BPC, BERC at loggerheads over LPG price fixing

Shahnaj Begum: Bangladesh Petroleum Corporation (BPC) is now at loggerheads with Bangladesh Energy Regulatory Commission (BERC) over fixing the price of liquefied petroleum gas (LPG) at the consumer level.
Mentioning its full power and authority to fix or to regulate the LPG price, BPC on Tuesday categorically said they were empowered by the government to fix the LPG price and accordingly they were maintaining the LPG pricing issue from their side so….there is no need to send any proposal to the BERC from their (BPC)’s side.
Mentioning the ‘Public Corporation (Management Co-ordination) Ordinance -1986’ BPC’s Managing Director M Fazlur Rahman Khan said this in a letter to the BERC.
“The ministry or division which has the administrative control over a public corporation shall determine the policy relating to the price of goods and services produced and rendered by such corporation and its enterprises, and the corporation shall fix the price of such goods and services according to such policy,” BPC said quoting from ‘the pricing policy of public corporation’.”
The letter disobeyed the Energy Division’s plan to streamline the LPG price and create a level playing field for the consumers to get the essential commodity at equal rate.
“Now, the Energy Division and the Law Ministry will decide who to regulate the LPG pricing issue. We sent the letter to the Energy Division,” a senior official of the BERC said.
The move to fix LPG price by the BERC came against the backdrop of a show-cause notice issued by the High Court seeking explanation on why action would not be taken against the energy product regulator for its failure to set LPG price.
Following the verdict, BERC took up an initiative to fix the retail price of LPG through enacting a pricing policy like that of natural gas and electricity as per the High Court order and asked the local LPG producers, including state-owned LPG company, to send their respective proposals to the regulatory body to facilitate holding the public hearing to be started from December 14.
“The court is scheduled to sit on December 15 to hear from the regulatory body on the issue. That’s why we’re trying to declare a public hearing date before the court hearing but now we just failed to understand what we need to do,” said a BERC official.
According to him, after getting the Energy Division’s nod they started a process following the BERC Act 2003 to fix LPG price at the retail level.
The government recently amended the law that empowered it (BERC) to review the prices of gas and electricity whenever it wishes, Energy Division Senior Secretary Md Anisur Rahman earlier told this correspondent.
BERC fixes natural gas price and the law makes it obligatory for it to set the price after holding public hearing but it had never fixed LPG price which is fixed by the market players.
Against the plea of the Consumers Association of Bangladesh (CAB), on November 29, the High Court issued the contempt of rule against the BERC Chief and sought explanation.
The High Court issued a contempt of court rule against the Chairman of BERC Md Abdul Jalil as he failed to fix the price of liquefied petroleum gas (LPG) in line with an earlier court decision.
The rule sought explanation why the allegation of contempt of court should not be brought against him as he failed to implement HC direction of fixing LPG price, he explained.
However, there is no LPG price monitoring system or existence of energy pricing policy to discuss the issue although LPG consumption in the country has increased four times in between 2016 and 2020.
About 26 LPG companies are now dominating the unlimited market who supplies over 1.0 million tonnes of LPG each year in the country. Bangladesh Petroleum Corporation (BPC) has a very insignificant market here.
However, this order compelled the energy regulator to take up the initiative. Currently, only 18 out of 58 approved companies, including state-owned Bangladesh Petroleum Corporation, market LPG across the country after importing it.