Captive power plants consume 1 million cubic feet of gas to produce approximately 4 MW of electricity, whereas the same quantity of gas in a combined cycle power station generates 6 MW.
This implies a potential 1.5 times increase in power output with the same gas volume.
Despite this, high-cost imported gas continues to be allocated to captive generation rather than power stations.
In the 2022-23 fiscal year, power stations received 9,724 million cubic metres of gas, compared to 5,310 million cubic metres allocated to captive plants.
There has been consistent obfuscation surrounding the number and gas demand of captive power plants.
According to Petrobangla’s production records, on 7 November 2024, power stations received 891 million cubic feet of gas, while captive plants received just 102 million cubic feet, or one-ninth of that amount.
However, annual reports from the six gas distribution companies tell a different story.
The largest distributor, Titas Gas, reported selling 3,285 million cubic metres to power stations and 4,330 million cubic feet to captive plants during the 2022-23 fiscal year.
Chattogram’s Karnaphuli Gas also indicated a greater supply to captive plants, allocating 572 million cubic metres to them compared to 522 million for power stations.
Jhalalabad and Bakhrabad were exceptions, providing more gas to power stations.
Across the six companies, the average daily gas distribution was 26.5 million cubic metres for power stations and 14.5 million cubic metres for captive plants, meaning over half of the total gas was used by captives.
Bangladesh Energy Regulatory Commission (BERC) said that as of June 2024, captive power capacity stood at 6,085 MW, of which 3,460 MW was gas-based and 2,625 MW was diesel-based.
The establishment of captive plants is on an upward trend: 47 licences were issued in 2020-21, 125 in 2021-22, 159 in 2022-23, and 310 in 2023-24.
Power Grid Company of Bangladesh (PGCB) reported that on 7 November 2024, only nine out of 59 gas-based power stations received a full gas supply, while 33 were completely shut down and others operated partially due to gas shortages.
Petrobangla stated that 891 million cubic feet of gas was provided for power generation that day, against a demand of 2,490 million cubic feet.
This shortfall is expected to worsen as the cost of domestic gas is Tk1 per cubic metre, while imported gas costs Tk71 per cubic metre, with no immediate infrastructure capability to increase imports within two years.
Shifting the 3,460 MW of gas used in captive generation to power stations could potentially yield an additional 1,600 MW of electricity.
Industrialists argue that inconsistent power supply compels them to invest in captive generation, as even brief load-shedding results in substantial raw material losses.
Bangladesh Power Development Board (BPDB) maintains that their claims are only partially true, noting that a "Q" category was introduced in 2012 to guarantee uninterrupted supply via special lines.
Despite this, no entrepreneurs applied due to higher tariffs.
In correspondence submitted to BERC, BPDB stated that distribution companies often prioritise captive power over more efficient combined cycle power stations, as they receive higher payments from captive supply.
This bias is further encouraged by senior officials of the distribution companies, who often hold high-ranking government positions, deterring transparency.
Inefficiency of gas utilisation, coupled with idle power stations, results in a growing deficit for BPDB.
Monthly capacity charges amounting to approximately Tk1,800 crore must be paid regardless of whether power stations are operational.
BPDB has set ambitious goals to generate 40,000 MW by 2030 and 60,000 MW by 2040.
Although nationwide electrification has been achieved, industrial consumption remains lower than anticipated, largely due to the proliferation of captive power plants.
Experts warn that unless this trend is curtailed, the power sector faces an uncertain future.
Shafiqul Alam, lead analyst at the Institute for Energy Economics and Financial Analysis, said that combined cycle power stations are more energy-efficient than captives.
By transitioning away from captive plants and using electric boilers where feasible, significant energy savings could be achieved.
