Power supply to be disconnected if dues are not paid
The National Review Committee has questioned the government’s agreement with Indian company Adani Power during the Awami League government as being against the country’s interest. At the same time, while the committee analyzed the information and data against the interest of this agreement, Adani Power Limited (APL) has warned that power supply will be stopped from November 11 if all dues are not paid by the 10th of this month. On October 31, Adani Power sent a letter to Bangladesh Power Development Board (BPDB) Chairman Engineer Rezaul Karim.
In the letter, Adani Power Vice Chairman Avinash Anurag alleged that BPDB has failed to pay dues of US$ 496 million. Out of this, BPDB itself has accepted $ 262 million as ‘undisputed dues’. The letter states that clause 13.2 of the Power Purchase Agreement (PPA) signed on November 5, 2017, states that the company has the right to suspend supply if the dues are not paid. If all dues are not paid by November 10, we will be forced to stop supply from November 11.
The Indian company said that even if power supply is stopped, Adani is entitled to get capacity charges on the basis of ‘reliable generation capacity’ as per the PPA. That is, even if there is no power supply, Bangladesh will have to pay a certain amount for capacity charges.
Earlier, on September 27, Gautam Adani had complained in a letter sent to Principal Advisor Professor Dr. Muhammad Yunus that BPDB had not paid the dues despite repeated promises. It was promised to settle all dues by September, but nothing happened.
Meanwhile, BPDB has refused to go to mediation for the time being regarding the contract dispute. They say that the matter is sub-judice in Bangladeshi courts and allegations of irregularities are under investigation, so going through the mediation process now is a waste of time and money. As a result, the ongoing tension regarding Adani-BPDB has created new uncertainty in the power trade between the two countries. In a letter sent to the registrar of the Singapore International Arbitration Centre (SIAC) on November 2, the Bangladesh Power Development Board said it was inappropriate to initiate mediation now. The matter is sub-judice in the High Court and allegations of irregularities are under investigation. The letter was signed by PDB Director (Coal-Based Power Generation) Engineer Maksudur Rahman and Secretary Rashedul Haque Pradhan. They said that Adani had proposed to initiate mediation in a letter dated October 30 under clause 19.3(b) of the PPA. But the PDB says, “As per clause 19.3 of the agreement, mediation is optional, not mandatory. As per clause 19.3(d), the expert’s opinion is not final and either party can go for arbitration if they wish.” The BPDB letter also said that the matter is currently under investigation in the context of a writ petition filed in the High Court alleging irregularities in the agreement. The concerned government agencies are looking into the matter. Therefore, going to mediation now could frustrate the court’s direction. The PDB, in a request to the SIAC registrar, said that no expert should be appointed or mediation proceedings should be initiated until the investigation is completed. The agency warned, “If the registrar appoints an expert despite PDB’s objections, the cost of that appointment will be borne by Adani or the concerned party.” Experts say that without prompt diplomatic intervention, the supply from the Gadda power plant in Jharkhand, India, could be cut off, leading to a power shortage of up to 1,300 MW in the national grid.
