Gas pipelines set to compete on price - Financial Express

Gireesh Chandra Prasad

Posted: Wednesday, Dec 29, 2010 at 0149 hrs IST

The Petroleum and Natural Gas Regulatory Board (PNGRB), the downstream regulator in the energy sector, has proposed to give gas pipeline operators freedom to compete in overlapping areas so that consumers benefit by way of lower tariff and softer gas prices.

Now, pipeline operators like Gail India and Reliance Gas Transportation Infrastructure do not have that freedom and have to charge the regulator-fixed tariff without a premium or discount.

PNGRB has now proposed that in overlapping areas, say, Uran in Maharashtra, there should be pipeline-to-pipeline competition, which is good for consumers of gas including commercial establishments, hotels and auto CNG consumers. The regulator wants pipeline operators to charge less than the tariff ceiling fixed by it without discriminating among consumers.

The decision would impact the gas market more decisively when a well-developed natural gas pipeline grid is in place. The beneficiary, of course, would be the consumer. “If pipeline operators...

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