Adani Power Ltd has yet to resolve its ongoing coal tariff dispute with the Bangladesh Power Development Board (BPDB), a disagreement that directly affects the per-kilowatt-hour cost of electricity from the 1,600MW Jharkhand power plant.
The impasse continued during a virtual meeting held on Monday between BPDB officials and a delegation appointed by Adani’s CEO.
At the meeting, BPDB reiterated its proposal to align coal prices with the model used for the 1,320MW Payra power plant. However, Adani rejected the suggestion, arguing that coal tariffs were already fixed under the existing Power Purchase Agreement (PPA).
Adani Seeks Capacity Revision
Adani also requested a revision of the plant’s dependable capacity, citing results from an April 2025 performance test.
According to the company, the plant’s dependable capacity has increased from 1,396MW to 1,570MW. BPDB responded that such a change would require a supplementary agreement.
Despite the stalemate, both sides agreed to hold a high-level in-person meeting soon, though no date has been set.
“We will sit tomorrow (Tuesday) to review the outcome of today’s meeting,” BPDB Chairman Engr. Rezaul Karim told Just Energy News. “Adani presented their position on coal pricing and other related matters.”
Dispute Over Coal Pricing Methodology
As of May 2025, BPDB estimates its outstanding dues to Adani at $485 million, while Adani claims the amount exceeds $700 million. The discrepancy stems from differing methods of calculating coal tariffs.
BPDB uses the Indonesian Coal Index (ICI3) as its benchmark, while Adani applies a blended index that includes higher-priced Australian coal from Newcastle—reportedly inflating the price by $10–$12 per ton and widening the billing gap.
Legal Experts Lead Adani’s Team
Adani’s negotiation team includes four international legal experts: Prof. Lawrence Boo and Lucy Reed of The Arbitration Chambers, and Toby Landau and Prof. V.K. Rajah of Duxton Hill Chambers, Singapore.
They were appointed under Section 19 of the PPA, which governs dispute resolution procedures.
Late Payment Surcharge & Waiver Talks
Due to payment delays, BPDB has accrued a late payment surcharge of $78.68 million, growing by roughly $6.07 million each month.
During a courtesy meeting on May 23 with Power Division Secretary Farzana Mamtaz, Adani Power CEO S.B. Khylia urged swift resolution, citing financial pressure.
He also followed up on a January proposal to waive around $50 million in surcharges for the January-June 2025 period, expressing concern over BPDB’s lack of response.
Adani has since agreed to waive $12.5 million, while BPDB is seeking an immediate payment of $33 million as a partial settlement.
Government Forms Review Committee
Amid growing scrutiny over the deal, the government has formed a high-level national review committee led by retired Justice Moinul Islam Chowdhury.
The committee is tasked with reviewing the Adani agreement and seven other large-scale power deals that were signed without competitive bidding during the previous Awami League administration.