Bangladesh Requests Full Power Supply from Adani Group

For the past three months, India’s Adani Group has been providing only half of the electricity supply to Bangladesh. With the approaching summer season and expected increase in electricity demand, Bangladesh has formally requested Adani to restore full electricity supply from its power plants.

According to Reuters, Adani Group’s coal-based power plant, located in Godda, Jharkhand, India, has a production capacity of 1,600 MW, with two units of 800 MW each. One of these units has been shut down since November, leading to a reduction in Bangladesh's electricity supply by half. Bangladesh is now requesting Adani to restart both units and supply the full amount of electricity.

A Bangladeshi official told Reuters that during the winter months, electricity demand was lower, and due to some payment issues, Adani reduced the supply. Now, with rising electricity demand, Bangladesh has asked for the supply to be restored to its previous level.

In 2017, during the tenure of Prime Minister Sheikh Hasina, Bangladesh’s state-owned Power Development Board (PDB) signed an electricity purchase agreement with Adani Group. According to the agreement, Bangladesh will purchase electricity from the 2000 crore USD power plant for 25 years. The first unit started commercial power production in April 2023, and the second unit started production in June of the same year.

Reuters reported that due to Bangladesh’s dollar crisis, the electricity bills could not be paid on time, leading Adani to shut down one unit on October 31. This resulted in the halving of electricity supply.

The Bangladesh Power Development Board (BPDB) has confirmed that it is paying Adani Group 85 million USD (8.5 crore USD) every month. However, with the increasing demand for electricity, Bangladesh has requested the resumption of power supply from the second unit as well.

BPDB Chairman Mohammad Rezaul Karim told Reuters, "The plan was to start the second unit based on our current demand, but it hasn’t been possible due to some technical issues."

He added, "Currently, we are paying 8.5 crore USD, and we are trying to reduce the outstanding amount. There are no major issues with Adani now."

Meanwhile, Adani Power’s spokesperson did not respond to Reuters' request for comment. However, in December, an Adani source stated that BPDB owed nearly 900 million USD (90 crore USD).

There is an ongoing dispute between Bangladesh and Adani regarding the pricing of electricity. According to Reuters, electricity supplied by Adani’s plant to Bangladesh costs nearly 55% more than other Indian power supplies.

Meanwhile, a Bangladeshi court has ordered an expert committee to review the electricity purchase agreement with Adani Group. The report of this committee may be released this month, after which discussions on the contract may resume.

Another report mentioned that, in August last year, facing student-led protests, Prime Minister Sheikh Hasina fled to New Delhi. In September, the interim government appointed an expert committee to review key energy contracts signed during Hasina’s tenure.

The interim government has raised allegations of irregularities in the power purchase agreement with Adani, claiming that Adani received tax benefits from Delhi for the Godda power plant that were not passed on to Bangladesh. This information was reported by Reuters in December.

Although BPDB Chairman Mohammad Rezaul Karim did not respond to Reuters' questions, he confirmed that the contract is under review, and discussions on the next steps are ongoing.