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Titas Gas seeks 115.33% distribution charge hike at BERC hearing

  • Published at 10:29 pm June 12th, 2018
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Tribune File Photo Syed Zakir Hossain

Gas companies have exempted residential and commercial users from the proposed increase

Titas Gas Transmission and Distribution Company Limited (TGTDCL) has proposed to raise the gas distribution charge by 115.33%.

They have proposed to increase Tk0.4987 for each unit of gas from the existing rate of Tk0.2316.

Bangladesh Energy Regulatory Commission (BERC) on Monday organized a public hearing as part of the government’s move to increase gas prices and distribution charges at consumer levels, to adjust the imported price of Liquefied Natural Gas (LNG).

During the hearing, the company authorities attributed the move to its liquidity crisis, less profits and the aim to boost revenue collection, among others reasons, recommending withdrawal of minimum charges in all consumer levels.

The public hearing was moderated by BERC Chairman Monowar Islam held at the Trading Corporation of Bangladesh (TCB) auditorium.

BREC’s technical evaluation committee, in its report, suggested the gas company to charge security money equivalent to the payment of two months, while issuing new gas connections.

All the state-owned gas distribution and transmission companies including Titas Gas have sought to hike gas prices on an average up to 75% for different consumer groups.

The gas companies have proposed a hike in price for the fertilizer sector by 372% and for the power sector by 206%. If the proposals are accepted, the fertilizer and power prices will skyrocket.

Once the prices are increased as proposed, each unit of gas for the power sector, which now sells at Tk3.16, will increase to Tk10 and the per unit price for the fertilizer sector will jump to Tk12.80 from Tk2.71.

It has been proposed that the prices for the industry and CNG sectors to be hiked by 93% and 25%, respectively. The gas companies have however, exempted the residential and commercial users from the proposed hike.

Mir Moshiur Rahman, managing director of TGTDCL said: “The company itself funds most of its infrastructural development, which is one of the reasons we want the gas distribution charges to be hiked.”

“Being a limited company, TGTDCAL has to pay dividend to its shareholders every year which is another cause of seeking the charge hike,” he said, adding, they on an average have paid 29% dividend to the shareholders in the last 10 years.

However, Moshiur avoided answering the question as to whether it is justified to realize 100% bill despite growing allegations of low gas supplies, especially in the capital.

Rather he said the current scarcity of gas is caused by the rise in demand, centering Ramadan.  

Dr Shamsul Alam, energy adviser of Consumers Association of Bangladesh (CAB), criticized the government’s move to import LNG as pilferage of gas goes unabated.

“Why did not the government focus on stopping the theft of gas when the country reels from acute gas shortage and despite intelligence reports in this regard,” he said.

Another appeal of gas price hike by Karnaphuli Gas Distribution Company Ltd will be heard on June 20 at the same venue.