Power crisis deepens as gas shortage fuels record load shedding
Graphics: Agamir Somoy
Gas crisis has persisted for over two weeks that has directly impacted the power sector, leading to increased load shedding.
On Monday at midnight, the country witnessed a record-breaking 3,512 megawatts of load shedding. Amidst the sweltering heat, hours of power outages have made life miserable, while the twin crises of gas and electricity are halting factory operations.
There are four primary reasons why load shedding has increased. First, the energy crisis prevents production from meeting demand, compounded by reduced gas supply due to LNG terminal faults. Second is the maintenance and technical glitches in various power plants. Third is the recent spike in demand for electricity. The final reason is the financial crisis.
Power Development Board (PDB) Member (Generation) Md Jahurul Islam said, “A minimum of 1 billion cubic feet of gas is required daily for power generation. While this was available until recently, it has now dropped to 670 million cubic feet, which is disrupting electricity production.”
Along with this shortage, rising temperatures and the increased use of electric stoves due to the gas crisis have further pushed up demand, exacerbating load shedding. Officials added that expensive oil-fired plants have increased production to mitigate the deficit, but these cannot be run for long periods as it would abnormally increase subsidies; thus, the PDB has no alternative.
The average electricity demand in the country is 16,000 to 17,000 megawatts, while production is around 14,000 to 15,000 megawatts. Although the electricity generation capacity is nearly 29,000 megawatts, it is not being achieved due to fuel shortages and various other crises.
On Wednesday, load shedding reached up to 2,970 megawatts. However, load shedding began to decrease from the morning as demand dropped due to the holiday and rainfall.
The most cost-effective gas-based power plants have a capacity of 12,154 megawatts, requiring at least 2.14 billion cubic feet of gas daily. However, production from these plants has never met demand due to the gas shortage, dropping from 5,500 megawatts recently to an average of 3,500 megawatts now.
Meanwhile, coal-fired plants have a capacity of 7,945 megawatts, with a maximum of 5,600 megawatts being produced. Indian company Adani is supplying nearly 1,500 megawatts, as their supply increased following faster arrears payments. The Indian firm expressed satisfaction with the payments and promised to supply maximum electricity based on demand.
On the other hand, production at the Payra Thermal Power Plant has decreased by over 500 megawatts due to technical faults, with expectations to return to production between 8 and 10 August.
At Barapukuria, production from domestic coal is also low, with two out of three units closed due to technical issues. To manage the shortfall, the use of oil-based plants has increased; despite a capacity of 6,400 megawatts, they are producing up to 3,350 megawatts. The average cost per unit for oil-fired electricity is nearly Tk 20, compared to about Tk 3.5 for gas-based electricity.
PDB officials said many private oil-fired plants are operating with limited fuel stocks. Some plants maintain production until 10 pm or midnight but reduce it afterward because delays in bill payments make it difficult for them to purchase new fuel.
While load shedding is somewhat lower in Dhaka and major cities, rural areas are facing 10 to 15 hours without electricity, with some areas receiving power for only 5 hours a day. This has caused an extreme disaster in life, particularly for children, the elderly, and hospital patients, while also disrupting students’ studies and reducing the income of auto-rickshaw drivers and small entrepreneurs.
In industrial factories, production is hampered by the dual shortage of gas and power, leading to increased costs, causing many owners to declare holidays, and resulting in mounting losses for businesses, while also negatively impacting tourism centers.
The government is burdened with a massive amount of arrears and debt left behind by the previous Awami League government, making it difficult to purchase the fuel needed for required power generation.
Public and private companies are owed around Tk 48,000 crore by the PDB, with private oil-fired plants owed about Tk 17,000 crore. Private plant owners are pressuring the government for arrears, claiming they lack the funds to buy fuel, while the government lacks the capacity to clear such massive debts at this moment.
This crisis has caused concern among officials, as the inability to manage load shedding could trigger public anger.
To reduce the subsidy burden, electricity prices were increased in June, which is expected to boost PDB’s income and prevent new arrears, though clearing old debts will take time.
Experts pointed that during the Awami League’s 15-year tenure, generation capacity increased over fivefold, and production grew 3.6 times, but capacity charges (plant rent) skyrocketed 16-fold.
They alleged that the deposed Awami League government built one unnecessary power plant after another without ensuring fuel security just to benefit special interest groups, leaving nearly half of the capacity idle.
According to the contracts, each plant must be paid a fixed capacity charge regardless of whether they produce electricity. In the 2024-25 fiscal year, plants took Tk 44,000 crore in rent, a figure that could exceed Tk 48,000 crore in the 2025-26 fiscal year.
