The Bangladesh Energy Regulatory Commission (BERC) has reportedly accepted proposals from the natural gas marketing and distribution companies that have sought to hike gas tariff at varying rates for different types of consumers.
The highest hike---122 per cent--- has been proposed for the household consumers, followed by captive power plants---102 per cent.
However, acceptance of proposals does not anyway mean their finalization.
There will be four-day 'public hearing' on the proposals, starting from February 2 next, where all stakeholders including the consumers will be free to attend and present their respective point of view.
If the final outcomes of the BERC's past hearings are taken into consideration, then one has reasons to hold the view that the deliberations at the upcoming hearing are unlikely to influence the pre-set decision relating to the extent of hike.
The gas distribution companies have submitted the proposals that the state-owned Petrobangla, reportedly, tried to submit on a number of occasions recently. The BERC refused to take proposals from the Petrobangla and wanted the distribution companies to submit their respective proposals.
However, that has not made any material change on the ground since the companies have only submitted the Petrobangla proposals in their own names. That is why the hikes proposed by all the distribution companies are identical.
The gas distribution companies have proposed the biggest tariff hike in the case of household consumers and the lowest hike for the power plants. Residents are now paying Tk.450 for a double-burner gas stove. But if the proposed hike is accepted, they will have to pay Tk.1000 for the burner.
It is unlikely that hikes that have been proposed by the gas companies would be accepted finally. The rates of hike could be lower than the proposed ones. It is the ministry of power and energy which will call the final shot, remaining, of course, behind the scene. The indicative rates of tariff hike, in all probability, have been already made known to the people concerned.
There is no denying that the hike in gas price has been long overdue. The last hike in gas tariff was made effective in August 2009. But the consumers would find it hard to cope with a more than 100 per cent hike in one-go. They would not have mind an annual 5.0 to 10 per cent hike in the past years.
Similarly, the proposal to hike the gas tariff by 102 per cent for the gas-based captive power plants seems unjustified. If the proposal is accepted, the cost of production in the factories that are dependent on their gas-fired plants for power supply would go up substantially. The government might have beefed up its own power supply recently. But greater reliance on rental power plants has made such supply vulnerable to breakdown anytime. In such a situation, the industries can hardly shut down their captive power plants for good.
Moreover, the global energy price situation does not anyway support the government's move to hike the power and gas tariff at this point of time in a big way. The price of fuel oils in the international market has been declining constantly and it climbed down to 5.5-year low at 49 dollar per barrel last Monday.
The international natural gas price also has been declining since March last year. The one million British thermal unit of gas was more than US$6.0 in February 2014. On January 12 last, the price of the same was US$2.88. Indication is that it may go down further in line with the movements of prices of petroleum products.
The proponents of the gas tariff-hike would cite the fact that the domestic gas tariff is much lower than that in many other countries. Yet the consumers do feel that the hike should be a reasonable one.
Unfortunately, consumers do not have any strong representation in the so-called hearings, organized by the energy regulator from time to time. The absence of such organization/s is felt everywhere. There is one organization that claims to be a representative body of the consumers. But until now it failed to play any effective role in protecting the interests of the consumers.
The Directorate of National Consumer Rights Protection, though a government agency under the Ministry of Commerce, does have a responsibility in the matters of rates of different utility services. It should attend the BERC's public hearing and speak on behalf of the consumers in line with the objectives behind its creation. Moreover, it must extend all sorts of cooperation to voluntary efforts for building consumers' resistance to any unjust action and also unfair treatment.
zahidmar10@mail.com
Gas tariff-hike proposals seem irrational
Shamsul Huq Zahid | Published: January 14, 2015 00:00:00 | Updated: November 30, 2024 06:01:00
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