Higher prices for CNG take effect today

Higher prices for CNG take effect today

The retail price of compressed natural gas (CNG) has been raised by 50 satang to 13 baht a kilogramme as of today, says the Energy Policy Administration Committee (EPAC).

A PTT attendant fills the tank of a CNG-powered taxi. The retail CNG price was raised by 50 satang to 13 baht a kilogramme, effective today. CNG for public transport also rose by 50 satang to 10 baht per kg. JULLADIT ONLAMUN

CNG for public transport also rose by 50 satang to 10 baht per kg.

Energy Minister Narongchai Akrasanee said the rise was part of the government’s restructuring plan to bring domestic fuel charges in line with global prices.

Natural gas prices have declined in line with global crude prices, which began to fall in the second half of 2014.

The natural gas price is 14-15 baht per kg, down from 16.50 baht calculated from its real cost last year.

The government plans to collect excise tax on retail CNG after its price is floated, out of fairness to other fuel consumers who have been paying tax to fund gas subsidies but do not use any gases.

The excise tax method will be applied to liquefied petroleum gas (LPG) as well.

Most CNG and LPG users are in the transport sector, whose big trucks and pickups leave a disproportionate amount of wear and tear on the roads.

Since Thailand launched commercial use of CNG, national oil and gas conglomerate PTT Plc, the sole seller, had subsidised the gas to the tune of 105 billion baht as of Dec 31.

With the heavy subsidy, the price of
CNG was fixed at 8.50 baht per kg for more than a decade. The price rose gradually to 10.50 baht in 2012 and 12.50 baht last October.

PTT has suffered losses of 20 billion baht a year from its CNG business.

The EPAC yesterday told PTT to prepare itself for cheap LPG under a scheme to help low-income earners.

The low-income group, mostly food vendors and households that use less than 90 kilowatt-hours of electricity a month, can buy LPG at a 33% discount starting on Monday.

The LPG discount price is pegged at 18.13 baht per kg, below the market reference price of 24.16 baht.

Energy policymakers estimate the low-income group at 7.5 million houses and shops nationwide.

The LPG subsidy could amount to 40-50 million baht.

The EPAC also approved a renewal of concessions for small power producers (SPPs) of the cogeneration type.

“We’ll renew concessions on the condition that those SPPs maintain current prices or lower the price of electricity,” Mr Narongchai said.

Separately, PTT chief operating officer Nattachat Charuchinda said CNG consumption had fallen by 200 tonnes a day from 9,000 tonnes last month.

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