5 private power plants getting contract extension for 2 years

Bangladesh Power Development Board (BPDB) has planned to extend the terms of contracts with the five private power plants (PPs) by two years more.

The plants are Summit Narayanganj Power Limited, Orion Power Meghnaghat, Dutch Bangla Power & Associates, and Khulna Power Company Unit-2 and Khan Jahan Ali Power Company.

The state-owned power transmission and distribution company wrote to the Ministry of Power, Energy and Mineral Resources on May 25 seeking approval to renew the contracts with the three companies—Summit Power, Orion Pharmaceuticals and United Group operating the power plants, according to BPDB Secretary Saiful Islam Azad.

“However, some fresh conditions might be tagged to extend the contracts. Of the conditions, ‘no electricity no payment without any guaranteed off-take is the key,” the secretary said.

The current contract with the Dutch Bangla Power plant will expire next month. The contracts with four companies have already expired.

The three parent companies have been pursuing the BPDB for a long to renew their contracts.

Earlier, BPDB Chairman Belayet Hossain in a webinar said the government already decided not to extend the Power Purchase Agreement with all rental and quick rental power plants by 2024.

“The government has allowed rental power plants on a short-term basis. Now their owners are pursuing long-term agreements, which cannot be accepted in any case,” he had said.

The government still has to purchase electricity at a much higher rate from the private power producers and sell it to the consumers at a lower rate, incurring huge financial losses for the BPDB, according to him.