An additional fund of Tk 187 billion will be needed in FY20 to cover losses due to payment for import of liquefied natural gas (LNG), the energy regulator said as it raised the price of gas across the board to be effective from Jul 1.
On Sunday (Jun 30), the Bangladesh Energy Regulatory Commission (BERC) announced that it has decided to increase gas prices by 32.8 percent on average.
Gas distribution companies, however, need to increase by 75 percent due to losses occurred for importing LNG at a much higher price, the regulator told a media call at its offices.
An additional fund of Tk 187.3 billion will be needed in the upcoming fiscal year to cover the losses, according to the BERC.
Some Tk 86.2 billion will be sourced from gas bills paid by consumers while the government will provide Tk 76.9 billion as subsidies.
The remaining Tk 24.2 billion will come from Energy Security and Gas Development Fund, which is also created from bills paid by consumers.
Speaking at the media call, BERC Chairman Monwar Islam said prices were revised considering the gas production, LNG import, transmission and distribution charges and the country’s socio-economic condition.
“The good news for consumers is that they will no more face gas crisis rather will have a steady supply,” he said.
Responding to a query on industrial consumers not getting enough gas, he said, “That’s why we withdrawn the existing minimum demand charge.”
The price of gas has been increased by 32.8 percent to Tk 9.80 per cubic metre from Tk 7.38 per cubic metre, said the BERC chief.
According to the revised prices, the price of household gas will rise to Tk 925 for a single-burner cooking stove and Tk 975 for double-burner stove from Tk 750 and Tk 800, respectively.
For customers paying for gas by the cubic metre, the price will jump to Tk 12.60 per cubic metre from Tk 9.10 per cubic metre.
The price of compressed natural gas (CNG), used in vehicles, will also rise to Tk 43 per cubic metre from Tk 30 per cubic metre.
Price of gas for commercial users like, restaurants, hotels and hospitals has been hiked by 34.98 percent.
The gas price hike for industry is 37 percent. However, the price for small and cottage industries was not raised.
Public and private power plants will have to pay by 42.8 percent while fertiliser factories by 65 percent more.
In February this year, the six gas distribution companies forwarded proposals to the regulator to hike prices by 102 percent on average, following which a four-day public hearing was held in March.
Gas prices were revised up by an average of 22.70 percent in February 2017 with households hit with over a 50 percent monthly rise for stoves.