Power board faces financial crisis
Its fund mobilisation has fallen drastically following a collapse in electricity sales and revenue collection due to the countrywide shutdown over the coronavirus pandemic
Bangladesh Power Development Board (BPDB), the state agency responsible for buying electricity from private plants and selling it to distribution companies, is in a financial crisis.
Its fund mobilisation has fallen drastically following a collapse in electricity sales and revenue collection due to the countrywide shutdown over the coronavirus pandemic.
The BPDB has already discussed the matter with private power producers and the power ministry, and has asked them to consider the circumstances.
"A financial shortage was anticipated in the current situation. Knowing that, as our longtime partners, we have urged them to cooperate with us in such a crisis period," said Engineer Md Belayet Hossain, chairman of BPDB.
The BPDB purchases electricity from independent power producers (IPP) and rental and quick rental plants, and sells it to power distribution companies.
It pays the power producers after collecting revenue from distribution companies. The payment includes the cost of energy and the infrastructure cost, which is fixed and is called capacity cost.
However, the private power plants have not been paid since January, said a source at the power division.
Sources said that the BPDB buys electricity worth around Tk1,500-1,600 crore from 69 IPPs and 19 rental plants every month.
But payment has been delayed as electricity sales have dropped considerably because of the closure of industries and businesses amid the countrywide shutdown.
Power distribution companies cannot collect revenue from consumers, and that is why they are unable to pay the energy bill to the BPDB.
The Bangladesh Rural Electrification Board (BREB) is the largest distribution company, which takes half of the country's total electricity production.
In normal times it sells 5,500-6,000 megawatts of electricity each day, and collects revenue worth Tk2,000 crore each month.
But it has not received 80 percent of the payments for electricity that was consumed in March.
"We are sending bills to consumers and requesting them to pay. But due to the situation, customers are not going out to deposit the money," said Major General Moin Uddin (retd), chairman of BREB.
Meanwhile, due to the nationwide shutdown and general holidays, the daily demand for power in the company's distribution areas has dropped to 3,500-4,000 megawatts.
It is not only rural power distribution, five other distribution companies face the same problem.
The Dhaka Power Distribution Company Ltd (DPDC) is responsible for supplying electricity to some parts of Dhaka and Narayanganj cities.
The company supplies 14.13 percent of the country's total electricity in its distribution area.
At this time in previous years, the company used to sell electricity worth Tk400-450 crore monthly.
But this month it did not receive more than Tk70 crore against the bills for the month of March.
"The revenue collection situation is very poor this month. Only 15 percent of the bills have been received," said Engineer Bikash Dewan, managing director of DPDC.
The Dhaka Electric Supply Company Ltd (Desco) is another big distribution company which supplies electricity to Dhaka City and to Tongi.
In March, it supplied electricity worth Tk300 crore. But the company received only 10 percent of the bills till April 20.
"We have a record of hundred percent bill collection. But we have received only 10 percent of the total bills for the month of March," said Md Kausar Ameer Ali, managing director of Desco.
"It will become difficult for us if the situation continues for another month," he added.
Currently, the country has the capacity to generate 19,633 megawatts (excluding captive power) of electricity from 136 plants. Out of this, more than 50 percent comes from IPPs and rental plants.
