Three-day public hearing on gas price hike proposal begins Monday

A three-day public hearing on the proposed gas tariff hike at the retail level will begin on Monday.

Bangladesh Energy Regulatory Commission (BERC) will hold the hearing at the BIAM Auditorium in the city from 10 am to 5 pm every day on March 21-24 to listen to the arguments from the stakeholders in the gas sector.

As per the schedule, the hearings on the proposals of the Petrobangla and Gas Transmission Company Limited (GTCL) will be held on March 21, Sundarban Gas Company and Pashchimanchal Gas Company on March 22, Titas Gas and Bakhrabad Gas companies on March 23, Jalalabad Gas and Karnaphuli Gas companies on March 24. 

The state-owned transmission company and 6 other gas distribution companies submitted their final proposals to the energy regulator on January 25 seeking a 117 per cent hike in gas price at the retail level.

Besides, their principal gas supplier Petrobangla also placed its proposal to raise the price of the natural gas at the bulk level.

As per the gas distributors’ proposals, the monthly gas price for a double burner will increase to Tk 2100 from existing Tk 975, while price for single burner will rise to Tk 2,000 from the current Tk 925.

Petrobangla is the bulk supplier to the six downstream distribution companies. Following the submission of the proposals by the companies, a 5-member watchdog body scrutinized and set the schedule for the public hearing.

As per the BERC Act, the commission will invite interested representatives from stakeholders in the gas sector to take part in the public hearing.

After the conclusion of the hearing, the watchdog body will announce its decision within 90 days.

Official sources said Petrobangla and its 7 subsidiary bodies submitted the proposals to raise gas prices at the bulk and retail levels following the directive of the Energy and Mineral Resources Division of the Ministry of Power, Energy and Mineral Resources.

For the last several months, the Energy Division has been under pressure from the Finance Ministry to collect more revenues by raising gas prices to offset subsidies in the energy sector.

A member of the BERC said Petrobangla currently imports only 5 per cent of its daily consumption from a highly volatile international spot market where it has to buy gas at a higher price.

It imports its 20 per cent gas from two international companies under long-term contracts where price is static.

“If the local production is raised by 5 per cent, then the country will not need to import the 5 per cent gas from volatile markets at a higher price and finally it would not have to raise the gas price at the retail level,” he added.

Normally, the Petrobangla supplies 2,700-3,000, million cubic feet (mmcfd) gas per day of which 2,300 mmcfd is produced locally while 600 mmcfd is imported as liquefied natural gas LNG.

Of this imported 600 mmcfd, 150 mmcfd is imported from spot market at a variable price between $10 and $30 per unit.