Domestic, commercial gas connection rates raised
Sunday, 2 August 2009
FE Report
The government has raised domestic and commercial connection rates of natural gas by more than 11 per cent effective from August 01 as per the directive of the Bangladesh Energy Regulatory Commission (BERC).
"We have given directive to the Petrobangla to raise the gas prices on an average 11.22 per cent Thursday. It will be effective from August 01," Md Salauddin Ahmed, a member of the BERC, told the FE.
He also said: "We have given our verdict in favour of raising gas prices after we got government assurance of the formation of a tax-free fund for the Petrobangla."
BERC said Petrobangla will earn around Tk 7.0 billion after the price hike of gas and it will be used for opening the Gas Development Fund. BATEXPO might use the fund to explore for new sources of gas.
Earlier, in October last, the BERC said the price of gas would be raised provided that the money to be realised from the consumers would be used for the fund.
BERC said the monthly charge for domestic supply of gas has been increased by 14.29 per cent. Earlier, the single burner charge was Tk 350 and now will be Tk 400. The charge for double burners has been increased to Tk 450.
However, the country's leading businesses had protested the price hike of gas saying it would increase the production cost significantly in the face of global financial crisis.
Shahedul Islam Helal, president of Bangladesh Chambers of Industries (BCI) told the FE: "This will create an additional burden on the industrial sector."
He also said: "The price has been raised at a time when the owners of industrial units are facing low gas pressure to operate generators."
Many businesses said the government should have raised the prices of gas a few months later.
Anwar Alam Chowdhury Parvez, a former BGMEA president told the FE: "We are facing world recession and the prices of our garments are decreasing. So this will create a fresh problem for the export oriented industries."
The price hike for commercial connections rose to Tk 268.09 against Tk 233.12 per 1000 cubic feet, BERC said.
The price for gas to be used in industries rose to Tk 166.91 against Tk 148.00 per 1000 cubic feet.
While for private power plants it has been hiked to Tk 79.82 from Tk 73.98, fertiliser factories Tk 72.92 from Tk 63.41, captives and small power plants Tk 118.36 from Tk 105.59.
BERC member Salauddin said Petrobangla will run advertisement in this connection adding: "We have also given our consent to the format of the advertisement."
Shamsul Alam, who participated in the public hearing last October on behalf of the Consumers Association of Bangladesh (CAB) told the FE: "We asked the jury not to raise gas prices for the fertiliser plants as it will increase the prices of the agro input."
"We have given our opinion on July 29 to the BERC and urged them to increase only 10 per cent," Mr Alam said.
He, however, said the money to be realised after the price hike will strengthen the state-owned BATEXPO saying: "BATEXPO will use the fund to explore gas."
He said the gas exploration cost by the BATEXPO is comparatively low and it will have a positive impact on the consumers in the long run.
The government has raised domestic and commercial connection rates of natural gas by more than 11 per cent effective from August 01 as per the directive of the Bangladesh Energy Regulatory Commission (BERC).
"We have given directive to the Petrobangla to raise the gas prices on an average 11.22 per cent Thursday. It will be effective from August 01," Md Salauddin Ahmed, a member of the BERC, told the FE.
He also said: "We have given our verdict in favour of raising gas prices after we got government assurance of the formation of a tax-free fund for the Petrobangla."
BERC said Petrobangla will earn around Tk 7.0 billion after the price hike of gas and it will be used for opening the Gas Development Fund. BATEXPO might use the fund to explore for new sources of gas.
Earlier, in October last, the BERC said the price of gas would be raised provided that the money to be realised from the consumers would be used for the fund.
BERC said the monthly charge for domestic supply of gas has been increased by 14.29 per cent. Earlier, the single burner charge was Tk 350 and now will be Tk 400. The charge for double burners has been increased to Tk 450.
However, the country's leading businesses had protested the price hike of gas saying it would increase the production cost significantly in the face of global financial crisis.
Shahedul Islam Helal, president of Bangladesh Chambers of Industries (BCI) told the FE: "This will create an additional burden on the industrial sector."
He also said: "The price has been raised at a time when the owners of industrial units are facing low gas pressure to operate generators."
Many businesses said the government should have raised the prices of gas a few months later.
Anwar Alam Chowdhury Parvez, a former BGMEA president told the FE: "We are facing world recession and the prices of our garments are decreasing. So this will create a fresh problem for the export oriented industries."
The price hike for commercial connections rose to Tk 268.09 against Tk 233.12 per 1000 cubic feet, BERC said.
The price for gas to be used in industries rose to Tk 166.91 against Tk 148.00 per 1000 cubic feet.
While for private power plants it has been hiked to Tk 79.82 from Tk 73.98, fertiliser factories Tk 72.92 from Tk 63.41, captives and small power plants Tk 118.36 from Tk 105.59.
BERC member Salauddin said Petrobangla will run advertisement in this connection adding: "We have also given our consent to the format of the advertisement."
Shamsul Alam, who participated in the public hearing last October on behalf of the Consumers Association of Bangladesh (CAB) told the FE: "We asked the jury not to raise gas prices for the fertiliser plants as it will increase the prices of the agro input."
"We have given our opinion on July 29 to the BERC and urged them to increase only 10 per cent," Mr Alam said.
He, however, said the money to be realised after the price hike will strengthen the state-owned BATEXPO saying: "BATEXPO will use the fund to explore gas."
He said the gas exploration cost by the BATEXPO is comparatively low and it will have a positive impact on the consumers in the long run.