The energy regulator has started a public hearing on the proposal to hike the power prices amid protests from leftist organisations which might end with the retail tariff getting costlier by 6 to 10 percent.
If that happens, nearly 15 million consumers will be charged extra from this month which would affect every sector starting from the market prices to investment.
The three-day hearing on Power Development Board’s (PDB) proposal had begun at 10:30am on Tuesday at the office of Bangladesh Energy Regulatory Commission (BERC) at TCB Building at the capital’s Karwan Bazar.
The second session of the public hearing began at 2:45pm on the proposal of the West Zone Power Distribution Company Limited (WZPDCL).
State-owned PDB proposed hiking the power prices by 15.50 percent on an average and WZPDCL 8.59 percent.
The two companies currently charge at least Tk 2.51 to Tk 11.85 per unit in different slabs.
After reviewing the latest proposals, the BERC evaluation committee told the hearing that 6.66 percent hike on the power prices for PDB was necessary while it should be 7.51 percent for WZPDCL.
After Tuesday’s hearing, one of the BERC members, asking not to be named, told reporters that they would not delay in making the decision to raise the power tariff. “The decision will come between Mar 10 and Mar 15. The prices might increase by 6 to 10 percent.”
The last power price hike took place in September 2012 with the retail prices going up by 15 percent and bulk prices 17 percent.
Meanwhile, a leftist organisation had begun demonstrating in the morning outside BERC office protesting the decision to push the power price again. The representative of Consumers Association of Bangladesh had also opposed the initiative in the hearing.
Gana Sanghati Andolan had started the mass sit-in around 11:30am. The activists also marched down Karwan Bazar with placards.
During the hearing, CAB Adviser Shamsul Alam said, “They said many times before that it wouldn’t be necessary to buy high cost rental power after 2014. Prices would fall.”
But, in reality, rental power plants will stay until 2020, he said. “We should try to bring the tariff down instead of hiking it.”
Alam trained a question at BERC: “Have you considered how you will protect the production process and people’s standard of living from the overall inflation caused by this hike?”
BIDS Research Director Zayed Bakht agreed that the power tariff hike would affect everything from price levels to investment.
“Of course there will be inflation. Products will be costlier, so the cost of living will go up. Production costs will go up and hurt investment,” he warned.
He believed the government was hiking the power tariffs in an effort to shake off some of the burden of the huge subsidy it gives for rental power.
Since the increased dependence on relatively expensive oil-based rental plants, there have been a total of 11 hikes in the retail and bulk power tariffs over the last five years. But despite the hikes the government subsidies to the power sector in four fiscal years were about Tk 170 billion.
In December 2012, with the national elections in sight, the government moved away from the latest tariff hike proposal. But since its re-election it has been gearing up for another hike.
Prime Minister Sheikh Hasina recently cleared her government’s position on the issue in parliament.
On Feb 26 she said in Parliament, “Look at our neighbouring countries, how much they pay for electricity. You have to pay the production cost at least.
Left-leaning parties including the Communist Party of Bangladesh, Bangladesh Samajtantrik Dal and Gana Sanghati Andolan have been protesting since the government proceeded to hike the power rates.
They allege the government’s expenses have gone up because of its faulty policy of encouraging power generation through oil-based quick rental plants and the government is trying to put the burden of extra expenditure on the people.
Public hearing will be held on the proposed hikes by Dhaka Power Distribution Company and Dhaka Electric Supply Company on Wednesday and the proposed hikes by Rural Electrification Board on Thursday at the BERC headquarters.
Source: bdnews24
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