Despite demand being nearly half of electricity generation capacity, the government of Bangladesh continues to extend the tenure of costly rental power plants. The latest decision for extension of contract for a gas-based rental power plant was made in the Cabinet Committee on Government Purchase on November 8. As per the decision, a 55 MW gas-based rental power plant of Precision Energy Ltd. will get an extension of 5 years to their existing contract with the state-owned Bangladesh Power Development Board (BPDB). Under the Power Purchase Agreement (PPA), the BPDB will buy electricity from the plant at a tariff rate of US Cent 5.7 (equivalent to about Tk 6) per kilowatt hour while it has been buying electricity from base-load plants at around half the price.  Read: Despite surplus electricity, contracts of 10 rental power plants extended in four months For instance, the government has been purchasing electricity from Summit-GE's Bibiyana 450 MW gas-fired power project at US 3.32 cents per kilowatt-hour, with a contract for a period of 22 years. The government approved a PPA in October 2021 under which Consortium of (1) Edra Power Holdings Sdn Bhd, Malaysia and (2) Winnievision Power Ltd, Bangladesh, will set up the 660 MW base-load combined cycle plant and the BPDB will purchase electricity from the plant over a contract period of 22 years at a levelised power tariff of US 3.679 Cents (equivalent to Tk 2.94) per kilowatt hour to be run by local gas. The move for continuing the extension of rental and quick rental power plants' contracts raised the eyebrows of the energy experts. Many experts and power industry insiders believe that such a move to continue entertaining the costly rental power plants will increase the burden on the government for more subsidies, at a time when the sector has already been facing huge capacity payments' obligation with surplus capacity of electricity generation reaching about 50 percent.    Read: Power flow set up from Payra plant to Rampal sub-station Last year, the government extended the contracts of at least 10 rental power plants with a new provision of “No Electricity, No Payment” but kept a fund allocation of Tk 6,564.08 crore to pay the owners of the rental power plants. This time also Tk 1205.40 crore was kept as allocation while approving the latest extension proposal of Precision Energy's 55 MW Ashuganj gas-fired rental power plant which will be paid in in next 5 years.   According to the Power Division’s official statistics, as of September 13, 2023, the country's power generation capacity was 27,834 MW including off-grid renewable and captive power, while the highest generated in a day was 15,648 MW. The BPDB official data shows the country generated 14,021 MW on September 26, while covering the excess demand by resorting to load shedding of 113 MW. Read:  5 rental power plants with 457 MW get 2-year extension The demand was decreasing with the coming winter and the country's power demand was recorded to be 10,954 MW on November 8 while on-grid installed capacity was showing 25,339 MW meaning that the surplus capacity was more than double at 14,385 MW. State Minister for Power, Energy and Mineral Resources Nasrul Hamid, however, defended the extension of the rental power plants’ contracts saying that the deals were extended for “emergency necessity” to tackle the current situation when last year 10 rental power plants' contracts were extended. “As there is a gas shortage, we have to run liquid-fuel based rental and quick rental power plants on full capacity to meet the demands," he had told UNB. He also said these plants don’t oblige the government to make 'capacity payment' - i.e. payment for unused electricity, that was the case with some earlier contracts. “As a result, the cost of electricity from these extended rental power plants came down by 30-40 percent from the original cost," Nasrul Hamid said. The government documents show that of the approved 5 plants in March last year, three belong to Summit Group, one belongs to Dutch-Bangla Group and one to Orion Group. 'Admit the mistake first' About the country's growing surplus electricity and extension of rental power plants, vice president of Consumer Association of Bangladesh (CAB) Prof M Shamsul Alam said: “There will be a big indiscipline in the power sector as pressure for private sector’s capacity payment will continue to go up while import of primary fuel will be increasing. Finally, it will lead to energy insecurity." Read: Deal period with rental, quick rental power plant owners can’t be extended: BPDB Chairman In such a situation, he said, the only way-out is that the government has to admit first it has done a mistake by giving permission to the private sector for excessive power generation without consideration of the demand and then change the current policy and strategy. Otherwise, the situation will be more difficult to manage as pressure from the International Monetary Fund (IMF) is coming to raise electricity tariff again. If so, it will further push up inflation, he added.

