Govt hikes retail power price by 5 per cent

The government has raised the electricity prices by Tk0.19 per unit at the retail level, which is 5 per cent higher than the existing tariff, effective retroactively from January 1.

The previous average retail tariff is Tk 7.13 per unit. The tariff was raised through an administrative order issued by a gazette notification on Thursday evening.

Although the Bangladesh Energy Regulatory Commission (BERC) held a public hearing on retail electricity price hike just five days ago, no effect was seen in the prices.

The experts, however, recommended keeping the electricity prices affordable for the consumers. But overriding the experts’ recommendations, the new price has been considered effective from January 1.

The decision to raise the power tariff at the retail level was taken under the new amendment to the BERC Act, which had empowered the government to take any decision in this regard bypassing the regulator’s jurisdiction.

However, nothing was mentioned in the Power Division’s 19-page gazette notification about the average hike in tariff or how much of the tariff was raised in percentage.

State Minister for Power, Energy and Mineral Resources Nasrul Hamid clarified the matter saying that the electricity tariff was raised by Tk 0.19 per unit at the retail level, 5 per cent up from the existing rate.

He also said the tariff will be adjusted every month from now on.

The residential customers using zero to 50 units will be charged TK 3.75 per unit, which was TK 3.94 per unit, zero to 75 units users have to pay TK 4.40 per unity from TK 4.19, according to the gazette notification.

The users of 76 to 200 units will have to pay TK 6.1 from TK 5.21 per unit while the users of 201 to 300 unit will have to pay Tk 6 per unit instead of TK 6.30.

For the users with 301 to 400 units will now have to pay TK 6.34 per unit which was earlier TK 6.66 and the users of 401 to 600 units will have to pay TK 9.94 instead of TK 10.45. The users who will use over 600 units will have to pay TK 11.49 per unit, which was TK 12.3, according to the gazette issued on Thursday.

In an immediate reaction, energy expert M Shamsul Alam told The Business Post that the regulator was formed as part of the long struggle to ensure good governance in the energy sector.

“All the government institutes related to power-energy came under this umbrella. We were on the way to ensure a certain transparency. But avoiding the BERC and hiking the price by an executive order after amending the law may push the country back further,” he said.

Meanwhile, the Ministry of Power, Energy and Mineral Resources has also indicated that the gas price may increase this month as well. Because the government is making policies to adjust the price of gas, electricity and fuel every month.

The government currently subsidises these essential commodities to keep prices affordable to the public. But Prime Minister Sheikh Hasina has recently urged her countrymen to pay the production cost of power to ensure a smooth supply.

On November 21, the BERC had increased the bulk power tariff by 19.92 per cent to TK 5.17 per unit to TK 6.20. Later, six power distribution companies including BPDB, REB, DPDC, DESCO, NESCO and WZPDCL submitted the application to increase the retail power tariff at the customer level.

But within a week, the Cabinet on November 28 approved an amendment to the BERC Ordinance 2022 to empower the government to set fuel tariff on its own under special circumstances without waiting for the commission’s public hearing and decision.