Cost rationalisation: PNGRB set to release framework for unified gas transport tariff
The Petroleum and Natural Gas regulatory Board (PNGRB) is set to release a unified gas transport tariff framework to reduce the cost of transportation of gas, a senior government official said. Many industry players had opposed the PNGRB proposal to rationalise transport tariffs on integrated gas pipeline networks such as those of GAIL and Gujarat State Petronet Ltd, pointing out that the move to reduce tariffs for customers further away from the source of gas would lead to cross-subsidisation with customers near sources of gas having to pay more for in gas transport costs. Petroleum Secretary Tarun Kapoor said that studies by the PNGRB had shown that the hike in tariff for customers near sources of gas would not be too much. The current framework requires gas consumers to pay per pipeline used for the transport of gas, while the proposed framework would allow for a simplified structure offering a single rate for transport of gas done within 300 km and that done beyond 300 km on the same pipeline network regardless of the number of pipelines used to transport gas. “It turns out that the impact is not too much and in the long run, volumes will increase and with increasing volumes, the tariff may also be rationalised further,” said Kapoor, noting that the regulator would come out with the unified tariff framework soon. Read the full article