The Federation of Bangladesh Chambers of Commerce and Industries has suggested rationing electricity and load shedding in unproductive industrial sectors to avoid further hiking in energy prices.
“If the electricity and gas prices in the industrial sector go up, the cost of production will go up as well. There are many power plants that have low productivity, whose production may be stopped.”
FBCCI President Jasim Uddin made the remark at a press conference over the proposal to increase electricity and gas prices in Dhaka on Saturday.
He mentioned that many countries are leaning towards rationing systems to reduce loss and pressure on power and suggested Bangladesh could adopt such a system as well.
“If necessary, 1-2 hours of load shedding can be accepted in the unproductive sectors,” he added.
The FBCCI president also mentioned that there were various systemic problems in the power sector, including overcapacity.
The country’s power generation capacity is 22,000MW but the demand is 14,000MW.
The low efficiency of oil-based power plants, delays in the commissioning of coal-based power plants, and erroneous planning of the LNG supply chain are some of the other problems in this sector.
Jasim Uddin stressed that these systemic problems need to be correctly identified and their solutions should be effectively planned without increasing the price of electricity.
In order to reduce production costs, the country needs to move towards coal-fired power plants, he remarked.
“Although environmentalists oppose it, industrialisation cannot be stopped simply based on that. India, America, and others are building coal-fired power plants. India says they need to run on coal power by 2050. We need it too,” said Jasim Uddin.
In order to reduce the cost of electricity and gas, he recommended measures, including radical changes in the overall management of the energy and power sector; putting a stop to all kinds of irregularities and wastage; disconnecting illegal connections; shutting down inefficient power plants; reducing overhead costs; and putting a stop to capacity charges so as to stop paying lazy producers.
Meanwhile, speaking on the matter, the Bangladesh Knitwear Manufacturers and Exporters Association Executive President Md Hatem said their production costs will increase if the government increases electricity and gas prices.
Bangladesh’s competitors were offering energy for much cheaper. “We will lose competitive capacity in the global market if our energy costs increased further,” he said.
“Besides, the further energy price hike will increase the inflation rate, which will hit people’s lives,” Hatem added.
Md Ali Khokon, president of the Bangladesh Textile Mills Association, it would be a suicidal decision if the government increased the prices of gas and electricity amid the global economic stagnation.
The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Vice-president Shahidullah Azim said that this is not the right time to hike gas and electricity prices while we are fighting to keep up with our competitors in the global market.
Anwar-ul Alam Chowdhury, former BGMEA president and president of the Bangladesh Chamber of Industries, said due to the Russia-Ukraine conflict, the country is experiencing a dollar crisis and rising goods prices.
“If the government hikes energy prices, the inflation rate will increase and consumers will be the sufferers,” Anwar-ul said.
“We are still struggling with the impacts of Covid and it will take a minimum of three to four years to fully recover. If the government hikes gas and electricity prices now, we will lose the capacity to sustain our businesses,” said Monowar Hossain, chairman of the Bangladesh Auto Re-Rolling and Steel Mills Association.