Abed Ali Mostofa, a 55-year-old resident of Old Dhaka, said his frustration has reached its limit.
“Every few days, I hear that grocery prices are rising, edible oil prices are going up, and even rickshaw fares are increasing. Everything just keeps getting more expensive,” he told TIMES of Bangladesh.
He noted that electricity is now likely to be added to the growing list of price hikes.
Frustrated, Mostofa said it feels like “adding salt to an open wound.”
“I know the government may not have much to do in this situation because energy has become more expensive due to the Middle East conflict, but we also have to survive and manage our daily lives.”
This week, the Bangladesh Power Development Board (PDB) proposed increasing electricity tariffs at both wholesale and retail levels by Tk1.2 to Tk1.6, equivalent to a 17 to 21 per cent hike, to the Bangladesh Energy Regulatory Commission (BERC).
Officials from both BERC and PDB confirmed the move, citing rising fuel import costs, a widening gap between production expenses and selling prices, and mounting subsidy pressures in the energy sector.
BERC has formed a technical committee to review the proposal.
Tk80,000 crore deficit
However, officials said the extent of the increase would be determined by balancing the sector’s revenue-expenditure gap with the government’s committed subsidies.
Currently, the average cost of generating electricity per unit is about Tk5.50 higher than the price charged to consumers, increasing dependence on subsidies.
BERC officials said the PDB could face a deficit of up to Tk80,000 crore in the current fiscal. The government has already allocated Tk36,000 crore in subsidies for the sector.
Bangladesh relies heavily on imported liquefied natural gas (LNG), oil and coal for electricity generation.
The rise in international fuel prices due to the Middle East war has driven up electricity generation costs.
Business concerns over rising costs
Business leaders have expressed concern over the proposed electricity price hike, saying it would inevitably hurt businesses and ultimately be passed on to consumers.
Cold Storage Association President Mostofa Azad Chowdhury Babu said the proposed electricity price hike would have a direct and significant impact on the sector, as electricity constitutes its primary operating cost.
According to him, electricity alone accounts for about 50 per cent of cold storage operating costs.
“Electricity is our main raw material. If the price per unit increases by Tk1.5, we estimate that storage rent per sack could rise by around Tk20,” he told TIMES of Bangladesh.
He warned that higher electricity bills would strain loan repayments if rent could not be increased, putting pressure on the entire cold storage sector.
Food industry warns of higher prices
Bangladesh Auto Biscuits and Bread Manufacturers Association President Md Shafiqur Rahman Bhuiyan said the proposed electricity price hike would inevitably increase production costs across the industry.
He added that rising input costs, including wheat, flour, edible oil and fuel, are already pushing up overall production expenses.
“Due to global factors, including the war, prices of raw materials such as wheat and oil have increased significantly. If electricity prices rise, our finished product costs will definitely increase,” he told TIMES.
He estimated that electricity accounts for 10 to 15 per cent of total production costs.
Manufacturing sector under pressure
Agricultural Machinery Manufacturers Association Bangladesh President Alimul Ahsan Chowdhury said the impact is not only potential but already visible through earlier power disruptions and instability.
“If electricity prices rise, costs will increase further. We are already operating under double costs due to generator use,” he told TIMES.
He added that the increased costs would inevitably be passed on to end users, particularly farmers.
He also noted that subsidies previously provided to the agricultural machinery sector had been withdrawn, increasing financial pressure on farmers.
He proposed that the government should reintroduce a 20 per cent rebate on electricity bills for agriculture-based industries, a policy that existed in the early 2000s.
He argued that such a policy would help reduce production costs and indirectly benefit farmers rather than placing the burden on them.
Plastic sector warns of market pressure
Bangladesh Plastic Goods Manufacturers and Exporters Association President Shamim Ahmed said, “Our industry is heavily dependent on electricity. Our machines consume a large amount of power, so if electricity costs rise, the plastic industry will suffer.”
When asked about mitigation measures or government support, he said the industry mainly operates as a linkage sector.
He added that most factories function within interconnected supply networks. As a result, the price hike would affect several linked industries and consumers.
He warned that this would put pressure on consumers and shrink the market.
Shamim Ahmed said production across the industry has already fallen by nearly half.
