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Our Bureau

New Delhi , June 6

GAIL India has sought a market determined tariff fixation system for natural gas transmission through the grid pipelines.

In a statement the authority has said that in the recently announced gas pricing order, the Government has approved a market related pricing mechanism for gas sold to customers other than those in the power, fertilisers and transportation sectors, the Agra-Ferozabad and small consumers.

The principle of adopting a market determined price of gas is a paradigm shift in the domestic gas industry. In line with this principle, it would be appropriate to consider adoption of a market determined transmission tariff methodology for transportation of gas also, GAIL has said.

The statement points out that the tariff for the existing gas grid pipeline in the country has already been fixed by the Tariff commission. Taking the initiative to understand global practices in tariff fixation methodology, GAIL conducted a study of international practices adopted by developed gas economies such as the US and UK.

The findings were shared with the Commission to aid in deciding and recommending a robust tariff methodology for grid pipelines in the country the statement points out. The practice followed by the Planning Commission has also been shared with the Tariff Commission.

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