Bangladesh Power Development Board (BPDB) has incurred a loss of Tk 36.92 billion in five months since March for selling electricity at tariffs lower than the purchase cost from rental, quick rental, independent power plants and power import from India.

“Electricity generation cost depends on fuel cost. But the depreciation of Bangladeshi taka and a fall in the demand for electricity amid the corona crisis have increased the cost of electricity,” state-run BPDB said in a letter to the Power Division at the end of August.
The fixed cost of electricity has increased due to a drop in demand for electricity, hike in gas price and a rise in dollar rate against local currency taka, the letter reads.

BPDB purchases electricity from rentals, quick rental, Independent Power Producers and import from India.

BPDB also spent Tk 1.86 billion for electricity import from India at a higher price despite surplus electricity supply at home due to a sharp fall in demand amid the corona outbreak.

An industrial expert said BPDB imports electricity at Tk 6-7 per unit.

“But the local power producers can produce electricity at a cost of Tk 4-5 per unit if the government doesn’t impose supplementary duties on their fuel import. I think the duty on fuel import for electricity is a conspiracy against local producers,” the expert said on the condition of anonymity.

The power plants of India have been benefited by the decision, he pointed out. “The cost incurred by BPDB has increased further due to the budgetary decision.”
The government has produced around 5000MW of liquid fuel-based electricity on Tuesday due to low pressure on the supply of natural gas.

BPDB Chairman Engineer Md Belayet Hossain said they have been purchasing electricity as per a merit list which has reduced their purchase cost to some extent.   

BPDB has recently received Tk 64.98 billion from the finance division to minimize loss incurred between July and April this year.    

The BPDB has sought another Tk 24.67 billion from the finance division to manage the loss for the trade of electricity at lower tariff between May and July.

BPDB incurred a loss of Tk 80.17 billion last fiscal year due to costly power purchase.

In its letter, the PDB also expressed hope that the electricity generation cost will come down when the nuclear and coal-based power plants come into operations.

BPDB said the country’s electronic generation dropped to 10,000 MW daily an average from average daily generation capacity 23,036 MW amid the corona pandemic.