PDB incurred loss of Tk 1.25 cr in 3-yr

Zarif Mahmud: The number of power plants in the country has increased fivefold in a decade and a half. Production capacity has also increased fivefold. However, in parallel with this, the cost of electricity production has increased several times. The Power Development Board (PDB) has to count huge losses every year due to this. On the one hand, the government has poured a large amount of money as subsidy to meet that deficit, on the other hand, the price of electricity has been increased step by step. As a result, there was no sustainable solution to the electricity problem.
Analyzing the accounts of PDB, it can be seen that in the 16 years from 2008-09 to 2023-24, this state-owned organization has recorded a loss of more than Tk 1.25 trillion. However, this pattern of losses was not always uniform. At the beginning of the Awami League government’s assumption of power, these losses were much less. It has increased a lot in recent years. Out of this, PDB has recorded record losses for the last three financial years.
According to the company’s data, in the financial year 2008-09, PDB recorded a loss of only Tk 828.61 crore. In the next financial year (2009-10) it slightly decreased to Tk 635.76 crore. However, in the fiscal year 2010-11, the loss increased by more than seven times to Tk 4,620.64 crore. In 2011-12 fiscal year it increased by 44 percent to Tk 6,693.34 crore. However, in the fiscal year 2012-13, it slightly decreased to Tk 5,043.84 crore.
PDB’s losses increased again in the next two fiscal years. Out of this, the loss in 2013-14 financial year increased by 35 percent to Tk 6,809.25 crore. And 2014-15 financial year increased by seven percent to Tk 7,282.99 crore. However, in the financial year 2015-16, PDB’s losses decreased by 47 percent to Tk 387.37 crore. 2016-17 financial year PDB’s losses increase again. In that fiscal year, the loss stood at Tk 4,43.49 crore.
In 2017-18 financial year, PDB’s losses increased a lot. In that financial year, the loss of the company increased by 110 percent to Tk 9,310.15 crore. However, in the next two fiscal years, it decreased again. Out of this, the loss in 2018-19 financial year is Tk 8,141.34 crore and in 2019-20 financial year Tk 7,448.63 crore. However, the loss of PDB increased to Tk 11,648.63 crore in the financial year 2020-21.
In the financial year 2021-22, PDB recorded a loss of Tk 32,891.17 crore. At the end of the financial year 2022-23, the loss of PDB stood at Tk 51,300.45 crore, which is the highest so far. And the loss of the organization for the outgoing financial year stands at (estimated) Tk 41,121.15 crore. That is, in the last three years, PDB has calculated a loss of Tk 1 lakh 25 thousand 312 crore 77 lakh. Although the loss in the previous 13 years was around Tk 77 thousand crore.
Meanwhile, the government has been regularly subsidizing the power sector to cover the shortfall in losses. However, the maximum subsidy has been given in the last three financial years. Out of this, Tk 35 thousand crores of subsidy has been given in the outgoing financial year. Earlier, the subsidy was given in 2022-23 financial year Tk 29,611 crores and 2021-22 financial year Tk 12,800 crores. That is, Tk 75,311 crores of subsidy has been given in three years. However, from 2008-09 to 2020-21 financial year, Tk 62,301 crores of subsidy was given in 13 years.
According to this, Tk 1 lakh 37 thousand 612 crores of subsidy has been given to PDB in 16 years. But at this time, PDB calculated a loss of Tk 2 lakh 2 thousand 86 crores. To meet this shortage, the price of electricity has been increased. However, in recent years, the government is under pressure due to the increase in deficit and subsidies. Therefore, it was decided to increase the price of electricity four times a year under the conditions of the International Monetary Fund (IMF) to reduce the subsidy. This plan was also presented to the IMF delegation last May.
It can be seen that electricity prices will be increased 11 times till January 2027 to meet the deficit. However, electricity prices will be hiked not during summer, but during winter, especially from November to February. In this case, it has been proposed to increase the price at the rate of five percent each time. Even if the cost of power generation increases slightly over the existing rate, the subsidy in this sector will come down to zero as a result of the 11-point increase at the rate of five percent.
In a meeting with the IMF, it was informed that the price of bulk electricity was increased by an average of five percent last February. In this, the price of bulk electricity is falling on a weighted average of Tk 7.04. Although currently the bulk supply price of electricity per unit is around Tk 11.96. In other words, PDB’s loss per unit of electricity sales is Tk 4.92.
On the other hand, the price of electricity at the consumer level has been increased by 8.48 percent on an average in February. In this, the retail price of electricity falls on a weighted average of Tk 8.95. Besides, demand charges and other service fees have been increased by an average of 20 percent in February. In this, the deficit of electricity distribution companies has been almost fulfilled. However, to meet the shortfall in bulk PDB, electricity prices should be increased at half-term (one and a half months) or quarterly (three months) or six-monthly (six months) intervals at the bulk and proportionally at the consumer level.