Revised energy prices closer to consumer demands

Revised energy prices closer to consumer demands

The President’s office has introduced a revised energy-pricing scheme to parliament that raises the cost of energy for consumers, but not as drastically as previously proposed.

An initial proposal by the Ministry for Electricity drew intense criticism from consumers — the 50 kyat (US$ 0.05) unit price for households using more than 100 units was seen as unfair. Last November, demonstrators took to the streets of Rangoon in candlelight vigil to protest the hike.

The current rate for supplying electricity to households across Burma stands at 25 kyat per unit.

The new proposal staggers household and industrial pricing of energy, so that households would have to expend over 200 units of energy to reach the price of 50 kyat per unit.

Usage up to 100 units will be charged at 35 kyat per unit, and 40 kyat per unit for up to 200 units used.

The proposal contains a bonus for large businesses. Firms expending between 100,000 and 200,000 units for industrial use will be charged at a rate of 150 kyat per unit. However, the rate will decrease to 125 kyat per unit once the 200,000 unit per year threshold is crossed.

The Burmese government is prioritising the improvement of electricity supply in their bid to attract foreign investment. The Kyuakphyu Special Economic Zone now features its own gas-fired power plant, and can therefore provide 24 hour power — unheard of throughout the rest of Burma, where dilapidated infrastructure and a limited national grid mean many businesses rely on expensive personal generators.

According to the Ministry of Electric Power, who floated the original price hike proposal, the softer increase will leave Burma with a deficit of 12 billion kyat (US$12m) per year.

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