Those implicated in the looting of the nation’s power sector are evading consequences. Two years following the collapse of Sheikh Hasina’s government due to a popular uprising, no individuals have faced punishment or accountability. There remains a lack of effective measures to recover the millions of taka that have been laundered abroad from this sector.
The interim administration under Dr. Muhammad Yunus has annulled the Energy and Power Sector Immunity Act, thereby facilitating the creation of new high-cost power plants without the need for tenders, which exposes a decade and a half of plundering.
However, they have failed to take action against those accountable. Instead, the Awami League syndicate continues to exert complete control over the power sector, effectively holding the government hostage. These issues have been underscored in a report by Amar Desh.The report indicates that substantial sums from the electricity sector are still enriching the looters.
In this context, they are enjoying a lavish lifestyle both domestically and internationally. Furthermore, intelligence agencies have reported that this money is being utilized to undermine the government. It is understood that some individuals are attempting to perpetuate the looting by forging alliances with influential figures within the current government. Additionally, they are exerting pressure on the government by manipulating the electricity supply through various tactics.
Consequently, the power department is finding it challenging to manage the current summer season. Despite the installation of a power plant with a capacity of 29,000 megawatts, only 14,000 megawatts are available during peak evening hours.
During the tenure of the ousted Prime Minister Sheikh Hasina, a significantly higher number of power plants were approved than necessary. To curb looting, the illegitimate government sanctioned power plants with a capacity of 30,000 megawatts, nearly double the actual demand. While these plants were established, approximately 1.25 lakh crore taka was disbursed in the name of capacity charges without any electricity being received.
This huge amount was taken away by the mafia business syndicate, members of the Sheikh family, the new power business circle of the Awami Gharana and people close to the party. The corrupt bureaucratic circle, the collaborators of misrule, also took advantage. Due to the embezzlement of state money for a decade and a half, the power sector is now on the brink of collapse. The expenses and liabilities have increased day by day. And the burden is on the shoulders of the people. The country’s economy has become bankrupt due to subsidies. The price of electricity has increased step by step. Now the agitation to increase the price of electricity has started again. The current BNP government has formed a high-level committee. An announcement of a price increase can come at any time.
The report of Amar Desh further states that the current democratic government is looking for ways to take action against the looters in the power sector. The minister said that the legal aspects of what kind of action can be taken against those concerned are being examined. Power Development Board (PDB) Chairman Engineer Md. Rezaul Karim sees some clauses of the agreements made with Quick-Rental, Rental and IPP owners as obstacles in recovering the lost money. He also said that he is unable to find a way out of the capacity charge trap, expressing helplessness.
When asked, Minister for Power, Energy and Mineral Resources Iqbal Hassan Mahmud said, “As soon as I took office, I had to deal with the fuel crisis due to the Iran war, so it has not been possible to pay much attention to other sectors. We will definitely consider what steps can be taken regarding the terrible reign of loot that was established in the power sector in the name of rental and quick rental in the last 15-16 years. Emphasis is being and will be placed on rescuing this sector from the clutches of capacity charges. He mentioned that all possible measures will be taken against those involved in looting. In the question-and-answer session of the parliament on Sunday, the minister also spoke about the government’s initiative to bring back the money laundered by the power sector from abroad.
Huge money is still going into their pockets. Even after the fall and flight of the Sheikh Hasina-led Awami League government, huge money is going into the pockets of Awami League leaders and their close associates in exchange for high-priced electricity from rental and IPP power plants. During the Awami regime, State Minister for Power, Energy and Mineral Resources Nasrul Hamid Bipu, Summit Group’s Aziz Khan, Orion Group’s Obaidul Karim, Jatiya Party’s Anisul Islam Mahmud, Awami League leader Mirza Azam’s family, Alauddin Chowdhury Nasim, Shamim Osman have built mountains of wealth in the country and abroad by bloating money from the power sector. Several other leaders and family members of the party, anonymously, are also on this list.
