Power Division fears Tk 35,000cr loss for corona pandemic

Power Division is facing a Tk 35,000 crore loss in generation, transmission and distribution sides caused by the coronavirus pandemic.
To offset the loss, Power Division plans to write a letter to the Prime Minister, the line Minister of the Power, Energy and Mineral Resources seeking directives and intervention to overcome the situation.
"We have prepared a draft report on probable huge financial losses here. We have estimated that these are coming from multiple directions including generation, transmission and distribution sector," Director General of Power Cell Mohammad Hossain told the Daily observer on Saturday.
Nasrul Hamid, State Minister for Power, Energy and Mineral Resources, asked the Power Cell to make an assessment of the corona effect on power sector recently.
According to the sources in Power Division, it would face a loss of Tk 5,598 crore in power generation side, Tk 17,666 crore in distribution and TK 3,322 crore in transmission side. At the same time, it would have to incur a TK 8,821 crore as tariff loss.
"Due to corona virus outbreak we cannot sell around 4,000 MW of electricity every day since the lockdown. During the Eid and Baishaki period we used to supply extra 4,000 to 6,000 MW of electricity to market places, however, this time around, coronavirus outbreak cut down the demand of electricity worth about Tk 5,598 crore in last two months," Mohammad Hossain said.
He said the extent of financial loss could be more than that, which is still unfolding.
It fears that if the situation worsens more, then the current gap between demand and supply may rise further, leading to an increase in surplus in electricity generation and may push to stop more power generation plants.
"No matter what the situation is, we have to pay the capacity charge to the entrepreneurs, on the other hand, they could stop generation showing the "emergency situation clause" of the IPP contract. But we have to pay the capacity payment," the Power Cell DG added.
He said the transmission and distribution projects will suffer the most, the delay in these projects will accelerate the project cost and as a single buyer, the BPDB will have to pay for the huge tariff loss.
Earlier, the Power Division estimated that it had already incurred a huge financial loss of over Tk 6,000 crore a year, due to surplus electricity generation.
He said the country's generation capacity will continue to grow in coming years as a good number of base-load plants will go into operation.