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New domestic tariff proposed

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If the proposal is accepted in its present form, expect bills to almost double

With the previous three-year revision cycle coming to an end on June 30 the Bhutan Power Corporation has submitted its proposal to revise domestic tariff for the next three years.

According to the proposal, submitted to the Bhutan Electricity Authority for scrutiny, and which must go through public consultations before it is finalised, monthly electricity bills in urban areas could double for domestic consumers.

In the proposal BPC, the lone power distributing company in the country, has proposed a two-tier tariff to replace the existing three-tier one.

For block one or lifeline consumers using up to 100kWh (kilowatt hours), the proposed a flat rate is Nu 1 a unit (kWh), up from the existing 0.85 a unit.

For the second block where consumption is more than 100kWh the proposed rate is Nu 4.1 a unit.

For a rural household with a boiler, rice cooker, a few tube lights and bulbs, the monthly consumption would not cross 100 kWh a month a BPC official said.    But most urban homes with a geyser, heaters, washing machines and other appliances would fall under the second proposed category, where the rate is Nu 4.1 for a unit (kWh).

A household in Thimphu that paid a bill of Nu 486 for consuming 336 units in the month of April could be paying close to Nu 1,000, according to the proposed revision. This could become Nu 3,000 in winter, when the heaters are turned on.

For low bulk consumers, like government ministry offices, hospitals, academic institutions and the army, BPC has proposed the same rate of Nu 4.1 a unit from the earlier Nu 2.14 a unit.

For medium voltage (MV) consumers, such as medium scale industries, like diary plants, the proposal drastically increases demand charge from present Nu 115 per kVA (kilovolt ampere) a month to Nu 856/kVA a month.   However, charge for energy consumed is to be decreased from Nu 1.79kWh a month to Nu 1.20kWh a month. Demand charge refers to charge industries pay to book a certain quantity of power for their use at all times.

Likewise for high voltage (HV) consumers such as ferro silicon factories in Pasakha, demand charge is to be increased from Nu 105/kVA a month to Nu 441/kVA a month, while energy charge is reduced to Nu 1.20 kWh a month from Nu 1.54 charged at present.

With regard to the medium and high voltage users, a BPC official explained that the proposal to increase demand charges was mainly to prevent hoarding of power by certain industries that do not use the power they book.

On an average the proposed revised tariff works out to Nu 2.40 a unit for high voltage users, Nu 4.29 a unit for medium voltage consumers, and Nu 3.29 a unit for low voltage or domestic consumers.

The proposed rates are still a subsidised rate because it is still below the actual cost of supply BPC officials said.

BPC’s tariff officer Sonam Phuntsho said BPC can only propose but had no authority to determine the rates.

The revision proposal does not account for the revised rates the Druk Green Power Corporation (DGPC) is proposing on the sale of power to BPC for the next three years.

DGPC has proposed to sell power to BPC at Nu 1.99 a unit from the existing Nu 1.2 a unit, which has been in place since 2007 so as to reflect actual cost of generation and give it satisfactory return on investments. In 2010 DGPC had made the same proposal but it was kept at Nu 1.2 a unit.

This is for sale of energy beyond the 15 percent of total generation or royalty energy, which is currently being sold at Nu 0.13 a unit to BPCL to meet domestic energy needs as a subsidy.

BPC managing director, Dasho Bharat Tamang, said their proposal reflects and shows transparency of energy generation price, transmission, distribution, and supply charges in the supply chain of electricity supply industry to customers.

By Passang Norbu

19 Comments to “New domestic tariff proposed”
  1. kuenlek | May 9th, 2013 at 15:03:42

    it has already been difficult for the commoners to manage house with increasing cost of living. if this development of Mega Hydro project is to not benefit the BHUTANESE people but rather burden them with increasing tariff , Bhutanese people would have been happier without it in the first place.

    Do we really need such development????????????????????????????????????????

  2. middlePATH | May 9th, 2013 at 12:29:39

    Hydropower Projects are developed by borrowing money from India. The money is taken back to India through exorbitant salary and allowances paid to numerous Indians working therein.
    N number of people are employed in such projects without necessarily having enough and valid duties and responsibilities to warrant huge salary. Rumours run that female Bhutanese are employed there and sexually exploited by Indian Bosses.
    Payment is again hefty for contracts and hire charges, which only benefit the rich ones.
    Costs, salary, perks and allowances are huge, but projects are not necessarily moving in a commensurate pace.
    Why do people of Bhutan have to pay for such costs?
    Income earned through this proudly-claimed resources do not reach our people. Instead, power tariff is going to be doubled. I really cannot understand the logic.
    This tariff revision needs a serious reconsideration. I do not like to mention GNH, but I have to. This is not making me happy at all.

  3. kinwang | May 9th, 2013 at 12:29:07

    The pay remains the same but the bill goes up like a rocket… good proposal BPC.

  4. Lekso | May 9th, 2013 at 11:55:40

    There is need to give a license to at least 2 private/ a public companies to supply electricity instead of only BPC. So that Bhutanese will have choice of three suppliers who will compete in reduction of power tariffs that will ultimately benefit people. LPG which, indeed non renewable is far cheaper than renewable energy (hydro power) when we compare in terms of usage and cost.

