Adani Power has resumed electricity exports to Bangladesh, supplying 1,362 MW from its Jharkhand plant following a request from the BPDB amid rising demand. This revival comes after a previous reduction due to unpaid bills. Payment agreements are in place to address outstanding dues, although the current Power Purchase Agreement raises concerns regarding late surcharges.
In a significant development, India’s Adani Power has resumed full-scale electricity exports to Bangladesh following a request coinciding with the commencement of Ramadan. The Adani Power Jharkhand Ltd (APJL) plant was able to supply approximately 1,362 megawatts (MW) out of its total capacity of 1,496 MW. This resumption has come in response to increased electricity demands in Bangladesh as the summer season approaches.
The Bangladesh Power Development Board (BPDB) demanded the full operation of the APJL plant due to the rising electricity requirements. Adani had previously reduced production by shutting down one of its units due to an outstanding payment issue totaling around USD 850 million. This led to a critical reduction in energy supply until the BPDB issued a payment of USD 170 million.
As a result of ongoing negotiations, the BPDB has committed to making monthly payments of approximately USD 85 million to help clear the backlog. Adani has expressed its willingness to allow BPDB to settle the outstanding dues, amounting to around USD 800 million, by June 2025 without incurring late-payment surcharges. However, the existing Power Purchase Agreement (PPA) stipulates a severe late-payment surcharge of 2 percent per month on total dues, which translates to an annual rate of about 27 percent.
Furthermore, the electricity purchase from APJL has been contentious since its inception, with the BPDB advocating for a revision of the PPA that has been in place since November 2017. Transparency International Bangladesh has urged that this agreement be reconsidered, highlighting the complexity of the agreement and tapping into the legal and financial implications surrounding it.
The negotiations between Adani Power and BPDB signify the delicate balance between fulfilling energy needs and managing financial relationships in cross-border electricity trade.
In conclusion, Adani Power’s resumption of electricity exports to Bangladesh marks a pivotal moment in addressing the energy demand amid rising temperatures. Despite previous challenges stemming from significant outstanding payments, cooperative measures between Adani and BPDB have paved the way for continued power supply. However, the controversies surrounding the Power Purchase Agreement underscore the need for transparency and potentially revising agreements to better serve both parties in the future.
Original Source: thefinancialexpress.com.bd
