Home Bangladesh Gas price hiked 700 pc in 15 yrs
Bangladesh - January 4, 2024

Gas price hiked 700 pc in 15 yrs

Mahfuz Emran : The gas demand in the country is currently around 350 million cubic feet per day. But supply is 270-275 crore cubic feet. Sometimes it goes down further. Although liquefied natural gas (LNG) is imported, it is unable to meet even one-fourth of the demand. However, gas prices have been increased in various sectors in the last 15 years without filling the deficit.
The price of gas has increased several times depending on the sector.
According to Petrobangla, the price of gas in the country has increased seven times since the Awami League government assumed power. However, only residential has increased five times. However, none of the residential, industrial-commercial or power sectors are getting gas as per demand.
Even last year in February, gas prices were hiked in the industrial, power, captive and commercial sectors on the grounds that supply would be increased. Still, gas is not being supplied to the sectors as per the demand.
Analyzing the increase in gas prices, it can be seen that at the beginning of 2009, when the Awami League-led grand coalition government assumed power, the price of gas was Tk 350 for a one-way stove and Tk 400 for a two-way stove. And the price of gas per cubic meter for metered stoves was Tk 4.60. All types of gas prices were increased in August that year. In this, the gas bill for a single-sided stove is Tk 400 and for a double-sided stove, it is Tk 450. And the price of gas per cubic meter for meter-based customers has increased by Tk 5.16.

Residential gas prices exceeded all previous records during the next tenure of the Awami League government. At that time, residential gas prices increased by Tk 350 per stove in just three and a half years. Among them, in September 2015, the bill for a single-sided stove was Tk 600 and for a double-sided stove, it was Tk 650. And for metered customers, the price of gas per cubic meter stands at seven rupees. Then in March 2017, the bill for one-sided stove was Tk 750 and Tk 800 for double-sided stove. At that time, the bill of meter based customers increased to Tk 9.10 per cubic meter.
The price of gas has been increased twice during the current term of the Awami League government. Among these, in July 2019, the monthly bill for one stove was Tk 925 and Tk 975 for two stoves. And gas price for meter-based customers has increased by Tk 12.60 per cubic meter. Meanwhile, in June 2022, the monthly bill for one stove is Tk 990 and two stoves is Tk 1,800. Gas price for metered customers increased by Tk 18 per cubic meter. Besides, residential gas prices were increased in June 2017, but it was canceled by the High Court’s ruling.
Meanwhile, at the beginning of 2009, the price of gas per cubic meter supplied for fertilizer production was Tk 2.24, electricity Tk 2.61, all types of industries including tea Tk 5.23, captive Tk 3.73 and commercial sector (hotel-restaurant and others) Tk 8.23. the money However, as a result of the price increase in August that year, the price of gas supplied for fertilizer production increased by Tk 2.58 per cubic meter, electricity by Tk 2.82, industry by Tk 5.86, captive by Tk 4.18 and commercial by Tk 9.47.
In 2012, Petrobangla applied to increase the price of all types of gas, but it was rejected by the Bangladesh Energy Regulatory Commission (BERC). Then in September 2015, gas prices were increased in various sectors. The price of gas used in service electricity generation has not been increased. And for the first-time prices were raised at a slightly lower rate, separating the tea industry from other industries. At that time, the price of gas supplied for fertilizer production increased by Tk 2.58 per cubic meter, tea industry Tk 6.45, other industries Tk 6.74, captive Tk 8.36 and commercial Tk 11.36.
In 2017, gas price hike was announced in two phases in February. Of this, the first phase will be implemented in March and the second phase in June. Gas prices were hiked in two phases across all service sectors. In March, the price of gas used in electricity production increased by Tk 2.99 paise per cubic meter, fertilizer by Tk 2.64, tea industry by Tk 6.93, other industries by Tk 7.24, captive by Tk 8.98 and commercial by Tk 14.20.
After three months i.e. in June 2017, the price of gas used in power generation increased by Tk 3.16 per cubic meter, fertilizer by Tk 2.71, tea industry by Tk 7.42, other industries by Tk 7.76, captive by Tk 9.62 and commercial by Tk 17.04. Two years and one month later, gas prices were increased in July 2019. However, the service industry sector is divided into three categories-large, medium and small and cottage industries. However, instead of incentives in small and cottage industries, prices are increased at abnormal rates.
In July 2019, the price of gas used in power generation increased by Tk 4.45 per cubic meter, Surrey by Tk 4.45, tea industry by Tk 10.70, large and medium industries by Tk 10.70, small and cottage industries by Tk 17.4, Tk 13.85 in captive and Tk 23 in commercial. After 35 months, the price of gas increases again. However, at that time the price of gas in the industrial sector was adjusted. It increases prices in large and medium industries, but reduces them in small and cottage industries.
In June 2022, the price of gas used in power generation increased by Tk 5.2 per cubic meter, Tk 11.93 in tea industry, Tk 11.98 in large industry, Tk 11.78 in medium industry, Tk 10.78 in small and cottage industry, Tk 16.78 in captive industry. Tk 26.64 in taka and commercial. But that time the price of gas used in fertilizer production was increased by one jump to Tk 16.
However, all types of gas services in the industrial sector have been waived at the latest announced rates. It has fixed the same rate of gas in large, medium and small and cottage industries as in 2017 or earlier. At that time, the price of gas per cubic meter increased by Tk 14 in power sector, Tk 30 in industry (all types), Tk 30 in captive and Tk 30.50 in commercial. However, the price of gas was not increased in the fertilizer production and tea industry like residential.
According to this, during the tenure of the current government, the gas bill has increased by 182.86 percent for one stove, 170 percent for two stoves, 291.30 percent for metered stoves, 436.40 percent for electricity, 614.29 percent for surrey, 128.11 percent for tea industry, 473.61 percent for other industries, and 704 percent for captives. Decimal 29 and commercial 270.60 percent.
Incidentally, the government started importing LNG from August 2018 to meet the gas shortage. At one time, up to 850 million cubic feet of gas was supplied per day from imported LNG. The government buys LNG from Qatar and Oman under long-term contracts and from the spot market. During the corona, this price drops to two or three dollars. However, due to the increase in demand after Corona and the Russia-Ukraine war, the price of LNG in the international market increased sharply in 2022. The government stopped buying LNG from the spot market due to rising prices. At one time this price exceeded 54 dollars in the spot market.
However, later the price of LNG came down again. However, due to the dollar crisis, the government is not able to take this opportunity of low prices. This reduced LNG imports by about 94 percent in 2022. It affects all sectors. In addition to residential, electricity and industrial gas shortages reach extremes. To deal with the crisis, the government announced load-shedding in electricity. Industrial owners started clamoring for gas. They want assurance of gas supply even at higher prices. Several meetings were held with the government regarding this. However, the government is still not able to supply uninterrupted gas in any sector.
Meanwhile, in the middle of last year, the supply companies proposed to increase the price of gas again. However, the government did not agree to take such an unpopular decision before the national elections. However, if the subsidy on gas is removed according to the conditions of the IMF, the gas prices will rise again soon.

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