OGRA notifies up to 143% increase in gas prices

Consumer slabs have been increased from three to seven to reduce burden on the poor

ISLAMABAD: The Oil and Gas Regulatory Authority (Ogra) notified on Thursday up to 143% increase in prices of natural gas sold by public utilities to different types of retail consumers, which came into effect on September 27, 2018.

On September 16, the Economic Coordination Committee (ECC) of the cabinet allowed the increase in gas prices for domestic consumers in the range of 10% for the lowest slab of consumers to 143% for the highest slab. The ECC also increased the number of slabs for domestic consumers from three to seven with the aim of passing minimum burden on to poor consumers.



For the consumption slab of up to 50 million cubic feet of gas per day (mmcfd), the government increased the price by 10% to Rs121 per unit. According to estimates, this will take the monthly bill of such consumers from Rs252 to Rs275.

For the second category of up to 100 mmcfd, the gas price has been increased by 15% which will push the monthly bill of domestic consumers up by Rs71. About 2.63 million households fall in this category.

For the third category of up to 200 mmcfd, the government has enhanced the gas price by 20%. The monthly bill of this category of consumers will go up from Rs1,851 to a minimum of Rs2,216.

The newly created fourth slab of up to 300 mmcfd, the gas price will rise by 25%. In this slab, the monthly bill of consumers will increase from Rs2,764 to Rs3,449.

For the fifth category of up to 400 mmcfd, the government has raised the gas price by 30%. The monthly bill of this category of consumers will swell from a minimum of Rs9,990 to Rs12,980.

For the sixth slab of up to 500 mmcfd, the government has jacked up the gas price by 143%. In this category, the monthly bill of consumers will jump from Rs12,482 to at least Rs30,339.

For the last category of more than 500 mmcfd, the government has increased the gas price by 143%. The monthly bill of this class of consumers will surge from Rs14,973 to a minimum of Rs36,402.

Minimum charges have also been increased for the gas consumers from Rs148.50 to Rs163.35 per month.

The government has also increased gas prices for commercial consumers by 40% including for special commercial connection like ‘Roti Tandoors’.

It increased the gas price for old fertiliser plants by 50% and for new units by up to 40%. For general industries and captive power plants, the government has raised the gas price by 40% from Rs600 to Rs780 per mmbtu. However, registered manufacturers or exporters of textile, carpets, leather, sports and surgical goods will be exempted from the price hike.

The government increased the gas price by 57% for the power sector.

Gas sale price for the cement sector was increased from Rs750 to Rs975 per mmbtu. The gas price for compressed natural gas (CNG) outlets was raised by Rs980 per mmbtu.



The CNG association has rejected the increase in gas price for the sector and demanded that the government undertake a review.

Association Chairman Ghayas Paracha said the increase in gas prices would impact the life of common man and pointed out that the hike had been made from September 2018, questioning how the utilities would recover it.

Published in The Express Tribune, October 5^th, 2018.

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