Gas prices should increase by about 9.5% in April
March 24, 2010
Gas prices in France should increase by about 9.5% in early April, Reuters said a source familiar with the matter, confirming a report published the same day by the daily Le Figaro.
The Regulatory Commission of Energy (CRE) will meet Thursday morning to discuss the proposed rate increase of GDF and Suez will wake in a binding opinion on the subject, also said a spokesman for the administrative authority , without specifying the proposed increase.
The energy group for its part has refused any comment.
Asked if the increase would be 9.5% as reported by Le Figaro, the source familiar with the matter said: "It is an evolution of that order."The increase should take place" on 1 or 2, at least at the beginning, "she added.
GDF Suez, which the state owns almost 35% stake, had announced in late February that "the costs of public distribution of natural gas (would) averaged lower (April 1) to that of 1 January 2009, and this despite higher crude oil prices by 50% during the year 2009 ".
The group had also recalled that "the only tariff movement occurred in 2009 (had) been lower rates of 11% on average, applied from 1 April."
An agreement signed in late 2009 between the government and GDF Suez has changed the procedure for revision of gas prices.
The CRE, which had hitherto an advisory opinion, issued a binding decision now while the Ministry of Economy, which was formerly the upper hand in setting prices, does most of the elements of annual cropping.
"Blow"
The formula used by GDF Suez, reviewed quarterly, provides that the price of gas is indexed to oil.
The establishment of a new procedure was, according to financial analysts, help depoliticize changes in gas prices in France, which are regularly the subject of controversy between the government and consumer groups.
Referring to the possible increase of 9.5% is expected, UFC-Que Choisir spoke Wednesday in a statement "a blow doubly unjustified", saying that the increase related to infrastructure and marketing was "the consequence of lax regulation "and the related costs of supply was the result of a" rate plan expired.
"In effect, the gas market has evolved substantially and GDF Suez has renegotiated some of its long-term contracts in the deindexing oil prices.It is therefore urgent that the formula exclusively pegged to oil prices would be reviewed, "said the association.
The UFC-Que Choisir has also requested the State "a real mastery of tariffs of infrastructure" and "revision of the formula intended to reflect the supply costs of GDF Suez to ensure that the price paid by consumers reflects the economic reality. "
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