Under the auspices of the Awami League government, the United Group has become a law unto itself, setting a precedent that is rare not only in Bangladesh but globally.
The United Power Generation and Distribution Company (UPGD) has emerged as a new entity, redefining the very essence and interpretation of the law.
Despite the Regulatory Commission’s rejection of their claims, United Group pursued legal redress through the High Court, only to be rebuffed again, and their case was similarly dismissed by the Supreme Court. This defiance has seen United Group's demands met while disregarding established legal norms.
The company is uniquely positioned in Bangladesh, holding the power to set its electricity prices according to its discretion.
In this regard, United Group has effectively transformed into a parallel regulatory body, operating outside the bounds of the Bangladesh Energy Regulatory Commission (BERC).
While BERC sets electricity prices for most companies, United Group sells at its own rates, sidestepping regulatory control.
Under the current legal framework, Bangladesh has two categories of private power plants: Independent Power Producers (IPPs) and Captive Power Plants (CPPs).
IPPs are required to supply electricity to the government as per its demand and have no scope for external sales.
Conversely, CPPs, deemed commercial, can sell surplus power under specific conditions, with BERC responsible for setting rates.
United Power Generation and Distribution Company’s gas-fired plants in Dhaka EPZ and Chittagong EPZ—totalling 86 MW and 72 MW respectively—have flagrantly ignored these laws.
BERC had fixed the gas price for CPPs at 30 Taka per cubic metre, while the rate for IPPs was set at Tk16.
United Group lobbied for the IPP rate, leading to extensive correspondence between the Electricity Department and BERC.
Abdul Jalil, the then chairman of BERC, clearly stated that the law did not cover their operations as IPPs and that they were obligated to pay the CPP rate.
Despite this, the regulatory commission's order was ignored, escalating into a dispute between the executive and regulatory bodies, which resulted in the transfer of rate-setting authority from BERC to the executive branch.
Mokbul E-Elahi Chowdhury, a former BERC member (Gas), expressed disbelief at how United Group secured IPP rates despite repeated rejections by BERC and the courts.
He remarked that the project was initiated as a CPP and saw no grounds for it to be classified as an IPP.
Abdul Jalil, former BERC chairman, also affirmed that the legal stance was clear, and any further developments were unknown to him.
United Group, undeterred by their legal defeats, sought intervention from the Prime Minister’s Office, which led to a directive from the Ministry of Power in February 2023, approving their request to be licensed as IPPs. This was issued despite being contrary to the fundamental legal and constitutional frameworks, as noted by energy adviser Dr Shamsul Alam.
He questioned the legitimacy of such approvals, arguing that they conflict with the state’s constitution and laws, and asserted that United Group's actions are unlawful.
Despite failing in court, United Group’s Chairman and Managing Director Moinuddin Hasan Rashid secured a letter from the Ministry, ostensibly signed by the Deputy Secretary of the Power Division, Saiful Azad, endorsing their pricing structure.
The letter, dated 25 March 2023, instructed BERC to set electricity tariffs based on IPP rates for United Group’s facilities.
In January 2023, amidst a broader increase in gas prices for the power, industrial, and commercial sectors, the price for gas used in electricity generation rose from Tk5.2 per unit to Tk14, while the rate for captive electricity consumers was set at Tk30 per unit, with incremental increases planned each month.
