GODDA PROJECT (Syllabus: GS Paper 2 – IR)

Context: To mitigate political risks in Bangladesh, Indian power exporters can reroute their output to Indian grids in case of payment delays from partner countries. Adani Power’s plant in Godda (Jharkhand) supplies all its generated power to Bangladesh.

Godda Project

• About: It is a power supply initiative managed by Adani Power's Jharkhand subsidiary.
• Power Capacity: The project has a net capacity of 1,496 megawatts, which is supplied to Bangladesh.
• Power Purchase Agreement (PPA): This supply is facilitated under a PPA with the Bangladesh Power Development Board (BPDB), signed in November 2017 for 25 years.
• Transnational Power Supply: The Godda plant is India's first power project that exclusively supplies electricity to another nation.
• Impact on Bangladesh: The electricity from Godda is expected to positively impact Bangladesh by replacing more expensive power generated using liquid fuel.
• Contribution to Bangladesh's Power Capacity: As of June 2023, Bangladesh's total installed generation capacity was 24,911 MW, with 2,656 MW imported from India. The Godda plant contributes 1,496 MW, about 6% of Bangladesh's total power capacity.

Export Rules Amendment

• Expanded Market Access: New rules permit electricity producers who export power to also sell in the domestic market, providing flexibility in case of drops in offtake or payment defaults.
• Impact on Export-Dependent Plants: The amendment is particularly beneficial for plants like Adani Power's 1.6-gigawatt Godda plant in Jharkhand, which exports electricity to Bangladesh, allowing for potential domestic sales if export demand decreases.
• Mitigation of Payment Risks: Producers facing consistent payment defaults or reduced demand from export markets can now rely on domestic sales to stabilize revenue and operations.