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Govt adjusts gas price for power plant

Govt adjusts gas price for power plant

The government has raised the natural gas prices by Tk 0.75 for power plants including captive with effect from February. A gazette notification is issued by the ministry of power, energy and mineral resources on Tuesday (Feb 27).

According to the Bangladesh Energy Regulatory Commission (BERC) Act, 2003, the government, for public interest, adjusted selling price of gas used for power generation at Tk 14.75 from Tk 14 per cubic meter (coordination rate 5.36%) and in captive power generation Tk 30.75 from Tk 30 per cubic meter (coordination rate 2.50%).

There are eight categories of gas consumers in Bangladesh, of which 37 percent gas is used in power generation, 23 percent in industry, 18 percent in captive power, 10 percent in household use, seven percent in fertilizer production, four percent in Compress Natural Gas (CNG) and one percent in commercial and tea industry, a ministry release said. 

It said the government will have to pay a financial loss/subsidy of Tk 6,570.54 crore in the FY 2023-24 in this sector due to difference between production, import, supply price and selling price of natural gas.

The release said gas demand for power generation is usually increased during agricultural irrigation season, Ramadan month and the summer. But price adjustments is remain unchanged in industrial, household, fertilizer producing, CNG, commercial and tea industries, it however, said.

As a result of the price adjustment, it may be possible to keep the subsidy at Tk 6,000 crore considering the current market price of LNG and dollar exchange rate, it added.