The growing backlog in payment obligation is emerging as a major problem in Bangladesh's power sector that may impede the growth of the sector. According to official sources, the payment mode in Bangladesh Government's power purchase agreement (PPA) with the private sector has mainly been made in foreign currency, specially, the US dollar. As per the existing arrangement, as a single payer the state-owned Bangladesh Power Development Board (BPDB) pays to the private power producers in local currency against its purchase of electricity. Under the PPA, the private power producers are allowed to convert the payments into US dollars to meet their different kinds of payment obligations like bank loan, fuel and machinery imports and also paying foreign staff salaries. If the investors are foreign companies, they can repatriate their profits in US dollars, said the officials of the BPDB. They also noted that the BPDB always remains in constant contact with power producers, their banks and the central bank to smooth the foreign currency repatriation. But following the dollar crisis in the country, official sources said in recent months, both the BPDB and the private power producers have been experiencing severe problems in getting dollars from their banks and also from the Bangladesh Bank. Official sources said the BPDB has been struggling to keep up with its payments owed to the private power producers for more than a year. Officials at the Power Division and BPDB said currently the total owed to the Independent Power Producers (IPPs) is $3.5 billion (equivalent to over Tk 35,000 crore) as of September 2023. Read: Rooppur Nuclear Power Plant to receive fresh batch of uranium from Russia’s Rosatom at ‘Graduation Ceremony’ tomorrow As per contract with the government, the IPPs are facing dual problems with their bills. First, they are not getting bills on time and secondly, they are getting partial bills, but not being able to convert the payment into foreign exchange due to the dollar crisis. A top BPDB official admitted the problem to UNB, saying that they had reached an understanding with Bangladesh Bank under a mediation of the Finance Ministry that the central bank will provide on average $20 million every day to BPDB to cover its costs. “But we’re not getting more than $10-15 million a day,” a top BPDB official told UNB on condition of anonymity as the issue is very sensitive and he is not allowed to speak on the issue. He also said that if measures are not taken to contain the growing dues in the power sector it will further aggravate the problem. Read: Japan provides $1500 million to implement Matarbari coal-fired power plant Admitting about the payment backlog, Imran Karim, former president of Bangladesh Independent power Producers Association (BIPPA), said the government should take necessary measures to clear the dues in the power sector. "Otherwise, it will accumulate the dues and create a major problem in the sector", he told UNB. Energy experts said the country is heading for problems in the power sector and it would have a big impact on the overall economy pushing up inflation further. Eminent energy expert and advisor to the Consumers Association of Bangladesh (CAB) Prof M Shamsul Alam said the government has been put in such a major problem because of its wrong planning in the power sector. He said that as a result of the wrong planning, the country is witnessing 50 percent surplus power in summer and 70 percent in winter, for which it is heading towards a disastrous situation. “There will be a big indiscipline in the power sector as pressure for private sector’s capacity payment will continue to go up while import of primary fuel will be increasing. Finally, it will lead to energy insecurity,” he told UNB. Read more: Cabinet purchase body approves proposals including 3 solar power plants in private sector

