Gas price hike proposals unrealistic: CAB

Staff Correspondent | Published: 16:08, Jul 25,2018 | Updated: 16:12, Jul 25,2018


The Consumers Association of Bangladesh on Wednesday holds a news conference at Dhaka Reporters Unity on Wednesday.-- New Age photo

The Consumers Association of Bangladesh on Wednesday opposed the proposal of gas price hike identifying a number of oddities and said addressing those would dictate no price hike.

At a press conference at Dhaka Reporters Unity, it said that a move of gas price hike was underway by increasing the tariff of gas supply and distribution by the state-run gas distribution utilities.

Recently a public hearing was organised by the Energy Regulatory Commission to analyse the proposals.

Earlier, Bangladesh Energy Regulatory Commission raised the gas prices by about 22 per cent on an average in two phases, from March 1 and June 1 in 2017, while the utilities now sought an average 75 per cent hike, from Tk 7.39 per cubic metre to Tk 12.95.

The public hearing on the proposals revealed that the utilities wanted to hike the tariff for gas distribution and supply to increase the gas price at the consumer end, CAB said.

Speaking at the press conference, CAB energy adviser M Shamsul Alam said the companies in their proposals incorporated ‘imaginary’ cost calculation of imported LNG gas distribution, though LNG gas was not yet included in the supply line.

‘When LNG gas is yet to be in the supply channel, calculation of it costs is unrealistic,’ he said.

‘The gas distribution and supply matters for only 3 per cent of price and keeping 97 per cent causes unanalysed and unaccounted is no way acceptable to raise gas price at the consumer end,’ he said.

Moreover, there was no technical committee evaluation on the price hike proposals that created questions, Shamsul said.

The companies’ price calculation included the depreciation accounting 100 per cent gas distribution properties in services which is unrealistic, he said.

CAB sought for measures to check gas theft by illegal connection and wastage.

It said that the price hike was not necessary as the companies’ accounts of loss could be met up with the addressing mismanagement.

CAB said the energy division officials were playing regulatory role and occupying positions in the boards of the utilities which created a scope of ‘conflict of interest’.

It proposed for keeping Gas Development Fund and Energy Security Fund under energy regulatory commission.


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