Photo: Messenger
Titas Gas Transmission and Distribution Company wants to increase gas bills for non-metered residential customers as well while the businesses are protesting the rise of gas price in industry. Although, currently, due to the political and economical instability the mass people are suffering for food inflation. The company's Managing Director Shahnewaz Parvez informed that this issue is in line with the proposal to increase gas prices for new industries and captives.
He said that non-metered residential customers are using a lot more gas. A bill of 55 cubic meters for a single stove and 60 cubic meters for two stoves are being collected. But in some cases, there is a record of gas usage of up to 100 cubic meters.
In response to a question, he said that there is a lot of difference between the usage of prepaid meter users and non-metered customers. Customers using prepaid meters are very frugal. Therefore, their usage is much less. In elite areas where prepaid meters are available, they often go to hotels and restaurants to eat. It is not possible to compare them.
On January 6, Petrobangla proposed to increase the price of gas supplied to new industrial boilers and industrial generators (captive) from Tk 30 and Tk 31.75 respectively, while keeping the prices of existing customers unchanged. Legally, Petrobangla's price increase proposal is not eligible to be considered. Only licensees can propose a price increase.
Therefore, BERC (Bangladesh Energy Regulatory Commission) has sought price adjustment proposals from distribution companies. In a letter issued on January 7, distribution companies have been asked to submit a proposal for tariff change to the commission within 3 working days.
Residential customers without meters are charged a fixed amount of gas. Whether the customer uses it, does not use it, or uses more, he has to pay the fixed bill. BERC last ordered a gas price increase on June 5, 2022. Before that order, a public hearing was held. At that time, the statistics of customers using prepaid meters of the distribution companies showed that on average one stove was using 40 cubic meters and two stoves were using a maximum of 50 cubic meters.
Based on the usage statistics of prepaid customers, one stove was reduced from 73.41 cubic meters and two stoves from 77.41 cubic meters to 55 and 60 cubic meters respectively.
Ten months after the BERC order, Titas Gas applied to increase the existing one stove from 55 cubic meters (990 taka) to 76.65 cubic meters and two stoves from 60 cubic meters (1080 taka) to 88.44 cubic meters. And if the quantity increases, the price will naturally increase. Titas said in its application that BERC has determined the amount of cubic meters without any survey or data analysis against approximately 2.5 million customers without meters. This has increased technical losses and Titas, a government-owned for-profit organization, is facing financial losses.
Former BERC member, Gas Maqbul E-Elahi Chowdhury told the Daily Messenger, “Titas Gas's allegations are not true. I think they should have been below 50 cubic meters. Of the 350,000 prepaid meters they had, less than 45 cubic meters were used on average.”
BERC has been holding Titas' application for a long time. The commission formed a committee, but the report of that committee has not seen the light of day. BERC is also considering taking up the proposal of unmetered residential customers in the public hearing, a source has confirmed.
On the other hand, distribution companies are embarrassed by the proposal for an unusual price increase. None of them sees the logic of increasing prices by 152 percent for industrial and captive customers. Top officials of several companies, on condition of anonymity, said that Petrobangla is trying to increase prices by putting a gun to our shoulders.
Consumers will have to face us in the public hearing. However, we do not agree with this price increase at all. As far as we know, a new price formula has been prepared as per the ministry's request. We are having to propose a price increase despite our reluctance.
Some companies are trying to use this as an opportunity. It is known that many, including Sundarban Company, are going to propose to increase the distribution charge. An official of Sundarban Gas Company Limited said on condition of anonymity, "Our existing wheeling charge is Tk 0.24, which is causing us losses. We can propose to set the distribution charge at Tk 32. 34."
Gas is purchased from the state-owned Sylhet Gas Field Company Limited at a rate of Tk 1, from Bangladesh Gas Field Company at a rate of Tk 1.25, and from Bapex at a rate of Tk 4 per cubic foot. Then, the average price of gas purchased from multinational companies Chevron Bangladesh and Tallo stands at Tk 6.07 per cubic meter.
Petrobangla's price hike proposal states that the current import price of LNG per cubic meter is 65.70 taka. Adding VAT-tax and other charges, it stands at Tk 75.72. As a result, the gas price gap will have to be reduced to sustain this sector. If LNG is imported as planned, Petrobangla will have a deficit of about Tk 16,161, 71 in the current fiscal year.
Business leaders and organizations have reacted strongly to the process of increasing gas prices. They have demanded an immediate halt to the process of increasing gas prices. They believe that industrialization will be stopped if the proposal is approved.
BERC has formed a technical committee to scrutinize the proposal to increase the price of Petrobangla gas. After receiving the report of the technical committee as per the rules, an order was given for a public hearing.
Messenger/Tareq
