Reduce system loss in the energy sector

We are concerned about the financial losses the government is facing due to "system loss" in the gas sector. Petrobangla estimates that Tk 3,500 to 4,000 crore is lost annually from inefficiencies in the supply network, which is nearly half of the government subsidies given to the sector. More specifically, Petrobangla attributes the loss to distribution defects, illegal connections, and gas theft. Some experts, however, suspect that those in charge could be masking the high cost of purchased gas as "system loss" or theft. Whatever the cause, the fact remains that a vast amount of gas remains unaccounted for. At a time when the country is grappling with a severe gas crisis, causing disruptions in industrial operations and other sectors, a loss of this magnitude is unacceptable.

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Gas crisis deserves priority attention

Reportedly, in the fiscal year 2023-24, an average of 6.28 percent of gas was lost in the distribution lines, amounting to 2,036 million cubic metres of gas, and resulting in a financial loss of Tk 3,790 crore. However, till March of FY2024-25, the loss increased to 7.44 percent, amounting to 1,451 million cubic metres of gas and causing a financial loss of Tk 3,286 crore. Officials estimate that the full fiscal year's loss would amount to nearly Tk 4,000 crore. At a time when the government is having to import LNG from abroad, providing a substantial amount in subsidies to address the country's gas shortage, such avoidable losses are deeply concerning. Reportedly, in FY2024-25, Petrobangla received Tk 8,900 crore as subsidy for the gas sector. That nearly half of that amount was lost due to gas theft and wastage is simply unthinkable.

Petrobangla attributes the loss to distribution defects, illegal connections, and gas theft. Some experts, however, suspect that those in charge could be masking the high cost of purchased gas as "system loss" or theft. Whatever the cause, the fact remains that a vast amount of gas remains unaccounted for. At a time when the country is grappling with a severe gas crisis, causing disruptions in industrial operations and other sectors, a loss of this magnitude is unacceptable.

Considering that international standards permit a maximum gas loss of only 0.20 to 0.30 percent in distribution lines, the overall system loss in our transmission and distribution network is alarmingly high. Experts also argue that the two percent loss recorded by the state-owned Gas Transmission Company Limited (GTCL)—responsible for delivering gas from production sources to distribution intake points—is unreasonable, as high-pressure transmission lines should not allow for significant wastage. While Petrobangla officials attribute this to technical faults, experts stress the need for thorough investigation to detect potential leaks or system errors.

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Acute gas crisis takes the lid off LNG vulnerabilities

System loss is a critical issue that must be addressed urgently. The authorities should minimise wastage by adopting advanced technology and closely monitoring transmission and distribution line faults. Replacing outdated pipelines and fixing leakages are also essential, alongside ensuring transparency and accountability in LNG purchase. Petrobangla must strengthen its oversight and actively work to curb illegal connections. Most importantly, accelerating domestic gas exploration is vital to reduce our overreliance on costly imported LNG.