If electricity distribution goes to private sector, people could suffer for decades

Former National Citizens Party (NCP) leader Tasnim Jara has warned that ordinary people could face long term hardship if the electricity distribution system is handed over to the private sector. In her view, if electricity distribution goes to private companies, customers will have no option to choose an alternative supplier. As a result, ensuring fair prices and quality service could become difficult.

She made the comments in a post on her verified Facebook account on Thursday night.

In the Facebook post, Tasnim Jara said the government is planning to hand over electricity distribution to the private sector. This means that control over the electricity lines that run through an area, the meters installed in homes and the bills issued at the end of the month would be transferred to private companies.

“When buying rice and lentils, if a shopkeeper asks for a higher price, the customer can go to the shop next door. Because there is an alternative, the shopkeeper also feels pressure to keep a fair price. But there will be no such opportunity in the case of electricity,” Tasnim Jara said.

Explaining her point, she said four companies would not install four separate sets of poles and power lines to supply electricity to the same area. Therefore, customers would not have the opportunity to compare the services and prices of different companies and choose one.

She said customers would have to receive electricity from the company that owns the power lines in their particular area.

Tasnim Jara used the example of a rice and lentil shop to explain the issue. She said, if only one rice and lentil shop is allowed to open in a neighborhood and there is no opportunity for a second shop to open, would that shopkeeper lower the prices? In her view, the answer is no.

However, she also acknowledged that there are examples of electricity distribution being handled by private companies in various countries around the world.

Tasnim Jara said these countries have strong regulatory bodies. Businesses cannot do whatever they want. The job of regulatory bodies is to protect the interests of the public, and they independently carry out that responsibility.

She cited Britain as an example. According to her, if a power line is disconnected there during a storm and it is not restored within a specified period, the electricity company has to pay customers a certain amount of compensation. Customers do not have to apply separately for this compensation. The company has to provide it. She said the regulatory authority ensures that this is done.

Tasnim Jara also questioned the independence of regulatory bodies in Bangladesh. She cited the example of the US Federal Reserve and said President Trump had publicly demanded for years that the central bank lower interest rates. He had publicly criticized the governor he appointed and even threatened to fire him. But it did not work.

Turning to Bangladesh, Tasnim Jara asked whether any regulatory body in the country has ever openly told the government no. In her view, it is difficult to recall such an example. Rather, she said, incidents to the contrary are more likely to come to mind.

She also commented that if electricity distribution remains under government control, it is comparatively easier to determine responsibility for failures. According to Tasnim Jara, if load shedding occurs or an unusually high electricity bill arrives, the government is held responsible. At the same time, there is also the fear of losing an election.

Jara said that in the case of a private company, this avenue of accountability could also disappear. She believes this is because private companies are not elected by the people. There is no opportunity to remove them through voting.

She also noted that if there is no alternative competitor in the market, customers will have no opportunity to receive services from another company.

At the end of her Facebook post, Tasnim Jara raised the issue of long-term contracts. She said such contracts generally last for 20 to 25 years. Once a contract is signed, it cannot easily be changed even if the government changes. As a result, she warned that people could have to bear the impact of a decision taken by the current government for decades.