Dhaka: Energy affairs adviser Dr. Muhammad Fouzul Kabir Khan has announced that the interim government is making continuous efforts to ensure a smooth power supply at an affordable cost by implementing new measures and revising existing systems. The adviser for the Power, Energy, and Mineral Resources ministry shared this during an interview with BSS, marking the first anniversary of the July anniversary.
According to Bangladesh Sangbad Sangstha, the government is actively working to maintain a stable power supply across the country at reasonable rates. Since taking office, the current administration has initiated several programs to enhance the cost-effectiveness of power and energy production and supply systems. One significant step has been the review and modification of contracts with Independent Power Producers (IPPs) to remove capacity payment clauses, which previously required payments for plant capacity even when no electricity was supplied to the national grid.
The adviser also noted that the interim government has abolished the “Quick Enhancement of Electricity and Energy Supply (Special Provision) Act, 2010,” commonly referred to as the quick rental act. Efforts are being made to reduce power generation costs, and discussions are ongoing with power plant operators to offer lower tariff rates due to a noticeable disparity in existing rates.
Dr. Khan emphasized the importance of increasing domestic gas exploration, as no initiatives had been undertaken since 2010. The current government has allocated necessary funds to the Bangladesh Petroleum Exploration and Production Company Ltd (BAPEX) for capacity building, moving away from the previous administration’s preference for gas imports.
Finance adviser Salehuddin Ahmed highlighted in the national budget that the interim government aims to cut overall power generation costs by 10 percent, potentially saving over Tk. 110 billion annually. Two committees have been established to review capacity payments to IPPs and joint venture power plants.
According to the Bangladesh Power Development Board (BPDB), 23 government-owned power plants, including entities such as NWPGCL, APSCL, EGCB, RPCL, and BRPL, have been instructed to reassess their agreements. The total power generation capacity in the country is currently 28,000 MW, with a demand of approximately 18,000 MW.
The power division’s initiative is projected to save around Tk 2600 crore annually, with total estimated savings from these reforms amounting to Tk. 14,000 crore in the 2025-26 fiscal year. BPDB Chairman Engr Rezaul Karim stressed the need for cooperation from IPPs and joint ventures in revisiting Power Purchase Agreements (PPAs) as part of the government’s cost-cutting strategy.
Plans are in place to supply 648 million cubic feet per day (mmcfd) of gas from domestic sources within the year and to extract an additional 1500 mmcfd from local wells by 2028. Efforts to modernize the power distribution system include placing distribution lines and substations underground in metropolitan areas, aiming to enhance stability and efficiency.
BPDC officials also disclosed an agreement signed with Nepal on October 3, 2024, under sub-regional cooperation to import 40 MW of hydropower at an affordable price to meet summer electricity demands. The government is optimistic that the 2,400 MW Rooppur Nuclear Power Plant will commence generation gradually and contribute to the national grid by December this year.