Muhammad Tariqul, Special Correspondent : The Power Division has prepared a proposal to hike retail electricity prices by 7.8% to 20.11% depending on usage, which could see unit prices rise between 70 paisa and 1.80 BDT.
Simultaneously, three alternative proposals for wholesale price hikes have been drafted, aiming to reduce government subsidies by 5,000 to 12,000 crore BDT.
Lifeline Customers Exempted
In a move to protect the most vulnerable, the proposal suggests no price increase for “Lifeline” customers—those consuming between 0 and 75 units.
The Economic Context
Following global instability and rising fuel costs, a high-level cabinet committee, led by the Finance Minister, was formed on April 9 to evaluate price adjustments.
While the Bangladesh Energy Regulatory Commission (BERC) traditionally sets prices via public hearings, the government is looking to mitigate a projected 56,475 crore BDT deficit for the Power Development Board in the 2025-26 fiscal year.
Wholesale Price Options
The Power Division has outlined three tiers for wholesale adjustments:
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Increase by 0.50 BDT: Saves 5,244 crore BDT in subsidies.
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Increase by 1.00 BDT: Saves 10,489 crore BDT in subsidies.
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Increase by 1.20 BDT: Saves 12,586 crore BDT in subsidies.
IMF Pressure and Global Trends
The proposal highlights that countries like Sri Lanka and Singapore have already hiked prices significantly. Additionally, the IMF has recommended a three-year roadmap to reduce subsidies and increase efficiency in the power sector.
High spot market prices for LNG and fuel oil have further strained the national budget, with an additional 39,000 crore BDT estimated to be needed by June.