How Bangladesh’s electricity tariff changed from 2020 to 2026
A year-by-year look at every retail tariff revision since 2020, why fuel imports and subsidy withdrawal pushed rates up, and what it means for a 250-unit household today.
If your bill has felt heavier every year since the pandemic, that is not a trick of memory. Bangladesh's residential electricity tariff has moved upward almost every year since 2022, after two calm years in 2020 and 2021. This article traces each revision, explains what actually drove it, and translates the cumulative change into what a typical 250-unit household pays today versus six years ago. For the current rate card in full, see our tariff tables.
Why tariffs moved: four drivers, not one
News coverage often reduces every hike to "fuel price," but four separate forces have been at work, sometimes together:
- Fuel import costs. Bangladesh's generation mix leans heavily on imported gas (including spot LNG), furnace oil and coal. When international prices for these commodities rise, the fuel component of the bulk power tariff rises with them.
- Subsidy withdrawal. For years the government absorbed part of the gap between generation cost and retail price directly from the budget. Fiscal pressure has pushed a gradual withdrawal of that subsidy, meaning retail tariffs now track true cost more closely.
- LNG dependence. Since domestic gas fields matured and output declined, imported LNG has filled a growing share of gas-fired generation. LNG cargoes are priced in US dollars against a global market that is far more volatile than piped domestic gas ever was.
- Taka depreciation. Nearly every fuel and capacity-payment contract in the power sector is dollar-denominated. As the taka weakened against the dollar through 2023–2025, the local-currency cost of the same physical fuel volume rose even when the dollar price was flat.
Timeline of retail tariff revisions, 2020–2026
| Year | What changed | Primary driver |
|---|---|---|
| 2020 | Retail tariff frozen through the pandemic | BERC held retail rates steady despite bulk power purchase pressure, absorbing cost through delayed subsidy adjustment as demand collapsed during lockdowns. |
| 2022 | Two mid-year retail hikes (average +5% then +5%) | Global gas and coal prices spiked after supply shocks in the international energy market, and spot LNG cargoes became too expensive to import regularly. |
| 2023 | Automatic quarterly fuel-price-adjustment mechanism introduced | Government shifted part of the tariff-setting process to a formula tied to fuel cost, aiming to avoid large one-off shocks by passing through smaller changes more often. |
| 2024 | Retail tariff up roughly 8% for the year, subsidy withdrawal accelerates | Government subsidy to the power sector was reduced in stages as part of broader fiscal consolidation, shifting more of the true generation cost onto retail bills. |
| 2025 | Two further adjustments, taka depreciation cited explicitly | A weaker taka against the US dollar raised the local-currency cost of imported fuel and capacity payments denominated in dollars, feeding directly into the fuel adjustment formula. |
| 2026 | June schedule in effect; residential slabs re-based | The current schedule keeps the lifeline rate for very small users but widens the gap between the top and bottom slabs, concentrating cost recovery on higher-consuming households. |
Indicative residential average rate by year
The table below blends all LT-A slabs into a single average rate per unit, useful for seeing the trend even though your actual rate depends on which slab your usage falls into. These are illustrative averages for a household using around 250 units a month, not official BERC summary statistics.
| Year | Approx. average rate | Context |
|---|---|---|
| 2020 | ৳6.50/unit | Pre-hike baseline, residential average across all slabs |
| 2021 | ৳6.50/unit | No change during the year |
| 2022 | ৳7.10/unit | Two hikes announced, effective from Q1 2023 billing |
| 2023 | ৳7.60/unit | Quarterly fuel adjustment mechanism begins |
| 2024 | ৳8.30/unit | Subsidy withdrawal accelerates |
| 2025 | ৳8.90/unit | Two more adjustments through the year |
| 2026 | ৳9.40/unit | June 2026 schedule, blended average across LT-A slabs |
What it means for a 250-unit household
At the 2020 average rate of about ৳6.50/unit, 250 units cost roughly ৳ 1,625 in energy charge alone. At the June 2026 average of about ৳9.40/unit, the same 250 units cost roughly ৳ 2,350 — a rise of about 45% in energy charge over six years, before VAT and demand charge. Demand charge and meter rent have moved far less over the same period, so the increase is concentrated almost entirely in the per-unit energy rate. If you want the exact slab-by-slab breakdown for your own usage, run it through our bill calculator.
Takeaways
- Retail tariffs were flat in 2020–2021 but have risen most years since 2022.
- Fuel import costs, subsidy withdrawal, LNG dependence and taka depreciation all contributed.
- A 250-unit household's energy charge has risen roughly 45% since 2020, ahead of general inflation in some years.
- Expect smaller, more frequent adjustments going forward rather than one large annual hike.
To see how this history compares across meter types and utilities, read our companion pieces on prepaid vs postpaid meters and how the six distributors differ.