Like LPG, govt leaves auto-gas pricing to private players

Manjurul Ahsan | Updated at 12:37am on March 11, 2018

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A newly installed auto-gas dispenser is seen at a vehicle refueling station at Mohakhali in Dhaka on Saturday. Like Liquefied Petroleum Gas used in cooking, the government has also left the pricing issue of autogas, LPG used in vehicles, to the private players ignoring the legal entitlement of the Bangladesh Energy Regulatory Commission. — Sony Ramany

Like Liquefied Petroleum Gas used in cooking, the government has also left the pricing issue of autogas, LPG used in vehicles, to the private players ignoring the legal entitlement of the Bangladesh Energy Regulatory Commission.
The Bangladesh Energy Regulatory Commission Act- 2003 made it mandatory for the energy sector players including those operating or willing to operate LPG business to obtain license from the commission, said officials.
Until now, owners of some 16 auto-gas filling stations have not obtained licenses from the commission and they charge Tk 50 to Tk 54 per litre of auto-gas, said the officials involved in the business.
Liquefied Petroleum Gas is called ‘auto-gas’ when it is used in motor vehicles.
Energy division secretary Nazimuddin Chowdhury on Monday told New Age that the market would determine the price of LPG or auto-gas.
The commission had nothing to do with the pricing of LPG, he said, adding that the government had created a competitive market by allowing a good number of private companies in the business which would enable consumers to get fuel at reasonable prices.
Issues like quality and safety were the areas where the authorities concerned would have to focus, the energy division secretary said.
He made the remarks at a time when there is demand for intervention of the energy commission in regulating the fast growing market of LPG in cooking as well as in vehicles.
The government drew severe criticism for not allowing the energy commission to regulate the LPG market so that the consumers could get it at a reasonable price.
Different private companies have planned to set up 50-60 auto-gas filling stations across the country in 2018 increasing the total number to 70 to 80, said private entrepreneurs.
Consumers Association of Bangladesh energy adviser M Shamsul Alam said that the government was not at all interested in protecting the consumers’ interests and bureaucrats were there to protect the interests of businesses.
‘There is no competition in any market of a commodity in Bangladesh as business syndicates determine the prices in absence of regulations,’ he observed.
Energy commission member Md Abdul Aziz Khan said that it would take more time to bring all the energy sector utilities under the commission’s umbrella.
Azam J Chowdhury, a director of Omera Petroleum Limited that operates an auto-gas filling station in Dhaka, said that the entrepreneurs set the price of the fuel as there was no benchmark set out by the government or the regulatory commission.
He claimed that the suppliers would feel secure if there were proper regulations in place and a regulatory body protecting the interests of both the suppliers and consumers.
Azam also said that the energy commission could prepare a pricing formula for LPG instead of determining specific price in a bid to address the always changing behaviour of its price in the international market.
Private companies in Bangladesh import propane and butane, ingredients of LPG, and bottle at their respective plants before supplying across the country.
On February 2, Omera in a joint venture with Japanese Saisan Co Ltd started operation of its auto-gas filling station at Tejgaon area in Dhaka.
While addressing the inaugural ceremony as a chief guest, state minister for power, energy and mineral resources Nasrul Hamid said that the private sector has made significant advancement in the sector while the energy division was yet to prepare for the new fuel option.