Another round of power hike in the offing?

With a significant portion of electricity generated today coming from oil-fired power plants and the international price of oil plummeting to new a low, we find the arguments of Bangladesh Power Development Board (BPDB) for increasing power tariff for both bulk and retail customers not particularly convincing. Indeed that was the general feeling of various stakeholders across the board at an ongoing hearing organised by Bangladesh Energy Regulatory Authority (BERC). (BPDB) has proposed an 18 per cent price hike for bulk consumers and nearly 21.5 per cent increase for retail consumers.

The rationale given for such proposed increase is to offset BPDB's earlier losses. The question is now that international oil prices have halved, BPDB should be in the green in terms of profit. And if this planned increase goes through, then the profit margins should increase further, but at what cost? Industrialists have argued that an increase in electricity tariff would negatively impact on fixed income groups and medium-sized enterprises. An inflated electricity bill for industry will ultimately have to be borne by consumers and the poor will be worst hit by such an action. Though BERC's recommended increase of 5.16 per cent is significantly lower than the nearly 22 per cent hike proposed by the utility provider, an increase is an increase. Whatever increase is decided upon, the monthly power bill for the average consumer will see a rise and this extra cash will have to be scraped from the monthly budget by cutting corners elsewhere.