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The Khulna Power Company and Orion Power have claimed that they received no formal instruction from their supervising body – Bangladesh Power Development Board – to resume power generation in their plants, though the cabinet has recently approved extension of their contract to facilitate uninterrupted power supply from the plants to the national grid.
Responding to queries made by the Dhaka Stock Exchange, the two publicly traded power generation companies came up with the disclosure through separate news filings with the bourse on Sunday.
The power plants run under the Quick Enhancement of Electricity and Energy Supply (Special Provision) (Amendment) Bill, 2010, which requires renewal after every five years.
The cabinet last week gave the final approval to the draft of Quick Enhancement of Electricity and Energy Supply (Special Provision) (Amendment) Bill, 2021, in order to ensure uninterrupted supply of electricity and energy from the private power plants.
According to media reports, the KPCL recently laid off more than a hundred workers citing non-renewal of their agreement with the government.
Later, the DSE served queries to the company on September 8 and asked it to clarify its stance regarding the issue.
In response, the KPCL said that the cabinet decision is an extension of the act, but not a specific decision on extension of Power Purchase Agreement (PPA) with any private company.
“We may consider this as a positive step for private power generation companies. The renewal of PPAs of KPCL’s two power plants (namely KPC Unit II 115MW plant and KPC 40MW Noapara plant) is still under process,” added the company.
The company described the DSE’s assessment based on media reports as irrelevant and said they will contact the government’s concerned body regarding the issue.
Meanwhile, Orion Pharma, which has two power generating subsidiaries, namely Orion Power Meghnaghat Limited and Dutch Bangla Power & Associates Limited, claimed that they were not aware of the extension.
“As per our knowledge and understanding, no such proposal was placed or approved at the cabinet meeting,” it said.
Rather, the company claimed that a vested group is spreading rumors in order to manipulate the share market.
“This news article holds no credibility and we believe that a vested group is spreading such rumors in order to influence the share market of Bangladesh,” it mentioned in the disclosure referring to the media reports on cabinet decision.
However, after the cabinet decision, the share price of KPCL increased more than 15 per cent within two trading days.
Its share price, which was Tk 43.4 on September 6, stood at Tk 50.1 at the Dhaka bourse on September 8. But it went down to Tk 46.9 on Sunday.
On the other hand, the share price of Orion Pharma increased by Tk 1.6 after the cabinet decision. The price, which was Tk 70.3 on September 6, stood at Tk 71.9 the next day. On Sunday, it went down to Tk 70.8
