Almost all overdue payments to IPPs cleared

Govt still owes Tk 35 billion


M AZIZUR RAHMAN | Published: July 09, 2025 00:00:11


Almost all overdue payments to IPPs cleared


The interim government has cleared almost all the overdue payments to privately-owned power plants to ensure increased electricity supply from such plants in the future.
The payment backlog to privately owned power plants now stands only at around Tk35billion, only around 14 per cent of the all-time high overdue payments worth Tk250 billion a couple of years back, said sources.
"Currently the bill is outstanding for 70 days, which once rose as high as 270 days," President of the Bangladesh Independent Power Producers Association (BIPPA) David Hasanat told The Financial Express on Monday.
"We are happy with the BPDB's approach of clearing the long pending outstanding payments," he said.
The entire overdue payments will come down to within the stipulated 45 day payment timeline as per the power purchase agreements (PPAs) of the BPDB with the power plant owners, Mr Hasnat hoped.
With the outstanding bill cleared, the BPDB will have an edge of having electricity from the privately owned power plants whenever needed, he said.
It means that the privately owned power plants will have to be readied to supply necessary electricity as per the BPDB's requirement, whenever needed, he said.
Otherwise the power plant owners will have to pay -- liquidity damage (LD) - as penalty, said the BIPPA president.
The BPDB has cleared the outstanding payments with subsidy from the government, said BPDB Chairman Md Rezaul Karim.
Sources said the interim government paid almost all the overdue payments to the privately owned power plants in line with its approach of clearing the outstanding payments to all the energy suppliers including the international oil companies (IOCs).
The interim government has paid around US$2.16 billion to the energy companies and suppliers over the past several months giving a positive signal to international energy suppliers, they said.
Of the US$ 2.16 billion, around $600 million was paid to liquefied natural gas (LNG) suppliers, $570 million to petroleum product suppliers, $280 million to US's Chevron Bangladesh and around $710 million to India's Adani Group, they added.
With the payment cleared, state-run Petrobangla is being able to purchase LNG at competitive prices from international market.
Many international LNG suppliers are queuing up to supply LNG under both short-term and long-term contracts, a senior Petrobangla official said.
LNG supply has increased and re-gasification is hovering above 1,000 million cubic feet per day (mmcfd), close to the country's maximum LNG re-gasification capacity of 1,100 mmcfd, according to official data of Petrobangla.
Riding on increased payments from Petrobangla and the BPDB, Bangladesh has been passing almost load-shedding-free summer for the first time of last several years.
Power generation from coal, gas and high sulfur fuel oil (HSFO)-fired plants along with imports contributed for increased electricity generation.
Power supply during the ongoing summer has been well-managed as well, sector insiders said.
Officials said most of the privately owned power plants were awarded to the project sponsors sector under the already revoked Quick Enhancement of Electricity and Energy Supply (Special Provision) Act 2010 (Amended 2021).
According to power sector officials, the country's peak electricity demand during the ongoing summer was expected at around 18,000 MW.
But the highest electricity generation during the ongoing summer was recorded at 16,603 MW on May 10, 2025.
Currently, Bangladesh's overall electricity generation is hovering between 12,600MW and 14,800MW during day and evening peak hours.

azizjst@yahoo.com

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