More than two-thirds of the total power generation capacity will remain idle this coming winter, as more power is added to the national grid from the private sector pushing up the capacity payment obligation of the government of Bangladesh. It comes at a time when already the government’s outstanding bills to the private sector power producers has ballooned out to $3.5 billion. According to the Power Division’s official statistics, as of September 13, 2023, the country's power generation capacity was 27,834 MW including off-grid renewable and captive power, while the highest generated in a day was 15,648 MW. Bangladesh Power Development Board (BPDB) official data shows the country generated 14,021 MW on September 26, while covering the excess demand by resorting to load shedding of 113 MW. It means half the power generation capacity remains utilised, while load shedding is also unavoidable. Read: Japan provides $1500 million to implement Matarbari coal-fired power plant According to power industry insiders, the surplus power situation will be getting worse in the coming winter with more electricity coming to the national grid from the private sector power plants in the next few months and installed generation capacity may cross 30,000 MW, increasing the surplus electricity to about 70 percent as demand usually dips during the season. The expected boost to capacity includes 1,224 MW from S Alam Group’s power plant in Bashkhali of Chattagram (of which first unit of 620 MW already came to the grid), 718 MW electricity from Reliance Power LNG-based Plant in Meghnaghat, 590 MW from LNG-based GE-Summit Meghnaghat-2 power plant and 584 MW from LNG-based Unique Group’s power plant in Meghnaghat. The sponsors of these plants are working hard to persuade the government to allow them to officially commission their plants as all of them are ready for operation. But due to shortage of gas they are not allowed to start operation. Read: First shipment of uranium for Rooppur nuclear power plant arrives in country In the meantime, more electricity from some of the recently completed power plants already came to the grid, including the second unit of the Adani Group’s 1,600 MW coal-fired power plant, and 620 MW from the second unit of Rampal Power Plant. Last winter, the power generation came down to below 10,000 MW with the decreasing demand. BPDB record shows the generation was recorded at 9,134 MW on December 31 in 2022. Experts believe the generation will remain below 10,000 MW in the coming winter as demand is not increasing at a faster pace. Though 70 percent electricity will remain idle, the sponsors will get their payments in the form of capacity charges as per their contract with the government, said the BPDB officials. Read: Climate change and the shift to cleaner energy push Southeast Asia to finally start sharing power The government is already struggling to keep up with its payments owed to the private power producers. Officials at the Power Division and BPDB said currently the total owed to the Independent Power Producers (IPPS) is $3.5 billion (equivalent to over Tk 35,000 crore) as of September 2023. As per contract with the government, the IPPs are facing dual problems with their bills. First, they are not getting bills on time and secondly, they are getting partial bills, but not being able to convert the payment into foreign exchange due to the dollar crisis. A top BPDB official admitted the problem to UNB, saying that they had reached an understanding with Bangladesh Bank under a mediation of the Finance Ministry that the central bank will provide on average $20 million every day to BPDB to cover its costs. Read: Power Cell engages top US consultancy in move towards ‘Smart Grid’ “But we’re not getting more than $10-15 million a day,” a top BPDB official told UNB on condition of anonymity as the issue is very sensitive and he is not allowed to speak on the issue. Energy experts said the country is heading for problems in the power sector and it would have a big impact on the overall economy pushing up inflation further. Eminent energy expert and advisor to the Consumers Association of Bangladesh (CAB) Prof M Shamsul Alam said that with the 50 percent surplus power in summer and 70 percent in winter, the country will be heading towards a disastrous situation. Read: S Alam Group’s 1320 MW Banshkhali coal-fired power plant starts commercial operation “There will be a big indiscipline in the power sector as pressure for private sector’s capacity payment will continue to go up while import of primary fuel will be increasing. Finally, it will lead to energy insecurity,” he told UNB. In such a situation, he said, the only way-out is that the government has to admit first it has done a mistake by giving permission to the private sector for excessive power generation without consideration of the demand and then change the current policy and strategy. Otherwise, the situation will be more difficult to manage as pressure from the International Monetary Fund (IMF) is coming to raise electricity tariff again. If so, it will further push up inflation, he added.

Prices of almost all spices have doubled in a year, and consumers are particularly feeling the pinch ahead of Eid-ul-Azha when consumption of spices is high. Despite sufficient stock and import of essential spices, traders at both wholesale and retail level hiked the prices of onion, ginger, garlic, cardamom, cinnamon, clove, cumin, turmeric, and coriander. SM Nazer Hossain, vice-president of the Consumers’ Association of Bangladesh (CAB), told UNB that prices of essential commodities have already gone up, and the hike in prices of spice will further burden the already hard-up low- and middle-income people. Though there is enough stock of spices to meet the demands during Eid, traders are indiscriminately hiking the prices to make more profit – due to lack of proper monitoring, he said. Spice prices soar in Faridpur ahead of Eid-ul-Azha According to the Trading Corporation of Bangladesh (TCB), on June 22, 2022, cumin was sold at a minimum price of Tk 380 and a maximum of Tk 450 per kg. The price of cumin has increased more than twice in one year. Before Eid-ul-Azha, other spices are also beyond the reach of low-income people. Prices of most spices, including locally grown onion, garlic, dried chillies, green chillies, turmeric, ginger, and cinnamon have increased. Among them, the prices of ginger and garlic have almost doubled. The UNB correspondent’s visits to Shyambazar, and Karwan Bazar – two major wholesale and retail markets in Dhaka – confirmed the latest prices today (June 24, 2023). There were enough stocks of ginger imported from Myanmar, Vietnam, and Indonesia in Shyambazar on Friday. The wholesale price of ginger is Tk 120 to Tk 250 per kg depending on the quality. In Karwan Bazar, the retail price was Tk 250 to Tk 350 per kg. TCB said that even a year ago, ginger was sold between Tk 60 to Tk 100 per kg at the retail level. Spice prices shoot up ahead of Eid despite sufficient stock Traders say that China is the biggest supplier of ginger in the country. But due to its high price, Chinese ginger is not available in the country right now. Stock of Indian ginger is also low in the market. Mainly because of this, the price of ginger has more than doubled within a year. The price of dried chilli has also increased. A year ago, dried chillies were sold at Tk 220 to Tk 250 per kg, but this year, it is being sold at Tk 300 to Tk 340 per kg. Indian dried chillies are being sold at a higher price of Tk 380 per kg. In retail markets, such as Karwan Bazar, the price of imported dried chillies has also gone up to Tk 480 per kg. Coriander is being sold at Tk 165 to Tk 220 per kg, cloves at Tk 1,500 to Tk 1,600 and cinnamon at Tk 410 to Tk 480 per kg in Karwan Bazar, Shyampur and Sutrapur Bazar. According to TCB, a year ago, coriander was sold at Tk 120 to Tk 150, cloves at Tk 1,050 to Tk 1,200 and cinnamon at Tk 400 to Tk 450 per kg. Traders say that due to the dollar crunch, importers are not able to import enough spices. The prices of some species are high in the global market as well. No shortage of spices in market ahead of Eid: Spice Traders Association Import costs have also increased. Apart from that, the production cost of spices in the country has also gone up due to the increase in fertiliser, fuel, and labour costs. Also, the cost of transportation is high. Mainly due to these reasons, the price of spices has gone up.

