The Ministry of Finance has released Tk 1,000 crore to the Bangladesh Power Development Board (BPDB) to help pay its overdue electricity bills.
This fund allocation comes at a time when the Bangladesh Independent Power Producers’ Association (BIPPA) has raised concerns about nearly Tk 16,000 crore in unpaid dues.
“We have received Tk 1,000 crore from the finance division on Monday,” BPDB Chairman Engr Rezaul Karim told Just Energy News. “However, this amount is insignificant given the mounting unpaid bills owed to private power producers and coal suppliers.”
Karim added that BPDB would meet with the finance division next week to request an increase in fund disbursements to address the overdue payments.
BIPPA has urged the government to settle their dues urgently, warning of a severe electricity crisis in the upcoming summer months.
At a press conference on Thursday, BIPPA leaders said the power supply shortfall could reach 2,500–3,000 MW during peak demand if heavy fuel oil (HFO)-based private power producers are unable to import fuel due to non-payment of dues.
Currently, the government owes private power producers approximately Tk 16,000 crore, including Tk 10,000 crore for HFO-based electricity, according to BIPPA.
Payments, which are typically delayed by 60–70 days, have now exceeded 180 days, despite the Power Purchase Agreement (PPA) requiring payment within 30 days.
“Our capital positions have turned negative as we’re not receiving payments on time,” said Imran Karim, BIPPA’s former president. “Without these payments, how can we continue supplying electricity?”
The delay in payments may have far-reaching effects, Karim warned, particularly during the peak electricity demand of Ramadan, which starts in early March, and the Boro harvesting season, beginning mid-March. He emphasized that importing furnace oil typically takes 40–45 days, leaving little time to mitigate the crisis.
Responding to allegations of irregularities among power producers, BIPPA President David Hasanat stated, “It’s unfair to generalize the entire sector. If there are issues, we support proper investigations.”
On the topic of purchasing electricity from India’s Adani Group, Hasanat noted that Adani’s electricity is exempt from tax and VAT, while local producers face over 15% in taxes. “Even with these taxes, our cost per unit is Tk 17.06 compared to Adani’s Tk 17.20. Without the tax burden, our costs would be even lower,” he said.
Imran Karim highlighted the economic toll on private power producers, citing a Tk 5,500 crore loss since late 2022 due to the devaluation of the Bangladeshi Taka against the US Dollar. Additionally, delayed payments from BPDB have resulted in Tk 3,200 crore in interest payments on bank loans.
“Many companies in the sector now have negative equity, and banks are losing confidence in them,” Karim said, urging the formation of a joint task force with the government to address the crisis.
