The government is unlikely to increase the prices of gas for households, sources within the power, energy and mineral resources ministry told The Independent. While many view this as a ‘populist stance’ in an election year, electricity prices are, however, likely to spurt, as the per unit gas price for the power plants will be increased by about 400 per cent. The gas-based power plants currently need to pay Tk. 3.16 per unit. The six gas distribution companies, in their proposals seeking gas price increases, have asked to make it Tk. 12.90 per unit, sources said.

Talking to The Independent, Mir Moshiur Rahman, the managing director (MD) of Titas Gas Transmission and Distribution Company Ltd, said they have already finalised their gas price increase proposal.

The MD of the largest gas distributor, however, said they have not proposed hiking gas prices for domestic households.

For compressed natural gas (CNG), the price hike will be minimal, he hinted, and for the rest, Titas will place a proposal for a 30–35 per cent hike.

For the power plants, however, Titas proposed a hike of about 400 per cent, said Rahman. The power sector alone consumes 41 per cent of the total gas production. The government wants the new gas prices to come into effect in April, when it is scheduled to start importing liquefied natural gas (LNG).

Sources in the ministry said by hiking the price, the government plans to stop paying subsidies for gas.

Earlier, in a letter last month, Petrobangla urged the Bangladesh Power Development Board (BPDB) and the Bangladesh Chemical Industries Corporation (BCIC) to manage enough funds for a considerable hike in gas prices. The average cost per unit of gas is Tk. 7.34, but it will be Tk. 13 per unit after the imported gas arrives.

“We know that LNG is going to cost more. We’re preparing for that,” BPDB chairman Khaled Mahmud told this correspondent.

The Bangladesh Energy Regulatory Commission (BERC) increased gas prices twice in 2017. The two-step increase came into effect from March 1 and June 1, hiking the prices by an average of 22.73 per cent.

The government last increased gas prices on February 22 last year, in two phases. The first phase came into effect in March 2017, when the charges for a single-burner stove were increased to Tk. 750 from Tk. 600 and for a double-burner stove to Tk. 800 from Tk. 650.

The second phase was supposed to come into effect from June the same year and the monthly charges for each single-burner stove were fixed at Tk. 900 and for each double-burner stove at Tk. 950. The second phase of the hike could not be implemented because of a High Court (HC) order.