Why raise power tariff?

With the beginning of public hearing on the proposed rise in power tariff, the diametrically opposed views of the Bangladesh Power Development Board (PDB) on the one side and the consumers, rights groups and some political outfits on the other have come to the fore. Finding the BPDB proposal unacceptable, business representatives and others have instead demanded lowering of the power tariff. The rationale behind the demand is simple and sound. Currently, power generation is more costly than it should have been because of a number of wrong decisions. Use of costly liquid fuel for power generation is one of those. The government policy on fuel supply disfavour the BPDB as it has to purchase fuel at higher rates than the one for private producers. If gas was supplied to the BPDB for electricity generation, the production cost would have come down substantially.

That the country still has to continue its reliance on rental power plants to a large extent is the greatest folly. By this time, a few large thermal power plants could be commissioned had the authorities been enough serious about the matter. Its rippling effect is felt now on the per unit power price. The ageing Ghorasal power plant has its own drawbacks reflecting adversely on the power generation cost. When the overriding need is to keep the generation cost as low as possible, the policymakers are slow to respond to this critical issue although they are not found unwilling to renew contracts with the rental power plants. They have not got their priority right. After two terms in office, no excuse for the failure to complete construction of at least a couple of large power plants is acceptable.

There is no end to raising the power tariff if the authorities get the basic wrong. Power has to be produced as much cheaply as possible and supplied to the consumers at the minimum possible rate. This is because a nation's progress and economic growth is directly proportional to the use of electricity. If it is less costly, goods and services are likely to remain market-friendly for the majority of consumers. When this happens, business picks up and the economy in turn experiences exponential growth. Again, such growth raises the living standard of the people. Here is a compelling reason the policymakers cannot overlook.

The Bangladesh Energy Regulatory Commission (BERC) has found fault with the BPDB arguments and accounting statements. How gross is the inconsistency in the accounting statement is not known but an attempt like this should be considered a legal offence. The BERC technical evaluation committee still has recommended a raise in power tariff by 11.78 per cent as against the 22.24 per cent proposed by the BPDB. This means the demand for bringing down power tariff will go unheeded, anyway. Under the present circumstances, the BERC may not have much room for manoeuvrability unless the system undergoes a major change with inefficiency and corruption involving pilferage of power getting totally eliminated.