SMEs exempted from Bangladesh's power factor correction charge

The Bangladesh Energy Regulatory Commission has exempted small and medium industries from paying power factor correction charge.

This transpired after the Federation of Bangladesh Chambers and Commerce Industries had demanded the waiver.

The commission ordered the power distribution agencies to realise the power factor correction charge from consumers who use power at a rate higher than 50kW with a retrospective effect from December 2010.

Small and medium industries usually use power at a rate between 30kW and 50kW.

The power distribution agencies earlier realised an extra charge from industrial consumers who used power at a rate higher than 30kW.

The commission also exempted farmers from paying the charge who use power-run pumps of 15 horsepower for irrigation as an incentive to marginal farmers to ensure smooth farming.

The Energy Regulatory Commission’s member Salim Mahmud said that the commission had considered that the PFC charge had put an additional burden on small and medium industries.

He said that small and medium industries were losing their competitiveness because of additional expenditure caused by the PFC charge.