The International Monetary Fund (IMF) delegation has collected information from the Power Division on rental and quick rental power plants (RPP & QRPP), capacity payments, power purchase procedure from Independent Power Producers (IPP) and ongoing load shedding.
Responding to a query, made in a meeting at the Secretariat on Wednesday, division officials briefed the IMF team on those key details. The IMF however did not make any recommendations on the subject, said Power Division Secretary Md Habibur Rahman.
“The IMF just wants to know the power sector’s current status, and we briefed them about it. They did not make any recommendations, but if there are any, those will be forwarded to the Economic Relations Division (ERD) or the finance ministry,” he added.
Bangladesh has been navigating through a forex crisis, triggered by the unprecedented global energy price hike, and a decrease in remittance earnings. This is why the government is seeking a $4.5 billion loan from the IMF.
A delegation led by IMF mission Chief Rahul Ananda is visiting Dhaka in this regard. The delegation is meeting with various government bodies and making recommendations to reform the banking sectors, lending rates, and power, energy sectors.
According to officials who had attended Wednesday’s meeting, the power division told the IMF team that oil-fired power plants were set up during a period of crisis, and the government had made agreements to shoulder capacity payments.
Power Division officials told the IMF that the government has since withdrawn from previous RPP and QRPP agreements. A new agreement is now in place, which is “no electricity, no payment.”
This means if a RPP or QRPP cannot provide electricity, they will not get any payments.
Officials added that the Power Division has discussed the ongoing load shedding situation with the IMF, and told the team that it is an Energy Division issue. There would be no load shedding if the Energy Division provides an adequate supply of oil and gas for electricity generation.
Insiders further say the IMF delegation had sought information from the Power Division about the renewable energy expansion programme in Bangladesh. The division responded by saying due to the geographical conditions of Bangladesh, the possibility of expanding solar energy on a large scale is quite low.
The IMF delegation is scheduled to have a meeting with Senior Secretary of Energy and Mineral Resources Division Md Mahbub Hossain at 11am on Thursday.
