LPG Not Available at the Fixed Price, Yet BERC Holds a Public Hearing on October 29 on Proposals to Raise Charges Again

Amid complaints that liquefied petroleum gas (LPG) is not available in the market at the fixed price, a fresh move to adjust prices has begun. The Bangladesh Energy Regulatory Commission (BERC) will hold a public hearing on October 29 on proposals to change LPG prices. The hearing will discuss proposals to raise charges or margins at the bottling, distribution and retail stages of LPG.

A BERC public notice said the hearing on proposals to change consumer-level prices of both government and private LPG will be held on October 29. It will discuss proposals to change the storage and bottling charges, distributor charges and retailer charges for private LPG.

The notice added that LP Gas Limited has submitted a proposal to change the current consumer-level price of government LPG. Several private LPG storage and bottling licensees have submitted proposals to BERC to change consumer-level prices, including storage and bottling charges, distribution charges and retail charges. Several distributor licensees have also proposed changes to distribution charges. The hearing is being arranged in response to these proposals.

Without a public hearing, BERC has no scope to raise the bottling charge or the margins of distributors and retailers. That is why the parties concerned were asked to submit proposals.

In their proposals, LPG companies have sought to raise the bottling charge from 15 to 16 taka per kilogram to 25 to 30 taka. They have also proposed raising the distributor charge from 4 taka 17 paisa per kilogram to 8 taka 33 paisa, and the retailer charge from 3 taka 75 paisa to 10 taka.

Distributors, for their part, have proposed raising their charge on a 12 kg cylinder from 50 taka to 150 taka, while retailers have proposed raising theirs from 45 taka to 70 taka.

On October 4, BERC raised the price of a 12 kg private LPG cylinder by 252 taka to 1,837 taka. In September, the same cylinder cost 1,585 taka. The price of autogas used in vehicles was also raised, from 73 taka 9 paisa per litre to 84 taka 62 paisa.

In the same determination, the price of a 12.5 kg cylinder was set at 1,913 taka, 15 kg at 2,296 taka, 16 kg at 2,449 taka, 18 kg at 2,755 taka, 20 kg at 3,061 taka, 22 kg at 3,367 taka, 25 kg at 3,827 taka, 30 kg at 4,592 taka, 33 kg at 5,051 taka, 35 kg at 5,357 taka and 45 kg at 6,888 taka.

Even after the October 4 increase, however, importers, distributors and retailers are not satisfied. When distributors and retailers recently called a two-day strike, the government sat in talks with them and assured them their demands would be considered.

A BERC official said: 'Our licensees have applied. We are going to hold a hearing in response to their applications. A hearing does not mean prices will rise. We will hear their demands and their arguments. The hearing is being held so that everyone can give their opinion.'

On October 12, the LP Gas Traders Cooperative Society announced a two-day nationwide closure of gas shops in protest at harassment of LPG cylinder traders. The society's president, Selim Khan, said at the time that traders were repeatedly being harassed over cylinder prices and supply, and warned of a tougher movement if their demands were not met. The society's general secretary, Nasiruddin Nasim, alleged that the marketing of LP cylinder gas is held hostage by only five companies and that LPG prices are being raised through them.

The strike was then withdrawn on October 14 after BERC announced it would hold a hearing on their demands. Earlier that same morning, Power, Energy and Mineral Resources Minister Iqbal Hasan Mahmud and Commerce Minister Khandaker Abdul Muktadir met LPG operators at the Secretariat.

Selim Khan said: 'Our traders have long been victims of harassment. We know LPG is held hostage by the country's five big companies. At this moment about three crore cylinders are lying idle. Of them, one crore belong to Bashundhara. About 15 companies cannot open LCs or bring in LPG because of various complications. If those three crore cylinders received LPG, the crisis would ease considerably.' He added that BERC sets a price at the start of the month, after which companies sometimes set prices twice within a month, forcing traders to sell at higher prices. Their demand is that companies should not be able to set prices without BERC's permission.