The Transition from Underpricing Residential Electricity in Bangladesh : Fiscal and Distributional Impacts

The electricity sector in Bangladesh has been facing unprecedented challenges, with severe capacity constraints and sector subsidies that quadrupled from 0.2 percent to 0.8 percent of gross domestic product (GDP) between 2010 and 2012, driving the government's fiscal deficit deeper. This policy note examines the poverty and distribution impact of one such reform-residential electricity tariff increases-along with their fiscal implications. A challenge of such adjustments is how to minimize their impact on the poor and vulnerable. Using household survey data, this report studies the distributional and fiscal implications of the residential tariff adjustments between March 2010 and March 2012 on to inform policy dialogue on the provision and targeting of electricity subsidies. Electricity subsidies are defined as the difference between the cost of supplying a unit of electricity and the tariff the end-user is charged for a given unit. Between 2010 and 2012, real cost of supply increased almost 20 percent. This policy note focuses on just one part of a much broader and complex system of connected energy policies. The policy implications of this analysis should only be considered in light of this broader context. In particular, this note does not study in detail the complex issues of generation and operational efficiency (in transmission and distribution). Second, this note does not study the political economy of tariff and subsidy reform. Tariff increases have been a source of social unrest, and planned increases could generate additional unrest. It will be important for the government to consider the political economy of further reform carefully. Moving forward, both of the new slab systems being discussed could relieve the fiscal burden of subsidies.

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Bibliographic Details
Main Authors: Ahmed, Faizuddin, Trimble, Chris, Yoshida, Nobuo
Language:English
en_US
Published: World Bank, Washington, DC 2013-01
Subjects:ACCESS TO ELECTRICITY, AGRICULTURE, APPROACH, BALANCE, COAL, CONNECTED HOUSEHOLDS, CONSUMER PRICE INDEX, CONSUMERS, CONSUMPTION INCREASES, CONSUMPTION LEVELS, COST OF ELECTRICITY, COSTS OF ELECTRICITY, CROSS SUBSIDIES, CROSS-SUBSIDIZATION, CRUDE OIL, CRUDE OIL PRICE, DECISION MAKING, DEMAND FOR ELECTRICITY, DIESEL, DISTRIBUTION COMPANIES, DISTRIBUTION OF ELECTRICITY, EFFECTIVE SUBSIDIES, ELECTRIC POWER, ELECTRIC POWER CONSUMPTION, ELECTRIC SUPPLY, ELECTRICITY, ELECTRICITY ACCESS, ELECTRICITY BILL, ELECTRICITY BILLS, ELECTRICITY CONNECTIONS, ELECTRICITY CONSUMPTION, ELECTRICITY COSTS, ELECTRICITY DEMAND, ELECTRICITY GENERATION, ELECTRICITY POLICY, ELECTRICITY PRICING, ELECTRICITY SECTOR, ELECTRICITY SERVICE, ELECTRICITY SUBSIDIES, ELECTRICITY SUPPLY, ELECTRICITY TARIFF, ELECTRICITY TARIFFS, ELECTRICITY UTILITY, ENERGY CONSUMPTION, ENERGY MARKETS, ENERGY POLICIES, ENERGY PRICES, ENERGY STATISTICS, EXPORTS, FORECASTS, FUEL, FUEL SOURCES, GAS, GAS