After nearly three decades, REB no longer prefers wooden poles. But not because wooden poles have become obsolete, costlier or less efficient.

Now the REB purchases only locally manufactured concrete poles which are costlier, less durable and less transportable than the wooden poles. The change is due to relentless pressure from a section of politically powerful businessmen, say well-placed REB sources.

As a result, the REB is spending three times more than necessary to expand its power distribution network.

According to an investigation by The Daily Star, 13 concrete pole manufacturers control REB's pole purchases using political and other types of influence. Their pressure has prevented the REB from purchasing any wooden poles for the last two years, barring one small exception.

These concrete pole manufacturers also influenced the REB to double the purchase of poles in these two yearsmaking the REB Spend more on the poles than ever before.

In the last fiscal, the REB spent around Tk 250 crore to buy four lakhs concrete poles for construction of 16,700 km of distribution lines. The same job could have been done with half the number of wooden poles by spending around only Tk 75 crore to Tk 85 crore, competent sources said.

Each wooden pole has double the strength of a concrete pole, according to different reports of REB.

Only three years ago, the REB purchased two lakh polesboth wooden and concrete poles-- spending around Tk 100 crore.

Before 1994, the REB had not even heard of using concrete poles in electrification. The purchase of concrete poles began after 1996.

Till June 2005, the REB installed 192,000 km of power distribution lines, purchasing a total of 17 lakh wooden poles from 1977 till 2003. These can cover 1.70 lakh km of distribution lines.

Between 1996-2005, the REB also bought 15 lakh concrete poles covering 75,000 km, official data shows. A part of both these types of poles have not yet been installed.

The present trend shows an increasing number of concrete pole coverage, increased spending and comparatively lower power distribution coverage. This has happened because the concrete pole manufacturers have established a monopoly by influencing the REB to change its purchase policy.

Both the government and donors fund the REB's pole purchases. When donors fund pole purchases, via international tenders, they insist upon wider participation, which keeps the door open for wooden pole purchases. But the concrete pole manufacturers do not view such international bids as 'cash cows'. Their influence stopped the REB from floating such bids from 2003. All present bids are now locally funded, giving donors no say in these deals.

In any international tenders floated till 2003, concrete pole manufacturers would quote their price close to that of wooden poles. In an international bid in 2003, concrete pole makers quoted 100 dollars for a particular size of concrete pole to compete with the wooden poles, which would cost around 100 dollars each. But at the same time, when REB floated a local restricted tender (which barred wooden poles), the concrete pole manufacturers quoted 300 dollars for each pole.

"The REB never had any requirement for concrete poles. But today its timbre department and specialists are sitting idle because REB is now buying something it never needed," an official commented.

Concrete poles vs. Wooden poles
According to a REB expert, the wooden poles have 10 main advantages over both concrete and steel poles. These include: highest shockproof capability, highest degree of non-corrosiveness, highest strength, easiest and cheapest handling, installation, line construction, replacement, renewability, maintainability etc.

These advantages led a REB committee in 2000 to recommended that wooden poles should be installed for 60 to 71 percent of all installed poles. The committee noted that in low lying areas, concrete poles can not be installed because it is it is costly and difficult to transport or install.

"To install power distribution in one kilometre area using the wooden poles, REB needs to spend maximum Tk 4 lakh. The same job needs between Tk 7 lakh to Tk 8 lakhs if concrete poles are used", quips the expert.

Performance-wise concrete poles tend to break down for reasons including design flaws and use of low quality materials. On the other hand, most of the wooden poles installed in the late seventies are still serving.

In March this year, REB concluded through its own investigation of dozens of damaged concrete poles in Netrokona that the manufacturer had cheated them. Investigators found fewer rods than required inside the broken poles, as well as a lower ratio of cement.

How the business group controls the poles purchase
According to a number of officials and businessmen interviewed by The Daily Star, a group of 13 contractors submit bids to the REB after reaching an understanding among themselves. They share the contracts on the basis of their own powers and status. The prices quoted in these bids have little difference. As a result, the price of the concrete poles, which are supposed to be low due to competition, is never low.

