Power prices to be effective from Feb
Staff Reporter :
Despite opposition from various quarters, the government has increased the electricity prices at both retail and bulk levels, which would be effective from February 1 retrospectively.
The electricity price at retail level has been increased by 8.50 per cent and at bulk level it is 5.74 per cent.
State Minister for Power, Energy, and Mineral Resources Nasrul Hamid said this to the journalists at the Secretariat on Thursday, saying “the gazette notification would be issued today. The new price will be effective from February 1 instead of March 1.”
To justify the causes of the increase of the electricity price, the state minister pointed out the volatility of the dollar in power incentives and the price hike of gas.
“The power incentive will now stand at Tk 43,000 crore. That’s why the government is saying about the price adjustment with the fuel prices. We will pursue the price adjustment gradually,” he said.
Asked about the price hike of per unit electricity, he said, the power tariff will be increased between Tk0.34 and Tk0.70 per unit for all kinds of consumers depending on their volume of consumption.
The gas price will go up by Tk0.75 per unit only for power plants, he added. He also said that dynamic fuel pricing will be introduced for the consumers from 1 March under which the price of petroleum fuel will go up and down in line with international market price.
About the cost of power generation, he said, the per unit power generation cost is about Tk 12 due to the volatility of dollars. Earlier it was only Tk7 – Tk8.
“We are selling per unit electricity on an average Tk 7. We are adjusting the prices on the upper level more than the lower level,” he said.
The state minister also said, “We have adjusted the fuel price with the electricity. We have adjusted 70 paisa in the gas used for the power plants. The fuel prices have also been fixed according to the dynamic pricing.”
Explain the dynamic pricing, he said, “If the fuel prices increase in the world market, the price will also be increased here also after adjustment. If prices decrease in the world market, the price will also go down here. It will be done in the first week of every month.”
Citing the example of India, he said, “Our neighbouring country does the adjustment every day. For example, the price of per litre diesel in Kolkata is Tk 133 and it is Tk 109 here.”
Nasrul Hamid also stated that the government has taken measures to minimise the losses caused by the increase in dollar rate.
“This year the government will incur loss of Tk43,000 crore due to the sale of electricity at a lower price,” the State Minister said.
According to the Annual Report 2022-23 of Bangladesh Power Development Board, it witnessed the production of 87,024 million kilowatt hours of electricity at a total cost of TK98,646 crore.
The per unit production cost was Tk11.33, while it was selling electricity at Tk6.7 per unit – incurring a loss of about Tk4.63 per unit, the report said.
This imbalance has led to a staggering loss of Tk 47,788 crore for the fiscal year, as the government grapples with purchasing power from private and international sources at significantly higher rates.
The government has been facing great trouble as it has to purchase electricity worth Tk 82,778 crore from private sector power producers, while it generates electricity worth Tk 13,307 crore from its own generation plants.
Against the government’s announcement of price hike of gas and electricity, the political parties are protesting in the streets and calling upon the government to refrain from such decision of price hike as the ordinary people are already over-burdened due to the food and non-food item inflation.
Even the protesters are facing police action while protesting the government’s move for price hike.
Bangladesh Samajtantrik Dal has called a countrywide demonstration on March 1, protesting the price hike of gas and electricity as well as the skyrocketing price hike of daily essentials.
Bangladesh Justice and Development Party in front of the Jatiya Press Club on Thursday demanded cancellation of the price hike gas and electricity.
Criticising the government, Delwar Hossain of the Party said, “The government’s wrong policy is responsible for the high production cost of electricity. Now they are burdening the people with additional expense by withdrawing the incentives in a bid to fulfill the foreign loan conditions.”
The leaders also said that the rental and quick rental power plants have not yet suspended while the immunity act for power sector has not been scrapped.
They have urged the government to immediately step down from the decision to increase the price hike of gas and electricity.
