Private power plants demand dues to boost oil-based generation

To address ongoing gas shortages in Bangladesh, the government has sought to increase electricity production from oil-fired power plants. However, owners of private power plants have stated that they will only ramp up generation if their long-standing financial arrears are cleared by the authorities.

According to the Bangladesh Independent Power Producer Association (BIPPA), the state-run Power Development Board (PDB) owes approximately 10 billion taka to private power producers. David Hasnat noted that the PDB has requested nearly 4,000 megawatts of electricity from them, while current generation from private furnace oil-based plants stands at about 2,600 megawatts. Hasnat added that clearing the overdue payments would enable producers to increase output by another 2,500 megawatts.

Hasnat further explained that while the government may not be able to clear the entire amount in a single payment, paying off the balance while keeping at least two months of bills pending would allow plant owners to open new letters of credit to import fuel oil. This financial arrangement would make it possible to operate the generation units at enhanced capacities across the country.

Energy expert M. Tamim emphasized that the current crisis requires the government to simultaneously maintain stable electricity supplies and provide gas to industries. In this challenging situation, running oil-based power plants could serve as an immediate necessity, thereby creating an opportunity to slightly increase gas allocations for industrial sectors.

Meanwhile, Imran Karim pointed out that private power facilities are not only owed regular electricity bills but are also dealing with liquidated damages or fines imposed by the PDB, issues that require a proper resolution. Karim affirmed that the private plants remain fully prepared to supply electricity to the national grid, provided that the necessary funds for purchasing fuel are adequately arranged.