Enhanced power tariff for bulk consumers effective today

FE Report Power tariff for bulk consumers goes up by 16.79 per cent from today (Thursday) in line with a previous decision of the country's energy regulator. The bulk consumers, especially the state-owned power distribution companies, will have to count an extra Tk 0.47 per unit from today to purchase electricity from state-owned Bangladesh Power Development Board (BPDB) as the average bulk tariff goes up to Tk 3.27 from the previous Tk 2.80 per unit. The tariff will go up further by 14.37 per cent, or Tk 0.47 per unit, to Tk 3.74 per unit from February 01, 2012. Bangladesh Energy Regulatory Commission (BERC) last week announced, the hike of electricity tariff for bulk consumers by 33.57 per cent on an average, to be effective in two phases, to reduce mounting losses incurred by state-owned Bangladesh Power Development Board (BPDB). BERC Chairman Syed Yusuf Hossain said the tariff hike for bulk consumers would be followed by a fresh hike for retail electricity consumers.BPDB will neither be a profitable entity nor will it reach a break-even point despite the hikes, he said. The BPDB earlier sought to raise the bulk rate of electricity in phases by 15 per cent in every three months from November 2011 until July 2012 and then by another 14 per cent in January 2013. BPDB said the cost of power supply bulk consumers against per unit of electricity is now Tk 4.15. Bulk electricity supply cost will increase to Tk 4.86 per unit by the end of current fiscal year (FY 2011-12), it said in its tariff hike proposal to the BERC. Bulk electricity supply cost was only Tk 2.62 per unit during FY 2009-10. But due to installation of dozens of high-cost diesel and furnace oil-fired power plants, the supply cost will rise by 85 per cent to Tk 4.86 per unit in FY 2011-12 compared to that of 2009-10, it said. Electricity for all state-run distribution entities including Dhaka Power Distribution Company Ltd (DPDC), Dhaka Electric Supply Company (DESCO), Rural Electrification Board (REB) and West Zone Power Distribution Company (WZPDC) will be costlier due to the bulk tariff hike. These distribution companies buy electricity from the BPDB at bulk level of 132 kilo-volt (kV) and 33 kV and sells electricity at retail tariff rates to reach end-users. Among the distribution companies, DPDC and DESCO have been providing electricity to retail consumers in Dhaka, WZPDC in Khulna and south-western region, REB in rural areas. Apart from being a generation agency, BPDB also operates as a distribution company in some districts including Chittagong and Sylhet. Electricity purchasing cost for DPDC and DESCO will be higher as BERC has ordered higher bulk tariff for these Dhaka-based distributors compared to other distribution companies operating outside the capital. The new bulk tariff for DPDC and DESCO at 132 kV level has been increased to Tk 3.56 per unit from December 1, 2011 and Tk 4.20 per unit from February 1, 2012. For 33 kV level the bulk tariff has been increased to Tk 3.60 per unit from December 1, 2011 and Tk 4.24 per unit from February 1, 2012. The Commission has raised bulk tariff for REB's 132 kV level to Tk 2.91 per unit from December 1, 2011 and Tk 3.17 per unit from February 1, 2012. BERC earlier raised bulk electricity tariff by 11 per cent from February 01, 2011 and by 6.66 per cent from August 1, 2011.