The Bangladesh Power Development Board (BPDB) has recommended reducing gas supply to captive and commercial power plants, arguing that supplying gas to captive power generation amounts to a major waste of scarce fuel resources.
BPDB said gas-fired combined cycle power plants operate at an efficiency rate of 55 to 60 per cent, while captive plants generate electricity at only 30 to 40 per cent efficiency. As a result, a significant portion of the country's gas supply is being consumed by captive and commercial power facilities, leaving state-run power plants idle due to gas shortages and driving up electricity generation costs while widening the government's fiscal deficit.
"Supplying gas to captive power plants is against the national interest during this energy crisis. It's a technical and economic concern," BPDB argued.
BPDB stated that the national grid is now capable of supplying electricity at international standards, and distribution companies can provide industries with quality power according to demand.
"We sent a letter to the BERC. Our estimates show between 350 and 400 million cubic feet of gas are being used daily by captive plants. We could generate significantly more electricity if that gas were redirected to combined cycle plants," BPDB Chairman Engineer Rezaul Karim said.
He acknowledged that some factories cannot tolerate even one minute of load shedding without suffering major losses. The Sustainable and Renewable Energy Development Authority (SREDA) is conducting a study to identify such industries before further decisions are made, he added.
Industrialists, however, argue that they still do not receive uninterrupted electricity and are forced to invest in captive systems to avoid production losses. They say even a few seconds of load shedding can destroy large quantities of raw materials, adding that no business would invest in captive generation if reliable grid electricity were available.
Bangladesh currently has four commercial power plants alongside nearly 6,500 megawatts of captive power generation capacity.
The agency noted that one million cubic feet of gas can produce around 4 megawatts of electricity in captive systems, whereas the same amount can generate up to 6 megawatts in combined cycle plants. Despite this gap in efficiency, expensive imported gas continues to be diverted to captive generation systems operated by private industries. However, the actual scale of gas consumption by captive plants has long remained unclear.
According to Petrobangla data from May 9, 2026, power plants received 929 million cubic feet of gas, while captive plants consumed only 100 million cubic feet. Total gas demand that day stood at 2,524 million cubic feet.
However, annual reports from the six gas distribution companies paint a different picture. Titas Gas, the country's largest distributor, reported supplying 3,989 million cubic metres of gas to captive plants during fiscal year 2024-25, compared to 2,751 million cubic metres supplied to grid power plants. That translates to more than 309 million cubic feet per day going to captive users from Titas alone.
Karnaphuli Gas Distribution Company reported supplying 567 million cubic metres of gas to captive plants and 469 million cubic metres to power stations during the same fiscal year. Combined, the two distributors supplied around 353 million cubic feet of gas daily to captive facilities, compared with just 249 million cubic feet to power plants.
BERC said captive power generation capacity had reached 6,085 megawatts by June 2024. Of that amount, 3,460 megawatts are gas-based and 2,625 megawatts diesel-based. The regulator also said the number of captive power plant licences has risen steadily, with 47 licences issued in FY2020-21, 125 in FY2021-22, 159 in FY2022-23 and 310 in FY2023-24.
BPDB acknowledged these concerns only partially. It noted that in 2012 the government introduced a "Q-class" service category offering guaranteed uninterrupted electricity through dedicated lines. However, no entrepreneur applied for the service because of its higher tariff.
BPDB also raised questions about the continued approval of captive projects despite severe gas shortages that have left more than half of the country's power plants idle. Under existing rules, captive plants with gas connections exceeding 10 megawatts require prior approval from the Power Division.
