Bangladesh Power Development Board (BPDB) will need to cut its electricity production by 917MW to minimize its loss if the fuel price for electricity production is raised by 20 percent as proposed.

According to official data, BPDB is now generating 4,586MW of electricity on an average from liquid fuel-based power plants at a cost of Tk 1.59 billion (Tk 14.50 per unit).

But if BPDB receives Tk 1.91 billion additional subsidy after fuel tariff adjustment, it might not require to cut the electricity generation, officials said after the power tariff has been submitted to the Prime Minister’s Office (PMO) recently.

The proposal also said BPDB will need to cut its production by 229MW or pay additional Tk 80 million daily to keep power generation uninterrupted after upward adjustment of liquid fuel tariff by five percent.

The power distribution companies have already introduced two to six hours load-shedding as per the austerity measure to cut fuel import by 20 percent.

The BPDB has already incurred a loss Tk 283.85 billion due to costly fuel and LNG import for electricity generation in FY 2021-22.

According to BPDB, the projected peak demand of electricity is 14,500MW. Distributions companies have been supplying 12,400MW on an average due to cut in electricity production.

Last month, the ministry of power, energy and mineral resources met with the transport owners about the proposed tariff hike of diesel and the impact on transport fare. Then it presented an analysis on Tk 10-30 per litre hike in fuel tariff.

The analysis said fare will soar by Tk 0.12 per km for a tariff hike of Tk 10 per litre and Tk 0.24 per km due to a rise in fuel tariff by Tk 15 per litre.

But the transport owners were not satisfied with the ministry’s proposal and said the national committee on transport fare may fix the new fares considering all the factors.

Sources said the government is considering to hike the octane and petrol tariffs in view of the current economic situation amid the Russia-Ukraine war.

Energy expert Prof M Tamim said adjustment in fuel tariff will be suicidal as it will increase inflation significantly.

He favours the austerity measures to shut the diesel-based power plants and cut fuel import by 20 percent.