Bulk power tariff has been raised by about 19.92 percent – to Tk 6.20 per kilowatt hour (each unit) from the previous Tk 5.17 – with effect from December 2022.

Chairman of Bangladesh Energy Regulatory Commission (BERC) Md Abdul Jalil announced the decision today to raise the power tariff, disposing of the review appeal of the state-owned Bangladesh Power Development Board (BPDB) to raise bulk power tariff.

However, the new power tariff will not be effective for retail consumers. It will be effective only for power distribution companies and some other bulk consumers.

BPDB filed the review appeal to BERC on November 14 – within 30 working days after its proposal was rejected by the regulator on October 13.

Before submitting the proposal, BPDB received a nod from the government’s highest policy level, the media release from BERC said. State Minister for Power, Energy and Mineral Resources Nasrul Hamid also approved the review appeal on bulk power tariff.

BERC Chairman Abdul Jalil said the new bulk tariff was set considering Tk 17,000 crore subsidy to be received from the government.

Read more: BPDB submits review appeal to raise bulk power tariff

Consumers Association of Bangladesh (CAB) Vice President ASM Shamsul Alam termed BERC’s decision, without any public hearing, as an “arbitrary act” and “violation of the BERC Act”.

“When people are already fed up with load shedding and sharp price hike of essentials, this decision from BERC will be a big blow for the public,” he told UNB.

Power Division officials said that the government has been under tremendous pressure to raise power tariff – in order to reduce the subsidy in power sector – as per condition of the International Monetary Fund (IMF), which promised to provide $4.5 billion in loan to Bangladesh as part of crisis management support.

Earlier when delivering a decision by rejecting the BPDB proposal on October 13, BERC chairman Abdul Jalil said that some of the private companies, which purchase electricity from BPDB have not submitted their data of transactions.

“There was data ambiguity. That’s why we did not analyse the impact of any rise in bulk tariff on the consumers considering socio-economic condition,” he had told reporters.

But this time, he said, BPDB submitted all required data. “As there is no price effect on the retail consumers, we didn’t have to analyse the socio-economic concision”, he said. 

The last public hearing on a BPDB proposal to raise bulk power tariff was held on May 18.

Read more: BPDB to incur over Tk 30,000 cr loss if bulk power tariff not raised

BPDB placed a proposal to raise bulk power tariff by 65.57 percent at the public hearing while a technical evaluation committee of BERC recommended a 57.83 percent hike.

BPDB in its latest review appeal proposal mentioned that its actual generation cost of supply is Tk 8.96 per unit, instead of previous calculated tariff of Tk 8.16 per unit.

Placing the proposal, BPDB officials had said the organisation will require Tk 74,189 crore in revenue to generate 88,993 million kilowatt hours (units) of electricity to supply to the power distribution companies.

Read more: BERC’s TEC commends a 57.83pc hike in bulk power tariff rejecting BPDB’s 65.57pc

Meanwhile, distribution companies are now preparing to submit their respective proposals to raise retail power tariff too, official sources said.

Nasrul Hamid also said that the distribution entities are preparing their proposals to submit to the energy regulator, seeking a substantial hike in the electricity tariff at retail level.

“Power distribution companies are now working to prepare their proposals…They are calculating the possible impact of any hike in the bulk power tariff,” he told UNB.