UNITED Power Generation and Distribution Co Ltd, which owns two commercial independent power plants, set up with a combined capacity of 164MW in 2008 and 2009 that supply power to the export processing zones in Dhaka and Chattogram, is reported to have been raking up an abnormal amount of money in profit, more so since 2018, when it began to pay less for the gas it buys for its plants from Titas Gas Transmission and Distribution Co Ltd. Paying less for years since January 2018, the power company has owed Titas Tk 4.86 billion by October 2024. This is believed to have been possible as the company owner had been close to the government of the Awami League, which assumed office in 2009 and was toppled in a mass uprising on August 5. The company, which produces power commercially, was not meant to receive gas in view of the 2008 policy to enhance private sector participation in the power sector. United Power, which has made 50鈥�74 per cent profit over the past decade, bought gas for Tk 9.88 billion between 2017鈥�2018 and 2023鈥�2024 and earned Tk 37.99 billion from its sales of power. Experts view the incident as a tell-tale sign of the Awami League鈥檚 favouritism.
The company has also been named a group favoured by the Awami League in the white paper on the state of the Bangladesh economy, which a government committee instituted on August 29 submitted on December 1, noting that the company had received special terms. The company receives gas at the purchase rate applicable to independent power plant, which is lower than the purchase rate applicable to captive and commercial power plants. The company had signed a deal with Titas to buy gas at the captive rate a year before it obtained the licence in October 2009. The company buys gas at the independent power plant rate of Tk 15.75 a cubic metre instead of the captive rate of Tk 30.75 a cubic metre. In 2009, the difference in gas prices for independent power plants and captive power plants was Tk 1.12 a unit, which has now increased to Tk 15 a unit. United Power kept paying for the gas at the independent power plant rate after it had obtained licence until August 2022, when the High Court ruled that the company should pay at the captive plant rate for the gas it uses for commercial power and at the independent plant rate for the gas it uses for power sold to the government. The High Court order came after a legal battle triggered by Titas asking for separate rates in 2019. United Power鈥檚 outstanding bills from paying less stood at Tk 3.77 billion in 2022, the company agreed in December that year agreed to pay back the dues in 40 instalments, but only one instalment, Tk 300 million, has so far been paid.
The government should, in such a situation, make United Power pay back the bills outstanding to Titas Gas and review the licence.
