Amid an acute energy crisis in Bangladesh, the power sector is facing a daunting challenge related to capacity charges. The Power Development Board (PDB) is burdened with capacity charges, amounting to a substantial Tk 400 crore, despite several power plants operating at minimal capacity.
In April 2023, at least 20 power plants operated at zero to 25 percent capacity, but the PDB was still obligated to pay full capacity charges as per their contracts. For instance, New Vidyut (Bangladesh) Limited, with a generating capacity of 220 MW, produced no electricity in April due to gas shortages but still incurred a capacity charge of Tk 32 crore 51 lakh.
The dollar crisis further aggravated the situation as some power plants faced difficulties in importing fuel, leading to partial production and additional financial strain. Additionally, irregular subsidy payments from the government and frequent power plant shutdowns due to gas shortages have exacerbated the problem. To address this pressing issue, timely actions are required, including finding ways to reduce capacity charges, ensuring efficient utilization of resources, and implementing effective strategies to sustain the functioning of the power sector in Bangladesh.
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