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China cuts non-residential natural gas prices

(Xinhua) Updated: 2015-11-18 18:05

BEIJING - China's top economic planner is slashing the price distributors pay to producers for non-residential natural gas.

From Friday, non-residential natural gas prices at city gate stations will be cut by 700 yuan (110 US dollars) per thousand cubic meters, the National Development and Reform Commission (NDRC) announced on Wednesday.

The NDRC said it would allow industry players to raise gas prices by 20 percent based on supply and demand from Nov. 20, 2016, exactly a year after Friday's cut.

This is the second natural gas price cut in 2015 after the NDRC lowered gate-station prices for newly-added natural gas supply by 440 yuan per thousand cubic meters in April.

The move will cut costs for downstream industry players, promote fair market competition and stimulate the economy, said the NDRC.

It is estimated that the price cut will save downstream industries, including electricity generation, heating supply and the taxi industry, over 43 billion yuan annually.

The price cut will also help reduce energy use and emissions, the NDRC hopes.

Statistics from the commission show that China's natural gas consumption rose 5.6 percent year on year in 2014, a 10-year low. It continued to slump in the first half of this year, with a year-on-year growth rate of 2.1 percent.

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