Consumers Association of Bangladesh (CAB) has urged the government to readjust edible oil prices in the country following their continuous downward trend in the international market. SM Nazer Hossain, Vice-President of the CAB central committee made the call through a statement on Saturday. In the statement, Nazer said Bangladesh Trade and Tariff Commission (BTTC) should readjust the prices of edible oil as the price of this daily essential is decreasing regularly in the international market.  He also blamed the BTTC for its reluctance every time for the edible oil price adjustment. Alleging that BTTC only works for the interest of the businessmen, the CAAB vice president said, when prices of edible oil go up in the international market, BTTC raises the price in the local market. But when, price decreases in the international market, it does not show interest to readjust the prices. The statement said the prices of edible oil went ups and down five times from October last year to June this year, while Bangladesh has hiked the oil price in three phases. Read: Edible oil prices to come down soon: Commerce Secretary On May 5, 2022, the government approved a fresh hike in the prices of soybean and palm oil by Bangladesh Vegetable Oil Refiners & Vanaspati Manufacturers Association on grounds of an increase in the global market. BVOVMA fixed bottled soybean oil at Tk 198 per litre while loose soybean oil at Tk 180 per litre. It means bottled soybean oil price increases by Tk 38 per litre and loose soybean oil price up by Tk 44 per litre.

Experts have urged the government to formulate a “fair and transparent policy” for Bangladesh’s energy sector to ensure energy rights for all the citizens of the country. “Access to energy is now a very important right of citizens. So, environmental safety has to be ensured in energy transactions,” said Dr M Shamsul Alam, an adviser of Consumers Association of Bangladesh (CAB). He was addressing a views-exchange programme organized by CAB at the University of Science and Technology, Chattogram (USTC) on Saturday. Read: Deal signed to set up Bangladesh’s first-ever waste-to-energy project USTC Vice Chancellor Dr Jahangir Alam, Prof Dr Tanzim Uddin Khan of Dhaka University, and former dean of Social Sciences Faculty of Chattagram University Dr Hossain Kabir also spoke at the programme held with CAB vice president SM Nazer Hossain in the chair. Dr Shamsul Alam said an energy policy is needed to protect the interest of the people of the country, said a CAB media release.

Protesting the relentless price hike of essential commodities and 'fare anarchy' in public transport, Consumers Association of Bangladesh (CAB) held a mass rally at Nayabazar Bishwa Road intersection in Halishahar on Friday. General Secretary of CAB Advocate Jamal Hossain presided over the rally. CAB leaders said the Department of Consumer Protection, Safe Food Authority and Bangladesh Competition Commission have taken various initiatives to keep the prices of daily commodities stable but it does not work. Passengers are not benefiting even though BRTA and public transport owners have fixed the bus fares. Read: BNP launches 41-day programme against price hike of fuel, essentials Businessmen and transport owners are increasing the prices and fares according to their will defying government directions. As a result, dissatisfaction is growing among the commoners. In order to ensure the fare prices of daily essentials and stop the rent anarchy in the public transports, the Hon'ble Prime Minister and the policy makers of the government need to get the right information, the leaders said, according to a press release. Speakers alleged that the prices of commodities are controlled by traders. As a result, though the prices of rice, soybean oil and gas have come down in the international market, it has not been reflected in the domestic market. Read: Diesel price hike will not affect prices of essentials: Info Minister The speakers also noted that despite the nationwide students' agitation demanding half fare in public transport, the owners have accepted the demand only for Dhaka. In Covid situation, the price hike of fuel added misery to the common people. People want to get rid of this situation, they said.

The post-paid electricity bill payers will be able to replace their meters with pre-paid ones to escape harassment regarding bill payment, said Consumers Association of Bangladesh (CAB) on Saturday.

Speakers at a webinar have urged the energy regulator to fix the price of liquefied petroleum gas (LPG) in a rational way through public hearing.

Consumers’ Association of Bangladesh (CAB), Chattogram on Friday claimed that despite the coronavirus crisis, prices of essential consumer goods have been rising all over the country.