Hearing On Gas Price Hike Proposal Faces Strong Protest

As directed by the Energy and Mineral Resources Division (EMRD), Petrobangla sent a proposal to the Bangladesh Energy Regulatory Commission (BERC) on 27 December 2024 for refixing the gas tariff for industries and captive power plants – existing and future. The proposal requested a review and determination of the gas tariffs.

- Khondkar Abdus Saleque

The proposal is as follows:

AA. New industrial and captive power customers would pay a tariff equal to the exact cost of imported LNG.

BB. Promised industrial consumers and captive generation plants (having primary approval/demand note issued) shall get 50% of the gas at the existing price applicable for the categories. They would pay the price determined based on the imported LNG for the remaining gas.

CC. If existing industrial consumers for their operations or operations of their captive power plants want to increase the load, they must pay a higher price as determined based on the import cost of LNG.

DD. The imported cost of LNG would mean the three-month average price of LNG imported under long-term contracts and spot market (LNG import price, cost of regasification, VAT, Tax, and all other margins).

The present gas price for industrial consumers is Tk 30 per cm and for captive power (used in industries) is Tk 30.75 per cm. Petrobangla proposes increasing both to Tk 75.72 per cm. This is a huge 152% increase at a time when Petrobangla cannot ensure quality gas supply to any consumer – power, fertilizer, industrial, or domestic consumers. BERC organized public hearings as per its mandate. Representatives of trade bodies, business organizations, consumer associations, energy analysts, and political leaders logically vehemently opposed the move. BERC heard all and is expected to announce the tariffs in due course.