Will policymakers remain blind to power sector’s problems?
It is frustrating that our policymakers seem as oblivious as ever to the pressing issues debilitating the power sector. According to a recent report by this daily, the burden of capacity charges from idle power plants has turned out to be far greater than what was previously reported. Just two months ago, the Implementation Monitoring and Evaluation Division (IMED) revealed in a report that the government has paid Tk 90,000 crore in capacity charges in the last 14 years. Now, the figure stands at a whopping Tk 99,279 crore. For a nation embroiled in economic turmoil and acute energy poverty, the situation is extremely alarming.
The latest report has revealed that 42 state-run power plants have been sitting idle, producing little to no electricity, while being paid Tk 13,446 crore in operation costs in the past five years. According to CPD Research Director Dr Khondaker Golam Moazzem, the government keeps these inefficient costly power plants to show how they've increased power capacity during their tenure. But what good has this culture of touting about achieving overcapacity done for the nation, when the public's demands continue to be unmet?
Ironically, despite overcapacity, Bangladesh reportedly witnessed the worst electricity crisis this year since 2013, which plunged residents and industries into utter misery. So then, would we be wrong to say that the overcapacity in the power sector – coupled with the disreputable capacity charge model – has only served as a cash cow for a powerful few? What's even more frustrating is that not only is there no sign of positive change, but more power plants are in the pipeline to increase the capacity to 60,000MW by 2040. This is beyond unacceptable.
Time and again, experts have criticised this practice of paying capacity charges to power plants. Numerous studies have shown the problematic nature of power plant contracts, which incentivise private high-cost rental power plants to produce less and maximise their profits. The government's IMED report itself deemed it a "model of robbery," though it was later revised excluding the chapter critical of the government's current policies.
Experts have recommended adopting a "no electricity, no pay" clause in power purchase contracts and phasing out dysfunctional power plants. We urge the government to act on these logical recommendations and overhaul the long-festering power sector with energy policies that prioritise – first and foremost – the people. No excuses can justify the authorities' inaction to change this unscrupulous system.