Although many of them have fled the country, the companies owned by them are selling electricity to the government at high prices and embezzling huge amounts of money as capacity charges as per the contract. After the coup, the government paid 5,978 crore taka to 5 companies of the Summit Group in the last fiscal year 2024-25. This includes the price of electricity as well as capacity charges. Apart from these five, four more companies owned and partnered by Summit had to pay huge amounts of money. Digital Power and Associates, a partnership company of Orion Group and Mirza Azam family, took 298 crore 62 lakh taka from the government in the last fiscal year (2024-25). Mirza Azam’s three brothers, Mirza Golam Rabbani, Mirza Golam Kibria and Mirza Zillur Rahman, are owners of this company along with Obaidul Karim of Orion Group. Mirza Azam did not become a direct director at that time because he was a minister.
The report also highlights that Alauddin Nasim, Sheikh Hasina’s former protocol officer and Awami League MP from Feni-1 constituency in the illegal parliament, has taken Tk 241 crore from the government in the previous fiscal year through capacity charges and high-priced electricity. Alauddin Nasim is the managing director of the company. Orion Group boss Obaidul Karim is also in this company. In another looting company, Orion Power Sonargaon Ltd., Obaidul Karim’s partner is the Mirza Azam family and the discussed godfather of Narayanganj, Shamim Osman. The state-run Power Development Board (PDB) has paid Tk 441 crore 69 lakh to this company in the last fiscal year after the coup. Another company, Orion Power Rupsha Ltd., with a capacity of 105 megawatts, is a partnership of the Mirza Azam family. The government paid Tk 351.85 crore to this company in the last fiscal year 2024-25. In the previous fiscal year 2023-24, the company was paid Tk 483.59 crore including capacity charges.
PDB’s helplessness: to deal with the emergency crisis, starting from 2009, it started setting up quick rental power plants and buying electricity without tender, with a term ranging from just one year to a maximum of 3 years. But even after 16 years, contracts with many plants have been maintained. During the interim government, PDB was able to wrap up business with a few companies.
PDB Chairman Engineer Rezaul Karim told Amar Desh on Sunday that during the Dr. Yunus government, it was possible to get out of contracts with 10-12 companies. It is not possible to cancel the contracts of other companies or get out of the capacity charge if they want. If they go to domestic or international courts, the complications will increase.
Sources said that the PDB is still taking electricity from 21 quick-rental and rental power plants at an unusually high price. In addition, the government also has to take electricity from 57 IPPs and SIPPs without tenders at high prices. There are allegations that some have even set up old and dilapidated power plants and grabbed capacity charges. When the Awami League government came to power in 2009, about 80 percent of the total generation capacity was in state ownership. And since the power plants were set up indiscriminately in the private sector to give party members an opportunity to loot, now the control of the entire sector has passed into the hands of mafia groups. They can plunge the entire country into darkness if they want. Sector stakeholders believe that a sensitive sector like electricity being held hostage in the hands of a particular group in this way is risky for any country.
Violation of license conditions : A report by PDB says that from the fiscal year 2008-09 to the fiscal year 2023-24, rental and IPP plants had to pay about 1.25 lakh crore taka without consuming any electricity. This capacity charge has been increasing continuously. In the 10 years from the beginning to the fiscal year 2017-18, while the capacity charge was 43,500 crore taka to the plants, in the next six years—that is, from the fiscal year 2018-19 to the fiscal year 2023-24—the capacity charge had to be 76,000 crore taka. A review of the data shows that 80 percent of the subsidy given to the power sector is spent on paying the capacity charge, i.e. on the bills of idle power plants.
In 2009, the Awami League government allowed the establishment of 32 quick rental centers without a tender. In 2010, the National Parliament passed an emergency special law for immunity for two years to avoid a tender. Later, the validity of the law was extended several times, most recently until 2026. Under this law, 72 rental and independent power producer (IPP) centers were allowed. Without a tender competition, a large part of these power plants were obtained by high-level people close to the then government and influential party businessmen. Summit, Orion, Desh Energy, Doreen Power, Hosaf Power, United and Energypac are among them.
