Introduction of New Gas-Fired Power Plants Increases Electricity Burden

Experts at a recent seminar emphasized Bangladesh’s urgent need for a long-term financing roadmap to expand renewable energy and achieve net-zero carbon emissions by 2050. They highlighted the necessity for monetary policies that encourage commercial lenders to invest in renewables.

Qatar has agreed to renew a previously expired MoU with Bangladesh for liquefied natural gas (LNG) supply and advance discussions on a land-based LNG terminal in Cox’s Bazar. Under the existing SPA signed in 2017, Bangladesh imports 1.5–2.5 million tonnes per annum (MTPA) of LNG for 15 years, with a second SPA signed in June 2023 for an additional 1.5 MTPA starting in January 2026.

Between August 2024 and mid-April 2025, outstanding dues in Bangladesh’s gas sector dropped by 68%, from $750 million to $240 million, due to an aggressive repayment push by the interim government. Over $500 million was cleared in just six weeks, with $180 million disbursed between April 7–16 alone.

n just seven months, Bangladesh’s interim government has slashed foreign dues in the power and energy sector by 75%, from $3.2 billion to $800 million, addressing nearly three years of unpaid bills. A major beneficiary is US-based Chevron, which supplies over 50% of the country’s domestic gas (1,108.6 MMCFD out of 1,873.5 MMCFD).

Bangladesh reduced its overdue payments to private furnace oil-fired power plants by 30%, from Tk 100 billion in January to around Tk 70 billion by April 2025. This was driven by decreased electricity purchases from high sulphur fuel oil (HSFO)-based plants—now only 20% of total generation, down from 50%—and accelerated payments by the Bangladesh Power Development Board (BPDB).

The Bangladesh Power Development Board (BPDB) has set the per-unit electricity cost for the 1,200MW Matarbari Ultra Super Critical Coal-Fired Power Plant at Tk8.45, which is 60.60% lower than Rampal's Tk13.57 per unit. This new tariff is also 42% cheaper than the 1,320MW Payra plant (Tk12/unit) and SS Power. The Power Division has submitted the proposal to the Cabinet Committee on Government Purchase for final approval.