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February 20, 2019

47,000 consumers of Sui Northern get billsinflated by 200-300pc

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February 20, 2019

ISLAMABAD: The fact finding committee on inflated gas bills, December 2018, has found that 47,000 gas consumers of Sui Northern received bills with huge increase by as much as 200-300 percent because of the 7 slab gas pricing formula with 10-143 percent growth in gas tariff imposed by govt.The committee has recommended to limit the 7 slab gas pricing formula to 5 slab structure with rationalised tariff. The committee also found that the pressure factor caused an increase in the bills and at least one out of every four consumers faced the hike due to the pressure factor, a senior official privy to the development confirmed to The News.

The Additional secretary Sher Afgan who is also chairman of the fact finding committee and is also spokesman of Petroleum Division said the report will be submitted to Cabinet Committee on Energy today (Wednesday). However he refused to share the findings of the committee saying he himself is the head of the fact finding body and sharing of the report is not ethical. However, it was also noted, according to the official, that on a single gas meter, two to three families thrive and their consumption increased in winter particularly in December due to which they graduate to the next slab of higher prices and excessive bills. The Prime Minister Imran Khan is also very sensitive to the issue of inflated gas bills and wanted an inquiry into the inflated bills phenomenon.

The committee comprising, its head Additional Secretary Mr Sher Afgan, was notified on February 4 with members consisting DG Gas, DG LG and General Manager Billing (Sui Northern) but later expanded with 7 members comprising Additional Secretary Mr Sher Afgan, DG Gas, DG LG, General Manager Billing (Sui Northern), General Manager Audit (SN), CFO Inter State Gas System and CFO Sui Norther. The committee had, the official explained, the mandate to look into excessive billing in view of the increased gas price introduced by the government and must seek the reason and justification of the excessive domestic gas bills. The Committee was to also look at the new slabs and suggest any rationalization. The committee was also to look into the billing mechanism including the observation of 30 day billing period, timely reading of the distribution of the bills in addition to other aspects of the billing system and procedure and suggest improvements.

The official said that the government will be asked in the next CCOE meeting to reduce the gas slabs to 5 with rationalization in gas prices. The official said first two slabs would be converted to one slab with price of Rs127 per MMBTU and last two slabs will also be recommended to be also reduced to one slab.

The official said currently the price for the first slab of domestic consumers of up to 50 cubic meters per month, stands at Rs121 per MMBTU. The second slab category starts from 51-100 cubic meters and its price is Rs127 per MMBTU. But because of severe cold the gas consumers consuming 51 cubic meters in one month have paid Rs127 against the units staring from 1 to 51 units and they were not be provided the first slab benefit of Rs121 per unit.

Similarly, the gas consumption falling into the third slab category of up to 200 cubic meters gas price becomes Rs264 per unit (MMBTU). This means that the end consumers who only use 101 unit in a month paid the price of Rs264 on all units of 101 units. And when the consumption increases up to 201 units then the gas price for all units changes to Rs 275 per unit starting from unit 1 as the price of gas price for up to 300 units (4 slab consumers) stands at Rs275.

The main surge in the gas price by the PTI government started from 5 slab domestic consumers at the price of Rs780 per unit for those consuming gas up to 400 cubic meters. This means that when the consumer using 301 units falls in the 5 slab category they pay a price of Rs780 against every unit staring from unit 1. The most vulnerable gas consumers who used up to 500 cubic meters of gas and over 500 cubic meters fall under slab 6 and 7 and the price of gas for them is at Rs1,460 per MMBTU which is at par with RLNG price. This means the consumers’ using 401 cubic meters falls in slab 6 category and pay Rs 1,460 per unit staring from unit 1 to unit 401.

The official said since in the first two slabs, the gas price difference stands at 6 per MMBTU. So the committee has recommend converting the first two slabs into one at Rs127 per MMBTU. The last 6 and 7 slabs should be converted into one slab of Rs780 per unit. The committee has recommended that the price of 4 and 5 slabs should be somewhere at Rs500 per MMBTU.

The Sui Northern has 6.7 million total consumers out of which 47,000 consumers which is 0.7 percent of the total consumers got inflated gas bills in December 2018, by 200 to 300 percent increase. The official said the gas consumers use two type of gas meters; one is domestic meter whose cost is $15-20 price and other is commercial cost of $30. In the domestic meter, it is not possible to check the pressure factor with monometer on a manual basis every month, so the pressure factor of 15 cubic meter is imposed on the usage of 100 cubic meters causing surge in gas bills. However, in commercial meters worth $30 have the capacity to read the gas price with the pressure factor. So reading the commercial meters is very easy. The official said if the pressure factor is not imposed, then volume of UFG (unaccounted for gas) will increase and the losses of the company will further increase.

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