The new tables already in force do not yet include the imminent increase in the cost of distribution

Through ten resolutions published this Wednesday in the Official Journal – one for each distribution company – the Government formalized the increases that will be applied to gas prices from March as well as the pending increase that will be defined for the month of May (which will apply to the distribution service).

The new tariff schedules must be applied by the distribution companies Metrogas, Camuzzi, Gasnea, Naturgy, Redengas, Litoral Gas, Gasnor, Distribuidora Gas del Centro, Distribuidora Gas Cuyana. According to official sources, the average increase that will be passed on to future user bills is 15% and corresponds to the price of gas before it enters the transport system (PIST), one of the components of the final price of the bill. .

The National Gas Regulation Entity (Enargas) has ordered a 28% increase in gas prices starting this Wednesday, with a variable impact on the final tariff of 15% on average. This percentage varies according to the tariff segmentation by economic capacity of the users: 21% on average for level 1 users (high income) and 19% for level 3 (average income, depending on whether the corresponding consumption ceiling is exceeded or not) . Meanwhile, Tier 2 (low income) users will not get a raise.

However, the new tables already in force do not yet include the expected increase in the cost of distribution, which should be published in the coming days. Of the total bill, the price of gas represents 57% of the total and distribution almost 12% of the final price.

Tier 2 (low income) users will not have a Tier 2 raise
Tier 2 (low income) users will not have a Tier 2 raise

According to the presentation made by the distribution companies during the public hearing where the future increases for the sector were discussed, distribution earnings rose well below all indicators in the economy. It was 80% from December 2019 to December 2022. A third compared to increases in inflation or wages, for example.

On the other hand, in the resolution, it was considered “opportune and opportune” to defer the application of the calculation of the DDAs (Accumulated Daily Differences) until the approval of the tariff schedules resulting from a Comprehensive Rate Review (RTI), since in most cases they reach very high absolute values. The cumulative daily differences come from the difference between the actual purchase price by the distributors and the value of the PIST gas recognized in the tariffs.

In the country there are some 9.2 million users of the Natural Gas service through the networks. According to the tariff segmentation which started to be applied last year, there are 3.4 million users who were enrolled in the higher income segment or who have not completed enrollment (Tier 1) who no longer receive subsidies and pay the full price.

Meanwhile, other 3.4 million were enrolled in the low-income sector (Level 2, which maintains subsidies) and finally some 2.3 million were classified in the middle-income sector (level 3). However, from the Secretary of Energy, they pointed out that there are 33% of users who today belong to the highest income segment but qualify to apply for subsidies. In this case, the percentage could be reduced to 24%.

Despite the fact that the data is cross-referenced between State services, the segmentation cannot be done compulsively and it is the user who must request that the subsidy be maintained, as established by the regulations.

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