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10 December 2023

Business Insider Bangladesh

Bulk power tariff hike could be announced within Oct 14

UNB || BusinessInsider

Published: 20:03, 2 October 2022  
Bulk power tariff hike could be announced within Oct 14

Photo: Representational

A new announcement on the adjustment of bulk electricity tariff is likely to come within October 14.

Chairman of Bangladesh Energy Regulatory Commission (BERC) Abdul Jalil said this while virtually briefing on Sunday on new LPG price for the month of October.

Responding to a question, he said as per the BERC Act, there is a provision to announce the decision of the commission within 90 days, following a public hearing on power- or energy-related issues.    

The last public hearing on a proposal of the state-owned Bangladesh Power Development Board (BPDB) to raise bulk power tariff was held on May 18.

The BERC extended the time for stakeholders to submit relevant documents, to conclude the hearing procedure.

From that additional time, BERC is now counting 90 days and the stipulated time will expire on October 14, said a BERC member.     

The BPDB placed a proposal to raise the bulk power tariff by 65.57 percent at the public hearing while a technical evaluation committee (TEC) of BERC recommended a 57.83 percent hike.

The 5-member commission makes the final decision following a public hearing after listening to arguments and counter arguments from the stakeholders on any proposal.

Any adjustment in bulk power tariff will not directly impact the current retail tariff of electricity.

But it will definitely have an impact on the power distribution companies which buy electricity in bulk from BPDB to sell it to their retail consumers.

So, if any upward adjustment comes from the regulator, the power distribution companies will then raise electricity tariff at retail level, said an energy expert.     

At the public hearing on May 18, consumer rights groups, including representatives from different business bodies, vehemently opposed any major rise in power tariff right now, as people are already struggling with high inflation caused by high commodity prices.

They termed the proposal illogical and said BPDB can offset its revenue deficit through addressing irregularities, corruption and unethical practice in buying electricity from inefficient private power plants at higher rates. 

Placing the proposal, BPDB  officials had said the organisation will require revenue of Tk 74,189 crore to generate 88,993 million kilowatt hours (units) of electricity to supply to the power distribution companies.

“But if BPDB sells its electricity at the existing rate of Tk 5.17 per unit, it will have to face a deficit of Tk 30,251 crore in revenue in the calendar year 2022. So, BPDB needs to raise the power tariff by 65.57 percent to Tk 8.56 per unit from Tk 5.17,” said a BPDB top official at the hearing, adding that this has been calculated without the government’s subsidy.


Monetary Policy Stance
Budget 2020-21