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Statement of the President of the Energy Regulatory Office on price increase of fuel gas

 

On 15th December 2006 the President of the Energy Regulatory Office has extended till 31th March 2007 to the Polskie Górnictwo Naftowe i Gazownictwo S.A. (PGNiG S.A.), and on 16th December 2006 to the further companies of the Capital Group of PGNiG S.A - the expiring on 31th December 2006 - validation term of gas fuel tariff settled by him, approving at the same time new, higher prices for that kind of fuel.

The higher prices have been also approved for three companies outside of the group mentioned. That is: KRI Sp. z o.o., ENESTA Sp. z o.o. and Linia K&K.

The rest components, decisive for the payment level, which are imposed on customers for fuel supply, that is basic price amounts as well as transportation fee (transmission and distribution fee) stay unchanged.

The decision on the matter has been published in the “ERO Bulletin - Gas fuels” from 16th December of this year.

The wholesale prices of gas fuels, sold by PGNiG SA, will increase by 9,9% instead of the applied for growth in the height of 14,3%.

Their height before and right after the increase are as follows:

 

Kind of gas fuel price in PLN/1000m3 increase in %

currently
valid price

new one
1 2 3 4
high-methane gas GZ 50 708,6 778,8 9,91
low-methane gas GZ - 41,5 524,0 576,1 9,94
low-methane gas GZ -35 449,0 493,6 9,93

 

That increase is resulting exclusively from the growing – in relation to the price being the base for the calculation of the currently valid tariff – import price of high methane gas as well as of the necessary to include costs coming from the duty to keep on the store a 3% reserve of gas from the import, that haven’t been included in the tariff calculation. The increase on price of gas imported is caused mainly by change of price formulas, according to which gas - coming from “Jamal contract” - is cleared as well as from spot purchase, which effects in increase of purchased gas respectively by 14% and 10,7%.

Price increase of low-methane gas coming from domestic sources (GZ-41,5 and GZ- 35) results from the necessary of not worsening the relation between heat units, gained as a result of gas combustion, and the unit gained as a result of a high-methane gas combustion.

This way of price settlement balances the interests of the customers, that are supplied with gas coming exclusively from cheap domestic sources, with the interests of the ones supplied with gas coming form the homeland resources and from import, which would result from growing purchase cost and the necessity of keeping a reserve on the store.

The increase of the wholesale price of high methane gas means the average increase of payments, with which the customers, being connected to the transmission network, shall be charged from 8,0 till 8,8% (herein the highest increase regards the largest customers, that is, nitrogen plants and large power and heat supply stations.) For them is the payment for gas of greater importance that for the transmission service. However, the increase of low-methane gas has effect on the payment increase from 7,5 to 8,8%.

The increase of fuel gas, which is being sold by the gas distribution companies, is caused by the price increase of that fuel, purchased at PGNiG SA. The increase of an average price for gas supply for customers of the gas distributions companies will be lower than for direct customers of PGNiG S.A. and will amount to average 6,0% (depending on the tariff group and distribution company it will be pending between 4,0% and 8,8%). The lowest increase goes for those tariff groups, where the communal and households customers are cleared. For instance for the receiver of the high methane gas consuming gas for:

- meals preparation ( group W-1) - 4,0%
- meal preparation and water heating ( group W-2) -5,2%,
- meal preparation, water heating and flats heating ( group W-3)- 5,9%

For an average customer of those groups mentioned, a year payment will increase respectively by: 10 PLN, 40 PLN and 160 PLN , in case of amounts of the so far made payments, that are for those customers in a year as follows: 230 PLN, 770 PLN and 2.750 PLN.

At the same time on 14th December of this year the President of the Energy Regulatory Office has approved of the tariff for high-methane gas transmission service for the year 2007, settled by the company EuRoPol GAZ SA.

05.08.2008

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