Fund crisis may close more power plants

After the closure of Payra Power Plants due to the lack of dollars to buy coal for power generation, several more power plants are in the face of shut down due to the same reason of fund crisis.

The dollar crisis has reached such an extent that out of the country’s 153 power plants, 29 have already been shut down and 65 are generating half of their capacity due to the government’s inability to buy the fuel required for electricity generation, said senior officials of Bangladesh Power Development Board (BPDB).

The BPDB officials apprehended the closure of more power plants in the near future if the government cannot ensure USD supply for fuel import quickly.

However, BPDB is now planning to increase generation at India’s Adani Group’s power plant and Chattogram’s SS Power Plant to meet the electricity deficit.

BPDB’s Generation Department said that currently 748MW of electricity is available from the first unit of Adani’s Jharkhand Power Plant. The second unit was supposed to supply another 748MW this June. But it is not possible as the substation is not fully operational and the commissioning is being delayed.

Adani Group supplied an additional 300MW from the second unit for three days this week during the commissioning phase. Now it is closed. It is expected to start electricity supply from next Saturday or Sunday.

On the other hand, another 400MW of electricity will be added to the national grid from the 1,320 MW SS power plant at Banshkhali upazila in Chattagram, BPDB sources said.

On condition of anonymity, a senior BPDB official told The Business Post, “The banks are unable to provide USD for opening LC (letter of credit). The situation is getting complicated. If the intensity of heat does not decrease, the power outage may worsen further in the coming days.”

“We are trying our best to keep the electricity supply normal. Financing is not the responsibility of PDB alone. The Ministry of Finance and Bangladesh Bank have a big role here. So, PDB cannot do anything alone,” BPDB Member (Generation) SM Wazed Ali Sardar told this correspondent.

Meanwhile, State Minister for Power, Energy and Mineral Resources Nasrul Hamid fulfilled his responsibility by expressing regret for the frequent power cuts amid the intense heat wave and telling the country’s people to have patience.

According to BPDB, the country’s total power generation capacity is 22,500MW against a demand of 16,500MW.

But, due to the energy shortage, electricity is now being produced at least 3500MW less than the demand, resulting in frequent load-shedding all across the country.

In addition to massive disruption in industrial production, the severe power cut is immensely hampering the daily life of people amid the ongoing unbearable heat wave.

The country’s largest power plant Payra was shut down on Monday due to a coal shortage, increasing the power outages at an alarming rate. The Chinese partner of the Payra power plant, the CMC, suspended the coal supply to BPDB as it owes $300 million.

After commissioning in December last, the first unit of the Rampal power plant has already been shut down twice due to coal shortage and once due to technical failure.

“We have only seven days of coal reserve. A coal-carrying ship is scheduled to reach Chattogram by this week. Due to coal shortage, less electricity is being produced,” said Syed Akram Ullah, managing director of Bangladesh-India Friendship Power Company Limited (BIFPCL), the owner of the Rampal power plant.

The power generation capacity of the plant’s first unit is 600MW but due to the coal shortage, it is now supplying 400MW.

Earlier, a 307MW power plant in Barishal was closed for almost two months due to a coal shortage.

Meanwhile, power generation at the private power plants, which already owe $2 billion to the BPDB, has also halved. Owners of private plants have warned that their plants will shut down soon if the dues are not cleared immediately.

BPDB sources said they are not able to pay bills to private owners due to the dilly-dallying of the Finance Division in providing funds. Apart from quick payment of outstanding bills, they have demanded around Tk 6,000 crore in interest.

Imran Karim, former president of the Bangladesh Independent Power Producers Association (BIPPA), said, “We have our own limitation and it has reached the maximum level. I heard that the government will give some money worth Tk 500-1000 crore. But it is almost nothing to our requirement. At least Tk 5,000 crore is required.”

“The ongoing crisis is not electricity; it is a crisis of energy,” said Professor Dr Badrul Imam, Department of Geology, University of Dhaka.

“There is coal in the global market, but we cannot buy it due to the lack of sufficient dollars. There is no immediate solution to the overall crisis. However, USD should be released quickly for the time being to get rid of load shedding,” he added.