It is nothing surprising that the energy adviser or the state minister concerned would defend the latest power tariff hike at an average rate of 5.3 per cent, terming the upward revision 'insignificant' and 'tolerable'. Anything said otherwise by them would put to question the very decision of the energy sector regulator on the power tariff increase. But the poor consumers, the ones belonging to the fixed-income bracket in particular, know where the shoe pinches as their cost of living would go a few points up from the next month. The truth is that expenditure on account of power-use, for most consumers, had gone beyond their tolerable limit even before the latest hike. The average power tariff has recorded a 90 per cent increase in nine phases since 2010.
Tariffs of utilities, depending on circumstances prevailing at different times, do require necessary review and the Bangladesh Energy Regulatory Commission (BERC) is there to facilitate it and make dispassionate decisions. The regulator, however, is expected to protect the lawful and genuine interests of the consumers. In accordance with the rules, it does organize public hearings on proposals on power and gas tariff hike. But, on most occasions, it is found to go along with the proposals coming from the utility service-providers. For instance, the latest power tariff hike is being put into effect to meet the 'increased operational costs' of the power distribution companies. The operational cost has gone up because of the hike in salaries and benefits of the employees of these companies. Consumers' rights organizations have condemned the power tariff hike on this particular ground as unjustified.
Overall, the power consumers have justified reasons to be aggrieved by the decisions taken on tariff increase from time to time. They have a feeling that the hikes are due to wrong policy decisions of the government. The proliferation of cost-intensive rental power plants and failure to operationalise conventional least-cost power plants over a long period of time are largely responsible for higher power tariff. Moreover, the repeated extension of the tenure of the legal provision that protects and facilitates installation of cost-intensive power plants without competitive bidding and thus the purchase of power at relatively high rates have given rise to suspicion among the consumers about the very intent of relevant government agencies.
Besides, the amount of subsidy made available to the Power Development Board (PDB) has also increased manifold because of procurement of power from the rental plants at 'exorbitant' rates. Though the power situation has improved in recent years, this has entailed a very high cost. Both the government and the consumers are paying through their noses. But the cost could have been far less, had the government exercised prudence and put in place the right policies in right time, in terms of building up higher power generation capacity opting for the least-cost ones. A few such projects are now in the offing. But those could have been operational by now had the government meant business from the very beginning.