PRICES, GDP, GENERATION, GENERATION CAPACITY, GENERATION COSTS, GROSS DOMESTIC PRODUCT, HOUSEHOLD ANALYSIS, HOUSEHOLD CONSUMPTION, INEFFICIENCY, INFLATION, INTERNATIONAL ENERGY AGENCY, KILOWATT HOUR, LIFELINE TARIFFS, LNG, LOW LEVELS OF ACCESS, LOW LEVELS OF CONSUMPTION, LOW TARIFFS, MINERAL RESOURCES, MONTHLY CONSUMPTION, NATURAL GAS, NATURAL GAS PRICE, NEW POWER PLANTS, OIL, PARTIAL EQUILIBRIUM ANALYSIS, PEAK DEMAND, PETROLEUM, PETROLEUM PRODUCTS, PETROLEUM SECTOR, POLITICAL ECONOMY, POLITICAL ECONOMY OF REFORM, POLITICAL ECONOMY OF TARIFF, POWER, POWER CONSUMPTION, POWER DISTRIBUTION, POWER GENERATION, POWER GRID, POWER PLANTS, POWER PRODUCER, POWER SECTOR, POWER SECTOR REFORMS, POWER SHORTAGES, PRIMARY FUEL, PRIVATE SECTOR, QUANTITY OF ELECTRICITY, REPUBLIC, RURAL CONSUMERS, RURAL ELECTRICITY, RURAL ELECTRIFICATION, RURAL ELECTRIFICATION PROGRAM, RURAL HOUSEHOLDS, SOURCE OF ENERGY, SUBSIDIZATION, SUPPLY COSTS, TARIFF LEVELS, TARIFF STRUCTURE, TARIFF STRUCTURES, UTILITIES, UTILITY COMPANY,
Online Access:http://documents.worldbank.org/curated/en/2013/01/17647682/transition-underpricing-residential-electricity-bangladesh-fiscal-distributional-impacts
https://hdl.handle.net/10986/18362
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libraryname Biblioteca del Banco Mundial
language English
en_US
topic ACCESS TO ELECTRICITY
AGRICULTURE
APPROACH
BALANCE
COAL
CONNECTED HOUSEHOLDS
CONSUMER PRICE INDEX
CONSUMERS
CONSUMPTION INCREASES
CONSUMPTION LEVELS
COST OF ELECTRICITY
COSTS OF ELECTRICITY
CROSS SUBSIDIES
CROSS-SUBSIDIZATION
CRUDE OIL
CRUDE OIL PRICE
DECISION MAKING
DEMAND FOR ELECTRICITY
DIESEL
DISTRIBUTION COMPANIES
DISTRIBUTION OF ELECTRICITY
EFFECTIVE SUBSIDIES
ELECTRIC POWER
ELECTRIC POWER CONSUMPTION
ELECTRIC SUPPLY
ELECTRICITY
ELECTRICITY ACCESS
ELECTRICITY BILL
ELECTRICITY BILLS
ELECTRICITY CONNECTIONS
ELECTRICITY CONSUMPTION
ELECTRICITY COSTS
ELECTRICITY DEMAND
ELECTRICITY GENERATION
ELECTRICITY POLICY
ELECTRICITY PRICING
ELECTRICITY SECTOR
ELECTRICITY SERVICE
ELECTRICITY SUBSIDIES
ELECTRICITY SUPPLY
ELECTRICITY TARIFF
ELECTRICITY TARIFFS
ELECTRICITY UTILITY
ENERGY CONSUMPTION
ENERGY MARKETS
ENERGY POLICIES
ENERGY PRICES
ENERGY STATISTICS
EXPORTS
FORECASTS
FUEL
FUEL SOURCES
GAS
GAS PRICES
GDP
GENERATION
GENERATION CAPACITY
GENERATION COSTS
GROSS DOMESTIC PRODUCT
HOUSEHOLD ANALYSIS
HOUSEHOLD CONSUMPTION
INEFFICIENCY
INFLATION
INTERNATIONAL ENERGY AGENCY
KILOWATT HOUR
LIFELINE TARIFFS
LNG
LOW LEVELS OF ACCESS
LOW LEVELS OF CONSUMPTION
LOW TARIFFS
MINERAL RESOURCES
MONTHLY CONSUMPTION
NATURAL GAS
NATURAL GAS PRICE
NEW POWER PLANTS
OIL
PARTIAL EQUILIBRIUM ANALYSIS
PEAK DEMAND
PETROLEUM
PETROLEUM PRODUCTS
PETROLEUM SECTOR
POLITICAL ECONOMY
POLITICAL ECONOMY OF REFORM
POLITICAL ECONOMY OF TARIFF
POWER
POWER CONSUMPTION
POWER DISTRIBUTION
POWER GENERATION
POWER GRID
POWER PLANTS
POWER PRODUCER
POWER SECTOR
POWER SECTOR REFORMS
POWER SHORTAGES
PRIMARY FUEL
PRIVATE SECTOR
QUANTITY OF ELECTRICITY
REPUBLIC
RURAL CONSUMERS
RURAL ELECTRICITY
RURAL ELECTRIFICATION
RURAL ELECTRIFICATION PROGRAM
RURAL HOUSEHOLDS
SOURCE OF ENERGY
SUBSIDIZATION
