Govt Moves to Clear Tk20,000cr Dues to Avoid Summer Outages

The interim government has stepped up efforts to clear more than Tk20,000 crore in unpaid dues to private power producers to avert possible load-shedding during the upcoming summer and to prevent a heavy financial burden from falling on the next elected administration.

Power and Energy Adviser Mohammad Fouzul Kabir Khan said arrangements are being made to settle the arrears as quickly as possible. He said discussions are ongoing with the finance authorities to resolve the long-standing liabilities in the power sector.

The government aims to ease pressure on the incoming administration by addressing the accumulated dues now, he added.

Industry insiders, however, warn that prolonged payment delays—driven by subsidy constraints and fiscal stress—are already affecting power producers’ ability to import fuel, raising the risk of plant shutdowns at a time when supply margins remain tight.

The concern has intensified at SS Power I Limited, a coal-fired plant supplying more than 1,100 megawatts to the national grid daily. The company has warned it may suspend generation unless overdue payments are cleared soon.

In a letter sent to the Bangladesh Power Development Board (BPDB) on 1 January, SS Power said its unpaid bills had crossed Tk4,000 crore. Under its power purchase agreement, the company is entitled to halt generation if payments are not settled within a specified timeframe.

According to industry estimates, BPDB’s outstanding liabilities to private power producers stood at around Tk20,000 crore as of November 2025. Producers caution that continued delays could severely disrupt electricity supply during Ramadan and the peak summer months.

BPDB officials acknowledge that even a partial shutdown of large plants would immediately create a supply gap, particularly as many gas-based power stations are operating well below capacity due to fuel shortages.

“If SS Power suspends generation, there could be an immediate shortfall of around 1,200 megawatts,” said a BPDB member, warning that such a gap would be difficult to absorb.

BPDB officials said they remain hopeful that payment issues will be resolved, noting that similar disputes in the past were settled before leading to prolonged shutdowns. They described the payment backlogs as cyclical rather than a sign of systemic failure.

SS Power has said delayed payments have hampered its ability to procure coal and spare parts, forcing it to consider shutting down at least one unit if dues are not cleared. The plant requires between 12,000 and 14,000 tonnes of coal daily to operate at full capacity.

Meanwhile, gas supply to power plants remains far below demand, further heightening the risk of load-shedding in summer. Power sector officials warn that unless arrears are cleared and fuel supply stabilised, maintaining uninterrupted electricity during peak demand will be a major challenge.