Proposal to increase gas price irrational: CAB

Staff Correspondent | Published: 00:49, Jul 26,2018 | Updated: 00:57, Jul 26,2018

 
 

Consumers’ Association of Bangladesh holds a news conference in Dhaka Reporters’ Unity on Wednesday opposing proposal to increase the gas price. — New Age photo

The Consumers’ Association of Bangladesh on Wednesday opposed the proposal for increasing gas price showing a number of oddities.
CAB leaders at a press conference in Dhaka Reporters’ Unity said a move was underway to increase the gas price by the gas utilities showing reason that tariff on gas supply and distribution was forcing them to go for an increase.
CAB arranged the programme in response to a recent public hearing 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 showed high tariff on gas distribution and supply as an excuse to increase the gas price at 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 its cost is unrealistic,’ he said.
‘The gas distribution and supply matters for only 3 per cent of price, and keeping the rest 97 per cent issues 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 proposal that created questions, Shamsul said.
The companies’ price calculation included the depreciation accounting 100 per cent gas distribution properties in services which was unrealistic, he said.
CAB sought measures to check gas theft though allowing illegal connection and wastage.
It 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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