20% Increase in Gas Tariffs

20% Increase in Gas Tariffs20% Increase in Gas Tariffs

Plans call for a 20 percent increase in gas prices for residential and commercial users in the present Iranian year (started March 2015) following President Hassan Rouhani's instruction, Hamidreza Araghi, managing director of the National Iranian Gas Company (NIGC) and the deputy oil minister said, Mehr News Agency reported.

"Revisions should be made to all 12 block tariffs for natural gas in order for high consumers to pay more, but not to put extra pressure on those with [justifiably] higher demands," Araghi said without elaboration. Under a block tariff scheme, users pay different amounts for different consumption levels.

NIGC says there has been no rise in gas prices this year, yet reports suggest that subscribers are now being charged more for the same. In addition, gas bills in January and February were issued by 20-25 day intervals in many areas including Tehran, though it often covered consumption for a period of 35-41 days. Some experts see this as a measure to cover up the rise in gas tariffs.

Araghi also stressed that new tariffs will not translate into higher income for the NIGC. Under a five-year plan that started in December 2010, and promoted as an “economic revolution” by former president Mahmoud Ahmadinejad, Iran began slashing the three-decade-old subsidies on sensitive energy and food items, replacing them with cash payments.

Members of parliament also have reacted to the extra burden households have to shoulder as gas price goes up. Voicing concern that Gas Company has raised the price in two stages, Seyed Naser Largani opines that the company should formulate a plan to set prices based on climate as well as the size of the family.