The new electricity bill will come into effect from March, which the subscribers will have to pay in April. Subscribers with prepaid meters will have to pay at the new rates from March. In November 2017 the government raised the price of power by Tk 0.35, that is by 5.3 per cent, and the consumers has to pay the new rate from December that year.

In the cities, the monthly electricity bill for a middle class family would average Tk 2433, without VAT. From April, these consumers will have to pay an additional Tk 133, totally Tk 2566

The business community is unhappy with the power price hike. As it is, the overall economy is under pressure and most indicators have taken a nose dive. Global economy is on the brink of recession. Overall demand is plummeting. Entrepreneurs are questioning how pragmatic it has been to increase the price of electricity at this juncture.

BERC justifies hike

Bangladesh Energy Regulatory Commission (BERC) chairman Md Abdul Jalil, announced that increase in power tariff on Thursday the commission’s office in Kawran Bazar of the capital city. In December last year a public hearing was organised regarding the increase in power prices. According to the law, BERC must give its decision within 90 days of the hearing. BERC claims that even after raising the tariff, the government is having to provide Tk 36 billion in subsidy.

Alongside the increase in retail electricity rates, the rates of wholesale electricity have gone up too. The rate of wholesale electricity has gone up by Tk. 0.40 per unit on average. Previously each unit cost T. 4.77. From March this will be Tk. 5.17.

BERC chairman Md Abdul Jalil, told a a press briefing that the prices of power had been increased because a 5 per cent VAT had been imposed on imported coal and a Tk. 0.10 demand charge on every cubic metre of gas. The capacity charge of power plants had gone up too. Rural electricity was being supplied at a comparatively lower cost. Many projects, funded on credit, were also being implemented in the power sector and interest was being paid on the loans. All these factors led to the power price hike.

However, energy advisor of the Consumers Association of Bangladesh (CAB) M Shamsul Alam, differs. Speaking on Thursday night over mobile phone to Prothom Alo, he said that there had been no need to increase the power tariff. The companies who had proposed the price hike could not justify their proposals at the public hearing.

He said the Bangladesh Power Development Board (BPDB) makes a profit of Tk 5 billion from wholesale, though there was no scope for them to do so as a state-run body. An expenditure of Tk 90 billion had been chalked up for certain unjustified expenditures. If such unjustified expenditures could be lessened, there would have been no need to put the prices of power up. But, he added, in order to keep up the looting that was going on in the sector, there unjustified expenses were not being addressed.

Concern in business sector

Businesses have expressed concern of the increase in electricity prices. They say that as it is the readymade garment sector has been hit hard and this top export-oriented industry is facing a tougher challenge that ever before. The increase it power prices will be yet another blow to the sector.

President of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Rubana Huq, on Thursday told Prothom Alo, “Over the past four years our costs have gone up by 29 per cent because of various reasons including power and gas tariff. On the other hand, foreign buyers are paying less. The garment factories do not have the capacity to bear the additional power cost.”

The textile industrialists are also concerned about inflation of electricity rates. Bangladesh Textile Mills Association (BTMA) president Mohammed Ali, speaking to Prothom Alo on Thursday night, said that the small and medium weaving mills as well as the big spinning mills will suffer.

The steel industry was hit hard this year with increased taxes in the sector. The prices of rods went up and sales fell. The increase in electricity rates will push the production cost of rods up and so price of rods are likely to go up too.

Former chairman of the Bangladesh Steel Manufacturers Association (BSMA) Sheikh Masudul Alam said, the country’s economy is going through a crisis. The power price hike at this juncture is a matter of concern for industries.

Anger all over

BNP secretary general Mirza Fakhrul Islam Alamgir expressed concern and anger over the increase in power tariff, saying that this would have a negative impact on the economy.

The Left Democratic Alliance, comprising eight left-wing parties including CPB, BSD and Gono Sanghati Andolan have also protested in this regard. Bangladesh NAP, Khelafat Majlis and other orgaisations have criticised the government’s move to put up electricity rates.

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