SUPPLY COSTS
TARIFF LEVELS
TARIFF STRUCTURE
TARIFF STRUCTURES
UTILITIES
UTILITY COMPANY
ACCESS TO ELECTRICITY
AGRICULTURE
APPROACH
BALANCE
COAL
CONNECTED HOUSEHOLDS
CONSUMER PRICE INDEX
CONSUMERS
CONSUMPTION INCREASES
CONSUMPTION LEVELS
COST OF ELECTRICITY
COSTS OF ELECTRICITY
CROSS SUBSIDIES
CROSS-SUBSIDIZATION
CRUDE OIL
CRUDE OIL PRICE
DECISION MAKING
DEMAND FOR ELECTRICITY
DIESEL
DISTRIBUTION COMPANIES
DISTRIBUTION OF ELECTRICITY
EFFECTIVE SUBSIDIES
ELECTRIC POWER
ELECTRIC POWER CONSUMPTION
ELECTRIC SUPPLY
ELECTRICITY
ELECTRICITY ACCESS
ELECTRICITY BILL
ELECTRICITY BILLS
ELECTRICITY CONNECTIONS
ELECTRICITY CONSUMPTION
ELECTRICITY COSTS
ELECTRICITY DEMAND
ELECTRICITY GENERATION
ELECTRICITY POLICY
ELECTRICITY PRICING
ELECTRICITY SECTOR
ELECTRICITY SERVICE
ELECTRICITY SUBSIDIES
ELECTRICITY SUPPLY
ELECTRICITY TARIFF
ELECTRICITY TARIFFS
ELECTRICITY UTILITY
ENERGY CONSUMPTION
ENERGY MARKETS
ENERGY POLICIES
ENERGY PRICES
ENERGY STATISTICS
EXPORTS
FORECASTS
FUEL
FUEL SOURCES
GAS
GAS PRICES
GDP
GENERATION
GENERATION CAPACITY
GENERATION COSTS
GROSS DOMESTIC PRODUCT
HOUSEHOLD ANALYSIS
HOUSEHOLD CONSUMPTION
INEFFICIENCY
INFLATION
INTERNATIONAL ENERGY AGENCY
KILOWATT HOUR
LIFELINE TARIFFS
LNG
LOW LEVELS OF ACCESS
LOW LEVELS OF CONSUMPTION
LOW TARIFFS
MINERAL RESOURCES
MONTHLY CONSUMPTION
NATURAL GAS
NATURAL GAS PRICE
NEW POWER PLANTS
OIL
PARTIAL EQUILIBRIUM ANALYSIS
PEAK DEMAND
PETROLEUM
PETROLEUM PRODUCTS
PETROLEUM SECTOR
POLITICAL ECONOMY
POLITICAL ECONOMY OF REFORM
POLITICAL ECONOMY OF TARIFF
POWER
POWER CONSUMPTION
POWER DISTRIBUTION
POWER GENERATION
POWER GRID
POWER PLANTS
POWER PRODUCER
POWER SECTOR
POWER SECTOR REFORMS
POWER SHORTAGES
PRIMARY FUEL
PRIVATE SECTOR
QUANTITY OF ELECTRICITY
REPUBLIC
RURAL CONSUMERS
RURAL ELECTRICITY
RURAL ELECTRIFICATION
RURAL ELECTRIFICATION PROGRAM
RURAL HOUSEHOLDS
SOURCE OF ENERGY
SUBSIDIZATION
SUPPLY COSTS
TARIFF LEVELS
TARIFF STRUCTURE
TARIFF STRUCTURES
UTILITIES
UTILITY COMPANY
spellingShingle ACCESS TO ELECTRICITY
AGRICULTURE
APPROACH
BALANCE
COAL
CONNECTED HOUSEHOLDS
CONSUMER PRICE INDEX
CONSUMERS
CONSUMPTION INCREASES
CONSUMPTION LEVELS
COST OF ELECTRICITY
COSTS OF ELECTRICITY
CROSS SUBSIDIES
CROSS-SUBSIDIZATION
CRUDE OIL
CRUDE OIL PRICE
DECISION MAKING
DEMAND FOR ELECTRICITY
DIESEL
DISTRIBUTION COMPANIES
DISTRIBUTION OF ELECTRICITY
EFFECTIVE SUBSIDIES
ELECTRIC POWER
ELECTRIC POWER CONSUMPTION
ELECTRIC SUPPLY
ELECTRICITY
ELECTRICITY ACCESS
ELECTRICITY BILL
ELECTRICITY BILLS
ELECTRICITY CONNECTIONS
ELECTRICITY CONSUMPTION
ELECTRICITY COSTS
ELECTRICITY DEMAND
ELECTRICITY GENERATION
ELECTRICITY POLICY
ELECTRICITY PRICING
ELECTRICITY SECTOR
ELECTRICITY SERVICE
ELECTRICITY SUBSIDIES
ELECTRICITY SUPPLY
ELECTRICITY TARIFF
ELECTRICITY TARIFFS
ELECTRICITY UTILITY
ENERGY CONSUMPTION
ENERGY MARKETS
ENERGY POLICIES
ENERGY PRICES
ENERGY STATISTICS
EXPORTS
FORECASTS
FUEL
FUEL SOURCES
GAS
GAS PRICES
GDP
GENERATION
GENERATION CAPACITY
GENERATION COSTS
GROSS DOMESTIC PRODUCT
HOUSEHOLD ANALYSIS
HOUSEHOLD CONSUMPTION
INEFFICIENCY
INFLATION
INTERNATIONAL ENERGY AGENCY
KILOWATT HOUR
LIFELINE TARIFFS
LNG
