The Financial Express

Businesses, rights groups demand power tariff cuts

Public hearing on proposed hike begins

| Updated: October 24, 2017 23:04:47

Businesses, rights groups demand power tariff cuts

Business bodies, rights groups and left political parties Monday demanded cuts, not any hike, in electricity tariff by increasing the efficiency level and decreasing generation from cost-intensive plants.

At a public hearing Monday on the proposed hike they argued that had the government followed the least-cost-power generation policy as advised by the energy regulator, the electricity generation costs would have been lower.

Charging interest of around 3.0 per cent on the subsidy money for power sector in violation of the instructions of Bangladesh Energy Regulatory Commission (BERC) to make it interest-free also adds up to electricity- generation costs, they pointed out.

The arguments came on the first day of a seven-day public hearing organised by BERC at the TCB Auditorium at Karwan Bazar in the city.

State-owned Bangladesh Power Development (BPDB) placed its proposal for raising power tariffs by 14.78 per cent or Tk 0.72 per unit (1 kilowatt-hour) at bulk level considering the costs in the fiscal year 2015-16.

The BPDB also demanded a raise in the bulk tariff by 22.24 per cent or Tk 1.09 per unit considering projected costs in FY 2017-18.

Currently, the bulk tariff on per-unit electricity is Tk 4.87, the BPDB stated.

A technical evaluation committee of the BERC, however, found gross inconsistency in BPDB's accounting statements and recommended a raise by only 11.78 per cent to Tk 5.41 per unit.

The BERC with its chairman Monwar Islam will take the final decision on the tariff-hike proposal on completion of phased hearings.

While placing the bulk-tariff-hike proposal at Monday's hearing, BPDB chairman Khaled Mahmood said the entity needs to raise the bulk tariffs because of huge loss being incurred for lower selling price against higher production cost.

"We have to buy electricity from private power producers at higher rates while the PDB has to buy fuel at higher rates than the private producers avail due to the existing policy," he said.

He also informed that the BPDB has to pay a huge amount as interest to the government for repayment of loans which it received as subsidy.

Opposing the submission by the BPDB, energy adviser of the Consumers Association of Bangladesh (CAB) Prof Shamsul Alam raised a volley of questions about justification for the proposed power-price hike.

He questioned why gas was not being supplied to generate power at low cost in state-run plants and why that gas is diverted to privately-owned power plants and BPDB is forced to buy power at much higher rates.

He accused the BPDB of buying liquid fuels at far higher rates from the Bangladesh Petroleum Corporation (BPC), but the private plants are getting it at much lower rates after import from the international market.

He argued that if such discrimination, distortions and irregularities were removed, the BPDB would not need to raise power tariffs at bulk level. If bulk-level price is up, the retail level, too, will go up, he said.

Communist Party of Bangladesh (CPB) leader Ruhin Hossain prince said if power tariff is raised, it will ultimately affect the whole economy and the common people will be the ultimate victim.
Joint secretary-general of CNG Association Hasin Parvez said one of the main costs of CNG pumps stems from electricity.

If the electricity cost goes up, it will affect the public transport fares as those are run on CNG, he said.

Member of Parliament (MP) from Bangladesh Workers' Party Fazley Hossain Badsha said the issue of electricity tariff should be discussed in parliament.

But, unfortunately, it had not been discussed in the past in parliament, which he said was injustice to the people, he lamented.

Gonosonghoti Andolan chief coordinator Jonayed Saki, Jahangirnagar University Associate Professor Dr. Begum Zebunnesa and energy-expert Saleque Sufi also spoke at the hearing, all opposing the BPDB proposal.

A number of business bodies including Dhaka Chamber of Commerce and Industry (DCCI), Bangladesh Textile Mills Association and Bangladesh Steel Re-rolling Mills Association also stood in protest against the tariff-hike move.


[email protected]


Share if you like