BERC eyes use of energy security fund for LNG, LPG import cost

Bangladesh Energy Regulatory Commission has drafted the guidelines on the use of energy security fund created last year from the sales of gas, giving priority to meeting import cost of liquefied natural gas and liquefied petroleum gas.
The BERC said it created the fund during the last gas price hike, aiming at taking short-, medium- and long-term measures under the fund to ensure the country’s energy security.
In September last year, the BERC increased price of natural gas by 26.29 per cent on an average considering Tk 1.01 as asset value of each cubic metre of natural gas.
The draft guidelines stipulate that the government could use the fund for the import of LNG and LPG as well as for the construction of infrastructure to facilitate the imports.
On Wednesday, the BERC held an open meeting on the draft guidelines. The energy commission chairman, AR Khan, presided over the meeting.
Khan said that the guidelines should accommodate the other projects in the energy sector as well as in the power sector to ensure country’s overall energy security.
But imports of LNG and LPG will get priority, he said.
The energy security fund was created from the increased prices of gas by setting aside Tk 1.01 from the sales of one cubic metre of gas for the fund and the fund would accumulate about Tk 2,600 crore a year, said officials.
The hike in gas prices followed a government decision of setting asset value of natural gas.
A fund management committee, proposed in the draft guidelines, will set the criteria of the projects in which the fund money would be used.
The BERC chairman-headed fund management committee, however, has not included any representative from consumers.
When asked, AR Khan said that the commission would consider the matter whether the committee could take in any consumer representative.
As per the draft guidelines, the committee includes representatives from Energy Division, Power Division and Planning Commission, a deputy governor of Bangladesh Bank and chairman of Petrobangla. The BERC director for gas will be the secretary of the committee.
The fund management committee will prepare a report annually on income and expenditure of the fund. The report will be sent to the government and the other stakeholders.
The BERC will constitute a separate committee to monitor and evaluate the projects under implementation using the fund.
The commission will also hold a public hearing every year on the projects.
In 30 days of collection of gas bills, the gas distribution utilities will deposit money at the rate of Tk 1.01 a cubic metre from their sales to a dedicated bank account governed by state-run Oil, Gas and Mineral Resources Corporation, popularly known as Petrobangla.
It is the second draft of the guidelines, the BERC chairman said, as a number of observations and suggestions from different government agencies and consumer representatives have been accommodated in the guidelines.
In the past two months, the energy commission received opinions on the first draft from a number of stakeholders including gas utilities, National Board of Revenue, Bangladesh Bank and Consumer Association of Bangladesh.
At Wednesday’s meeting, the BERC chairman asked the consumers and other stakeholders to submit their opinions on the draft guidelines.

News Courtesy: www.newagebd.net