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ICE STATISTIQUE DES COMMUNAUTES EUROPEENNES - STATISTICAL OFF! DER EUROPAISCHEN N - ISTITUTO STATISTICO DELLE COM 'ESE GEMI DET STATISTISKE DEPARTEMENT FOR DE EUR IAUTES EUROPEEN THE EUROPE ,FTEN - ISTITUTO STA1 MUNITÀ EUROPEE kTISTISKE DEPARTEMENT FOR DE El -E F /E LLESSKABI ÎAL OFFICE OF THE EUROPEAN COMMUNITIES - STATISTISCHES AMT DER EUF .E COMUNITA EUROPEE - BUREAU VOOR DE STATISTIEK DER EUROPESE GE^ IROP/E1SKE F/E LLESSKABER - OFFICE STATISTIQUE DES COMMUNAUTE IMUNITIES - STATISTISCHES AMT DER EUROPAISCHEN GEMEINSCHAFTEN - I
OF THE EUROPEAN CO.MMUNITIES - STATISTISCHES Af rA EUROPEE - BUREAU VOOR DE STATISTIEK DER EUR( -FFICE STATISTIQUE DES COMMl •ES AMT DER EUROPAISCHEN GEMEINSCI TATISTIEK DER EUROPESE GEMEENSCHAPPEN - DET S' .'JE DES COMMUNAUTES EUROPEENNES - STATISTl EN GEMEINSCHAFTEN - ISTITUTO STATISTICO DEI I A P P E N - DET STATISTISKE DEPARTEMENT FOR Dl PEENNES - STATISTICAL OFFICE OF THE EUROPEAN C< UTO STATISTICO DELLE COMUNITA EUROPEE - BUREAt
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DET STATISTISKE DEPARTEMENT FOR DE EUROP/E ISKE F/E LLESSKABER
E EUROP/E ISKE F/E LLESSKABER - OFFICE STATISTIQUE DES COMMl COMMUNITIES - STATISTISCHES AMT DER EUROPAISCHEN GEMEINSCI IEAU VOOR DE STATISTIEK DER EUROPESE GEMEENSCHAPPEN - DET OFFICE STATISTIQUE DES COMMUNAUTES EUROPEENNES - STATIS" MT DER EUROPAISCHEN GEMEINSCHAFTEN - ISTITUTO STATISTICO DEI PESE GEMEENSCHAPPEN - DET STATISTISKE DEPARTEMENT FOR DE NAUTES EUROPEENNES -STATISTICAL OFFICE OF THE EUROPEAN COI FTEN - ISTITUTO STATISTICO DELLE COMUNITA EUROPEE - BUREAU ATISTISKE DEPARTEMENT FOR DE EUROP/E ISKE F/E LLESSKABER - Ol AL OFFICE OF THE EUROPEAN COMMUNITIES -STATISTISCHES AMT Dl
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OFFICE OF THE EUROPEAN COMMUNITIES - STATISTISCHES AMT DER EUROPAISCHEN GEMÊINSCHAFTEI MUNITA EUROPEE - BUREAU VOOR DE STATISTIEK DER EUROPESE GEMEENSCHAPPEN -DET STATISTISKI F^ELLF FICE STATISTIQUE DE NAUTFS EUROPEENNES - STATISTICAL OFFICI ) STATISTICO DELLE COMUNI" RTEMENT FOR DE EUROP/EISI — , rHE EUROPEAN COMMUNITIES A EUROPEE -BUREAU VOOR DE ST; )EPARTEf l LLESSKABER -OFFICE STATIS" YTISTISCHES AMT DER EUROPÂIÎ UTO STATISTICO DELLE COMUNITA EUROPEE - BUREAU VOOR DE STATISTIEK DER EUROPESE GEMEENSt ARTEMENT FOR DE EUROP/E ISKE F/E LLESSKABER - OFFICE STATISTIQUE DES COMMUNAUTES EUROPI
GAS PRICES
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DE EUROP/EISKE F4ELLESSKABERS STATISTISKE KONTOR STATISTISCHES AMT DER EUROPÀISCHEN GEMEINSCHAFTEN STATISTICAL OFFICE OF THE EUROPEAN COMMUNITIES OFFICE STATISTIQUE DES COMMUNAUTÉS EUROPÉENNES ISTITUTO STATISTICO DELLE COMUNITÀ EUROPEE BUREAU VOOR DE STATISTIEK DER EUROPESE GEMEENSCHAPPEN
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This publication is also available in the following languages: DE: ISBN 92-825-1139- FR: ISBN 92-825-1141- IT: ISBN 92-825-1142-
A bibliographical slip can be found at the end of this volume.
