Dhaka: The Center for Policy Dialogue (CPD) has proposed an appropriate price setting model for fuel oil in Bangladesh, focusing on energy security and transition. The private think-tank recommends adopting an Artificial Neural Network (ANN)-based pricing model to establish a more stable, transparent, and equitable system. This model offers a shock-absorbing mechanism at the import stage, mitigating exchange rate volatility while reflecting the socio-economic realities of the country. According to Bangladesh Sangbad Sangstha, the new model could reduce the existing fuel price by Tk 10 to Tk 15 per litre. The think-tank today introduced the new price model at a dialogue titled 'Market-based Fuel Pricing: Government-led Initiatives and Possible Revision' held at a local hotel. Attendees included Bangladesh Petroleum Corporation (BPC) Chairman (Secretary) Md Amin Ul Ahsan, Jalal Ahmed, Chairman of the Bangladesh Energy Regulatory Commission (BEFC), and Khalid Ahmed, Additional Secretary (Operation) of the Energ y and Mineral Resources Division, who were present as guests of honour. The event also featured distinguished discussants such as Professor Dr M Shamsul Alam, Energy Advisor of the Consumers Association of Bangladesh (CAB), Humayun Rashid, Vice President of the Bangladesh Independent Power Producers' Association (BIPPA), and others. Dr Khondaker Golam Moazzem, Research Director of CPD, moderated the dialogue, while Helen Mashyat Preoty, CPD Senior Research Associate, and Faisal Quaiyyum, CPD Programme Associate, delivered the keynote presentation. Golam Moazzem highlighted that the government of Bangladesh had earlier adopted an automated pricing system for various fuel oils in March 2024. This decision aimed to alleviate the fiscal and financial burden of the government as part of the International Monetary Fund (IMF) loan condition. However, this pricing formula has faced criticism, necessitating an immediate revision. Helen Mashyat Preoty, in her presentation, emphasized that the study, conducted in par tnership with the Australian High Commission in Dhaka, recommends a market-based pricing model using ANN. This approach simplifies the pricing method while ensuring sensitivity to fiscal constraints and consumer capabilities. The adoption of this model is essential for fostering a balanced and equitable pricing environment, aligning with international best practices. Preoty also stressed the importance of approving the draft regulation prepared by Bangladesh Energy Regulatory Commission (BERC) for fuel oil pricing. By approving this draft, BERC would gain the authority to determine the price of all fuel oils, ensuring full monitoring and implementation of the automated pricing model. She further added that BERC should organize regular public hearings to ensure transparency in the process. The predictive power of the ANN model plays a crucial role in the strategic shift towards sustainable energy, enabling consumers and policymakers to effectively plan transitions to alternative energy sources, supporting lo ng-term energy strategies in line with sustainable development goals.
