Bangladesh faces an impending crisis in its power sector as over two-thirds of its total power generation capacity is expected to remain idle during the upcoming winter. The surplus electricity situation has arisen due to an influx of power from private sector plants and a decline in demand during the winter season. The country’s power generation capacity stands at 27,834 MW, but only about half of this capacity is utilized on average.
Several private-sector power plants are set to contribute additional electricity, potentially increasing the surplus to around 70%. However, the government is grappling with a mounting capacity payment obligation to private power producers, with outstanding bills totaling $3.5 billion as of September 2023. Delays in bill payments and difficulties converting payments into foreign exchange due to a dollar crisis have compounded the issue.
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