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City gas distribution companies worried about competition but third party access will remain a problem
Nov 24: City Gas Distribution companies seem quite worried about competition using their infrastructure to market PNG and CNG once their exclusivity periods come to an end.
8The worry emerges from the regulator's attempt to fix third party access rights and transportation rates for CNG and gas shortly.
8There are worries that PNGRB may try and benchmark costs on normative basis without taking into account actual costs, particularly the high cost of land acquisition in some cases
8The post tax rate of return at 12% set by the regulator has been found to be too low, and most companies want the return raised to 14 or 15%
8There are worries that benchmarking of costs will not take into account the additional capex of last mile connectivity of domestic PNG networks
8Those who think of making an entry into lucrative city gas markets through third party common carrier arrangements must be careful before going in, because existing entities are capable of raising non-tariff barriers or using the legal system to hold up connectivity
Click on Reports for a summary of all the views that have poured in on the PNGRB;s draft regulations on third party transportation rates in CGD networks


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