Unified power tariff structure from Nov

M Azizur RahmanThe country's energy regulator is set to fix upward a unified power tariff structure for all the retail clients under state-owned power distribution agencies in November next, officials said Wednesday. "We have decided in principle to set a unified electricity tariff structure for all the clients in the country, irrespective of their locations," Bangladesh Energy Regulatory Commission (BERC) Chairman Syed Yusuf Hossain told the FE Wednesday. He said the unified power tariff structure will help reduce complexities in calculation and keeping of books of accounts. The BERC Chairman said a hike in electricity tariff might be announced in November. All state-owned power distribution entities including Bangladesh Power Development Board (BPDB), Dhaka Power Distribution Company Ltd (DPDC), Dhaka Electric Supply Company (DESCO) and Rural Electrification Board (REB) have already submitted proposals to raise electricity tariff at different rates separately. They have strongly pleaded for raising the electricity tariff to cope with the mounting costs in purchasing electricity from the power generation companies including the high-cost liquid fuel-run rental and quick rental power plants. This time the power distributors have come up to the BERC with a new type of proposal, seeking a markedly higher tariff-rate for uninterrupted electricity supplies to affluent clients, said sources. They have also proposed for introduction of one more slab for electricity consumers of residential category and recommended that the slabs should be for the clients consuming electricity from 0-100 units, 101-500 units, 501-1000 units and above 1,000 units. Currently there are three slabs for residential electricity consumers from 0-100 unit, 101-400 units and above 400 units. BERC will hold public hearing on the tariff hike proposal of DPDC today (Thursday). The Commission will also organise public hearings on other proposals from state-run entities shortly, before deciding on power tariff-hike in one go, said the Commission chairman. Officials said the hike in electricity tariff will reduce the burden of a mounting subsidy bill on the public exchequer and its direct or indirect shifting to the state-owned power entities. The government will have to pay around Tk 90 billion (9000 crore) in subsidies to the parent state-owned power entity, BPDB, alone in the current fiscal year (FY) 2011-12, if the tariff is not hiked, BPDB chairman ASM Alamgir Kabir said. The amount of subsidy required for the current fiscal is double the previous year's Tk 45 billion. High-cost rental and quick rental power plants are now producing around 1,700 megawatts (mw) of electricity, which is 34 per cent of the country's aggregate electricity generation of around 5,000mw. Until October 19, 2011, the government signed 45 deals with different sponsors to build a total of 47 power plant projects, most of them being oil-based ones. Twenty-seven rental and quick rental power plants have already been put into operation, while about a dozen more are expected to start generation by the end of the year. Seven quick rental power plants with an aggregate generation capacity of 522mw electricity have started supplying electricity to the national grid and the remaining 20 with production capacity of 1,173 mw are rental ones. Most rental and quick rental power plants are either diesel-fired or run on furnace oil. With the commissioning of high-cost rental and quick rental power plants, BPDB has sought to raise the bulk electricity tariff by 12 per cent every six months or at an annualised rate of over 25 per cent for years, up to 2013 to help reduce the amount of subsidy and ensure payment against electricity purchase from the power plant sponsors. But the energy regulatory commission raised power tariff by 11 per cent for bulk consumers and by 5.0 per cent for retail consumers from February 1, 2011. The bulk power tariff was raised further by 6.66 per cent from August 1, 2011, meaning that overall hike in power tariff for the bulk consumers is now 18.14 per cent higher than that of pre-February, 2011. The average bulk tariff rate of electricity is now Tk 2.80 per unit from the previous Tk 2.37 per unit.