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Proposal for gas price hike faces opposition

Star Business Report
A committee of the energy regulator has opposed the proposal of transmission charge hike of Gas Transmission Company Ltd (GTCL) as the state-run company is already realising more than it requires in meeting expenditures.
Considering the demand for revenue in the current fiscal year, Tk 0.13 is enough for the transmission of a cubic metre of natural gas, said a technical assessment committee of Bangladesh Energy Regulatory Commission or BERC.
A report by the committee concluded that the current tariff of Tk 0.32 is already exceeding the company's revenue requirement by Tk 0.19 per unit.
The BERC panel presented the report at a public hearing yesterday on GTCL's proposal to increase transmission charges to Tk 0.47 per cubic metre for 2014-15, Tk 0.73 for 2015-16 andTk 0.75 for 2016-17.
The GTCL justified the hike saying that its cost of operation shot up due to the government's expansion programmes in gas transmission, most of which were not financially viable.
The gas transmission company, however, is recording profits every year - Tk 318.53 crore in fiscal 2010-11, Tk 407.57 crore in 2011-12, Tk406.08 crore in 2012-13 andTk 425.88 crore in 2013-14.
At the hearing presided over by BERC Chairman AR Khan, the GTCL officials failed to explain a number of gray areas over the revision in charges, development projects, profit bonus sharing and recruitment process.
Consumer rights groups, leftist political parties and professional bodies also strongly opposed the proposal at the hearing held at BERC office in Dhaka.
They said GTCL should lower its tariff, enabling the general people to receive gas at lower prices.
Consumers Association of Bangladesh Adviser Shamsul Alam, leftist leaders Ruhin Hossain Prince and Zonayed Saki, energy expert Nurul Islam and representatives of the Federation of Bangladesh Chambers of Commerce and Industry, Bangladesh Garment Manufacturers and Exporters Association and other businesses bodies opposed the proposal as well.
Gonotantrik Baam Morcha, an alliance of seven leftist parties, demonstrated at the BERC entrance, opposing the hike
Zonayed Saki said authorities should look into how the money earned by the companies that produce and distribute gas is spent and ensure that people are not overpaying for the basic service.
The gas distribution companies appealed to increase the price of gas for double burners in households by 122 percent to Tk 1,000 a month, and that for single burners by 112.5 percent toTk 850 a month.
They also appealed for gas price hike for pre-paid meter users in households by 60.68 percent to Tk 235 per cubic metre.
The companies wanted to increase the gas prices for commercial consumers by 30.55 percent, industries by 32.6 percent, tea estates by 20.55 percent, and fertiliser factories by 9.71 percent.
According to the appeals, for CNG filling stations, the price per cubic metre will be increased to Tk 32 from Tk 23, which will force retail consumers to pay Tk 40 a unit, up from Tk 30.
BERC also instructed the state-run gas companies not to hold annual general meetings at expensive venues.
The four-day public hearing ends on February 5.