Dhaka, Nov 21 (EFE).- Bangladesh authorities on Monday announced a nearly 20 percent hike in wholesale prices of electricity, a measure that will come into effect from December and is aimed at reducing fuel consumption amid an energy crisis.
From December, each unit of power will cost 6.20 takas ($0.06) at the wholesale level, up from the current price of 5.17 takas, the chairman of the Bangladesh Energy Regulatory Commission, Abdul Jalil, said in a virtual presser on Monday.
In a subsequent statement, the commission said that the new price was part of an effort to reduce subsidies worth 170 billion taka ($1.65 billion) that the government hands out to the state-owned Bangladesh Power Development Board, which had sought a revision of the power prices.
The measure amounts to a nearly 20% increase in bulk price of electricity, and although the authorities insist that it would be applied only on six companies, experts said that it is the retail consumers who would eventually bear the brunt.
“Normally, if the price is increased at the wholesale level, the consumer-level price also goes up,” Ghulam Rahman, president of the Consumer Association of Bangladesh, told EFE.
Rahman said that retail consumers may not be affected by the new tariffs if the government decided to compensate the power distributing companies for the price difference in the form of subsidies, but otherwise, “distribution companies will have to increase consumer price soon.”
Energy expert and the dean of the faculty of engineering at the Daffodil International University, Shamsul Alam, termed the decision “farcical and cheating,” and said that the government could have dealt with the matter differently.
“It is obvious consumers will be affected. One, who will buy power in bulk, where will he get the extra money? The consumer has to pay the price,” he told EFE.
Energy-starved Bangladesh has been experiencing a power crisis for months, forcing the government to announce a series of measures to reduce power consumption.
In July, authorities ordered the closure of all diesel-run power plants due to high oil prices in the global market, apart from imposing a ban on decorative illumination during events at homes, community centers and shopping malls as well as both government and private-sector offices.
However, rising fuel prices have led to inflation shooting up in the country.
Inflation surged to 9.52 percent in August after authorities raised fuel prices by nearly 51 percent, before declining marginally to 8.91 percent in October. EFE