A businessman who leads this unofficial manufacturers group, takes more than 30 percent of total poles purchase tenders.

Another concrete pole manufacturing company led by a group of ruling party leadersincluding a very powerful young politician, his close friend and a state ministerdraw a major share in the concrete pole deals, taking another 20- 25 percent of the business, a senior REB official said on condition of anonymity.

"Competition is supposed to keep price low. But when the competition is arranged, you can not expect lower price," notes a REB source. "Last year, there was a misunderstanding among these companies and suddenly in one of the bids, the price of poles quoted by a bidder was half the price they usually quote. After that incident the feuding companies patched up and the prices in the next bid shot up again."

Again, the group was taken aback last year when a new bidderDada Groupparticipated in a bid and quoted a price 50 percent lower than the consortium members' prices. To stop Dada Group from securing any deal, the nexus resorted to court injunction. Finally, to make sure outsiders cannot bag the REB money for the poles, they made the REB dictate a contractor's criteria stipulating at least two years experience in making and installing such poles.

The REB last month floated a tender for procuring 3500 "training poles" which was open for wooden poles suppliers also after two years. The Palli Bidyut Samities (PBSs) use training poles to train their technicians to work on distribution lines.

In this tender, a bidder submitted a suspiciously low price offer of Tk 2500 for each wooden pole while the same bidder has offered Tk 15,000 per concrete pole of same specifications. The REB has not finalised the bid yet.

How it started
"In the mid-nineties, in the wake of concerns on arsenic contamination of underground water, a powerful businessman fed a news in the state-owned news agency saying that the REB's wooden poles are treated by arsenic and this arsenic is contaminating the underground water," says a REB source. This businessman was trying to sell his concrete poles to REB from 1994but REB refused.

After this report made headlines in 19 dailies, the REB held a press conference to clarify that the wooden poles are indeed treated with arsenic among other chemicals, but that has nothing to do with water contamination.

But under relentless pressure from the businessman, the REB formed an expert committee to see if the wooden poles indeed affects the water. "The committee found no truth in that story," says a REB high official. "However at this point, the government asked the REB to purchase some concrete poles to stop the businessman from campaigning further."

Again since there was no other concrete poles manufacturer, the businessmanin addition to his original manufacturing company-- made three more companies just to make the REB bids on concrete poles look competitive. These four companies are now helping him bag around 30 percent of the business in poles.

An official of the REB's procurement division noted, "in technical terms, there is no bid manipulation. We know one person owns four companies. But these companies have four distinctive boards, four separate tax identification numbers. Legally they are separate entities and therefore they are not manipulating the bid."

After the change of government in 2001, there was serious competition. The number of manufacturing companies reached 13. While there were some competition at the outset, these companies soon realised that far more money can be made if they collaborated with each other, rather than competing.

Meanwhile, as high cost differences with wooden poles put the concrete poles manufacturers at a disadvantage, the business group pushed the idea of making lighter concrete polesusing lesser construction materials that cut the cost.

To legitimise this move, the group made the REB undertake a study in 2003 with some BUET teachers. The BUET group recommended thinner concrete poles for REB's use, but said the number of the poles per-kilometre would have to be increased.

The BUET group suggested that instead of 16 original size concrete poles per kilometre, the REB may use 24 thinner poles. This recommendation helped bidders reduce the price of each concrete pole, but did not decrease the REB's total expenditure.

What the authorities say
REB Chairman Helal uz Zaman declined to speak officially on the issue, terming the matter a "sensitive one". No REB official would speak officially on the matter. All say the purchases are decided by the ministry.

State Minister for Power Iqbal Hasan Mahmud on the other hand says, "All of the purchases are following the Public Procurement Regulation, 2003. The concrete poles are cheaper."

When asked about the syndicate of contractors, Mahmud told The Daily Star over the phone last month, "Once it used to be a monopoly of one companynow there is competition."

The REB has 70 palli biddit samities (PBS), most of which run on losses. However, a few of them make enough profit to keep the REB system looking functional. The REB's annual earnings stand at Tk 2240 crore with an outstanding bill of Tk 334 crore.