According to sources, public institutions under several ministries have requested more financial allocations to assist them in paying the growing arrears on electricity bills owed to power distribution corporations. Due to the substantial amount of unpaid bills, the Power Division has asked the Ministry of Finance to provide extra funding to the relevant ministries and divisions in order to rescue the defaulters.

Data from the Power Division up to August of this year indicates that public institutions under several ministries and divisions owe electricity distribution companies approximately Tk 24.30 billion.
In a recent letter to the relevant ministries and divisions, the Power Division stated that “the power-distribution businesses have been enduring financial losses due to the non-payment of bills coupled with facing disruptions to the upgrading of their distribution system.”
The Power Division had previously written to Dr. Salehuddin Ahmed, the Finance Adviser, during the first week of November, requesting his assistance in making sure that the necessary monies were included in the updated budget to pay unpaid electricity bills.

A senior Finance Division official told to media that funds may be allocated in the revised budget if ministries and divisions can justify their demands.
“But we have asked them to make realistic demands and not to seek funds unnecessarily,” the official said.

Data show that entities under the Local Government Division are the largest defaulters, owing about Tk 9.5 billion to Bangladesh Power Development Board (BPDB), Bangladesh Rural Electrification Board (BREB), Dhaka Power Distribution Company (DPDC), Dhaka Electric Supply Company (DESCO), West Zone Power Distribution Company Ltd (WZPDCL), and Northern Electricity Supply PLC (NESCo).

Entities under the Ministry of Disaster Management and Relief are the second-highest defaulters, with arrears amounting to Tk 6.14 billion. The Ministry of Housing and Public Works ranks third, owing around Tk 1.56 billion.

Entities under the Ministry of Defence, the Secondary and Higher Education Division, the Health Services Division, and the Ministry of Religious Affairs are also among 57 ministries and divisions with significant electricity-bill arrears. Even entities under the Power Division itself owe Tk 155 million, according to official data.

A senior BPDB official said the government incurred a staggering loss of Tk 550 billion in the last fiscal year by selling electricity at prices lower than generation costs, compared to Tk 500 billion in the previous fiscal year. Following the uprising, the interim government paid Tk 380 billion in subsidies to BPDB to offset the losses.

“The delay in receiving power bills from public entities further increases the financial losses of the distribution companies,” the official said.

Finance Division officials noted that the government is facing pressure from the International Monetary Fund (IMF) to reduce power-sector subsidies.
“Instead of declining, subsidy payments are increasing every year, creating severe challenges for fiscal management amid low revenue generation,” an official added.