Under cross-border electricity trade, Bangladesh has agreements with neighboring India and Nepal to import a total of 2,800 megawatts of power. To meet demand, up to 80 percent of this capacity is currently being imported. Meanwhile, the state-run Bangladesh Power Development Board (BPDB) has a total generation capacity of 6,114 megawatts per day. However, in FY 2023-24, only about 16.5 percent of the total electricity used in the country was purchased from BPDB. As a result, the plant factor of BPDB’s power plants dropped below 30 percent that year. Industry insiders say that despite supplying less power, BPDB still bears heavy financial costs due to its large workforce.

The “plant factor” in power generation is an indicator that shows the percentage of time and efficiency at which a power plant operates compared to its installed capacity. Typically, power plants are built with the expectation of operating at 80 percent plant factor.

Energy experts say the main reason for the idling of BPDB and other state-run power plants is the increasing dependence on imports and electricity purchase from the private sector. Cost-effective state-owned plants are sitting idle while power is bought at higher prices from private plants. This, they argue, is driving up BPDB’s overall financial costs and leaving much of its capacity unused.

However, senior BPDB officials say that although they have more than 6,000 megawatts of generation capacity, most plants are gas- and oil-based. Many gas-based plants remain idle due to fuel shortages, while oil-based plants stay shut most of the year. They note that even though BPDB’s overall power generation is low, the plant factor for gas-based plants exceeds 40 percent.

BPDB officials could not specify the exact share in total power generation for FY 2024-25. However, they said that output from BPDB’s own plants was not much higher than in FY 2023-24.

To maintain an uninterrupted power supply across the country, BPDB is making maximum use of imported electricity. Of the total 2,800 megawatts under power purchase agreements, 1,600 megawatts are with India’s Adani Group. Currently, an average of 1,200 megawatts is being imported from Adani’s plants. Under the government’s G2G agreements, 1,000 megawatts are imported out of 1,160 megawatts contracted. In addition, of the 40 megawatts of hydropower from Nepal, an average of 38 megawatts is imported daily.

Because of higher imports, the government is paying larger foreign power bills while also incurring rising capacity charges for keeping local plants idle. Energy sector insiders believe the reliance on power imported from India, including from Adani, while leaving domestic capacity underutilized, is driving up costs in the sector.

Dr. M Shamsul Alam, an energy expert and Professor at Daffodil University, told Bonik Barta, “The major financial burden in the power sector is its excess capacity. The government needed to focus on efficient management of this capacity. But we are not seeing that. They should have reviewed the outdated power generation system and the real capacity of plants. That has not been done, which is why costs have not decreased. There is uncertainty about how much they will drop in the future.”

BPDB’s financial reports show that in FY 2023-24, total power generation stood at 95,996 million kilowatt-hours. Of this, BPDB’s own plants produced 15,831 million kilowatt-hours, only around 16.5 percent of the total.

As of FY 2023-24, BPDB oversaw 50 power plants, with an average plant factor of 30 percent. However, 22 of these plants did not produce any electricity that year, with a plant factor of zero. If those idle plants are included, BPDB’s overall plant factor for FY 2023-24 would be no more than 18 percent.

BPDB’s financial share in power generation costs has also declined. Of the total BDT 1.06 trillion spent on power generation, BPDB’s own plants accounted for only BDT 134.02 billion. More than BDT 904.88 billion was spent on purchasing power from IPPs, rental plants, and imports from India. An additional BDT 25 billion was spent on other expenses.

BPDB’s 21 gas-based power plants have a combined capacity of 4,278 megawatts. In FY 2023-24, these plants had a plant factor of 32 percent. The six plants producing solar, hydro, and wind power have a total capacity of 242 megawatts. During the same fiscal year, the plant factor was 41 percent for hydro, zero for wind, and 13 percent for solar power. The furnace oil–based plants have a combined capacity of 742 megawatts, but ran at an average plant factor of only 17 percent for the year. All diesel-based plants remained shut down throughout the year.

Industry insiders say that although most BPDB plants are old or inactive due to a fuel shortage, a large workforce remains employed to manage them. They suggest reducing the workforce cost of the financially struggling BPDB and determining the real capacity by phasing out the inefficient plants.

Energy expert and BUET Professor M Tamim told Bonik Barta, “A large portion of the power plants on BPDB’s list exists only on paper. Many of them are no longer in production. Most of the operational plants are old and inefficient. These should be phased out. In a way, BPDB is now moving away from production. The plants it operates are mainly for grid stability and cost efficiency. To reduce costs, BPDB’s generation sector, its maintenance, and operations need a complete overhaul.”

Senior BPDB officials did not deny the decline in production at its own plants. They said cost-cutting policies and the gas shortage were the main reasons behind the production shortfall.

BPDB Chairman Engineer Rezaul Karim told Bonik Barta, “The main reason BPDB’s power plants are not running as expected is the gas shortage. The Ghorashal power plant has a large capacity and good machinery, but it is not receiving enough gas. Efforts are underway to bring it back into production. In addition, many inefficient power plants will eventually be phased out.”

A large part of BPDB’s capacity is not in production, yet it requires a significant workforce. When asked regarding plans to reduce workforce expenses, the top official said, “We have always tried to see how we can keep only the necessary staff at non-operational plants while reducing other costs. BPDB wants to minimize expenses.”

An immediate attempt was made to contact Power, Energy, and Mineral Resources Adviser Muhammad Fouzul Kabir Khan for his views on BPDB’s financial strain and its heavy workforce expenses. But as of last night, when this report was written, he could not be reached.