Reproduction of the contents of this publication is subject to acknowledgement of the source
Printed in Belgium 1979
ISBN 92-825-1140-
Cat.: CA-28-79-326-EN-C
CONTENTS
Page
I - INTRODUCTION
- Scope of the study and locations
- Units of measur?e«ent of energy
- Standard consumers
- Définition of the price levels recorded
11 II^ -^ UNITS OP VALUE
17 26 32 42 49 61 65 74 77
III IV V VI VII VIII IX X XI
P.R. OP GERMANY
FRANCE
ITALY
NETHERLANDS
BELGIUM
LUXEMBOURG
UNITED KINGDOM
IRELAND
DENMARK
a) Organization b) Régulations c) Taxes d) Household prices - tariffs e) Household prices - analysis f) Industrial prices - tariffs g) Industrial prices - analysis
81 XII^ -^ COMMUNITÏ^ COMPARISON^ AND CONCLUSIONS
Al STATISTICAL ANNEX
A3-A
A
-A
Tables 1 - 29 Prices "by location, households and industry 30 PPS conversion table and GDP price indices 31 - 36 International comparisons
!• IHTRODUCTIOH
The présent publication updates the previous study on gas prices 1970-1976,
published by B0H0STAT in 1 9 7 7 ^ • I* follows the same définitions, uses iden-
tical methods and has the same scope. It is therefore not necessary to repeat
in détail ail the explanations, to which the reader will be able to refer by
reading the above-mentioned publication»
The présent version sets out again only the gênerai ouline of the study and
indicates any changes made in the last couple of years.
In the chapterof each country, only the changes in régulations, taxation or
tariffs hâve been explained» The absence of any explanation means that there
has been no change since the previous study*
Although this publication is only an updating, the work involved proved to
be quite considérable and could not hâve been accomplished without the coopé-
ration of the gas companies which willingly provided information, explanations
and calculations* He should like to express particular thanks to them for
their understanding and the amount of work they put in on our behalf •
1 - Scope and locations
As in the previous study, the survey covers the nine Member States of
the Community and the prices were recorded in 29 town or conurbationss
- FR of Oermany i Hamburg, Hanover, Dusseldorf, Frankfurt, Stuttgart,
Munich;
- France * Lille, Paris^ ', Strasbourg, Marseilles, Lyons,
Toulouse{
- Italy i Milan, Turin, Oenoa, Rome, Haples;
- Netherlands i Rotterdam;
- Belgium s Antwerp, Brussels, Liège;
- G«D. of Luxembourg! Luxembourg city;
- Uhited-Kingdom s London, Cardiff, Glasgow, Leeds, Birmingham;
- Ireland t Dublin;
- Denmark : Copenhagen*
(1) Publication»^0 CA-22-77-120-2A-C English/French édition
Office for Officiai Publications of the European Communities, BP 1003
Luxembourg
(2) Paris région
Pour years are covered by this study :
1973 - 1976 - 1977 - 1978.
The priées are recorded and calculated in accordance with the tariffs, conditions and rules in force at the beginning of each year.
1976 is included as a link with the previous study, and also enabled any necessary corrections to be made to prices.
1973 serves as the base for the time séries, since it represents the last year before the oil crisis and its repercussions on priées*
1973 and 1976 are important years because they constitute links with the previous study, which was presented on the basis of Gigacalories, whereas the new statistics are compiled on the basis of Gigajoules, in accordance with légal obligations. This question of the change in unit of measurement of energy is dealt with more fully below.
