PDB's losses mount as state coal supplier's inflated price continues defying global fall
BPDB says the inflated rate has pushed its annual losses above Tk1,000 crore and increased the cost of power generation at the Barapukuria coal-fired power plant
HIGHLIGHTS
- BCMCL's fixed coal price $176 per tonne, 45% higher than global benchmarks
- PDB paying $54–$75 more per tonne
- BCMCL previously demanded $201.56/tonne
- Profit per tonne for BCMCL: $54.99-$57.47
- Average imported coal cost: $74.76 per tonne
- Barapukuria-grade equivalent: $91.20 per tonne
Bangladesh Power Development Board (PDB) is suffering steep financial losses as state-owned Barapukuria Coal Mining Company Limited (BCMCL) continues to charge a fixed coal price of $176 per tonne, well above international benchmark rates, which are currently hovering between $116 and $121 depending on the index.
PDB says the inflated rate has pushed its annual losses above Tk1,000 crore and increased the cost of power generation at the Barapukuria coal-fired power plant.
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According to PDB data, the coal pricing alone caused losses of Tk1,742.26 crore in the 2024-25 financial year, driven by dollar exchange rate volatility and high production costs.
Barapukuria Power plant is located in Dinajpur, with two units – one 125MW and another 275MW commissioned in 2006, and is operated by PDB.
PDB Chairman Md Rezaul Karim said the price disparity is causing heavy financial strain.
"BCMCL is charging $176 per tonne, which is far above the international market. A decision has been taken to pay following the Indonesian Coal Index-1 (ICI-1), but BCMCL refuses to follow it," he said.
He also noted that BCMCL distributes significant profits among its employees – around Tk40-50 lakh each – made possible by the inflated pricing.
BCMCL had earlier sought an even higher coal price of $201.56 per tonne.
The company now earns a profit of $54.99 to $57.47 per tonne, generating annual profits of Tk444.29 crore in FY2022-23 and Tk581.03 crore in FY2023-24.
BCMCL Managing Director Md Abu Taleb Farazi, however, defended the pricing, saying the Energy Division set the price in 2022 and that it reflects operational expenses and future mine expansion costs.
Now, with no government subsidy to absorb the inflated coal cost, the Barapukuria power plant is struggling to meet its energy payment obligations, raising concerns about its operational stability and reliability, according to PDB officials.
Price gap with global market, deepened loss
Coal prices on major international indices between January 2024 and September 2025 remained well below BCMCL's fixed rate. Benchmark prices averaged between $100 and $122 per tonne.
A comparative review of international coal prices during the period shows that PDB is paying over 45% more for Barapukuria coal.
The Australian Newcastle Index averaged $121.85, Indonesia's HBA 6322 stood at $117.85, and the Indonesian ICI 6500 was $116.58 per tonne. Even South Africa's RB 6322, one of the lowest benchmarks, was just $100.68.
This means PDB has been paying between $54 and $75 more per tonne than comparable global rates, sharply raising power generation costs and contributing to its mounting annual financial losses for the state-owned power management company.
The organisation posted losses of Tk1,023.22 crore in FY2022-23, Tk1,190.47 crore in FY2023-24, and a staggering Tk1,742.26 crore in FY2024-25.
The latest surge was driven by high coal prices and a sharp rise in the US dollar, increasing dollar-denominated payments.
BCMCL profits surge
While PDB plunges deeper into financial losses, Barapukuria Coal Mining Company Limited recorded unprecedented profit growth since the coal price was fixed at $176 per tonne in January 2022.
The company posted profits of Tk444.29 crore in FY2022-23, Tk581.03 crore in FY2023-24, and an audited Tk851 crore in FY2024-25.
A major factor has been the increase in the US dollar exchange rate. Although most BCMCL expenses – such as salaries, royalty, depreciation, and taxes – are paid in Bangladeshi Taka, payments from PDB are made fully in dollars.
The exchange rate shift from Tk84 to Tk122 per US dollar has boosted BCMCL's earnings by more than 45%.
Imported coal comparisons
After analysing imported coal pricing data, a stark gap was seen between PDB's coal costs and those paid by other major coal-fired plants.
While PDB paid $92.92 per tonne for 5000 GAR coal, other plants sourced fuel at significantly lower international benchmark rates.
BCPCL's 1,244MW Payra plant bought coal at $76.16 under the Newcastle Index, and Rampal Power Plant secured supplies at $73.84 following the ICI-2 index, compared with PDB's $90.08 for similar grades.
SS Power's 1,244MW unit paid $71.49 under ICI-3, against PDB's $87.22. Even Adani Power paid only $76.91 using a blended Newcastle – HBA2 reference, whereas PDB paid $91.20 for equivalent coal.
Imported coal averaged $74.76 per tonne FOB, and the equivalent value for Barapukuria-grade coal stands at $91.20. Since Barapukuria coal is delivered without shipping costs – typically $10.92 to $21.94 per tonne – PDB says $91.20 per tonne is an appropriate benchmark.
