Consumers Association of Bangladesh (CAB) has claimed that the price of electricity and fuel is being increased in the country to protect the business of dishonest traders. Therefore, under the pretext of reducing the subsidy of the International Monetary Fund (IMF) to protect the rights of consumers, the organization called for filling the deficit by stopping irregularities and corruption without increasing the price of electricity and fuel.
This demand was made by the national organization working on consumer rights in a press conference organized at Sagar-Runi Auditorium of Dhaka Reporters Unity on Thursday (May 2).
Cab’s energy adviser in a written statement. M. Shamsul Alam said, the development of the sector is continuing under the non-competitive private sector investment under the Electricity and Energy Fast Supply Act 2010. In that, investors are taking advantage of predatory profits by increasing the cost of electricity and energy supply at will. As a result, financial deficit is increasing rapidly. And with that, both prices and subsidies are increasing. Deficit cannot be brought under control.
He said, the government is now desperate for a loan of 4.5 billion US dollars and is running after the IMF. It is no longer important for the government to ensure the interests and welfare of the people as well as energy security. So consumers are in dire straits. Fearing the loss of national energy security in this situation, we call on the government to ‘rein in the dishonest power and energy business, withdraw from price increase – give people fear’.
At this time energy expert professor Dr. Ejaz Hossain said, I will give the price (of electricity and fuel) that the government increases. But the theft and waste in it, why should I take the responsibility? No fuel, yet power plants are being built. Why the IMF-World Bank does not investigate irregularities. In Bangladesh still 30 percent furnace oil is being used to generate electricity. But nowhere in the world is more than 5 percent. Donor organizations are not taking action on these issues?
He said, what is the benefit of 25,000 MW power plant, if it cannot be produced. I think 15 thousand megawatt power plants in the country is enough (possible). Because more than this is not being produced in the country. 16,000 megawatts of electricity production is sometimes available. In the rest of the time 12-13 thousand megawatts are produced. So why is the IMF not looking at additional waste?
MM Akash, former professor of economics department of Dhaka University, said that electricity and energy is a static product or service. Hence this price increase by notice is not acceptable. It will be through BERC’s public hearing, and that is desirable. But BERC’s powers have been curtailed by executive orders. Now the price of electricity and fuel is increasing by executive order. People are losing their rights through this.
ALRD Executive Director Samsul Huda said that there is no precedent that any country in the world has improved with loans under IMF conditions. And the government needs to keep an eye on this. So don’t put your country in danger if you violate their terms. Because their conditions are not in the interest of the people.
CAB president Golam Rahman said the IMF said to reduce subsidies by increasing prices. But it doesn’t make sense. It is not even justice. So we will ask the IMF to find out where the anomalies are (without stipulating inflation).
He said that the government has many achievements in the energy sector. But the government has failed or is unwilling to take appropriate decisions at the right time. As a result, the consumer has to take responsibility for it. As suggested by the IMF, it is possible to reduce the subsidy without increasing the price of gas and electricity if the energy sector can be prevented and transparency ensured.
In the press conference, the 13-point demand of CAB was presented to bring down the subsidy to zero within 3 years without increasing the price of electricity and fuel. These include-
>> Any form of non-competitive investment in the development of electricity, energy and renewable energy sectors should be prohibited by law.
>> As it is contrary to conservation of energy rights and energy justice, (a) Prompt Electricity and Energy Supply (Special Provisions) Act 2010 should be repealed, and (b) Section 34A added by amendment to Bangladesh Regulatory Commission (BERC) Act 2003 should be repealed. BERC should be given sole jurisdiction to fix electricity and fuel rates.
>> Gas Development Fund, Power Development Fund and Energy Security Fund should be treated as consumer equity investment and not debt in BAPEX’s gas exploration, PDB’s power generation and energy import respectively.
>> More than 50 percent of electricity and gas generation on cost basis excluding profit must be owned by the government. Government will provide electricity and fuel services only on cost basis, not cost plus.
>> The proportion of LNG, coal and oil in the primary fuel mix should be reduced in short and medium term plans. Import costs should be reduced by controlling the import of electricity and energy by increasing own gas exploration and reserves and renewable power generation.
>>Government shall not engage in power and energy business in joint ownership with the private sector and shall not transfer shares of any government-owned company to the private sector – to be ensured by law. The second oil-refinery should be solely owned by the government and not with S Alam Group.
>> All bureaucrats of both power and energy departments should be withdrawn from the board of directors of all government and joint-owned companies belonging to the power and energy sector.
>> The activities of the companies/organizations of both the sectors should be managed independently by their own technical manpower. Therefore, the Ministry should be limited to making rules and policies and ensuring administrative oversight and accountability of licensees in following laws, rules and regulations and implementing regulatory orders. Besides, BERC as a regulator should be proactive, independent and impartial.
>> Receipt/reimbursement of compensation for damage from other related sources including Climate Fund should be ensured and that compensation should be ensured by investment law in capacity building of victims and expansion of renewable energy markets.
>> Electricity, fossil and renewable energy development policies, laws, regulations and plans must be consistent with the Paris Agreement on climate change.
>> All contracts executed in power and energy development should be in accordance with model contracts approved in due legal process with a view to transparent execution in the statutory process, then anti-public interest contracts like Adani’s power purchase contract can be prevented.
>> Meanwhile (a) Supplementary Agreement executed between Bapex and Santosh for drilling Magnama-2 exploration well, (b) Power Purchase Supplementary Agreement executed between REB and Summit Power Ltd., (c) PDB and Summit Power Ltd. Supplementary Power Purchase Agreement of Meghnaghat Power Plant executed (d) Power Purchase Agreement executed between PDB and Adani is illegal and against public interest and appears contrary to energy justice, these agreements should be cancelled. All other contracts accused of similar charges should also be scrutinized and annulled. Also, the government should refrain from signing the Energy Charter Agreement 1994.
>> Energy Price Stabilized Fund should be formed to control the increase in the price of electricity and fuel with the aim of protecting energy security.
MAS/MAH/GKS
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