Adani Power cuts electricity supply to Bangladesh over $846 million unpaid debt: report

Dhaka, November 1 (Xinhua) According to local media reports, India’s Adani Power Company Limited (APJL), a wholly-owned subsidiary of Adani Power in Jharkhand, has stopped half of its power supply to Bangladesh due to arrears of US$846 million. Friday.

According to the Daily Star, data from Bangladesh Power Grid Corporation showed that Adani factories reduced supply on Thursday night.

Bangladesh reported a power generation shortfall of more than 1,600 megawatts (MW) on Thursday and Friday nights as the 1,496 MW power plant currently produces 700 MW per unit, the newspaper reported.

Previously, Adani sent a letter to the Minister of Power, requesting the Power Development Board of Bangladesh (PDB) to settle its outstanding dues before October 30.

The letter, dated October 27, said if the bills were not paid, the company would be forced to take remedial measures under the power purchase agreement (PPA), namely suspending power supply on October 31.

The company said PDB neither extended a $170.03 million letter of credit to Bangladesh Krishi Bank nor liquidated the outstanding amount of $846 million.

The newspaper quoted PDB officials as saying they had earlier settled some of their previous dues, but Adani’s charges since July have been higher than in previous months.

He said PDB was paying out about $18 million a week, while charging more than $22 million.

“That’s why payments due have increased again,” he said, adding that they had also submitted last week’s payment to Clichy Bank, but the bank was unable to open a letter of credit against the payment due to a shortage of dollars.

Regarding the additional payment, he said that when the PDB raised the issue of coal pricing in February last year, they signed a supplementary agreement requiring Adani to quote coal prices lower than those of other coal-fired power plants.

According to reports, after the one-year supplementary agreement expired, Adani once again began charging according to the power purchase agreement.

According to the PPA, coal prices are calculated based on the average price of two coal indices – the Indonesian Coal Index and the Australian Newcastle Index – which increase prices.

Adani said it reserves the right to recover capacity payments under clause 13.2(1) of the power purchase agreement during the supply suspension period.

Adani has been urging the interim government to pay its dues since it came to power following the ouster of then-prime minister Sheikh Hasina.

On August 8, an interim government led by Nobel Prize winner Professor Muhammad Yunus was established in Bangladesh. Gautam Adani, chairman of Adani Group, also wrote to Yunus’ chief adviser.