State Minister for Power, Energy and Mineral Resources Nasrul Hamid said on Thursday that the IMF has asked to increase electricity tariff four times in a year to offset huge losses of power sector.
"To offset the financial loss of the power distribution companies, IMF asked us to increase electricity tariff four times in a year, in line with the idea, we have already increased the price of electricity twice, it is price adjustment, we rationalized the tariff on regular basis, when we are asked to increase the price again, we will increase it," Nasrul Hamid said at a post budget media briefing on Thursday at his secretariat office.
The IMF has given the condition of increasing the price of electricity four times a year. In view of this, the price has been increased twice and it is a regular adjustment, he added.
Replying to a question, the State minister said Bangladesh will seek Chinas assistance to implement a total of seven power and energy projects involving around US$1.0 billion during the forthcoming visit of Prime Minister Sheikh Hasina to China.
Of the projects, one will be the Moheshkhali to Bakhrabad third parallel gas transmission pipeline, and six will be power transmission lines, he added.
Once agreed, both the countries are expected to ink a memorandum of understanding (MoU) during the PMs visit, slated for July 8-11, he added.
To share the future development plan of the countrys energy and power sector, the Ministry of Power, Energy and Mineral Resources has conducted the briefing that discussed budget allocation in power and energy sector development for the current fiscal year, future development plan, and green and clean energy issues by the year of 2041, investment requirement of these sector and bottlenecks.
"Nowadays we have been seeing that the sector is huge financial challenges, the power distribution companies are incurring losses due to fluctuations in the dollar rate. They had been calculating the dollar at Tk 85 (price of fuel like coal, LNG, diesel and furnace oil) since the previous fiscal year; it was then set at Tk 110 and is currently at Tk 117.
In reply to another question, the state minister stated that in the current 2023-24 financial year, the amount of subsidy for the electricity sector in the budget is Tk35,000 crore, and Tk31,833 crore has already been provided from the subsidy funds.
"We will need to adjust the price," he said, replying to a query in a post-budget press conference at the Secretariat.
The State Minister admits the suffering of the people due to shortages in electricity and gas supply at the consumers ends.
"We
e now trying our best and the situation is under control. Gas supply will be uninterrupted by July 15-16," he said adding that electricity supply would be improve within a couple of days as Adani has resumed power supply and the Payra power plant is back in operation.
"We have taken up a robust plan to address the gas crisis in the country by 2027. To achieve this, we have developed several plans, including joint venture with our development partners, however, Prime Minister Sheikh Hasina will discuss around 8 projects mainly on power and gas distribution network with China," the State Minister has said.
The state minister added that the cost of electricity from gas and coal-fired power plants has been unstable.
Previously, gas that cost $7 per unit has risen to $67 per unit, resulting in Petrobangla spending over Tk35,000 crore in expenses.
