BERC recommends retail power price hike for consumers

Power tariff hike

Jehangir Hussain

The technical evaluation committee of Bangladesh Energy Regulatory Commission (BERC) on Sunday recommended to the government to raise retail electricity price by 15.43 per cent, or by Tk 1.21 per unit, for the consumers.

Now, the retail electricity price per unit is Tk7.02.

After the proposed increase, the price will be  Tk8.23, according to the recommendation made by the BERC following proposals submitted by six state-owned power distribution companies to raise the retail power tariff by about 20 per cent for the consumers.

On Sunday, BERC held day-long public hearing at BIAM Auditorium in the capital.

 BERC Chairman Md Abdul Jalil and four BERC members heard the suggestions.

The Communist Party of Bangladesh (CPB), in a statement issued on Sunday, protested against the BERC’s recommendation and urged the government not to implement the recommendation for increasing power price considering the economic condition of the people.

At the hearing, Dhaka Mass Transit Company Ltd (DMTCL) and high-tech park authorities ve demanded power supply by the distributing companies.

Bangladesh Power Development Board, Bangladesh Rural Electrification Board, Dhaka Power Distribution Company, Dhaka Electric Supply Company, Northern Electricity Supply Company PLC and West Zone Power Distribution Company Limited had made the proposal to raise retail power tariff for the consumers.

All the six state-owned power distribution bodies submitted their separate proposals to raising retail power tariff in the wake of bulk power tariff hike. They placed almost identical proposals to raise retail power tariff by about 20 per cent.

They submitted their proposals after ERC had taken the decision to raise  bulk power tariff by 19.92 per cent with effect from December 1, 2022.

According to the latest statistics, the annual financial loss of state-owned BPDB, and also the lone  buyer of electricity from private sector power plants, is likely to increase by Tk18,094 crore.

According to BPDB's estimates, its financial loss will exceed Tk48,000 crore in fiscal 2022-23 from Tk29,915 crore in fiscal year 2021-22, an increase in losses by almost 67 per cent.

BPDB sources said that its revenue deficit has further increased due to purchase of electricity from the private sector at higher price and selling at lower price, as well as the hike in petroleum prices and also the escalation of value of dollar.

Officials said the recent 19.92 percent hike in the bulk tariff may help the BPDB to reduce its loss by Tk5,000 crore though its huge revenue deficit would continue to remain a burden for it.

The retail power tariff was raised for the last time in March, 2020 by BERC after holding a public hearing.

At that time, retail power tariff was increased from Tk6.77 to Tk7.13 per unit or kilowatt-hour.

Officials said the Power Division is under tremendous pressure from the Finance Ministry to increase bulk and retail power tariffs to cover its losses.

Conditional borrowing $4.5 billion from the International Monetary Fund (IMF) has increased the pressure on the government to reduce subsidies to he power sector and raise power tariff to make up losses, said Power Division officials.

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