Term Paper

Topics: Productivity, Politics of Bangladesh, Utility cooperative Pages: 13 (3273 words) Published: April 22, 2013


Dhaka Electric Supply Company (DESCO) has been a trendsetter in Bangladesh electric supply company since its inception since incorporated under the company act in 1994. Over the last decade DESCO actually rose to a new standard – moving beyond electric supply co. to win mindshare of clients, users, shareholders, business partners and communities where we work and live. DESCO was constituted to provide uninterrupted & stable power supply, better consumer service, improve system loss & C. ratio and accordingly DESCO starting its operational activity since September 24, 1998 by taking over of Mirpur area from DESA. Our dedication to add more value to the common wealth of the society compounded by innovative strategies for growth and diversification.

Dhaka Electric Supply Company (DESCO) which will initially take over part of the distribution network of DESA and ultimately take over all its assets. The formation of this company is seen as an essential step towards “corporatization and commercialization" of the sector and to reduce the excessive inefficiently in the distribution network in the capital. With the economy performing very well during 1992-95, the demand for electricity grew substantially. Constrained by the paucity of its resources, the Government decided to allow private sector participation in the power sector. Faced with a grim possibility of serious electricity shortages during the next few years and to enable the sector to be financially self-sustaining and also attract private capital, the cabinet approved in principle, the inter-ministerial committee report named "Power Sector Reforms in Bangladesh (PSRB)", in September 1994.

1.1 Company Overview

1.1.1 History of the Company

The electricity supply industry in South Asia started with the commissioning of the first power station in the 1890s. Although a number on small stations were constructed over the next 20 years, these stations were isolated, catering to small distribution networks serving the major urban centers.

The first effort to structure a legal framework for the industry came in 1910 with the enactment of the Indian Electricity Act, 1910. This Act sought to regulate the business of industry still based on the old concept of isolated privately owned distribution networks fed by small generation stations & essentially defined the rights & obligations of the supplier and the consumer.

In 1947, at the time of independence of India & Pakistan, the installed generating capacity in the then East Pakistan was only 21 MW. Electricity was available to only small elite in the district and sub-divisional headquarters. The distribution networks in these cities were isolated and were fed by coal fired steam power plants or diesel generation. In an effort to expeditiously augment generation capacity to feed a development economy, the then Government of Pakistan issued and ordinance in 1959 creating the East Pakistan Water and Power Development Authority (EWAPDA). The Ordinance essentially provided for the Governments takeover of all generation, Transmission and distribution facilities from the private sector, thereby creating a total Government monopoly in the sector. During 1960 to 1970 the generation capacity of the then East Pakistan rose from 88MW to 475 MW, supplied largely by natural gas and oil fired, steam power and hydro plants. The networks of Dhaka and Chittagong and then been interconnected albeit with weak 132 KV links.

Shortly after the creation of an independent Bangladesh, in 1972, the first Government of Bangladesh, in an effort to speed up the investment in the sector issued an Ordinance creating the Bangladesh Power Development Board (BPDB) as the successor organization of the power side of EWAPDA. The Ordinance recognized the divergence of energy related issues in development. During 1972 to 1995, BPDB has increased the generating...
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