2 - Units of measurement of energy
The years 1976 - 1978 represent a period of revision of units of measurement, leading to a number of changes and a certain amount of confusion. A Council Directive of 18 October 1971 (No 7l/354/EEC) drew up a list of prohibited and authorized scientific units of measurement. The date of application of this directive was deferred to the beginning of 1978, with a number of excep- tions for the United Kingdom and Ireland. In th.e field of energy, this direc- tive prohibits in particular the use of the calorie and its derivatives (thermie, therm, British thermal unit). The units still authorized for the measurement of energy are the Joule and the derivaties of the Watt, together with their décimal multiples.
During the period of transition and adjustment, we came across tariffs expres- sed in calories, BTU, kilowatt hours, Joules and cubic mètres. It was therefore necessary to convert ail the resulting prices into a single authorized common unit. In agreement with the United Nations and the International Gas Union, the Joule was chosen in the Community as the basio unit of measurement of energy.
This method of measurement départs from that used in energy statistics and for other sources of energyf where the net calorific value (NCV), which is closer to the energy that can actually be used by the consumer 9 is always used. For gas, the différence between gross and net calorific value is around 10$. Thus, the gaz prices shown in this study in GJ (GCV) can be converted into GJ (NCV) by applying a factor of 1.1.
3 - Standard consumers
The survey is based on the System of standard consumers, i.e. the prices are recorded for certain levels of gas consumption and under certain condi- tions of supplyf chosen as being représentative of the population of gas consumers. Thèse standard levels of consumption remain fixed from one year to the next and for ail the countriesf which is one of the primary conditions for spatial and temporal comparability of prices.
For domestic uses» the standard consumers are deiermined by the annual volume of consumption. Five standard consumers, coded D. to D. and defined as follows, hâve been taken i
ABNUâL CONSmPTION EQUIFMEHT
__ - 8*37 GJ (i.e. 2 326 kHh or 2 Ocal ) ) cooking and D 2 - 16.74 GJ (i.e. 4 652 kWh or 4 Ocal ) j water heating. ^ ~ 83#7 GJ (i.e. 23 260 kWh or 20 Gcal) | cooking, water heating D (^) 3 b - 125.6 GJ (i.e. 34 89O kWh or 30 Gcal) j and central heating, D 4 - 1047 GJ (i.e. 297 500 kWh or 250 Gcal) block central heating for at least 10 dwellings.
por industrial uses» a key point apart from the annual quantity consumed is the regolarity with whichsthe consumer withdraws gas f3?om the network. This is the concept of modulation (or load factor). The daily modulation indicates the number of days it would take to reach the annual consumption if the maximum were consumed each day. The hourly modulation indicates the number of hours it would take to reach the annual consumption if the maximum were consumed each hour. Thèse terms détermine the peaks in consumption or the maximum daily and hourly intake acheived by the consumer.
(l) For U.K. there is an additional standard consumer 33.49 GJ (9 300 kWh or 8 Gcal)
For example, in the case of a user who consumes 41 860 GJ a year, a load factor of 200 days means that the maximum daily intake is 209 0J (41 860/200), and a load factor of 1 600 hours means that the maximum hourly intake is 26 OJ (41 860/l 600 ).
Seven standard industrial consumers, coded Ij to 1^ and with the following characteristics, hâve been taken t
ANNUAL CONSUMPTION MODULATION
h
h
*3-l
*3-
J4-l
*4- h
OJ (i.e. GJ (i.e. GJ (i.e. GJ (i.e. GJ (i.e. GJ (i.e. GJ (i.e.
116 300 kWh or 1 l63000kWh or 11.63 kWh or 11.63 kWh or 116.3 kWh or 116.3 kWh or H 6 3 k W h or!
100 Goal) 1 000 Goal) 10 000 Gcal) 10 000 Goal) 100 000 Gcal) 100 000 Gcal) 1000 000 Gcal)
no modulation laid down 200 days 200 days 1 600 h 250 days 4 000 h 250 days 4 000 h 330 days 8 000 h 330 days 8 000 h.
It can be seen that certain standard consumers hâve the same modulation for différent volumes of consumption or, conversely, différent modulations for the same volume of consumption j the reason for this is to enable the effect of thèse conditions of supply on the level of priées to be obeerved. The higher the modulation (in days or hours) the moreregular the offtake of gas, thus enabling the consumer to obtain favourable priées.
