Titas Gas Transmission and Distribution Company, the largest gas distribution utility in Bangladesh, has recently submitted a proposal to the energy regulator to charge its existing more than 2.5 million fixed-price subscribers extra, claiming its investigation found that these subscribers have been using more units of gas than they are legally allocated.
If Bangladesh Energy Regulatory Commission, or BERC, approves the proposal, the charges of the fixed-price subscribers will go up to Tk 1,379 from the current Tk 990, marking a 39 percent increase for a single burner stove, while the charges for a double-burner stove will rise to Tk 1,592 from current Tk 1,080, a 47 percent increase.
The current prices for fixed-price subscribers were set in June last year, and the prices were set by considering the fact that in a household, customers use an average of 55 cubic metres of gas with a single-burner stove, while with a double-burner stove, a customer uses an average 60 cubic metres of gas in a month.
While speaking, the distributor’s Managing Director, Md Haronur Rashid Mullah, said Titas’s investigation found that the fixed-price subscribers use way more than the allocation.
“We conducted surveys and investigation in this connection for a while and found out that on average, fixed-price subscribers use an average of 76.65 cubic metres of gas in a month with a single-burner stove, while 88.44 cubic metres of gas are being used on average by a subscriber with double-burner stove,” he said.
MD Haronur said they have already submitted all their findings to the regulator and asked it to raise the price by considering these facts.
FACTS ABOUT SUBSCRIBERS
- As of now, Titas has about 2.86 million subscribers in Bangladesh.
- Out of these subscribers, 2.52 million subscribers are fixed-price customers.
- Titas has 332,000 pay-as-you-go subscribers, who have to top up their pre-paid meters before they can use the distributor’s services.
- Of Titas’s total subscribers, 155,000 use single-burner stoves, while 2.31 million use double-burner stoves.
Haronur said their investigations found that Titas’s pay-as-you-go subscribers, on average, do not pay more than Tk 600 a month for using Titas’s services.
For each unit of gas, pay-as-you-go subscribers are charged Tk 18, which was set in June last year when the retail prices of gas were adjusted for the last time.
In his argument, the Titas MD said pay-as-you-go subscribers consciously monitor their usage, which allows them to check their outgoings for the gas payment, while fixed-price subscribers do not care for their usage as they are in a fixed bracket.
“We are arguing to BERC to raise the average usage quota, which we have found in our investigation, and let us charge accordingly,” he said.
Haronur, however, does not favour increasing per unit gas price.
“Titas does not get involved in the price-increasing business. We are not usually the ones that handle it. We get Tk 0.13 margin on gas distribution, and that’s all.”
When approached about the Titas proposal, BERC Chairman Md Nurul Amin said the regulator would only be able to comment on the matter after scrutinisation.
The government hiked the gas prices for industrial usage earlier this year with an executive order, bypassing the commission.
In large-sized industries, the price of gas per unit was hiked from Tk 11.98 to Tk 30, which means the price has nearly tripled. For captive power plants, the new gas unit price was set at Tk 30, which is Tk 16 more.
For mid-sized industries, the price of a gas unit has been increased to Tk 30 from Tk 11.78. In the small-scale and handicraft industry, gas per unit has been increased to Tk 30 from Tk 10.78.
The prices for hotels and restaurants changed from Tk 26.64 to Tk 30.50 for a gas unit.
‘TITAS’S PROPOSAL OUTRAGEOUS’
Calling Titas’s proposal “outrageous”, Dr M Shamsul Alam, the energy adviser of the Consumers Association of Bangladesh, said since Titas’s services are below average and its infrastructure is shoddy at best, the distributor has no leg to stand on to ask for such a rise in prices.
“It’s [Titas’s] distribution pipelines have millions of holes, and the distribution system is sub-standard. We should call their distribution system a death trap instead, since they hardly carry out any maintenance in their distribution lines. I am shocked to learn about their outrageous proposal,” he said.
Dr Shamsul alleged that the company is riddled with corruption and irregularities, and it pays hardly any attention to those.
“Still, it gets a two percent systems loss benefit, 10 per cent interest on the paid-up capital and Tk 0.13 margin for distribution. We [CAB] have asked BERC to suspend these benefits to the company to pressure it to improve its services.”
The CAB adviser also said they had submitted evidence to BERC that Titas cannot even provide the existing quota amount of gas, which the company is legally required to provide.