LOW LEVELS OF ACCESS
LOW LEVELS OF CONSUMPTION
LOW TARIFFS
MINERAL RESOURCES
MONTHLY CONSUMPTION
NATURAL GAS
NATURAL GAS PRICE
NEW POWER PLANTS
OIL
PARTIAL EQUILIBRIUM ANALYSIS
PEAK DEMAND
PETROLEUM
PETROLEUM PRODUCTS
PETROLEUM SECTOR
POLITICAL ECONOMY
POLITICAL ECONOMY OF REFORM
POLITICAL ECONOMY OF TARIFF
POWER
POWER CONSUMPTION
POWER DISTRIBUTION
POWER GENERATION
POWER GRID
POWER PLANTS
POWER PRODUCER
POWER SECTOR
POWER SECTOR REFORMS
POWER SHORTAGES
PRIMARY FUEL
PRIVATE SECTOR
QUANTITY OF ELECTRICITY
REPUBLIC
RURAL CONSUMERS
RURAL ELECTRICITY
RURAL ELECTRIFICATION
RURAL ELECTRIFICATION PROGRAM
RURAL HOUSEHOLDS
SOURCE OF ENERGY
SUBSIDIZATION
SUPPLY COSTS
TARIFF LEVELS
TARIFF STRUCTURE
TARIFF STRUCTURES
UTILITIES
UTILITY COMPANY
ACCESS TO ELECTRICITY
AGRICULTURE
APPROACH
BALANCE
COAL
CONNECTED HOUSEHOLDS
CONSUMER PRICE INDEX
CONSUMERS
CONSUMPTION INCREASES
CONSUMPTION LEVELS
COST OF ELECTRICITY
COSTS OF ELECTRICITY
CROSS SUBSIDIES
CROSS-SUBSIDIZATION
CRUDE OIL
CRUDE OIL PRICE
DECISION MAKING
DEMAND FOR ELECTRICITY
DIESEL
DISTRIBUTION COMPANIES
DISTRIBUTION OF ELECTRICITY
EFFECTIVE SUBSIDIES
ELECTRIC POWER
ELECTRIC POWER CONSUMPTION
ELECTRIC SUPPLY
ELECTRICITY
ELECTRICITY ACCESS
ELECTRICITY BILL
ELECTRICITY BILLS
ELECTRICITY CONNECTIONS
ELECTRICITY CONSUMPTION
ELECTRICITY COSTS
ELECTRICITY DEMAND
ELECTRICITY GENERATION
ELECTRICITY POLICY
ELECTRICITY PRICING
ELECTRICITY SECTOR
ELECTRICITY SERVICE
ELECTRICITY SUBSIDIES
ELECTRICITY SUPPLY
ELECTRICITY TARIFF
ELECTRICITY TARIFFS
ELECTRICITY UTILITY
ENERGY CONSUMPTION
ENERGY MARKETS
ENERGY POLICIES
ENERGY PRICES
ENERGY STATISTICS
EXPORTS
FORECASTS
FUEL
FUEL SOURCES
GAS
GAS PRICES
GDP
GENERATION
GENERATION CAPACITY
GENERATION COSTS
GROSS DOMESTIC PRODUCT
HOUSEHOLD ANALYSIS
HOUSEHOLD CONSUMPTION
INEFFICIENCY
INFLATION
INTERNATIONAL ENERGY AGENCY
KILOWATT HOUR
LIFELINE TARIFFS
LNG
LOW LEVELS OF ACCESS
LOW LEVELS OF CONSUMPTION
LOW TARIFFS
MINERAL RESOURCES
MONTHLY CONSUMPTION
NATURAL GAS
NATURAL GAS PRICE
NEW POWER PLANTS
OIL
PARTIAL EQUILIBRIUM ANALYSIS
PEAK DEMAND
PETROLEUM
PETROLEUM PRODUCTS
PETROLEUM SECTOR
POLITICAL ECONOMY
POLITICAL ECONOMY OF REFORM
POLITICAL ECONOMY OF TARIFF
POWER
POWER CONSUMPTION
POWER DISTRIBUTION
POWER GENERATION
POWER GRID
POWER PLANTS
POWER PRODUCER
POWER SECTOR
POWER SECTOR REFORMS
POWER SHORTAGES
PRIMARY FUEL
PRIVATE SECTOR
QUANTITY OF ELECTRICITY
REPUBLIC
RURAL CONSUMERS
RURAL ELECTRICITY
RURAL ELECTRIFICATION
RURAL ELECTRIFICATION PROGRAM
RURAL HOUSEHOLDS
SOURCE OF ENERGY
SUBSIDIZATION
SUPPLY COSTS
TARIFF LEVELS
TARIFF STRUCTURE
TARIFF STRUCTURES
UTILITIES
UTILITY COMPANY
Ahmed, Faizuddin
Trimble, Chris
Yoshida, Nobuo
The Transition from Underpricing Residential Electricity in Bangladesh : Fiscal and Distributional Impacts
