Proposal to raise gas price despite acute shortage in supply

The residents of several parts of the capital, including Shahjahanpur, Jatrabari, Mohammadpur, Kazipara and Rayerbazar, are suffering immensely due to the gas crisis. There is almost no supply of gas or the pressure of gas remains low most of the times of the day in these areas.

The picture is almost the same in all big cities in the country, including Gazipur and Narayanganj. A consumer must pay Tk 1,080 as the gas bill for double burners no matter whether interrupted gas supply is available or not. Now a proposal has been placed to raise the bill by Tk 512.

If this proposal submitted by the gas distribution companies is approved, then the gas bill will be Tk 1,592 every month for a double burner. The gas bill for a single burner now stands at Tk 990 every month. The proposal recommends raising the price by Tk 390.

The Bangladesh Energy Regulatory Commission (BERC) has took the proposal to raise gas prices into cognizance and formed a technical committee, which has already started its work.

The committee has issued a letter addressing six gas distributing companies of the country on Monday seeking required information in favour of the proposal to raise gas price. The committee will make a decision after verifying those data.

A portion of the people who have gas stoves at home, pay the gas bill at the end of the month. They are called non-meter consumers. There is another section of the consumer who has gas meters at their households. They pay the bill as per the usage. These consumers are called prepaid meter consumers.

The prepaid meter consumers use a maximum of 40 to 45 cubic feet of gas per month on average in case of a double burner, where the consumers without gas meters have to pay the bill of 60 cubic feet of gas regardless of how much they used. Now, the gas distributing companies want to increase the gas price showing that the customers without meters use more gas.

Around 4.3 million consumers have gas connections across the country. Of them, 430,000 are prepaid customers.

The Titas Gas Transmission and Distribution Company Limited (TGTDCL), the gas distributing agencies in Dhaka and adjacent districts, appealed to the BERC to adjust the gas price considering more than 60 cubic feet of gas usage per consumer last year.

The BERC then sought the opinion of the Petrobangla as there five more gas distributing companies apart from the TGTDCL. In response, Petrobangla recommended considering the appeal of the Titas for other gas distributing companies too. The recommendation was taken into consideration during the BERC meeting last month. Following that, the technical committee was formed by the end of December.

The TGTDCL appealed to consider 88.44 cubic metre usage for double burner and 76.65 cubic metre usage for single burner. The price for per cubic metre gas is Tk 18 in residential areas.

The TGTDCL deposited Tk 7.06 billion in the government treasury in the 2022-23 fiscal. Even after that the company made a profit of Tk 1.58 billion.

Speaking regarding this to Prothom Alo, BERC chairman Md Nurul Ami told Prothom Alo that a committee has been formed and it has already started working. The BERC will finalise the next step based on the report submitted by the committee during the next meeting.

The BERC raised the gas price for residential consumers in June 2022. The price of per cubic metre of gas was fixed at Tk 18 that time. However, the considered usage was reduced to 60 cubic metres for double burners and 55 cubic metres for single burners. The monthly gas bill for double burners was fixed at Tk 1,080 and Tk 990 for single burners.

A reliable BERC official says the reality is people have to pay the gas bill without getting an uninterrupted supply. Now Petrobangla and the TGTDCL want to increase the price. Now the BERC will have to verify their proposals.

A five-member technical team led by BERC director (gas) Fazle Alam is working to verify the proposal of the distributing agencies to raise the gas price. The committee has asked for different information from the gas distributing companies. The committee itself will investigate to check whether the information provided by the companies is true or not. After that, the committee will prepare a review report analysing all this information.

Speaking to Prothom Alo, BERC director Fazle Alam said that the commission has ordered the check the rationale of the appeal from the gas distributing agencies. The committee is likely to submit the report within this month after verification.

The TGTDCL claims that the BERC fixed the amount of usage without any feasibility study. Apart from cooking, gas is also used to boil water. Besides, a single house accommodates several families (sublet) in industrial areas. The usage of gas is higher than the considered amount in these cases. The TGTDCL is incurring losses due to this.

The TGTDCL has shown in the proposal that the residential consumers use 97 cubic metres of gas every month on average. However, it didn’t mention any information regarding the prepaid consumers.

According to the BERC sources, gas bills of 320,000 consumers of the Titas and 50,000 prepaid consumers of the Karnaphuli Gas Company were analysed during the public hearing on gas price held in March 2022. It was found at the time that the double burner users use 45 cubic metres of gas every month on average. It was said at the time that the amount of considered usage would be reduced further in the future.

A reliable Titas official said the company has a total of 380,000 prepaid customers at the moment. They collect a total of Tk 160 million to Tk 180 million every month from the consumer as gas bills. As such, the gas bill of a prepaid consumer stands at Tk 474 on average. That means a consumer uses 27 cubic feet of gas per month.

Earlier, on 18 April 2022, Prothom Alo published a report analysing the gas bills of prepaid customers from December 2021 to March 2022. It showed that the TGTDCL earned some Tk 134.2 million from the meter users. The price of per cubic metre of gas was Tk 12.60 at the time. As such, the monthly usage of a single prepaid customer was 34 cubic metres. Their average gas bill was Tk 428 per month within that time.

Residents of several areas in the capital are not being able to cook, due to gas outages. The problem has intensified further in the last two months. The customer care service of the Titas is receiving numerous phone calls from customers in different areas of the city due to this. Many of the customers are posting on Facebook regarding their sufferings due to the gas crisis. They complain that gas is not available at all during day times. It is available only for a few hours after midnight.

Rayerbazar Madrasah lane resident Md Hasan told Prothom Alo that gas supply resumes at around 11:00 pm and goes away again by 6:00 am in the morning. However, they still have to pay the monthly bill to keep the gas connection. At the same time, they have no other way than buying LPG cylinders for cooking. The cost of a single cylinder of LPG is around Tk 1,500.

Speaking to Prothom Alo, Kamrunnesa Ruhi, a homemaker from Mohammadpur, said the residents of the area could cook until 8:00 am in the morning even a few months ago. However, that too is not possible now. She said that they are suffering a lot as the expenditure for gas doubled amidst soaring price.

According to the sources in the Energy and Mineral Resources Division, the daily demand for gas in the country is 3.80 billion cubic feet. It is possible to meet a large portion of demand in the industrial and residential areas with 3 billion cubic feet of gas. However, the amount of supply right now is less than 2.50 billion cubic feet.

Such a situation emerged due to the decline in the import of liquefied natural gas (LNG) caused by the ongoing dollar crisis in the country. At the same time, the domestic production of gas in different gas fields has also dwindled. The situation could improve a bit if the import of gas could be increased.

The Consumers Association Bangladesh (CAB) has termed the proposal to raise gas price without ensuring an uninterrupted supply as irrational.

Energy expert and CAB senior vice-president M Shamsul Alam told Prothom Alo that although people are not getting gas supply regularly, they have to pay the full gas bill to keep the connection. The proposal to raise gas prices is not acceptable at all in this situation. Efforts are on to extend the market of LPG by creating a crisis in gas supply. There are interests of large business conglomerates behind this. The people are already suffering due to the soaring prices of daily essentials.

“How could they think of increasing gas prices amid this?” he questioned.

*This report appeared on the print and online versions of Prothom Alo and has been rewritten in English by Ashish Basu