Overview of Bangladesh’s Energy Crisis
Bangladesh is currently grappling with an escalating energy crisis, with widespread power outages affecting much of the country. The situation has become so dire that authorities have been forced to impose prolonged load shedding in rural areas and smaller towns, while Dhaka, the capital, remains relatively unaffected. Power cuts now range from 9 to 12 hours daily in these regions, further disrupting daily life and economic activities.
The key problem lies in a significant shortfall between electricity generation and demand. Bangladesh’s current generation capacity is 12,800 MW, while the national demand exceeds 14,500 MW—resulting in a daily shortfall of approximately 1,700 MW. With power plants shutting down due to a lack of essential resources like gas and oil, the crisis continues to worsen.
Power Plants Shut Down Due to Resource Shortages
Nearly 45 power plants in Bangladesh have either partially or completely shut down due to the unavailability of gas and oil—the primary energy sources for electricity generation. These shortages are significantly affecting the country’s ability to meet its growing electricity demand, exacerbating the energy crisis further.
One of the most prominent reasons behind the shortfall is the reduced power supply from Adani Power, which had previously warned Bangladesh of outstanding unpaid bills. The group has now cut its power supply by 500 MW, leaving the country to rely on only 1,100 MW from the 1,600 MW previously supplied by Adani’s Godda power plant in Jharkhand, India. Without a resolution to these unpaid bills, further reductions in power supply are likely.
Why Bangladesh is Struggling to Meet Energy Demands
One of the primary causes behind Bangladesh’s worsening power situation is its heavy reliance on gas for electricity generation. The country’s LNG supply, essential for powering its gas-based power plants, has been disrupted. A critical LNG terminal operated by Summit Group has suspended operations for nearly three and a half months, causing a 1,200 MW shortfall in daily power generation.
Bangladesh usually generates about 7,000 MW of power from gas, but this figure has dropped to 4,800 MW due to gas shortages. With the LNG terminal down, the shortfall is further exacerbated.
Impact of Adani Power’s Cutbacks
Adani Power’s reduced supply has intensified Bangladesh’s energy crisis. Previously supplying 1,600 MW daily, Adani Power cut its supply by 500 MW due to unpaid bills, leaving Bangladesh with just 1,100 MW. The company’s letters to the Bangladeshi government highlighted $800 million in outstanding debt, $500 million of which is overdue. If the situation remains unresolved, Adani may further reduce power supplies, pushing Bangladesh deeper into the crisis.
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Wider Implications: Load Shedding Across Rural Areas
The impact of these shortages is felt most acutely in rural areas, where 80% of the regions now experience prolonged load shedding. Districts such as Chandpur, Brahmanbaria, and Lakshmipur are facing severe power outages of up to 12 hours daily. The northern areas of Bangladesh, including the Dinajpur region, are also facing challenges. The Barapukuria thermal power plant in Dinajpur has been shut down, as the plant has run out of oil and gas needed for power generation.
Political Instability and Its Effect on Energy Security
The energy crisis is exacerbated by Bangladesh’s political instability, which has strained relations with key international partners like India. Previously, India had extended an oil pipeline from Dinajpur to Siliguri, supplying diesel to Bangladesh. However, recent announcements indicate that India will not further extend the diesel pipeline, citing concerns over Bangladesh’s political instability. This lack of fuel further hampers the country’s ability to keep power plants operational.
Is There a Way Forward?
Bangladesh’s government claims the situation will improve within the next 20 days. A faulty pump at the Barapukuria power plant is being replaced with assistance from China, and the government is attempting to resolve issues with Adani Power by allocating $100 million through Sonali Bank. However, this may not be enough, as $500 million remains overdue. Without political and economic stability, Bangladesh’s energy crisis may continue to worsen, leading to even more severe consequences for the nation’s economy and quality of life.