Butkevicius: heating prices will not grow next year if gas capacity model is applied

Wednesday, 21 October 2015

Prime Minister Algirdas Butkevicius says that heating prices will not grow from next year if gas capacity model is applied, whereas in Vilnius they would decrease by 5 percent.

"Gas capacity model was submitted because we started consuming less gas, but new projects transferred infrastructure costs as a separate gas price component. If less gas is consumed, then infrastructure costs will grow for gas consumers. The Government has found a model how to share the increased cost between all gas consumers in Lithuania," the prime minister told the radio Ziniu Radijas on Thursday.

According to Butkevicius, if gas capacity model is not adopted, gas price will grow for some people. However, the prime minister believes the law will be passed.

"Heating prices for people living in Lithuania will not increase once the law is adopted from 1 January 2016. There even are calculations how, for example, in Vilnius heating prices would fall by 5 percent," said the head of Government.

When asked what to do about the Liquefied Natural Gas (LNG) Terminal and perhaps it should be "conserved", the prime minister said that it has to be used on the regional level.

"The terminal was designed much earlier, now it is too late to discuss whether it is too big or too small. We know that gas demand in Lithuania is slightly above 2 billion cubic metres. The terminal's capacity is 4 billion cubic metres. We understand perfectly well that the terminal has to be used regionally and this is being done," said Butkevicius.

As reported, the Lithuanian Parliament returned to the Government the law on the LNG Terminal for improvement.

The proposed legal regulation stipulated that every natural gas user, who is receiving gas directly or indirectly from the natural gas transmission system located in the territory of Lithuania, would have to pay additional component.

Under the suggested method of regulation, the constant operational costs of the LNG terminal and the costs of the supply of the minimum required quantity from the LNG terminal would be shared by all users of natural gas in proportion to the benefit they receive.

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