description The electricity sector in Bangladesh has been facing unprecedented challenges, with severe capacity constraints and sector subsidies that quadrupled from 0.2 percent to 0.8 percent of gross domestic product (GDP) between 2010 and 2012, driving the government's fiscal deficit deeper. This policy note examines the poverty and distribution impact of one such reform-residential electricity tariff increases-along with their fiscal implications. A challenge of such adjustments is how to minimize their impact on the poor and vulnerable. Using household survey data, this report studies the distributional and fiscal implications of the residential tariff adjustments between March 2010 and March 2012 on to inform policy dialogue on the provision and targeting of electricity subsidies. Electricity subsidies are defined as the difference between the cost of supplying a unit of electricity and the tariff the end-user is charged for a given unit. Between 2010 and 2012, real cost of supply increased almost 20 percent. This policy note focuses on just one part of a much broader and complex system of connected energy policies. The policy implications of this analysis should only be considered in light of this broader context. In particular, this note does not study in detail the complex issues of generation and operational efficiency (in transmission and distribution). Second, this note does not study the political economy of tariff and subsidy reform. Tariff increases have been a source of social unrest, and planned increases could generate additional unrest. It will be important for the government to consider the political economy of further reform carefully. Moving forward, both of the new slab systems being discussed could relieve the fiscal burden of subsidies.
topic_facet ACCESS TO ELECTRICITY
AGRICULTURE
APPROACH
BALANCE
COAL
CONNECTED HOUSEHOLDS
CONSUMER PRICE INDEX
CONSUMERS
CONSUMPTION INCREASES
CONSUMPTION LEVELS
COST OF ELECTRICITY
COSTS OF ELECTRICITY
CROSS SUBSIDIES
CROSS-SUBSIDIZATION
CRUDE OIL
CRUDE OIL PRICE
DECISION MAKING
DEMAND FOR ELECTRICITY
DIESEL
DISTRIBUTION COMPANIES
DISTRIBUTION OF ELECTRICITY
EFFECTIVE SUBSIDIES
ELECTRIC POWER
ELECTRIC POWER CONSUMPTION
ELECTRIC SUPPLY
ELECTRICITY
ELECTRICITY ACCESS
ELECTRICITY BILL
ELECTRICITY BILLS
ELECTRICITY CONNECTIONS
ELECTRICITY CONSUMPTION
ELECTRICITY COSTS
ELECTRICITY DEMAND
ELECTRICITY GENERATION
ELECTRICITY POLICY
ELECTRICITY PRICING
ELECTRICITY SECTOR
ELECTRICITY SERVICE
ELECTRICITY SUBSIDIES
ELECTRICITY SUPPLY
ELECTRICITY TARIFF
ELECTRICITY TARIFFS
ELECTRICITY UTILITY
ENERGY CONSUMPTION
ENERGY MARKETS
ENERGY POLICIES
ENERGY PRICES
ENERGY STATISTICS
EXPORTS
FORECASTS
FUEL
FUEL SOURCES
GAS
GAS PRICES
GDP
GENERATION
GENERATION CAPACITY
GENERATION COSTS
GROSS DOMESTIC PRODUCT
HOUSEHOLD ANALYSIS
HOUSEHOLD CONSUMPTION
INEFFICIENCY
INFLATION
INTERNATIONAL ENERGY AGENCY
KILOWATT HOUR
LIFELINE TARIFFS
LNG
LOW LEVELS OF ACCESS
LOW LEVELS OF CONSUMPTION
LOW TARIFFS
MINERAL RESOURCES
MONTHLY CONSUMPTION
NATURAL GAS
NATURAL GAS PRICE
NEW POWER PLANTS
OIL
PARTIAL EQUILIBRIUM ANALYSIS
PEAK DEMAND
PETROLEUM
PETROLEUM PRODUCTS
PETROLEUM SECTOR
POLITICAL ECONOMY
POLITICAL ECONOMY OF REFORM
POLITICAL ECONOMY OF TARIFF
POWER
POWER CONSUMPTION
POWER DISTRIBUTION
POWER GENERATION
POWER GRID
POWER PLANTS
POWER PRODUCER
POWER SECTOR
POWER SECTOR REFORMS
POWER SHORTAGES
PRIMARY FUEL
PRIVATE SECTOR
QUANTITY OF ELECTRICITY