It is learnt that although the rental power plants were licensed on the condition that they would be used at 80 to 85 percent capacity, the power plants were operating at 25 to 30 percent capacity. In other words, these power plants did not generate electricity for 70 to 75 percent of the year, but were sitting idle. But the capacity charge has been paid.
A committee formed by the interim government has received information that Sheikh Hasina’s close associates have been smuggling billions of dollars out of the country for 15 years in the name of capacity charges for power plants. The entire time, the deposed Prime Minister Sheikh Hasina kept the responsibility of the Ministry of Power, Energy and Mineral Resources in her own hands. The syndicate of the then Minister, State Minister, Advisor, Secretary of the Power Division, PDB Chairman and top officials of the Power Division, who were in charge of the Ministry of Power, Energy and Mineral Resources of the ousted Awami League government, participated in the reckless looting. Among them, the deposed Prime Minister’s son Sajeeb Wazed Joy and his close and trusted State Minister for Power Nasrul Hamid Bipu were the masterminds of the looting. And the former Energy Advisor (currently imprisoned) Toufiq-e-Elahi Chowdhury, former Chief Secretary Abul Kalam Azad and Ahmed Kaikaus worked as the ‘gurus’ of the syndicate to control the overall looting of the energy and power sector. This syndicate, under a special law, without any competitive bidding, provided rental, quick-rental and IPP power plants to businessmen close to the then government and supporters of the Awami League. However, the government itself could have established more power plants with the money that the looters had borrowed from various centers to set up the plants.
Instead of fines, private sector furnace oil-fired power plants have been charging capacity charges : instead of fines, while keeping the power plants in the same manner. It is learned that according to the agreement, a power plant can shut down (outage) for 10 percent of the year for repairs and maintenance. That means a 100 MW power plant can shut down for 836 hours (36.5 days) a year. Outside of this, the plant will not receive rent; rather, they will have to pay a fine. But even if the power plant is shut down in violation of the conditions, the PDB pays the capacity charge.
BPDB officials say that PDB was kept in the dark while making the suicidal agreements. The then government did not involve PDB in any of the agreement processes except for being present as an ordinary member in the tariff determination committee. Yet they are the ones who have to take responsibility. The outstanding bills of private power plants have already increased to about 56 thousand crores. As the arrears are piling up, the companies of powerful owners are occasionally refusing to operate the power plants. This is putting PDB in a hostage situation. PDB is paying electricity bills without calculating the time the plant is closed. It is known that such bills have been being paid since July 2022. The then chairman Engineer Mahbubur Rahman approved this decision in the BPDB board without the approval of the Power Department.
Recently, in response to a question in the National Parliament , Minister for Power, Energy and Mineral Resources Iqbal Hassan Mahmud Tuku said that the bank loans of the country’s power plants are currently Tk 1,49,311.26 crore. Most of the owners of private power plants have not paid their bank loans despite collecting the bills from the government.
The Energy Minister also said that Tk 17,357.68 crore is outstanding for capacity charges and fuel payments for gas and fuel oil-based IPP power plants. In addition, Tk 15,452.91 crore is outstanding for coal price and capacity charges for joint venture and IPP coal-based power plants.
Entrepreneurs of private power plants say that private power generating companies are now under financial pressure due to the increase in arrears against electricity sales. Many companies are at risk of repaying loans due to non-payment of arrears for a long time. Due to this situation, the opportunities for many companies to get new bank loans have also narrowed. Due to non-payment of regular payments, banks are also uncertain about getting back their loans.
When contacted on his cell phone, David Hasnat, president of the Bangladesh Independent Power Producers Association (BIPPA), an organization of private power plant owners, did not receive a response to his statement about the power sector being held hostage and looting and money laundering in the name of capacity charges.
