Monday, 4 July, 2022

Proposed power tariff hike insensible

Bangladesh Energy Regulatory Commission’s proposal to hike bulk power tariff by nearly 58% came at a time when businesses were already struggling to survive amid pandemic-induced shocks and the Russia-Ukraine war. This is why the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) said the hike if materialised is going to be suicidal for the economy. However, if the bulk power tariff is raised, it will also have a profound impact at the retail level and the people, in general, will be affected badly.

 Although electricity and gas pricing are politically sensitive issues, we are appalled by the way the tariff on these two essential commodities has been raised time and again in the last 12 years by the Awami League government. During this time electricity price witnessed a 118 per cent hike at the wholesale level and a 90 per cent hike at the retail level. Although the government has been very successful in increasing electricity production and has already achieved cent per cent electricity coverage, the nagging tariff hike at repeated intervals has been a cause for concern.

Although the production capacity was increased, it is alleged that there was no planned development in the power sector. As a result, production costs have increased. Power plants have been rented out and the term of high-cost rental power plant (Quick Rental) has been repeatedly extended, while some plants continue to receive payment without generating any electricity. All of these factors have increased the cost of electricity production and its responsibility is being passed on to the consumers.

The current proposal for a power tariff hike has come at a time when the people were already down due to the rising cost of living. Any tariff hike at this moment will usher in a new round of inflation. So, we hope the authorities concerned will make efforts to bring down the cost of electricity generation instead of raising the tariff.