Missing efficiency and scale effect on power pricing
Dhaka, June 9 -- To reduce subsidies from Tk 56,000 crore to Tk 41,000 crore, the Bangladesh Energy Regulatory Commission (BERC) increased the bulk electricity tariff by 19.85 per cent, or Tk 1.39 per unit, raising it from Tk 7.00 per kWh to Tk 8.39 per kWh. To further reduce subsidies, it is likely that BERC will continue to increase electricity tariffs. Moreover, tariffs have been raised multiple times in the past. For instance, the average retail electricity tariff was increased by 3.2, 5.4, 4.1, and 10.0 per cent in 2015, 2017, 2020, and 2023, respectively. This raises an obvious question: has electricity pricing in Bangladesh entered an endless upward trajectory? More importantly, is there a rational basis to expect that tariffs shou...
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