Gas prices go up across the board

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Gas prices

The gas prices of all consumer types will go up with the first phase starting next month, followed by the second phase in June this year.

Household consumers will have to pay Tk750 per month for a single burner and Tk800 for double burner with effect from March 1. At present, the rate is Tk600 and Tk650 respectively.

In the second phase that takes effect on June 1, the consumers will have to pay Tk900 and Tk950 for single and double burners respectively.

Bangladesh Energy Regulatory Commission (BERC) Chairman Monwar Islam announced the new prices at a press briefing in Dhaka today (February 23, 2017). The prices of gas will then increase by 22.7% (weighted average).

New gas tariffs for metered household consumers would be Tk9.10 per cubic meter from March 01 and Tk11.20 per cubic meter from June 1, from the existing rate of Tk7 only.

The price of CNG, used for motor vehicles, will be Tk38 per cubic metre from March 1 and Tk40 from June 1. The existing rate is Tk30 only.

The feed gas price for CNG has been raised to Tk30 per cubic metre from March 1 and Tk32 per cubic metre from June 1 against current Tk27. However, the operators’ margin was kept unchanged at Tk8.0 per cubic metre.

The gas prices for other sectors, including power, fertiliser, industries, commercial ventures and captive power plants, were also raised.

The BERC announced the new tariff after six months of holding public hearing on proposals from state-run gas marketing, transmission and distribution companies.

It also raised the distribution margins of Sundarbon Gas Company Ltd and Pashchimanchol Gas Company Ltd, but rejected the plea for raising the similar margin for Titas Gas Marketing and Distribution Company Ltd.

The BERC chairman said the gas tariff has been increased to cope with the growing costs of natural gas production, transmission and distribution.

“We’ve decided the hike to be effective in two phases offering a comfort to consumers so that it doesn’t create any pressure on their pockets at once,” he said.

The BERC last raised the natural gas prices in September 2015 with an average hike of 26.29% (weighted average) while it was hiked by 11.22% (weighted average) in 2009.

The tariff for natural gas for power plants will be Tk2.99 per cubic metre from March 1 and Tk3.16 from June 1. The existing tariff for power plants is Tk2.82 per cubic metre.

Gas tariff for captive power plants has been increased to Tk8.98 per cubic meter from March 1 and Tk9.62 per cubic meter from June 1 from the current tariff of Tk8.36 per cubic meter.

For fertiliser factories, the new tariff of Tk2.64 per cubic metre will be effective from March 1 and Tk2.71 per cubic metre from June. The present natural gas tariff for fertiliser factories is Tk2.58 per cubic metre.

For industrial consumers, the new gas tariff will be Tk7.24 per cubic metre from March 1 while Tk7.76 per cubic metre from June 1 from existing Tk6.74.

The BERC raised the natural gas tariff for commercial consumers to Tk14.20 per cubic metre from March 1 while Tk17.04 per cubic metre from June 1 against the existing Tk11.36.

For tea estates, the new tariff of Tk6.93 per cubic metre will come into effect on March 1 and it will be Tk7.42 from June 1 from the existing Tk6.74 per cubic metre.

The transmission margin of state-run Gas Transmission Company Ltd (GTCL) was increased to Tk0.2654 per cubic metre from Tk0.1565.

Replying to a question, a BERC member said the most part of the increased natural gas tariff will go to the national exchequer as supplementary duty, value added tax (VAT) and corporate taxes. Currently, some 81% of gas prices go to the exchequer as SD, VAT and corporate taxes.


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