Recently, natural gas pipeline price reform policy landing. The implementation of the measures will help stimulating social capital investment in pipeline construction, promote pipeline industry open to the third parties, and accelerate the natural gas market reform. It is expected that the pipeline transportation fee will to be reduced in the future, which will help reducing the cost of downstream gas purchaser, and ultimately allow the users to enjoy the gas price cut dividends, as well as promoting the natural gas industry healthy development.
On Oct 12th, 2016, the NDRC issued "Natural Gas Pipeline Transportation Price Management (Trial)" and "Natural Gas Pipeline Transportation Pricing Cost Supervision Method (Trial)" after soliciting opinions from the community and improved. The measures will be effective from Jan 1st, 2017 and last for 5 years.
The natural gas pipeline in these measures referred to across provinces gas pipeline, i.e. trunk pipeline network, mainly owned by PetroChina, Sinopec, CNOOC. The two measures defined that the gas pipeline transportation prices to implement the mechanism of government pricing, the pricing department of the State Council in charge of formulation and adjustment. The measures also pointed that, the provincial price department can manage the short-distance gas pipeline transport prices in the province and develop the province's short-distance gas pipeline transportation price management measure referring to the above two measures.
Compared with the existing gas pipeline transportation price management, the new regulation has three main changes. First, defined a new pricing method, instead of the original principle of supervision pipeline transportation price by projects financial evaluation, the new principle is "permit the cost plus a reasonable profit". Second, adjusted the price supervision objects, the object is no longer a single pipeline but the pipeline companies, the mechanism of separate pricing for each pipeline will be abolished and turn to pricing for different enterprises. Third, adjusted the price announcement mode, the mode changed from specific price levels publishment by the State to audit pipeline tariff price rate (CNY/m3•103km) by the State, and the enterprises to estimate and announce the specific price level from the intake port to the outlet.
Considering that the depreciation period is extended from 14-20 years to 30 years, the allowable cost will be reduced, because this occupies a large proportion in the allowable cost. At the same time, the permitted yield will be unified to 8% from the old range of 8%-12%, but still higher than the national debt rate of 3%-4%. The implementation of the measures will help stimulating social capital investment in pipeline construction, promote pipeline industry open to the third parties, and accelerate the market reform of natural gas. It is expected that the pipeline transportation fee will to be reduced in the future, which will help reducing the cost of downstream gas purchaser, and ultimately allow the users to enjoy the gas price cut dividends, as well as promoting the natural gas industry healthy development.
This year, the state introduced a series of policies to strengthen the natural gas pipeline transmission and distribution price management. Several months ago, the NDRC issued the notice on "Strengthening the Local Natural Gas Pipeline Transmission and Distribution Price Regulation to Reduce the Cost of Downstream Users " (NDRC[2016] No.1859), to build the whole network gas price monitoring system from long-distance pipeline to the province short-distance transport pipeline, and then the city gas distribution pipeline.
Next, the state will actively promote the implementation of policies, and further improve the relevant regulatory policies. First, in 2017 will be fully launched pipeline transportation enterprise pricing cost supervision and examination work, reasonably determine the cost of pricing, development and adjustment of natural gas pipeline transportation prices. The second is to urge local governments to effectively strengthen the monitoring of transmission and distribution prices, and rationally formulate and adjust the local natural gas pipeline network transmission and distribution prices. Thirdly, according to the operation of the two measures in practice, the two "measures" should be perfected at the right time, combined with the development of the domestic natural gas market, and actively carry out the research work of "two systems" Mature launch, and constantly improve the price of natural gas pipeline transportation management science and rationality.
