Investors\\\' approach to reduce energy crisis

Gas is the crying need of the industries in Chittagong. Businesses and industries are extremely frustrated over the gas crisis. It has been the same old story they have been telling for years but there is none to pay any heed to it. And there is no visible probability of any solution to that.
Unlike other regions of the country, it poses the biggest hindrance to economic development of the region -- country's commercial hub and home to the prime maritime port -- also a place of strategic importance.
Most of the major industries are located in Chittagong. But the gas supply fluctuates between 200 and 220 million cubic feet a day (mmcfd) against the peak demand of 391 mmcfd. The situation was a little better as long as the production in the Sangu gas field was normal. But closure of the Sangu gas field exacerbated the shortage of gas supply since September 2013 when the field was completely abandoned. Karnaphuli Gas Distribution Company, responsible for gas distribution in Chittagong, said it does not have any extra gas to supply.
Gas staggering in Chittagong, unlike elsewhere in the country, has caused huge financial losses to the industries which may lead them to bankruptcy. There are some industrial plants where there is no scope to close them totally. If closed, the components of a few of their machineries might turn useless.
The businesses in Chittagong see the energy crisis as an unfair and discriminating act on the part of Petrobangla because it has shelved the Ashuganj-Bakhrabad-Chittagong (A-B-C) pipeline plan. Installing the A-B-C pipeline was undertaken in 2008 by then caretaker government as the only viable means of gas supply to Chittagong as the discovered gas fields around Chittagong had tiny reserve potential.
The trade body leaders in Chittagong have also urged the government to search for reserved gas fields in greater Chittagong through BAPEX in possible areas. Gas production in Sangu was suspended while Semutang produces only 10 million mmcfd.
The trade body leaders of Chittagong Chamber of Commerce and Industry and Chittagong Metropolitan Chamber of Commerce and Industry have urged the government to import fertiliser for agriculture and arrange temporary suspension of gas supply to CUFL (Chittagong Urea Fertilizer Ltd) and KAFCO (Karnaphuli Fertilizer Company) as maximum gas of Chittagong is being consumed by these two fertilizer factories, gas being the raw material for fertilizer production of those factories.
Electricity: Total demand of electricity in Chittagong is 700 megawatts. Power supply has improved over the year but the people are yet to get rid of corruption in the power meter reading system as the reading staffs take the advantage of non-digitalised meters.
Since energy is the key factor of industrial production, pricing under efficient management has never been appreciated in Bangladesh. Industries using gas connection to produce power pay Tk 2.50 to Tk 3.00 per kilowatt hour while industries depending on power development board (PDB) for power pay Tk 7.00 per kilowatt hour making a wide gap between grid electricity and gas based electricity.
Industries using grid power have been suffering due to steep increase in power costs. It needs to be looked at energy intensive industries like steel that require large quantity of electricity to melt scrap steel to produce steel billets. Variation in power costs of these two groups -- grid power users and captive power producers -- has created a difference of Tk 4000 in the cost of production per tonne steel. The rebalancing of costs for all power users is necessary to avoid the risk of closure of the major industries under the dual pricing plan of energy.
With serious gas shortage in the country, the government stopped giving new gas connections for captive power plants which was a right decision. But some new connections have recently been allowed. With a Tk 4.90 in price cost, how can any industry whose competitors have captive power, be set up? This issue has to be taken by the government with extreme seriousness.
Trade body leaders say that under the highly unjustified state of affairs, the government initiative does not go with the invitation for investment, employment generation and exports growth.
Discriminatory policies within energy management that tantamount to violation of fundamental right do not encourage investors. Unless government policy support and investors' need assessment meet, energy crisis cannot be solved. The trade body leaders invite concern agencies to think over the issue and request the relevant policy formulating authority to look at the following proposals.
1)    Ensure level playing ground for all industries and increase gas prices to such level so that it will be worthwhile to use furnace oil and diesel as a substitute in nearly 80 per cent of all industrial units, and 2) the government can provide loan at a lower rate of interest to those industries who have gas-based boilers and furnaces to convert them into furnace oil or diesel as the case may be.
Benefits likely to be derived from this action are: a) within a few months all stalled industrial units will start work of converting to furnace or LDO or diesel oil as fuel against huge difference between furnace oil and gas prices, b) huge idle money with banks can be utilized to finance import of furnace oil and diesel which will generate building facilities for pumping oil imports and setting up tank terminals etc providing huge employment opportunity in different sectors including sea going and inland transport vessels, c) with fuel equalized, lot of closed down furnace oil and diesel power projects will re-start and power shortage will vanish, while government can sell power at a little higher rate/fixed rate 24 hours a day without any peak hour rates. Closed down industries during peak hour will ease substantial production in those industrial belts that currently do not run on peak hours and d) surplus energy can be sold to increasing domestic consumers including the transport sector. Presently, fertilizer being produced in under highly subsidized gas supply will go, while subsidy to furnace oil and diesel imports can be considered, if gas prices cannot increased under complex situation.