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CAB demands subsidy in power sector

  • Published at 02:02 am October 6th, 2017
CAB demands subsidy in power sector
Consumers Association of Bangladesh (CAB) on Thursday demanded that a number of measures, such as subsidising the power sector, should be introduced to reduce the bulk power price for consumers. “It is possible to reduce the bulk prices of electricity if the government takes a number of steps, such as providing subsidy to the power sector,” Energy Adviser to CAB Prof M Shamsul Alam said. He made the comment while addressing a public hearing on power price reduction held on Thursday at the TCB Bhaban at Karwan Bazar in Dhaka. He said the bulk price of electricity continued to increase, because the government did not provide subsidy in the sector, rather it provided loan schemes. He further added, the order on bulk power price hike, issued on September 1, 2015, mentioned that the government will provide Tk4,300 crore as subsidy to power sector in FY 2015-16. Instead, the government provided Tk4,100 crore to the Power Development Board as loan with a 3% interest rate. In addition to the interest payment for the loan, diesel was also used as fuel instead of furnace oil in the 350MW power plant in Meghnaghat, which contributed to the price hike of electricity, Shamsul Alam added. Elaborating on the issue, the energy adviser to CAB said the government could have avoided  increasing the bulk power price, if allocations for Maintenance and Development Fund for Power Development Board (PDB) were made separate from the bulk power price rates. Shamsul Alam recommended that the power plants be operated through a merit order dispatch, which could bring transparency in power plant operations across the country. “There should be allocations for the power sector, not subsidy,” Communist Party of Bangladesh (CPB) President Mujahidul Islam Selim said during the public hearing. “We do not calculate the amount allocated for defence, education or any other important sectors, and the same should also apply to the power sector,” he further added. Speaking at the hearing, Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) Director Amzad Hossion said: “In the last seven years, the power price witnessed a 77% spike at the retail level. If it continues to increase, it will disrupt the economic development of the country. “Inflation and production costs will skyrocket, which in turn will negatively impact the business community,” he added. BERC Chairman Monowar Islam, members Rahman Murshed, Md Mizanur Rahman, Md Abdul Aziz Khan and Md Mahmudul Haq Bhuiyah, along with PDB General Manager (Commercial Operation) Md Kawsar Amir Ali, Director AHM Taslim Hossain attended the public hearing, among many others. In the beginning of the hearing, BERC Chairman Monowar Islam said there is no legal ground to hold this public hearing, but it was organised following demand from the consumers. “The BERC has listened to opinions of all stakeholders on power price restructuring and will inform its decision at a later date,” he added.