The Bangladesh Power Development Board’s Annual Report 2022–23 reveals 29 power projects under construction with a combined capacity of 10,881 MW. Despite a 40% power sector overcapacity, the report envisions adding 20,416 MW from July 2023 to December 2027. Experts warn that this surplus, coupled with the 10,881 MW addition, may heighten capacity payment burdens, estimated at Tk28,000 crores in FY2023. Of the 29 projects, 5 are public and 17 are private (independent power producer projects).
The increasing surplus capacity is expected to lead to a rise in capacity payments, impacting the government and consumers, especially if the ongoing dollar crisis persists. Capacity payments to private power plants have surged from Tk5,376 crores in FY2017 to an estimated Tk28,000 crores in FY2023, posing financial challenges to the sector. The power and energy sectors are grappling with a severe cash crunch, accumulating outstanding bills of about $5 billion, of which $4 billion is in the power sector.
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