REPUBLIC
RURAL CONSUMERS
RURAL ELECTRICITY
RURAL ELECTRIFICATION
RURAL ELECTRIFICATION PROGRAM
RURAL HOUSEHOLDS
SOURCE OF ENERGY
SUBSIDIZATION
SUPPLY COSTS
TARIFF LEVELS
TARIFF STRUCTURE
TARIFF STRUCTURES
UTILITIES
UTILITY COMPANY
author Ahmed, Faizuddin
Trimble, Chris
Yoshida, Nobuo
author_facet Ahmed, Faizuddin
Trimble, Chris
Yoshida, Nobuo
author_sort Ahmed, Faizuddin
title The Transition from Underpricing Residential Electricity in Bangladesh : Fiscal and Distributional Impacts
title_short The Transition from Underpricing Residential Electricity in Bangladesh : Fiscal and Distributional Impacts
title_full The Transition from Underpricing Residential Electricity in Bangladesh : Fiscal and Distributional Impacts
title_fullStr The Transition from Underpricing Residential Electricity in Bangladesh : Fiscal and Distributional Impacts
title_full_unstemmed The Transition from Underpricing Residential Electricity in Bangladesh : Fiscal and Distributional Impacts
title_sort transition from underpricing residential electricity in bangladesh : fiscal and distributional impacts
publisher World Bank, Washington, DC
publishDate 2013-01
url http://documents.worldbank.org/curated/en/2013/01/17647682/transition-underpricing-residential-electricity-bangladesh-fiscal-distributional-impacts
https://hdl.handle.net/10986/18362
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AT trimblechris thetransitionfromunderpricingresidentialelectricityinbangladeshfiscalanddistributionalimpacts
AT yoshidanobuo thetransitionfromunderpricingresidentialelectricityinbangladeshfiscalanddistributionalimpacts
AT ahmedfaizuddin transitionfromunderpricingresidentialelectricityinbangladeshfiscalanddistributionalimpacts
AT trimblechris transitionfromunderpricingresidentialelectricityinbangladeshfiscalanddistributionalimpacts
AT yoshidanobuo transitionfromunderpricingresidentialelectricityinbangladeshfiscalanddistributionalimpacts
_version_ 1809106231816617984
spelling dig-okr-10986183622024-08-08T14:37:16Z The Transition from Underpricing Residential Electricity in Bangladesh : Fiscal and Distributional Impacts Ahmed, Faizuddin Trimble, Chris Yoshida, Nobuo ACCESS TO ELECTRICITY AGRICULTURE APPROACH BALANCE COAL CONNECTED HOUSEHOLDS CONSUMER PRICE INDEX CONSUMERS CONSUMPTION INCREASES CONSUMPTION LEVELS COST OF ELECTRICITY COSTS OF ELECTRICITY CROSS SUBSIDIES CROSS-SUBSIDIZATION CRUDE OIL CRUDE OIL PRICE DECISION MAKING DEMAND FOR ELECTRICITY DIESEL DISTRIBUTION COMPANIES DISTRIBUTION OF ELECTRICITY EFFECTIVE SUBSIDIES ELECTRIC POWER ELECTRIC POWER CONSUMPTION ELECTRIC SUPPLY ELECTRICITY ELECTRICITY ACCESS ELECTRICITY BILL ELECTRICITY BILLS ELECTRICITY CONNECTIONS ELECTRICITY CONSUMPTION ELECTRICITY COSTS ELECTRICITY DEMAND ELECTRICITY GENERATION ELECTRICITY POLICY ELECTRICITY PRICING ELECTRICITY SECTOR ELECTRICITY SERVICE ELECTRICITY SUBSIDIES ELECTRICITY SUPPLY ELECTRICITY TARIFF ELECTRICITY TARIFFS ELECTRICITY UTILITY ENERGY CONSUMPTION ENERGY MARKETS ENERGY POLICIES ENERGY PRICES ENERGY STATISTICS EXPORTS FORECASTS FUEL FUEL SOURCES GAS GAS PRICES