Power Supply at Risk Without Subsidy Payments

As Bangladesh approaches the holy month of Ramadan, the peak summer season, and the irrigation period, deep uncertainty looms over electricity supply. The country’s two largest coal-fired power plants—Rampal Maitree Super Thermal Power Plant and Payra Power Plant—are facing a severe financial crunch for coal imports due to outstanding subsidy payments amounting to BDT 4,726.37 crore. This situation threatens uninterrupted electricity production and distribution across the national grid.

In a letter sent to the Ministry of Finance on Tuesday, the Power Division warned that unless the overdue subsidies are released, both Rampal and Payra will be unable to import fuel or generate electricity. Combined, these plants contribute 2,400 MW of base-load power to the national grid, making them critical for maintaining supply stability. The subsidy payments for these plants have been pending since August last year.

The Power Division emphasised that failure to release the funds could result in nationwide load-shedding of 2,000–2,500 MW during periods of high demand in Ramadan, the irrigation season, and summer. This would not only disrupt irrigation operations but also generate widespread public discontent.

The crisis is further exacerbated by global energy market dynamics. The closure of the Hormuz Strait due to conflict in Iran and production reductions by Qatar, the country’s main LNG supplier, have added pressure on domestic electricity generation.

The Bangladesh Power Development Board (BPDB) has requested the Finance Secretary, Dr. Md. Khairuzzaman Mozumdar, to expedite the release of pending subsidies to ensure continuous electricity supply during this critical period. According to BPDB data, each plant requires approximately BDT 700–800 crore in monthly subsidies. From August 2025 to January 2026, the total outstanding subsidy amounts to BDT 4,726.37 crore. Delays in subsidy payments have also affected timely settlements with other power plants.

The Power Division noted in the letter that foreign loans linked to these plants require clearance from lenders before revised tariffs can be approved. The absence of such approvals has delayed submission to the government’s procurement committee. Discussions with lenders are ongoing, and the division assures that tariff reviews and approvals will be completed as soon as possible.

Rampal and Payra Power Plants Overview

Experts warn that without timely release of subsidies and resolution of tariff issues, Bangladesh’s electricity system could face significant strain. Immediate coordinated action is crucial to prevent widespread disruption during the high-demand summer and irrigation periods.