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Beijing pays the price for limited supply options

Beijing’s local gas distributor currently has to hike non-residential retail tariffs considerably for winter to keep seasonal gas demand in check, but new supply sources starting up in coming years will allow it to offer more affordable gas Beijing’s local gas distributor currently has to hike non-residential retail tariffs considerably for winter to keep seasonal gas demand in check, but new supply sources starting up in coming years will allow it to offer more affordable gas.
By Tang Tian 9 May 2019 Asia Pacific / Exploration & Production 0 34202
The Beijing skyline. (Gazprom)

The key issue: The wholesale price of pipeline gas is 9% lower in Beijing than it is in China’s financial hub of Shanghai, but non-residential gas users in the Chinese capital pay higher retail tariffs because there is not enough gas-on-gas competition in the city to keep the cost of supplies down.

Interfax analysis: Beijing is working on expanding its range of gas sources to enable the city’s distribution monopoly, Beijing Gas Group, to price volumes more affordably during winter. 

At present, high prices for power generation...