Saturday , July 11 2020
Breaking News
Home / Business / Minimum gas charges enhanced by 39pc
Minimum gas charges enhanced by 39pc

Minimum gas charges enhanced by 39pc

ISLAMABAD: After increasing gas tariff by up to 200 per cent, the government hiked minimum gas charges by 39pc for almost all consumer categories, except 9pc increase for commercial and no change for domestic consumers.

The decision was notified by the Oil and Gas Regu­latory Authority (Ogra) on the advice of the Ministry of Energy — Petroleum Division. Minimum gas charges are payable by every consumer irrespective of consumption levels. This also means that even a closed premises having gas connection but zero consumption is required to pay this charge.

According to the notification, the minimum gas charges for residential consumers have been kept unchanged at Rs173 per million British Thermal Unit. All the increases in minimum charges have been made to come into force with retrospective effect from July 1, 2019.

The minimum charges on the other hand have been reduced by 17pc to Rs3900 per month from Rs4680 for government and semi-government offices, hospitals, official guesthouses, armed forces messes, Rangers, educational institutions, orphanages and bulk residential consumers.

The minimum charges for commercial consumers and ice factories have been increased by 9.1pc to Rs6,415 per month from Rs5,880 and those for general industries by 38.6pc to Rs36,450 per month from Rs26,302.

The minimum rates for registered manufacturers or exporters of five zero-rated sectors and their captive powers, including textile, jute, carpets, leather, sports and surgical goods, have also been increased by 38.6pc to Rs28,060 per month from Rs20,232.

The minimum charges for compressed natural gas (CNG) and cement have been increased by 38.6pc to Rs45,803 per month from Rs33,046 and those for the power sector, including Wapda, IPPs and K-Electric, by 38.7pc to Rs29,417 per month from Rs21,210.

The rates for captive power plants of industrial units carrying out the activity of power production for self-consumption or sale of surplus to others, including a distribution company or bulk consumer, have been increased by 39pc to Rs36,450 per month from Rs26,302.

When contacted, a Petroleum Division official said the gas charges were required to be increased along with consumer tariff as had been the practice in the past, but it could not be properly conveyed to Ogra in the last week of June when consumer-end gas prices were increased. He said the security deposit and minimum charges were always adjusted with direct proportion of consumer-end gas tariff to generally represent around three months of average gas consumption.

Responding to a question, the official said the Petroleum Division had not yet received in writing a recent decision of the Economic Coordination Committee (ECC) of the cabinet about a reduction in gas price for tandoors because it had not yet been formally endorsed by the cabinet. He said another notification would be issued once the ECC and cabinet decision for the reduction in gas price for tandoors was received.

The government had on June 29 increased gas tariff by up to 200pc for domestic and 31pc for all other categories under an agreement with the International Monetary Fund to generate about Rs510bn during the current fiscal year. The revised prices are required by the law to become effective on July 1 and Jan 1 every year.