Private power-plant owners in Bangladesh may encounter uncertainty in oil imports for at least the next two months(June, and July 2023), potentially risking the country’s electricity-supply situation if their pending payments are not cleared by the government. The private-sector power producers have expressed concerns over a shortage of US dollars for furnace oil imports due to a dollar crunch.
Despite assurances from the concerned minister to exercise patience, there is no clear visibility for fuel imports in June and July 2023. The country heavily relies on oil-fired power plants, which account for around 31% of the overall installed capacity. The Bangladesh Independent Power Producers Association (BIPPA) highlights a payment backlog of around Tk 180 billion owed by the Bangladesh Power Development Board (BPDB) to independent power producers (IPPs) until March 2023. The IPPs have reached their credit limits with banks, and foreign confirmation banks have exhausted their country limits. The BIPPA is urging the government to disburse the allocated subsidy amount and ensure the availability of US dollars for fuel imports. The situation underscores the challenges faced by private power-plant owners and the need for a prompt resolution to maintain a stable power supply in the country.
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