Gas prices up 32pc

The government has decided to raise the price of gas across the board, effective from today, despite objections from various quarters. The Bangladesh Energy Regulatory Commission (BERC) declared an average price hike of 32.8 per cent for all users from July 1, the beginning of a new fiscal year, at a crowded press conference in its headquarters in Karwanbazaar. The price of the single burner will rise to Tk 925 per month from Tk 750 while the price of the double burner will rise to Tk 975 from Tk 800, BERC chairman Monowar Islam said.

For customers who pay for gas by the cubic metre, the price will jump to Tk 12.60 per cubic metre from Tk 9.10 per cubic metre. The price of compressed natural gas (CNG), used to fuel vehicles, will also rise from today to Tk 43 per cubic metre from Tk 38 per cubic metre.

According to the increased price, CNG consumers will have to pay Tk 43 per CM with a 7.5 per cent hike instead of Tk 40 while captive and small power plant operators will have to pay Tk 13.85 per CM instead of Tk 9.62 with a 43.97 per cent hike. CNG station operators will have to pay Tk 35 per CM instead of Tk 32 to the government for their feed gas.

Commercial consumers like restaurants, hospitals, student hostels and hotels will have to pay Tk 23 per CM instead of Tk 17.04, thanks to a 34.98 per cent hike in prices.

The gas price hike for industry is 37 per cent as industrialists will now have to fork out Tk 10.70 per CM instead of Tk 7.76 per CM. Tea estates will have the same price as industries. However, the gas price was not raised for small and cottage industries.

Public and private power plants will have to pay Tk 4.45 per CM instead of Tk 3.16 per CM due to the price increase

by 42.80 per cent while fertiliser factories will have to shell out Tk 4.45 per CM from the existing Tk 2.71 per CM.

Energy sector experts believe that the increase in gas price for power plants would have a spillover effect and the power plant operators will soon raise demands for an increase in power tariffs.

BERC chairman Monowar Islam explained that multiple factors prompted the BERC to backtrack from its earlier decision to not increase the gas price. This includes the injection of costly LNG into the national pipeline, because of which the country is losing Tk 7,000–8,000 crore annually.

Bangladesh entered the LNG era in August last year after the LNG brought from Qatar was supplied into the national grid line. This was done after regasification in the country’s first floating storage and regasification unit (FSRU), docked at Moheshkhali. The government is buying LNG at Tk 39 per SCM and is selling this for Tk 7.17. Altogether, two FSRUs—one of Excelerate Energy and another of Summit—are currently supplying a total of 500 mmcfd of regasified LNG to the network.

The BERC member said they have heard the arguments and counter-arguments from the gas distribution companies and the consumers’ and human right groups during the four-day hearing in March this year.

BERC member Mizanur Rahman said the gas utility companies need to increase the gas price by 75 per cent due to the losses caused by the import of liquefied natural gas (LNG) at much higher price. “A Tk 18,730-crore additional fund is required to cover losses caused by payments for the import of LNG.”

But now, he said, some 33 per cent or Tk 8,620 crore will be collected from consumers while 29 percent or Tk 7,690 crore will be given by the government as subsidy and the remaining amount of Tk 2,420 crore will be given from the Gas Development Fund (GDF), also created by the money from consumers.

The new price hike came in response to the demands of different gas utility companies. The BERC started the recent round of public hearings on March 11 on the proposals placed by six gas distribution companies (Titas, Bakhrabad, Jalalabad, Pashchimanchal, Karnaphuli, and Sundarban) for the gas price hike at the consumer level.

Titas and Sundarban have demanded 208 per cent hike for the gas consumed by power plants, 211 per cent for fertilizer companies, 96 per cent for captive power plants, 132 per cent for industries, 41 per cent for commercial entities and 50 per cent for CNG-run vehicles.

Gas prices up 32pc

The government has decided to raise the price of gas across the board, effective from today, despite objections from various quarters. The Bangladesh Energy Regulatory Commission (BERC) declared an average price hike of 32.8 per cent for all users from July 1, the beginning of a new fiscal year, at a crowded press conference in its headquarters in Karwanbazaar. The price of the single burner will rise to Tk 925 per month from Tk 750 while the price of the double burner will rise to Tk 975 from Tk 800, BERC chairman Monowar Islam said. For customers who pay for gas by the cubic metre, the price will jump to Tk 12.60 per cubic metre from Tk 9.10 per cubic metre. The price of compressed natural gas (CNG), used to fuel vehicles, will also rise from today to Tk 43 per cubic metre from Tk 38 per cubic metre. According to the increased price, CNG consumers will have to pay Tk 43 per CM with a 7.5 per cent hike instead of Tk 40 while captive and small power plant operators will have to pay Tk 13.85 per CM instead of Tk 9.62 with a 43.97 per cent hike. CNG station operators will have to pay Tk 35 per CM instead of Tk 32 to the government for their feed gas. Commercial consumers like restaurants, hospitals, student hostels and hotels will have to pay Tk 23 per CM instead of Tk 17.04, thanks to a 34.98 per cent hike in prices. The gas price hike for industry is 37 per cent as industrialists will now have to fork out Tk 10.70 per CM instead of Tk 7.76 per CM. Tea estates will have the same price as industries. However, the gas price was not raised for small and cottage industries. Public and private power plants will have to pay Tk 4.45 per CM instead of Tk 3.16 per CM due to the price increase by 42.80 per cent while fertiliser factories will have to shell out Tk 4.45 per CM from the existing Tk 2.71 per CM. Energy sector experts believe that the increase in gas price for power plants would have a spillover effect and the power plant operators will soon raise demands for an increase in power tariffs. BERC chairman Monowar Islam explained that multiple factors prompted the BERC to backtrack from its earlier decision to not increase the gas price. This includes the injection of costly LNG into the national pipeline, because of which the country is losing Tk 7,0008,000 crore annually. Bangladesh entered the LNG era in August last year after the LNG brought from Qatar was supplied into the national grid line. This was done after regasification in the countrys first floating storage and regasification unit (FSRU), docked at Moheshkhali. The government is buying LNG at Tk 39 per SCM and is selling this for Tk 7.17. Altogether, two FSRUsone of Excelerate Energy and another of Summitare currently supplying a total of 500 mmcfd of regasified LNG to the network. The BERC member said they have heard the arguments and counter-arguments from the gas distribution companies and the consumers and human right groups during the four-day hearing in March this year. BERC member Mizanur Rahman said the gas utility companies need to increase the gas price by 75 per cent due to the losses caused by the import of liquefied natural gas (LNG) at much higher price. A Tk 18,730-crore additional fund is required to cover losses caused by payments for the import of LNG. But now, he said, some 33 per cent or Tk 8,620 crore will be collected from consumers while 29 percent or Tk 7,690 crore will be given by the government as subsidy and the remaining amount of Tk 2,420 crore will be given from the Gas Development Fund (GDF), also created by the money from consumers. The new price hike came in response to the demands of different gas utility companies. The BERC started the recent round of public hearings on March 11 on the proposals placed by six gas distribution companies (Titas, Bakhrabad, Jalalabad, Pashchimanchal, Karnaphuli, and Sundarban) for the gas price hike at the consumer level. Titas and Sundarban have demanded 208 per cent hike for the gas consumed by power plants, 211 per cent for fertilizer companies, 96 per cent for captive power plants, 132 per cent for industries, 41 per cent for commercial entities and 50 per cent for CNG-run vehicles.