‘Automated pricing can make LPG cheaper’

To bring down the price of liquefied petroleum gas (LPG), investors, stakeholders and experts have called for fixing the tariff of the petroleum product through an automatic formula where companies' profit margin, transportation costs and other charges are included. 

They also suggested a reduction in multiple charges imposed by various government agencies on LPG companies to make the cooking gas cheaper for its users. 

Formed by the Bangladesh Energy Regulatory Commission's (Berc), the committee on making recommendations on fixing the tariff of LPG at the end-user level virtually organised the views-exchange programme on Saturday.

Md Maqbul-E-Elahi Chowdhury, member (gas) at Berc, moderated the meeting.  

As of now, the LPG price is fixed based on the open market formula where investors set the rate of the petroleum product as per the competitiveness. 

Currently, each kilogramme of LPG sells for around Tk72-75 in Bangladesh while the price is only Tk50 in Kolkata, India.  

Welcoming Berc's initiative, Azam J Chowdhury, chairman of East-Coast Group and LPG Association of Bangladesh, said that they are not against price-fixing by the government. 

"Before fixing the price, Berc should end its internal conflicts with Bangladesh Petroleum Corporation (BPC), which also claims its authority on fixing the LPG price," he said. 

He said that currently, they pay different fees and charges to BPC, Berc and the Energy and Mineral Resources Division. 

Zakaria Jalal, general manager at Bashundhara LP Gas Limited, said that they need a compact policy where representatives from the government, the private sector and consumers will be able to give their opinions and their interests are ensured. 

Among others, Chief Executive Officer of Beximco LPG Mrinal Roy, Managing Director of JMI LPG Gas Md Abdur Razzak, Managing Director of Promita LPG Dr Muzibur Rahman and Euro Gas's Aziz Islam gave their opinions on the price-fixing. 

Energy Adviser to the Consumers Association of Bangladesh Professor Dr Shamsul Alam expressed his doubt over whether Berc is an independent and impartial body. 

"We have long been urging Berc to take charge of fixing the LPG price, but we have not received any response from it. However, it has started working on the price-fixing as the ministry asked it to take the initiative," he added. 

Mollah M Amzad Hossain, editor of Energy and Power magazine, talked about the domination of dealers and retailers at the field level. 

"If the government wants to bring down the LPG price, it should control the domination of retailers who are charging high prices for the product," he said.

Currently, there are 30 LPG suppliers for seven lakh tonnes of annual demand for the cooking gas across the country.