaka to talk about alternative energy and new technology. The PDB invited them for further sharing of knowledge.
Towfiq said the government decision comes in the wake of various measures taken by it to ease the country’s power crisis. And a Statutory Regulatory Order (SRO) has been framed in this regard.
He also said as in the previous year, the government will again distribute 12 million energy saving lamps for free across the country to discourage use of traditional light bulbs. A traditional 100 watt bulb utilises only five percent of the power it consumes, and its replacement will reduce power demands.
Later, talking to The Daily Star, Chairman of the National Board of Revenue (NBR) Nasiruddin Ahmed said the SRO on the withdrawal of duty is now being printed for gazette notification.
“There is a severe energy crisis in the country, and this will help ease this crisis. It’s true that we will lose some revenue from import. But, as the import (of furnace oil) will increase power generation and industrial production, we expect our overall revenue to increase,” the chairman said.
Meanwhile, large industries like Youngone are seeking this kind of incentive from the government so that they can build their own power plants based on imported furnace oil. They want it even though the cost of furnace oil-based power will be higher than that of gas-based power. “I can tell you that within six months, industries will change the power crisis ” said Captain Sikder Ahmed of Youngone.
Gas supplies have become erratic and no one knows for sure when the government will be able to supply it with appropriate pressure to industries to run their boilers or generators. Salman Karim of Orion Group says, “All our new equipment are ready to consume both gas and furnace oil.”
The decision concerning furnace oil will also help ease storage of imported oil issue. Till now, the BPC imports and stores all kinds of petroleum at its depots. This year the government’s oil import will go up by 1.9 million tonnes just to cater to the needs of diesel and furnace oil- based rental, private and government power projects. Of this additional import, most will be furnace oil. The BPC does not have adequate storage facility for this additional oil.
The government opted for diesel and HFO-based expensive power projects to add around 2,400 megawatt of power by the end of this year. Use of oil will ensure that the ongoing gas crunch will not affect this new power generation.
Other than these power projects, majority of the country’s large industries generate power for their own requirements using natural gas. In the last few years, their power generation was greatly disturbed.
The PDB estimates these industries generate more than 1,000 MW of power, in addition to that on the national grid. But Titas Gas Transmission and Distribution Ltd, which deals with gas supplies for major industries, says these industries generate more than 2,500 MW of power using gas.
Besides, the industries also use natural gas to run their boilers and other generators. Now they will have the option to run those using furnace oil.
However, furnace oil-based production causes heavy pollution which requires the industries or power plants to have their own treatment plants. Otherwise, this will create a new problem for the country, officials noted.
Energy boost forlocal industries
Import duty on furnace oil to go; power producers, industries allowed to import it
Sharier Khan
In a major policy decision, the government is withdrawing import duty on furnace oil to help local industries overcome the on-going energy crisis and resolve their problems on their own.
Private power plant developers and industry operators who will directly benefit from this will also be allowed to import furnace oil to meet their own requirements with permission from Bangladesh Petroleum Corporation (BPC).
All industries, except ship-breaking industry, will be allowed to import duty-free furnace oil for their needs. This is a major incentive, as the duty is now 37.5 percent.
Since furnace oil or Heavy Fuel Oil (HFO) is the cheapest commercially used oil, industries are now expected to solve their own energy problem by using it.
On the other hand, it is one of the most polluting petroleum products.
The prime minister’s energy adviser Towfiq-e-Elahi Chowdhury disclosed the government decision regarding furnace oil while exchanging views with four non-resident Bangladeshi (NRB) energy experts and officials of the Power Division and Power Development Board.
The Daily Star had invited the four NRBs to Dhaka to talk about alternative energy and new technology. The PDB invited them for further sharing of knowledge.
Towfiq said the government decision comes in the wake of various measures taken by it to ease the country’s power crisis. And a Statutory Regulatory Order (SRO) has been framed in this regard.
He also said as in the previous year, the government will again distribute 12 million energy saving lamps for free across the country to discourage use of traditional light bulbs. A traditional 100 watt bulb utilises only five percent of the power it consumes, and its replacement will reduce power demands.
Later, talking to The Daily Star, Chairman of the National Board of Revenue (NBR) Nasiruddin Ahmed said the SRO on the withdrawal of duty is now being printed for gazette notification.
“There is a severe energy crisis in the country, and this will help ease this crisis. It’s true that we will lose some revenue from import. But, as the import (of furnace oil) will increase power generation and industrial production, we expect our overall revenue to increase,” the chairman said.
Meanwhile, large industries like Youngone are seeking this kind of incentive from the government so that they can build their own power plants based on imported furnace oil. They want it even though the cost of furnace oil-based power will be higher than that of gas-based power. “I can tell you that within six months, industries will change the power crisis ” said Captain Sikder Ahmed of Youngone.
Gas supplies have become erratic and no one knows for sure when the government will be able to supply it with appropriate pressure to industries to run their boilers or generators. Salman Karim of Orion Group says, “All our new equipment are ready to consume both gas and furnace oil.”
The decision concerning furnace oil will also help ease storage of imported oil issue. Till now, the BPC imports and stores all kinds of petroleum at its depots. This year the government’s oil import will go up by 1.9 million tonnes just to cater to the needs of diesel and furnace oil- based rental, private and government power projects. Of this additional import, most will be furnace oil. The BPC does not have adequate storage facility for this additional oil.
The government opted for diesel and HFO-based expensive power projects to add around 2,400 megawatt of power by the end of this year. Use of oil will ensure that the ongoing gas crunch will not affect this new power generation.
Other than these power projects, majority of the country’s large industries generate power for their own requirements using natural gas. In the last few years, their power generation was greatly disturbed.
The PDB estimates these industries generate more than 1,000 MW of power, in addition to that on the national grid. But Titas Gas Transmission and Distribution Ltd, which deals with gas supplies for major industries, says these industries generate more than 2,500 MW of power using gas.
Besides, the industries also use natural gas to run their boilers and other generators. Now they will have the option to run those using furnace oil.
However, furnace oil-based production causes heavy pollution which requires the industries or power plants to have their own treatment plants. Otherwise, this will create a new problem for the country, officials noted.
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