Special Correspondent :
Consumers’ rights group and industry leaders Friday sharply criticised the government over the latest increase in power tariff, calling it an anti-people and anti-industry act.
Terming the latest hike proposals ‘illogical’, Consumers’ Association of Bangladesh (CAB) Energy Adviser Prof Dr M Shamsul Alam claimed that if the current leakages and corruptions could be prevented power tariff hike will not be required.
He held the government’s ‘faulty’ policy for the escalating electricity prices and the consumers are bearing the brunt of it.
“Present government hiked the electricity tariff for ninth time since 2009, making electricity unaffordable for household and industrial consumers,” said Prof Shamsul Alam.
Denouncing the latest power tariff hike, he questioned, how consumers would afford the tariff increase when the cost of other basic commodities have gone up.
Bangladesh currently has an installed capacity of generating 22,562MW electricity, according to the Bangladesh Power Development Board (BPDB).
The maximum generation has been attained so far is 14,165MW.
Sources said, in winter the demand hover around 6,000-7,000MW, causing a significant number out of 137 power plants to sit idle.
“The Power Sector Master Plan recommends that the government should limit reserve generation capacity within 20-25 per cent. But the prevalent higher reserve capacity has been not only harming the opportunity cost for the capital invested in power plants but also incurring huge regular expenses from the national exchequer in from of capacity charges,” noted Prof Shamsul Alam.
“The government finally passes the burden of it to the consumers by raising electricity prices again,” he added.
The Bangladesh Energy Regulatory Commission (BERC) on Thursday raised the power tariff by 5.3 per cent at retail and 8.4 per cent at wholesale levels.
Terming the power tariff hike decision ‘untimely,’ former FBCCI president (Federation of Bangladesh Chambers of Commerce & Industries) Shafiul Islam Mohiuddin, said, “The move will put detrimental effect on the industries and private sector.
“Manufacturers are already under pressure as industrial production cost has raised significantly over the last couple of years. Besides, exports continue to fall owing to sluggish global demands. The recent outbreak of coronavirus also shakes up domestic industrial production and outbound shipments. In this situation, power tariff hike afresh will intensify the manufacturing crisis,” he noted.
Mohiuddin hoped that the government would provide necessary policy supports to the industrial sector to overcome the crisis.
“The increase in power tariff will take a heavy toll on the readymade garment industry,” MA Rahim (Feroz), a leader of Bangladesh Garment Manufacturers and Exporters Association, told The New Nation.
He said the latest hike in power tariff would raise production cost and pile more pressure on already hard-pressed industry.
Highlighting the current situation of the country’s garment sector, MA Rahim said, “At least 32,900 workers lost their jobs in the last seven months after 69 readymade garments (RMG) factories closed down due to various challenges including declining competitiveness in the international market.”
During this period, the country’s top export earning sector also registered negative growth, he noted.
“The industry is now struggling to keep afloat owing to negative export growth and high cost of doing business. In this situation, a further rise in production cost associated with the latest power tariff hike would sound the death knell for the industry,” MA Rahim, a Vice-President of BGMEA, said.
Expressing frustration over the fresh power tariff hike, Mohammad Hatem, Vice-President of Exporters Association of Bangladesh (EAB), said, the industries involved in export business will suffer most due to the government move.
“Export-oriented industries were already struggling to keep costs down after increasing the salaries of their workers and the move could lead to closure of many apparel factories since their costs have gone up by almost 29.40 per cent during the last four years,” he added.
“Small and medium factories will be severely hit due to the fresh power price hike,” said Mohammad Ali Khokon, President of Bangladesh Textile Mills Association (BTMA).
He added, “It is not rational to raise the tariff without ensuring uninterrupted and quality power supply and improved transmission system.
He also demanded review of the decision of electricity tariff hike considering its adverse impact on the industrial sector.
“The tariff hike will certainly add extra pressure on consumers of all classes and will also erode competitiveness of local industries in global arena,” said CAB Chairman Golam Rahman.
