The Petroleum and Natural Gas Regulatory Board (PNGRB) has simplified the gas pipeline tariff structure in order to make the fuel more affordable for distant users. In addition, it also aims at attracting investment from gas transmission companies for setting up new gas infrastructure in the country. The unified tariff structure will be applicable on the pipelines that form the National Gas Grid, increasing the transportation charges paid by users near the source by 20-30 per cent and reducing the tariff for consumers located in the hinterland.
As per the notification, the unified tariff shall be determined by PNGRB in respect of the national gas grid system for each financial year before the start of such financial year. The board has now notified a two-zone tariff structure wherein the first zone will be 300-km from the source of gas while the second zone will be beyond that. According to the PNGRB, the charges for the first tariff zone will be 40 per cent of the tariff for the second zone.
The new tariff structure is aimed at creating a single gas market in the country. At present, the tariff is levied in proportion to the distance transported, resulting in consumers in the hinterland paying higher charges as compared to the ones located closer to the source.