17th February 2021
EP Report

Bangladesh Power Development Board (BPDB) has incurred a loss of Tk 45.66 billion in first half of the current fiscal for selling power at tariffs lower than purchasing cost.


The government incurred a loss of Tk 2.49 per unit of electricity after purchasing it at Tk 5.17 for payment of 2,847,454,966kw power from private producers.


The government purchases power from rental, quick rental, independent power plants alongside importing power from India.


Rationing in supply of natural gas to gas-fired power plants from October, 2020 will also push the electricity production from costly oil-based power plants. It also increased the loss in first six month of the current fiscal year.


The government has cut LNG import due to rise in LNG price in the international market. The government is expected to resume the supply of natural gas from March subject to normalcy of spot market.  


Besides, capacity payment of the private power plants also ate up the subsidy significantly.


“Electricity generation cost depends on fuel cost. But the depreciation of Bangladeshi taka against US dollar and a fall of power demand amid corona crisis has increased the cost of electricity,” state-run BPDB said in a letter to the Power Division on January 19, 2021.


The fixed cost of electricity has increased due to hike in gas price, the letter reads.

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