Electricity Prices Raised at Consumer Level, Effective from June

The government has announced a substantial hike in electricity tariffs at both wholesale and retail levels across the country. According to the new directive, wholesale electricity prices have been raised by 19.85 percent, while retail prices at the consumer end have increased by an average of 16.68 percent.

Simultaneously, electricity transmission charges have been increased by 23.96 percent. Jalal Ahmed, Chairman of the Bangladesh Energy Regulatory Commission (BERC), announced these changes during a press conference held today, Wednesday (June 3). The newly adjusted rates will come into effect from the current month of June.

Impact on Consumer Tiers and Tariff Structures

Under the new tariff structure, electricity prices have been scaled up at varying rates across different categories of consumers:

• Lifeline Consumers: Low-income household users falling under the lifeline category will face the lowest adjustment, with their tariff increasing by 15 percent.

• Other Categories: For other consumer tiers, the price hike will scale up to a maximum of 19.94 percent.

• Average Retail Price: At the consumer level, the average price of electricity per unit has been raised by 1.52 BDT, locking the new average rate at 10.63 BDT per unit.

• Wholesale Price Adjustment: The wholesale price of electricity has been bumped up by 1.39 BDT per unit.

According to sector experts and officials, the price adjustments were deemed necessary to cope with the escalating costs of power generation and supply, alongside relieving severe financial pressures building up within the power sector. However, the tariff hike is bound to increase operational overheads across residential, commercial, and industrial sectors, potentially driving up the overall cost of living and industrial production.

Background on Distribution Company Proposals

The decision follows public hearings organized by BERC on April 20 and 21, where the country's six power distribution companies submitted separate proposals seeking retail price hikes ranging from 85 Poisha to 2.05 BDT per unit.

The Bangladesh Power Development Board (BPDB) had proposed a hike of 85 Poisha, while the Rural Electrification Board (REB) requested an increase of 1.77 BDT. Furthermore, the Dhaka Power Distribution Company (DPDC) pitched a 1.54 BDT increase, the Dhaka Electric Supply Company (DESCO) sought 1.98 BDT, the West Zone Power Distribution Company (WZPDCO) requested 1.39 BDT, and the Northern Electricity Supply Company (NESCO) pushed for the highest requested adjustment of 2.05 BDT per unit.