The Power Division, operating under the Ministry of Power, Energy and Mineral Resources, has requested a substantial sum of $5.921 billion to ensure uninterrupted electricity supply for the 2023-24 fiscal year.
The sought-after funds are earmarked for diverse expenditures, including the purchase of electricity from Rental, Quick Rental, and Independent Power Producers (IPPs), as well as for electricity imports from India, power generated from 1000 diesel-based plants, repayment of Export Credit Agency (ECA) funded projects, and payments for long-term service agreement (LTSA) based power plants in the public sector.
According to official sources, there are outstanding arrears amounting to $475 million for electricity imports in the current fiscal year (2022-23). The Power Division anticipates needing an additional $1,755.24 million in the next fiscal year to maintain electricity imports. These costs may fluctuate depending on the global fuel market.
In addition, the arrears of IPPs and rental power plants have been reduced to $890 million from $1.8 billion. An estimated additional $253 million will be required in the next fiscal year for IPPs and rental power.
Moreover, the Bangladesh Power Development Board (BPDB) currently owes $180 million to the 1320MW Payra power plant and an additional $40 million to the Rampal power plant, mainly for coal imports. The cumulative figure stands at $573.46 million in the current fiscal year, and BPDB will need approximately $1,513.09 million to obtain full-load electricity from these coal-fired power projects, which are joint ventures. One of the projects is halted due to a coal crisis, while the other has experienced significant production declines.
Furthermore, there is an outstanding debt of $161.83 million for producing electricity from costly, diesel-fired power plants, with the per-kilowatt tariff being Tk 36.43, of which Tk 18.31 is the fuel cost.
Additionally, BPDB has not repaid $73.20 million under ECA-funded projects, and another $146.40 million will be needed for payment in the next fiscal year.
Payments for BPDB’s power plants also remain unpaid at $14.04 million for this fiscal year, with an expected payment of $28.08 million due next year.
Power Division Senior Secretary Md Habibur Rahman, in a conversation with the Daily Sun, mentioned that approximately $4 billion will be needed by January 2024 to ensure uninterrupted power.
“We will present our fund requirement before Prime Minister Sheikh Hasina. State Minister for Power and Energy Nasrul Hamid will also be present during the presentation,” he stated.
Furthermore, Bangladesh Independent Power Producers Association (BIPPA) recently disclosed that they are still awaiting Tk 180 billion in arrears. BIPPA President Faisal Khan has urged the government to settle these payments for the survival of private power producers.
There are also reports of local power plants facing challenges due to currency fluctuations and delayed payments.
Energypac’s EPV Thakurgaon Limited has transferred 51 percent of its shares to Dubai-based EMA Services Private Limited Bangladesh for survival, and more local power plants are considering similar measures.
[source: Daily Sun]
