BPDB to pay extra Tk 6000cr to power producers

Staff Reporter :
Private power producers are getting additional Tk6000 cr due to excessive delay in receiving bills, sources said.

State-owned Bangladesh Power Development Board (BPDB) is paying this extra payment to the heavy fuel oil (HFO) based private power producers.
BPDB officials said that the decision of extra payments has been taken after getting the request from the private power plant operators organisation- Bangladesh Independent Power Producers Association (BIPPA).

The BIPPA leaders made the request as per the provision of the power purchase agreements signed with the BPDB.

According to the agreement, the private power producers should receive the payment against purchase of electricity within maximum 45 days.
The BIPPA leaders said that their payments have been delayed and remain pending for about five months.

They said that the private power producers received the last payments against partial bills of October last year.

Sources said that the country’s 55 per cent electricity comes from private producers which the BPDB purchases under the power purchase agreement.
The BPDB’s outstanding payment stayed at Tk 20,000 to 25,000 crore for more than a year.

In this circumstance, the government raised electricity tariff a number of times in the last five months to ease the crisis. But no significant improvement has been made in this regard because of the recent dollar crisis, officials said.

They said that most private banks showed reluctant opening any letter of credit to import fuel or spare parts while Bangladesh Bank is also found to be reluctant in allowing banks to open fresh LC for any import.

Banks are also charging interest against any default in the loan repayment.

Amidst this, the BIPPA initially wrote a number of letters to the BPDB and Power Division to clear their outstanding bills to facilitate the private power producers to import fuel, lube oil, spare parts and repayment of bank loans.

But finding no major progress in this regard, the BIPPA finally requested the BPDB to suspend the counting of liquidity damage against the ‘excess outage by the private power producers’ from May 2022.

In this situation, the BPDB has decided to pay the extra additional bill to the private power producers as per the agreement.