  5. dremikuenden | May 9th, 2013 at 11:35:33

    I failed to understand why the tariff for domestic use like rural and urban is so high than industries. I certainly feel that there is need to consider revision. one need to consider the usage and needs for domestic where we don’t use for profit making. its solely for home which is basic need of the people. such revision can’t be blind, need to look from different angles.

  6. Fountainhead | May 9th, 2013 at 11:07:44

    Bhutanese voters should not support any government who wants to increase electricity tariff for Bhutanese people. We are producing so much electricity that our government cannot afford to subsidize for domestic private consumption. Any other countries who produces their own goods get at a huge subsidized rate. Look at middle east countries, they produce oil and their citizens get fuel at a very very cheap price. That is how electricity should be available for private domestic consumption. I as a voter do not support any increase in electricity tariff. I expect it should be subsidized further.

  7. Ghadhey Baymo | May 9th, 2013 at 11:01:14

    What the hell is the DGPC and BPC people doing to the People of bhutan!
    Astonished to see this.These two corporations can only rape the Bhutanese people,not other..
    We stand on our last leg to hope for new government to bring this down to normal..
    Please GOD help us ,we are again going to fall under poverty line…..

  8. Eye2013 | May 9th, 2013 at 03:57:57

    OMG!!! What percent of your monthly salary will be taken by Power Authority??? forget GNH or GNP

    THE CONCERN DEPARTMENT OR DECISION MAKING BODY REALLY NEED TO STUDY TIME AND AGAIN BEFORE THE PROPOSAL IS PROPOSEDDDDDD

  9. keynote | May 9th, 2013 at 03:51:03

    is there going to be another pay rise? Even pay rise isnt going to solve this problem. as the pay hits another level, price for everything will shoot up. why so much of a hike in price of electricity?? isn’t electricity generated in our country or are we importing it BPC? hows this even a GNH?? isn’t this hike going to affect the larger part of our population?? is GNH about making government rich or the People of Bhutan Happy?? i know and i feel that this power tariff may make our government rich but what about we the people??? BPC if you ever get time from increasing power tariff go around ask people of lower income how they are managing their monthly needs? or you can also ask your employees with the low income if they would be able to pay the bill? just ask! don’t just write things so as you please on paper. people feel the pinch, in-fact i already started feeling the pinch.

  10. ancient | May 8th, 2013 at 23:29:34

    BPC, please think of those lower income group of people who earns monthly salary Nu. 5000/ month. “A household in Thimphu that paid a bill of Nu 486 for consuming 336 units in the month of April could be paying close to Nu 1,000, according to the proposed revision. This could become Nu 3,000 in winter, when the heaters are turned on.”

    He have family to serve, as a human we cant keep our heater off during the winter season. This is indeed making GNH country as corrupt country. No matter how the richer people used, the only sufferer are poor peoples.

  11. online | May 8th, 2013 at 17:07:13

    Is Bhutan’s hydropower are for the benefit of those working in BPC, rich, and people of India? Are we paying the huge price of displacing people from their ancestral land,degrading environment, subjecting the nation to many bans just for the benefit of those few? Is this the GNH bhutan striving for? 50% increase is understandable but 400% is beyond imagination! It is un unethical, irrational proposal from a organization who’s employee never felt the burden of paying electricity bill. Why don’t you reduce your cost and work more efficiently?

  12. Tshewangneedup | May 8th, 2013 at 17:04:49

    the poverty line has decrease by half that is why BPC is trying to take back to original position by increasing the tariff so people will be in poverty once more

  13. gasap | May 8th, 2013 at 14:47:32

    Last week I said there is more to come, just wait. We have borrowed too much, don’t know how to pay back, it will be passed on to the people. Taxes will be increased too. When the debt gets heavier in the later years, it’s the people who will suffer.

  14. middleman | May 8th, 2013 at 14:26:15

    BPC trying to improve GNH by imposing more!

  15. logical | May 8th, 2013 at 14:13:25

    If production cost per kW has gone high, it is because of internal corruption. Why should the public suffer for dishonesty of the project management teams and their practices? If sin takes the toll, let it take from the sinners…

  16. songkay | May 8th, 2013 at 14:03:33

    I support Haichi. Try revising the industries’ tariff n the export tariff. Our people ve sacrificed their land n properties for many hydro projects to come. If you ve to profit from the lower rung of the society what is is point of having so many projects in the country. Or are u encouraging people to go back to the forest for fuel. God save us.

  17. utls | May 8th, 2013 at 13:44:40

    Wow, what a good proposal for a GNH country, keep it up increasing for the poorer people to be poorer.

  18. ali | May 8th, 2013 at 13:43:37

    so ironical. yet they talk about GNH.

  19. Haichi | May 8th, 2013 at 12:58:14

    Bravo !!! so much for GNH …. rich gets richer & poor gets poorer. Why more power subsidy to already power subsidized industry sector??? What is the percentage of Bhutanese & the public benefited by this power subsidy to Pasakha industries? And, by how much?

    Public (especially the urban/domestic consumers/institutions should not accept this power tariff proposal. By more power projects, the public is suppose to benefit but it seems the other way round.

    REMOVE POWER SUBSIDY & rework the power tariff porposal.

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