In the past decade, the population of Bangladesh has grown tremendously, which has led to a high increase in the demand for energy and electricity. As a result, the development of the energy sector will play a critical role in Bangladesh’s efforts to improve standards of living and promote economic growth.
The government of Bangladesh is working on improving current energy policies and power market design to address challenges within the energy sector, such as meeting growing energy demand, increasing affordability and access, and achieving power sector financial viability. In the meantime, it is essential that the government continues to develop strong regulatory frameworks to introduce more competition in the market, strengthen the role of energy regulators, and encourage increased private investment.
Created in 2004, the Bangladesh Energy Regulatory Commission (BERC) plays a large role in these developments. BERC performs three major functions in its regulatory oversight of the power, gas, and petroleum sectors: determining tariffs, issuing licenses, and overseeing dispute settlement.
Supported by the United States Agency for International Development (USAID), NARUC builds BERC’s regulatory capacity through the Bangladesh Energy Regulatory Partnership. This partnership focuses on providing strategies and recommendations so that BERC is better equipped to meet its goals of improving public communication processes, developing a robust dispute resolution process, strengthening tariff frameworks, and achieving government mandates.
From 2004 to 2008 and from 2011 to 2012, NARUC assisted Bangladeshi regulators with interpreting BERC’s founding legislation, creating an organizational structure, and providing a foundation for regulatory growth. In 2018, NARUC expanded efforts as the partnership progressed, helping BERC operate within the social, political, and economic realities of Bangladesh and working to encourage consumer education in collaboration with the Consumer Association of Bangladesh. Currently, NARUC assistance through the partnership focuses on enhancing BERC’s capacity to develop a robust dispute resolution process, improve public communication processes, review energy efficiency and auditing procedures, and strengthen tariff frameworks.
Bangladesh is also a part of NARUC's regional work under the USAID Regional Development Mission for Asia (RDMA).
Under Section 40 of the BERC Act of 2003, BERC is empowered to settle any dispute between licensees, or between licensees and consumers. The Commission is also empowered to settle any appeals against the decisions of the Electricity or Petroleum Inspector under the Electricity Act of 2018 and the Petroleum Act of 2016. As dispute resolution processes are closely linked with stakeholder engagement (to build support for these processes) and effective enforcement, strengthening BERC’s capacity in these areas is critical to strengthening its regulatory authority and ability to be an effective steward of the energy sector.
Through NARUC technical workshops in 2020 and 2021, BERC staff and participating energy sector stakeholders learned about related topics such as handling customer complaints, customers’ involvement in regulatory decision making, enforcement processes for dispute resolution, and the use of public engagement with stakeholders to prevent and resolve disputes and regulation of alternative suppliers. During these activities, NARUC experts, BERC staff, and stakeholders also analyzed the current dispute resolution process. In addition, they outlined a new informal dispute resolution process. Following the 2021 workshop, BERC continues to work on its draft informal dispute resolution procedure.
Public Communications and Stakeholder Engagement
As a relatively new agency, BERC has made efforts to improve its recognition as an authority with the public and with the sectors it regulates and is working to build on that progress. Through technical workshops held in 2018 and 2020, NARUC provided an opportunity for BERC and other Bangladeshi energy sector stakeholders to exchange best practices on public communications and stakeholder engagement. Participants discussed topics such as using social media platforms to better connect with the public, developing a consumer complaints database, and the importance of engaging the public and key stakeholders during a pending tariff change.
As BERC is continuing to strengthen its methods of engagement, these activities have allowed representatives to learn from different perspectives and viewpoints. Further, implementing the best practices shared will help BERC to increase its transparency and efficiency, ultimately leading to a regulatory environment that is more conducive to investment. Following these workshops, BERC has stated that it is monitoring social media platforms more actively and has introduced a 24/7 hotline to help settle consumer complaints.
BERC is tasked to pursue energy efficiency on the supply side and is currently focusing on auditing the maintenance and operations of all thermal power plants in the country. This includes adhering to recommended maintenance schedules, assessing power plant efficiency targets, evaluating fuel procurement contracts, and benchmarking power plant performance. Consequently, BERC is in the process of finalizing a draft Regulation on Energy Efficiency and Energy Audit of Generation Facilities.
NARUC has provided technical recommendations on how to improve the regulation during this process and is providing additional assistance by developing an Energy Audit Manual. The Manual will include all the necessary steps to conduct an energy audit of the generation facilities under BERC’s purview by technology type. It will also include recommended timelines/time periods for each phase or step of the audit process.
Technical assistance under NARUC’s partnership with BERC is designed to improve regulatory oversight of the energy sector in line with international best practices, which is critical for boosting investor confidence in the private sector and promoting an enabling environment for investment. In this context, BERC has invited different stakeholders (e.g., ministries, utilities, gas transmission and distribution companies, etc.) to attend its engagements with NARUC so that they can stay informed and provide feedback on any recommendations from experts on how to improve BERC’s regulatory framework.
For example, during a 2019 technical workshop on tariff setting and tariff review, NARUC experts and participants from BERC met with stakeholders in the Bangladeshi energy sector to discuss BERC’s current tariff setting methodology and how it could be improved upon by adopting a uniform system of accounts (USoA). By talking through this topic together, the attending stakeholders were able to share their views on implementing a USoA and how such a system would impact their operations.
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Photo Credit: © Taoty / Adobe Stock
Project Dates: 2004-2008; 2011-2012; 2018-Present
Primary Partners: Bangladesh Energy Regulatory Commission (BERC)