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Energy Adviser Fouzul Kabir Khan has stressed the need to bring down the price of a 12kg liquefied petroleum gas (LPG) cylinder below Tk 1,000, urging the private sector to boost efficiency and end the practice of profiteering.
Speaking at a policy dialogue on Bangladesh’s LPG sector organised by the Bonik Barta newspaper at a Dhaka hotel on Saturday, the adviser said the country’s consumers were being overcharged for cooking gas, bdnews24.com reports.
“LPG is largely under the private sector, but we are not getting the efficiency we should from it. The current price of a 12kg LPG cylinder is around Tk 1,200, but it should come down below Tk 1,000,” he said.
“What’s worse -- like adding insult to injury -- is that these Tk 1,200 cylinders are sold for Tk 1,400 to Tk 1,500 in the market. This needs to be reduced.”
Calling for accountability in the energy business, he said: “Those of us in charge must take responsibility. This kind of irresponsible business cannot continue where no one is held accountable. As I said earlier, LPG prices should be brought down below Tk 1,000.”
“To do that, we need to look at logistics and find ways to reduce costs further so that the private sector’s efficiency can be fully realised. The government will also work on this.”
Reducing LPG prices would also help increase its use in industries and power generation, according to the advisor.
“Using LPG in factories and power generation is another major challenge. Akij Group has said they use it but cannot increase usage because of high prices. That’s why reducing prices is a key challenge, and everyone must work on it.”
“Businesses must act responsibly. They must abandon the desire to build mountains of wealth abroad and move away from the culture of money laundering.
“If the country itself doesn’t survive, where will you live? Those who laundered money -- where are they today? I hope they will reflect on this.”
He outlined two priorities that must guide policy: reducing LPG prices for cooking gas, and ensuring affordability for autogas and industrial use.
The adviser also urged researchers to propose ways to expand the industry and guide government strategy.
On October 7, the Bangladesh Energy Regulatory Commission (BERC) reduced the retail price of a 12kg LPG cylinder by Tk 29, setting the new price at Tk 1,241, or Tk 105.87 per kg, down from Tk 1,270 in September.
Under the new rates, reticulated LPG is priced at Tk 99.65 per kg, compared with Tk 102.12 the previous month.
Bangladesh imports propane and butane, the main components of LPG, and BERC sets domestic prices based on the Saudi Aramco Contract Price (CP), which this month averaged $482 per tonne.
Fouzul alleged that during the previous government’s tenure, power-plant licences were issued to several companies “through corruption”, despite an ongoing gas shortage.
He said illegal gas connections had also been provided to factories and households.
“All these misdeeds were committed by our politicians. Given the crisis and shortage we now face, I won’t go into details, but we are making every effort.”
He said the interim government had intensified onshore gas exploration, with “satisfactory progress” so far.
“While domestic production has been declining by about 200 million cubic feet per year, we’ve managed to add about 70 million cubic feet recently. So we are hopeful.”
In order to offset the shortfall, he noted that the government had increased imports of liquefied natural gas (LNG) despite its high cost.
“We’re now importing LNG to meet the deficit. Yes, it’s expensive and there has been criticism, but we’ve had no choice. Otherwise, industries and exports would collapse. Last year we imported 84 cargoes. This year, it’s 108.”