B Mirror Desk : Foreign owners of the EPV Thakurgaon 115-megawatt power plant express frustration over ongoing payment delays that create significant financial and operational challenges for the company.

The independent power producer, one of many contracted by the previous government, has reported the payment backlog in a letter, citing that the Bangladesh Power Development Board (BPDB) has consistently failed to make bill payments on time as agreed.

As noted, the board has “consistently failed” to adhere to the 30-day payment term outlined in the Power Purchase Agreement, with delays reaching as long as 165 days.

However, the specific amount of payment arrears has not been disclosed and remains unknown.

“These delays are significantly affecting EPVTL and jeopardizing its ongoing ability to operate and supply electricity to the people of Bangladesh,” states Stephen Vineburg, chairman of EMA Power Investment Ltd, the company that owns the power plant, in a letter addressed to the energy adviser of the interim government.

He has requested “immediate action” from the adviser to address the delays in settling energy payments owed to EPVTL.

The independent power producer has also forwarded a copy of the letter to the finance ministry for necessary action, according to sources.

“It is crucial that the outstanding payments are resolved promptly and consistently in the future, in accordance with the terms of the PPA,” Mr. Vineburg writes.

He further noted that due to BPDB’s failure to make timely payments, EPVTL has been unable to meet its payment obligations for importing heavy fuel oil.

This situation has resulted in significant foreign-exchange losses amounting to US$12 million, exacerbating the financial pressure on the company.

Moreover, banks have ceased providing working-capital loans, severely restricting EPVTL’s capacity to maintain the essential fuel inventory, thereby diminishing its ability to satisfy the demand from the National Load Dispatch Centre (NLDC).

The EPVTL is a wholly owned subsidiary of EMA Power Investment Ltd, which serves as an investment platform created by the Islamic Development Bank Infrastructure Fund II and DL Energy Co Ltd, a branch of Delimb Co Ltd from Korea.

“The debt and equity investments that support EPVTL are sourced entirely from foreign entities, and there is increasing apprehension among international capital providers regarding these delays under the PPA,” states the chairman’s letter.

“Any additional delay in payments from BPDB threatens foreign direct investment, local job opportunities, and suppliers, as well as the reliability of energy supply and the future of independent power producers in Bangladesh,” comments Mr. Vineberg.

When contacted, a BPDB representative confirmed the delay in processing energy bill payments due to financial constraints. “We are working to address the payment issue with the company.”

A finance division official, when reached out to, declined to comment on the matter until receiving an update from the power division regarding this issue.