The Northern Electricity Supply Company PLC (Nesco), responsible for power distribution across 16 northern districts, faces a stark disparity in “system losses” between its Rajshahi and Rangpur divisional offices.
Rajshahi division’s eight districts maintain a ‘system loss’ of 6.99 per cent, whereas Rangpur division’s eight districts climb to 8.79 per cent.
This persistent gap is not a one-year anomaly. Over the last seven years, Rangpur’s excess ‘system loss’ has cost the government an additional Tk242.85 crore compared to Rajshahi, marking it as the worst-performing region for system loss nationwide.
While ‘system loss’ technically refers to grid inefficiencies and mismanagement, illegal electricity theft and faulty metering are draining the economy. Because the government cannot bill unauthorised connections, these criminal losses compound technical limitations, costing the country thousands of crores of taka annually.
The ‘system’ loss situation in the Rangpur region is currently the worst in the country.
In the 2024-25 fiscal year, the system loss for Dhaka Electric Supply Company-Desco (responsible for power distribution in part of the capital) was 5.50 per cent, while Dhaka Power Distribution Company-DPDC (covering the other part) stood at 5.6 per cent. Meanwhile, the Bangladesh Power Development Board (BPDB) recorded a 6.68 per cent loss.
In the southwestern region, West Zone Power Distribution Company Limited-WZPDCO reported a rate of 7.26 per cent, and the Rural Electrification Board (REB), which services rural areas, saw losses reach 8.51 per cent.
Shafiqul Alam, lead energy analyst at the Bangladesh chapter of the Institute for Energy Economics and Financial Analysis (IEEFA), a non-profit power and energy think tank, told TIMES of Bangladesh: “System losses include both transmission and distribution losses. The global average for technical grid losses is about 8 per cent, and in developed countries, it is usually below 6 per cent. In comparison, there is still considerable room for improvement in reducing system losses in our region.”
Nevertheless, the current situation is a massive improvement compared to the 2001-02 fiscal year, when combined system and transmission losses consumed nearly 28 per cent of total production. Now, average system losses have dropped to 7 per cent. However, when adding the 3 per cent transmission loss, the total loss exceeds 10 per cent, which is still two percentage points higher than the global average.
Three reasons behind ‘system loss’
When asked why the Rangpur region faces such severe system losses, Nesco Managing Director Md Mashiur Rahman outlined three primary reasons.
First, he cited the acute shortage of operational power plants in North Bengal. “Although gas-based power plants have been set up in Sirajganj and Bheramara in Kushtia, they cannot run at full capacity due to fuel shortages,” Rahman explained. “Similarly, while there is a 525 MW thermal power plant in Barapukuria, Dinajpur, it currently generates no more than 50 to 60 MW. Another diesel-powered plant in Saidpur of Nilphamari, remains idle because its production cost is a staggering Tk 25 to Tk 30 per unit. Consequently, electricity must be transmitted over a distance of 550 kilometres from Dhaka, resulting in massive transmission losses.”
Second, Nesco chief highlighted the fragile state of the 28,000-kilometre power grid in the Rangpur region, particularly the transmission lines in Lalmonirhat.
“BPDB has burdened us with the responsibility of supplying electricity to these remote areas, a task that should actually fall under REB. Not only are the lines dilapidated, but the substations are also in poor condition,” he said.
“Due to these weak lines, the voltage in Rangpur has recently dropped from 33 kV to 26 kV, and in Lalmonirhat, it plunges even lower to 24 or 25 kV. When voltage drops, the current increases, exacerbating the loss.”
Finally, Rahman pointed to weak regulatory supervision. “Almost all senior officers, including chief engineer live in Rajshahi, who are reluctant to relocate to or visit the Rangpur region. If we want to fix this, ground-level monitoring must be drastically strengthened.”
‘Head office’ stands as a problem
To counter the region’s energy crisis, Nesco Managing Director emphasised a shift toward solar power in North Bengal, noting that two plants, a 68 MW facility in Sirajganj and a 30 MW plant in Lalmonirhat, have already commenced production.
Alongside renewable energy, Rahman highlighted plans to relocate Nesco’s headquarters from Rajshahi to Bogura to bridge the severe administrative gap. Distance between Rajshahi and Rangpur has become a major roadblock for effective supervision.
When NESCO launched in 2016, authorities initially decided to set up the head office in Bogura, a strategic midway point between Rajshahi and Rangpur. Yet, a “temporary” decision to run operations from Rajshahi stretched into a decade-long inertia.
The issue resurfaced on 25 February this year when the Ministry of Local Government, Rural Development and Cooperatives formally requested the relocation, resulting in formation of a feasibility committee tasked with delivering recommendations within a month.
“There is an urgent need for closer monitoring of commercial activities in Rangpur zone, particularly regarding net losses and outstanding arrear collections,” noted its report.
On 3 April, the committee inspected a 51.59-acre site near the old Bogura Power Building in Bogura Sadar Upazila. The property includes 7.5 acres of power grid, a 7,002 sq ft three-story Superintending Engineer’s office, an older building for renovation, two double-story rest houses, and two residential buildings—enough to house the managing director’s office with land remaining for future construction.
Relocating here would halve travel distance from Rangpur to the headquarters, reducing it from 218 km to 105 km, while Bogura’s 113 km distance from Rajshahi positions it as a balanced central hub for both regions.
The committee concluded that Bogura is closer to the capital and offers far superior road connectivity for official coordination with the ministry, the Power Division, and the BPDB.
“The Rangpur region lags drastically behind the Rajshahi zone due to weak supervision, severe manpower shortages, and a lack of logistical support,” the committee’s analysis stated. Because of the current geographic disconnect, senior officials rarely conduct vital field-level inspections, while Rangpur-based staff waste immense time, energy, and travel allowances commuting to Rajshahi for routine paperwork.
Establishing the NESCO head office at a central axis between Rajshahi and Rangpur divisions would allow equal supervision over both zones, ultimately cutting system losses and driving up revenue collection.
When contacted, committee member Md Golam Mortuza briefly said: “We have submitted our report and detailed everything there.”
Nesco’s managing director remains optimistic about the transition. “Relocating to Bogura brings us closer to the field and trims 62 kilometres off our commute to Dhaka, directly cutting operational costs.”
He said Chief Engineer, planning department, and the data centre will all remain in Rajshahi as they are only moving the corporate office, specifically MD and executive associates, which would not trigger any trouble.
