Summit shuts another power plant

Summit Power has shut down its gas-fired Madhabdi Power Plant Unit-2 as the factory's power purchase agreement with the government has expired.

In a disclosure posted on the Dhaka Stock Exchange website yesterday, the listed power company said the 24.30 megawatt plant's agreement to supply electricity to the Power Division had expired on December 15 this year.

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On February 18, Summit Power had applied for an extension of its government contract from the Ministry of Power, Energy and Mineral Resources.

However, this request is still under active consideration, the company said in its disclosure.

It also informed that the plant has been shuttered since midnight on December 15 and will remain as such until receiving further instructions from the ministry.

As a result, Summit Power's share value fell 2.26 per cent to Tk 38.90. Earlier, Summit Power shut down its gas-fired Summit Chandina Power Plant Unit -2 due to the same reason. The unit had a power production capacity of 13.5 megawatts.

The company's Madanganj Power Plant, which has the capacity to produce 102 megawatts, also saw its government contract expire and subsequently halted operations.

Swapon Kumar Pal, company secretary of Summit Power, said operations at all three power plants were suspended due to the same reason, which is the expiry of their government purchase agreements.

Although the company is yet to get extensions for the two plants that were closed previously, they are hopeful of a positive decision from the relevant authorities.

"We are working on it," Pal added.

Meanwhile, the owners of many quick rental power plants have been lobbying the government to extend the tenure of their purchase agreements.

The Bangladesh Securities and Exchange Commission also lobbied government high-ups to grant these extensions considering the interest of general stock investors as many of these plants are listed.