(Adds details of the new regulation, comments from the NDRC)
BEIJING Oct 12 China's National Development &
Reform Commission (NDRC) said on Wednesday it will allow for a
net 8 percent yield on investments in natural gas pipelines,
part of an earlier pledge to lower transportation costs for the
cleaner burning fuel.
The new yield, down from previous rates of 10 to 12 percent,
applies to pipelines with a utilization of at least 75 percent,
the state planning agency said.
Yields will be lower than 8 percent when utilization drops
below 75 percent, it said.
In a Q&A published on its website, the NDRC said "downstream
consumers have limited ability to carry the burden from
operators asking for higher yield."
The new regulation also confirms a previous proposal from
the agency that introduced a new formula for transportation
costs and a scheme to lower prices to boost natural gas
NDRC also said it plans to adjust natural gas pipeline
transportation cost once every three years.
The new policy takes effect from Jan 1, 2017, it said.
The announcement of the new regulation comes two weeks after
the NDRC said pipeline operators would be able to hike natural
gas prices for bulk consumers by a maximum of 20 percent this
winter as demand surges.
(Reporting by Meng Meng, Chen Aizhu and Beijing monitoring
team; Editing by Tom Hogue)