Power Deficit drives Rental Power in Pakistan and Bangladesh

A large power deficit has been the driving force behind the rental power market in Pakistan and Bangladesh. Bangladesh is running rental power plants for reducing its deficit until its base load, i.e. permanent power plants, come into existence in 2020. However, a few rental power plants will serve for a longer duration and will likely be around until 2025. Pakistan also had these rental power plants, but corruption in distributing generation licenses by the government resulted in their closure in 2012. Those plants are now in the process of revival and will serve the nation again. Two plants have already been given licenses by the National Electric Power Regulatory Authority (NEPRA) of Pakistan. Currently, Pakistan has a huge deficit of 5 GW, and this deficit has been driving companies to provide rental power to end-users directly (i.e. industries, commercial, events, and residential, among others). Bangladesh’s end-user driven power rental market also relies on the power deficit, though not to the same extent as in Pakistan. Bangladesh’s rental power plants reduce deficit to a large extent.

Many of the rental power plants in Bangladesh were supposed to close down around 2013-14. However, the country’s power deficit and delay in commissioning of its base load power stations has resulted in extension of rental power plant operations. This extension is a positive indicator for companies invested in these power plants, however, it is not very good for the nation’s economy, as large scale power rental is a heavy burden on the country’s treasury. There has been increasing demand to close these rental power plants, but the country’s power deficit and a lack of adequate permanent power generation capacity have left rental power a necessary solution.

Concerning rental power, India cannot be left out of the discussion. The market in India is still evolving, is unorganized, competitive and price sensitive. There is a presence of several regional and local companies. Large companies making up a sizable market due to the clear focus of market segment they wish to target.

To learn more about these markets, you can review our report titled the ‘Indian Subcontinent Power Rental Market’. For more reports on the power rental market, you can visit http://www.verifymarkets.com/collections.  Or, email us at info@verifymarkets.com.

By Verify Markets | | Trends & Insights | 0 comments
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