Bangladesh’s coal-dependent power sector is facing a severe crisis, with plants shutting down due to an acute shortage of fuel and mounting payment backlogs.
The Matarbari coal-fired power plant has already ceased operations due to a lack of coal, while the Rampal and Payra plants are similarly at risk of shutdown.
The country currently operates four large coal-based power plants, each with a generation capacity exceeding 1,200 megawatts (MW), alongside four smaller units with capacities of 307 MW, 275 MW, and two units of 125 MW each.
The major plants, excluding three smaller ones at the Barapukuria mine, are grappling with severe fuel shortages, largely due to dependency on imported coal and substantial unpaid bills.
As a result, supply chains are close to breaking down as some plants struggle to open Letters of Credit (LC) due to a lack of funds or dollar shortages.
The Bashkhali plant is the only major coal plant maintaining a steady supply. On Saturday, a new coal shipment arrived in the country to sustain one of its units in uninterrupted production.
The Barishal 307 MW and Barapukuria 125 MW plants are undergoing regular maintenance, while partial generation continues at the Barapukuria 125 MW and 275 MW plants. Despite limited operations at Payra and Rampal, sources confirm that the coal supply at Rampal will run out by the end of the week.
Bangladesh relies on imported coal and receives 1,600 MW of power from India’s Adani Group. However, the Adani Group currently has an outstanding bill of approximately Tk10,000 crore.
The company announced the suspension of one unit from 31 October and has threatened to shut down the second unit by 7 November unless dues are cleared.
The Matarbari power plant operated by the Coal Power Generation Company Bangladesh Limited (CPGCBL), which began production last year, also halted operations on 31 October due to a depletion of its stockpile of 22.05 lakh tonnes of coal.
Despite CPGCBL’s international tender to secure a three-year coal supply, allegations of fraud by a contractor resulted in a six-month ban on imports issued by the High Court, later suspended by a higher court.
However, long-term coal import prospects remain uncertain. CPGCBL expects new coal supplies by late November.
Additionally, the Bangladesh-China Power Company Ltd. (BCPCL) operates the Payra 1,320 MW power plant, where only one of its two units is currently operational due to coal shortages.
BCPCL reportedly has an outstanding payment of Tk5,800 crore to the Bangladesh Power Development Board (BPDB) and faces LC complications due to liquidity issues.
With coal-fired plants reducing output, BPDB data shows an increased dependency on expensive furnace oil-based plants, yet power cuts persist.
On 1 November, production during the evening peak reached 12,302 MW, though a 1,700 MW load shedding was recorded around 1:00 am.
A BPDB official indicated that financial losses have already impacted their operations, with suggestions to curb expenses by optimising coal-fired generation. However, any increase in production costs could further strain the average electricity production cost.
A respite from higher demand was observed on 1 November, a weekly holiday, as demand lowered due to seasonal temperature declines in northern regions. The cooler winter months from December to February are expected to keep demand subdued.
However, the peak irrigation and Ramadan season anticipated in late February presents a considerable challenge, with significant shortages feared if the issues are not resolved beforehand.
This coal crisis is compounded by a gas supply shortfall, further straining power production.
Many gas-powered plants have been producing electricity for less than half the day for several months, with some units offline for extended periods.
Repeated attempts to reach BPDB Chairman Md Rezaul Karim and Production Member Khandaker Mokammel Hossain for comment were unsuccessful as calls went unanswered.
