Govt increases gas tariff up to 112%

In a massive price hike, the federal government has approved an increase in gas tariff to 112%.

The increase has been made for domestic (everyday consumers) and general industries, including export-oriented sectors, captive power plants, CNG and IPPs, and commercial sectors.

While the gas tariff has been kept unchanged for tandoors.

The new prices will be effective from January 2023.

The Oil and Gas Regulatory Authority (OGRA) issued a notification following the advice of the Petroleum Division.

Following the mini-budget, This move has also been taken to comply with a long-stalled financial bailout from the International Monetary Fund (IMF).

For domestic consumers, the earlier consumption level of up to 0.1HM cube/month gas consumption was charged Rs300/mmBtu and now it has been increased to Rs400, depicting an increase of 33.3%.

Similarly, up to 2HM cube/month, the consumption tariff has been increased by 44.7% to Rs800/mmBtu; for up to 3HM cube/month consumer category, the tariff has been increased by 49% to Rs1100/mmBtu.

According to the notification, gas off-take for the CNG sector has been determined at a flat rate of Rs1,500 mmBtu against an earlier tariff of Rs1,371/mmBtu.

For Independent Power Producers (IPPs), the bulk off-take tariff has been increased to Rs1,050/mmBtu from earlier Rs857/mmBtu.

For captive gas users, the tariff has been increased to Rs1,200/mmBtu from earlier Rs1,087/mmBtu. Captive plants are those which have been established by an industrial undertaking/unit to produce power for their own consumption and or sell the surplus to DISCO or bulk power consumers. Captive power plants’ minimum gas charges have been increased to Rs36,653/month from earlier Rs36,450/month.

“Ministry of Energy (Petroleum Division) has communicated the decision of the Economic Coordination Committee (ECC), ratified by the federal cabinet, in respect of gas sale price, effective January 1, 2023. The Ogra, after receipt of the said advice, notified the sale prices against each category of retail consumers of natural gas,” a spokesperson for the regulator said.

The tariff will be uniform throughout the country on both Sui Northern Gas Pipelines Limited and Sui Southern Gas Company Limited networks.

Meanwhile, for Wapda and K-Electric’s power stations, the bulk tariff has been increased from Rs857 to Rs1,050/mmBtu and minimum charges have been kept unchanged at Rs28,898/month.

The tariff has been increased by 17.5% to Rs1,500/mmBtu for the cement sector.

For all established commercial units, the tariff has been increased by 28.6% to Rs1,650/mmBtu from earlier Rs1,283/mmBtu while the minimum charges have been kept unchanged at Rs6,415/month.