The government has failed to rein in the losses of Bangladesh Power Development Board (BPDB) which has cost the exchequer around Tk 50,000 crore since independence.
Officials said BPDB incurred losses caused mainly by low power sales tariff over a higher production rate.
The state-owned entity had incurred Tk 6,233 crore losses during the last fiscal.
“Our losses are increasing every year due to the prevailing gap between the average electricity tariff and production cost,” a senior BPDB official told The New Nation on Thursday.
He said: “Electricity purchase from costly IPP’s and rental power plants has further aggravated BPDB’s financial position.
The official also pointed out that though it’s an autonomous body, all the major decisions of the BPDB are controlled by the administration deeply affecting its financial health.
“We have submitted a proposal to the Bangladesh Energy Regulatory Commission (BERC) to enhance the present power tariff by 41 per cent so that the organisation can reach a break-even point,” he added.
According to him, BPDB is now incurring over Tk 100 crore losses per month due to the lower billing price of electricity that the supply cost.
“The cumulative losses has made BPDB financially crippled and it is now running with huge financial difficulties,” he said.
When asked, State Minister for Power, Energy and Mineral Resources Nasrul Hamid Bipu told The New Nation yesterday that the government is highly concerned over the BPDB’s losses and formulating policies to rein in its mounting losses.
“We are also formulating the market based electricity pricing mechanism so that BPDB can run under break-even point,” he said, adding, “Besides, steps have been taken to reduce system losses, electricity theft and prevent illegal connection to narrow the losses.”
Justifying the losses, Bipu said, BPDB was selling electricity at a lower rate than actual production cost to the distribution companies since its inception forcing it to incur losses year after year piling up the loss amount to Tk 50,000 crore.
“It has long been adopted the policy to follow a government policy to provide electricity at subsidized rate to the consumer,” he said.
But, now the government has come out from the policy and fixing the electricity rates based on market price to improve the financial health of the BPDB and other state-owned power companies.
