- Independent Journalism From Today's Armenia
 January 16, 2004 

Price Hike for "Blue Flame": Natural gas rates to increase in March

About 186,000 dwellings have had gas restored.

The Armenian Natural Monopolies Commission has approved a 1-cent raise in the price of natural gas.

At the request of the monopolist gas company "HayRusGasArd" a Russian-Armenian JSC, beginning March 1, the price of gas will go from 51 drams (about nine cents) to 59 drams (10 cents) per cubic meter.

Large-scale consumers who buy more than 10,000 cubic meters per month will not be subject to the price increase. And it is that stipulation that disappointed the gas company as it slowly works to restore natural gas service throughout the republic.

According to director of the company, Karen Karapetyan, the gas provider entered the new year with a loss of 10 billion drams (about $17.5 million). He says individual subscribers account for less than 20 percent of customers, but says that the slight increase will produce revenue for continue installations throughout Armenia.

It will take at least four more years to return gas service to Soviet-era levels.

Currently, some 186,000 sources use natural gas. By 2008, the company hopes to have renovated pipes and delivery systems to restore Armenia to its Soviet-era reliance on natural gas, when it had 484,000 subscribers.

Last year the company imported about 1.2 billion cubic meters of gas, 82 million cubic meters more than the previous year.

Officials at "HayRusGasArd" say that the tariffs could be reduced if Armenia consumes at least 1.6 billion cubic meters a year.

While the company considers the price increase insignificant, the consumers who use blue fuel have calculated that under the new tariffs they will have to pay about 2,000-3,000 drams ($4-5) per month in winter.

Seda Arakelyan who has a three room apartment in Yerevan says her family of five uses about 200 cubic meters of gas during cold weather, for which she pays about 10,000 drams (about $18).

Natural gas costs less than firewood or electricity.

"The natural gas lightens our family life, as now we can cook, bath and heat using natural gas. I agree that the change in price is not so dramatic, but the Government should take into account that the additional two or three thousand drams people have to pay this year will affect many families, including mine, especially in winter time," Arakelyan says.

The Chairman of the Union of Consumers Rights of Armenia Armen Poghosyan says that they have already had many phone calls from citizens upset over the coming increase.

The consumer rights group has appealed to the commission to exempt socially vulnerable families from the price increase.

Talk of a price increase started in October, but were dismissed by Parliament speaker Arthur Bagdasaryan as rumors. Bagdasaryan said the ruling coalition would strongly oppose any increase.

No objection has been filed, however, as more attention is focused on upcoming action that could see the price of water increase by 200 percent.

According to Agnes
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