The Bangladesh Energy Regulatory Commission (BERC) has announced a steep increase in electricity tariffs, raising consumer-level rates by an average of 16.68 percent and wholesale rates by 19.18 percent, effective from the June billing cycle. The power tariff got a hike when load shedding across the country is continuing.
BERC Chairman Jalal Ahmed at a press conference on Wednesday announced the new rates will take effect from the June billing cycle.
At the consumer level, prices have been increased from a minimum of 15 percent for lifeline customers to a maximum of 19.94 percent. The current wholesale rate of 7.04 taka per unit has been raised to an average of 8.39 taka. On the other hand, the average transmission cost per unit has been increased from 31 paisa to approximately 39 paisa.
Most recently, on February 29, 2024, consumer-level electricity prices were increased by 8.50 percent through an executive order. At the same time, the wholesale rate was raised by 5 percent from 6.70 taka to 7.04 taka per unit.
The per-unit bill for residential lifeline customers has been increased from the current Tk 4.63 to Tk 5.32. As a result, the monthly bill for customers using up to 50 units will rise by Tk 35.
Meanwhile, the bill for those consuming up to 600 units will increase by approximately Tk 1,644 per month. The applicable VAT amount will also increase proportionally.
Residential users are divided into six additional consumption tiers. In the first tier, the bill for users of 75 units has been increased from Tk 5.26 to Tk 6.18 per unit. In the second tier (76-200 units), the rate has risen from Tk 7.20 to Tk 8.50. For the 201-300 unit tier, it has been increased from Tk 7.59 to Tk 9.10; for 301-400 units, from Tk 8.02 to Tk 9.62; for 401-600 units, from Tk 12.67 to Tk 15.01. In the final tier, the bill for users consuming above 600 units has been raised from Tk 14.61 to Tk 17.35 per unit. These rates apply to low-voltage category customers, while separate rates have been fixed for medium and high-voltage customers.
Additional electricity rate hikes have been announced for irrigation, street lighting, religious institutions, and battery charging. The low-voltage irrigation rate has been increased from Tk 5.25 to Tk 6.04 per unit. For battery charging, the peak rate has been raised from Tk 12.14 to Tk 14.20, while the off-peak rate has increased from Tk 8.66 to Tk 10.22.
Consumers will now pay different bills based on time of use and voltage level (low, medium, and high voltage), with electricity priced comparatively higher during peak evening hours.
For electric vehicle and battery charging (low voltage), the flat rate has been increased from Tk 9.59 to Tk 11.36 per unit. The off-peak rate has risen from Tk 8.63 to Tk 10.22, the super off-peak rate from Tk 7.71 to Tk 9.09, and the peak rate from Tk 12.14 to Tk 14.20.
For medium voltage (11 kV) battery charging, the flat rate has been increased from Tk 9.62 to Tk 11.31 per unit, with the off-peak rate now Tk 10.18, super off-peak Tk 9.05, and peak rate Tk 14.14.
For agricultural irrigation (medium pressure), the flat rate has been increased from Tk 6.42 to Tk 7.38, off-peak from Tk 5.77 to Tk 6.64, and peak from Tk 8.06 to Tk 9.23.
The electricity rate for educational institutions, religious institutions, charitable organizations, and hospitals has been increased from Tk 7.55 to Tk 9.05 per unit at low voltage. Rates for residential, small industries, heavy industries, commercial, and office users have also been raised.
Electricity prices for small to large industries, commercial establishments, and offices have been increased. Consumers will now pay different rates based on time of use and voltage level (low, medium, and high voltage), with power priced higher during peak evening hours.
For small and cottage industries at low voltage (230400 volts), the peak hour rate has been increased from Tk 12.95 to Tk 15.27 per unit; off-peak from Tk 9.68 to Tk 11.45; and the flat rate from Tk 10.76 to Tk 12.73.
For commercial establishments and offices at low voltage, the peak hour rate has been raised from Tk 15.62 to Tk 18.43; off-peak from Tk 11.71 to Tk 13.82; and the flat rate from Tk 13.01 to Tk 15.36.
For medium voltage (11 kV) commercial and office users, the peak rate has been increased from Tk 14.57 to Tk 17.41 per unit; off-peak from Tk 10.48 to Tk 12.54; and the flat rate from Tk 11.63 to Tk 13.93.
For high voltage (33 kV) users, the peak rate has been raised from Tk 14.40 to Tk 17.05; off-peak from Tk 10.26 to Tk 12.28; and the flat rate from Tk 11.39 to Tk 13.63.
In high-voltage industrial establishments, the peak rate has been increased from Tk 13.47 to Tk 15.93; off-peak from Tk 9.69 to Tk 11.47; and the flat rate from Tk 10.75 to Tk 12.75.
Additionally, prices have also been increased for the extra high voltage (132 kV and 230 kV) EHT-1 general and EHT-2 general categories.
Despite a 19.85 percent increase in wholesale electricity prices, the Bangladesh Energy Regulatory Commission (BERC) has stated that an annual loss of Tk 41,000 crore will still remain. BERC Chairman Jalal Ahmed told the press conference.
He further said, The current wholesale electricity rate has been increased by an average of Tk 1.39 per unit, from Tk 7 to Tk 8.39. This average increase of Tk 1.39 per unit will generate an additional revenue of Tk 14,200 crore. Even after that, we will have to provide Tk 41,000 crore in subsidies.
Responding to a question, he said the Rate of Return (RoR) for state-owned power companies has been reduced from 12 percent to 6 percent. This wills somewhat lower generation costs. On the other hand, if production from the Rooppur Nuclear Power Plant and solar power increases, Bangladesh may enter a phase of reducing electricity prices in the future. Even if prices cannot be reduced, there may be no need for further increases.
He stated that the electricity price adjustment order will include specific directives regarding the merit order dispatch (using cost-effective power plants first), capacity charges, and several other issues. These will be reviewed from time to time.
The Chairman said, At the consumer level, the current average per-unit price has been increased by Tk 1.52, from Tk 9.11 to Tk 10.63. Responding to another question, he noted that prices have been determined based on a specific rate of return for the distribution companies.