GDP GENERATION GENERATION CAPACITY GENERATION COSTS GROSS DOMESTIC PRODUCT HOUSEHOLD ANALYSIS HOUSEHOLD CONSUMPTION INEFFICIENCY INFLATION INTERNATIONAL ENERGY AGENCY KILOWATT HOUR LIFELINE TARIFFS LNG LOW LEVELS OF ACCESS LOW LEVELS OF CONSUMPTION LOW TARIFFS MINERAL RESOURCES MONTHLY CONSUMPTION NATURAL GAS NATURAL GAS PRICE NEW POWER PLANTS OIL PARTIAL EQUILIBRIUM ANALYSIS PEAK DEMAND PETROLEUM PETROLEUM PRODUCTS PETROLEUM SECTOR POLITICAL ECONOMY POLITICAL ECONOMY OF REFORM POLITICAL ECONOMY OF TARIFF POWER POWER CONSUMPTION POWER DISTRIBUTION POWER GENERATION POWER GRID POWER PLANTS POWER PRODUCER POWER SECTOR POWER SECTOR REFORMS POWER SHORTAGES PRIMARY FUEL PRIVATE SECTOR QUANTITY OF ELECTRICITY REPUBLIC RURAL CONSUMERS RURAL ELECTRICITY RURAL ELECTRIFICATION RURAL ELECTRIFICATION PROGRAM RURAL HOUSEHOLDS SOURCE OF ENERGY SUBSIDIZATION SUPPLY COSTS TARIFF LEVELS TARIFF STRUCTURE TARIFF STRUCTURES UTILITIES UTILITY COMPANY The electricity sector in Bangladesh has been facing unprecedented challenges, with severe capacity constraints and sector subsidies that quadrupled from 0.2 percent to 0.8 percent of gross domestic product (GDP) between 2010 and 2012, driving the government's fiscal deficit deeper. This policy note examines the poverty and distribution impact of one such reform-residential electricity tariff increases-along with their fiscal implications. A challenge of such adjustments is how to minimize their impact on the poor and vulnerable. Using household survey data, this report studies the distributional and fiscal implications of the residential tariff adjustments between March 2010 and March 2012 on to inform policy dialogue on the provision and targeting of electricity subsidies. Electricity subsidies are defined as the difference between the cost of supplying a unit of electricity and the tariff the end-user is charged for a given unit. Between 2010 and 2012, real cost of supply increased almost 20 percent. This policy note focuses on just one part of a much broader and complex system of connected energy policies. The policy implications of this analysis should only be considered in light of this broader context. In particular, this note does not study in detail the complex issues of generation and operational efficiency (in transmission and distribution). Second, this note does not study the political economy of tariff and subsidy reform. Tariff increases have been a source of social unrest, and planned increases could generate additional unrest. It will be important for the government to consider the political economy of further reform carefully. Moving forward, both of the new slab systems being discussed could relieve the fiscal burden of subsidies. 2014-05-15T19:37:33Z 2014-05-15T19:37:33Z 2013-01 http://documents.worldbank.org/curated/en/2013/01/17647682/transition-underpricing-residential-electricity-bangladesh-fiscal-distributional-impacts https://hdl.handle.net/10986/18362 English en_US CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ application/pdf text/plain World Bank, Washington, DC