Fresh power tariff hike from March

The consumers are set to undergo a fresh hike in electricity tariff from March as all state-owned electricity distribution companies have been asked to submit fresh proposals to the energy regulator for the hike within this month, a top official said.
The Power Division under the Ministry of Power, Energy and Mineral Resources (MPEMR) asked the electricity distribution companies to submit their respective proposals to Bangladesh Energy Regulatory Commission (BERC), he said.
BERC will arrange public hearing as per regulation before announcing a fresh tariff hike, the official added.
The announcement is likely to come by the end of March, but the tariff hike might have the retrospective effect from March 1, 2014, the official added.
The Power Division has moved again for raising the electricity tariff after getting a go-ahead from Prime Minister Sheikh Hasina, who is also the minister of the MPEMR, on February 6, 2014.
During a meeting with the officials of the MPEMR, the Prime Minister has reportedly directed them to expedite the process of raising electricity tariff as the ministry officials in a presentation stressed hike in the tariff to reduce losses of the power distribution companies.
The energy regulator hiked the average bulk and retail electricity tariffs by 16.92 per cent and 15 per cent on September 20, 2012.
After that hike all the electricity distribution companies submitted proposals for further hike in electricity tariff in December 2012.
The commission had held public hearing on the tariff-hike proposals and decided to hike the tariff.
The state firms had then sought an average hike of around 11 per cent, within two months of the previous hike, arguing that they would have to incur loss if the tariff was not raised.
BERC decided to hike tariff by 5.0 per cent on an average.
But the decision was put on hold following a request from Prime Minister Sheikh Hasina that was apparently made to avert public dissatisfaction before the general election.
Five state-owned power entities had said that they would require around Tk 13 billion as subsidy, if the electricity tariff were not hiked.
The technical evaluation committee of the BERC earlier had recommended a hike in electricity tariff by 3.30 per cent for Dhaka Power Distribution Company (DPDC) and 3.65 per cent for Dhaka Electric Supply Company (DESCO) consumers.
DESCO had sought to raise the power tariff at the consumer level by an average of 11.69 per cent, while DPDC proposed an 11.31 per cent increase.
The BERC evaluation committee had recommended 4.84 per cent and 4.15 per cent hikes in retail electricity tariffs for the consumers of Bangladesh Power Development Board (BPDB) and West Zone Power Distribution Company (WZPDC).
The BPDB had sought 12 per cent hike in retail electricity tariff, while the WZPDC had sought a 9.59 per cent hike.
The BPDB has argued that it would incur a loss of Tk 5.16 billion this year if the tariff is not hiked.
The commission, however, opposed retail tariff hike proposal of the Rural Electrification Board (REB) saying the REB had not provided accurate information.
The cost of electricity has been rising as the government has adopted short-term measures of installing dozens of high-cost diesel and furnace oil-fired rental power plants to ease the country's mounting electricity crisis.
The cost of supplying power to bulk customers in September, 2011, was Tk 4.15 per unit.
It soared to around Tk 6.8 per unit by fiscal year 2012-13.
It averaged Tk 2.62 per unit in fiscal year 2009-10.