Moreover, the modulation gives some idea of the use made of installations consuming gas. Thus, a very high modulation, e.g. of 8 000 hours, is obviously équivalent to an installation functioning practically non-stop, day and night, throughout the 8 760 hours in the year.
Pinally, the priées recorded in this study for standard industrial consumers relate to non-interruptible supplies, i.e. the seller of gas must supply the quantities demanded by the consumer (whose peaks are determined by the modulation laid down for standard consumers). In certain cases, there are interruptible contracts, under which the seller of gas can reduce the quan- tities supplied to the consumer at certain peak times when the network is overloaded. In return for this réduction of supply, the customer receives a priée rebate.
9
UNITS OP VALUE
Since 1973, there has been a period of monetary instability. National currencies hâve undergone fluctuations which hâve distorted both sta- tistics expressed in currencies and international price comparisons. New solutions are required for this new problem and are of particular relevance to this survey of gas prices.
Gas prices were first calculated and presented in national currencies whose real value - or purchasing power - dépréciâtes to a greater or lesser degree in the course of time because of the gênerai trend to- wards inflation. Thèse price measurement units are therefore not stable, in contrast to scientific quantitative units which hâve a fixed défini- tion and a constant value. A joule represented exactly the saine aaount of energy in 1973 as in 1978, whereas the Lira, for example, would not buy the same quantity of goods or energy in 1973 as in 1978. Consequently, the unit price of energy expressed in a national currency conceals a unstable ratio which is gradually eroded in the course of time. There is therefore a problem of comparability in time.
In addition, comparisons between countries of prices expressed in natio- nal currencies nécessitâte conversion into a common unit. There is no doubt that the usefulness of market exchange rates for this conversion is < clining, resulting in a problem of comparison between countries.
A solution therefore has to be found to this dual problem in the form of a common unit which will permit comparisons of price levels with the mini- mum of distortion between countries and periods of time.
In theory a number of différent units could be used :
- US dollar
- European Unit of Account (EUA)
- hour of work
- purchasing power unit
US DOLLAR
Since 1973, it has no charger been possible to consider the US Dollar as a stable référence unit as its exchange rates with the major world currencies hâve been floating since that date* This would not be too serious if the Dollar were not shaken by rapid and violent fluctuations. The use of the Dollar at the market exchange rate leads to large distortions. The fluctuations of the European currencies arre added to the Dollar^1 s own fluctuations which are the resuit of financial, political, économie and even spéculative phenomena outside Europe.
EUA
The European Unit of Account reduces the distortions mentioned above but does not eliminate them. In particular, the use of market rates to calculate the EUA produces fluctuations of the monetary parities which are influenced by international commercial transactions and capital movements. The latter hâve been particularly noticeable since 1973. The use of a unit influenced by in- ternational transactions therefore appears incompatible with the measurement of relative pices on internai markets. Calculations show that comparisons of price levels in EUAs give a picture very similar to that obtained using the Dollar.
Hour of work
The hour is a unit of time which has no intrinsic value. It must therefore be given an 'économie value' defined according to certain criteria. It is at this stage that the difficulties become apparent. Prom the outset, there are two confliciting viewpoints: an hour of work may be defined either as the average hourly labour cost or as the average hourly earnings of paid workers, sometimes with contradictory results. In both cases, the problems regarding scope and définition are difficult to solve in practice. Without entering into détails which would be beyond the scope of this survey, it may be said that the définitions are not comparable because of the différences in the
It is defined as follows : The purchasing power parity rate between the Purchasing Power Standard and each national currency expresses the num- ber of national currency units required to purchase in each country of the Community the same volume of goods and services as would be obtained with one Purchasing Power Standard in the Community. The PPS is fixed in such a way that the GDP of the European Community expressed in PPSs is identical to that expressed in European Units of Account (EUA). The PPS is therefore defined both:
- in terms of the basket of goods and services which formed the Community GDP for 1975 (économie définition);
- and in terms of the basket of currencies of the Member States fixed by décisions of the Commission and Council and calculated at the average exchange rates for 1975 (monetary définition).
The purchasing power of the PPS, defined using 1975 as the base year, varies from time to time according to the évolution of prices. The current PPS will therefore hâve a purchasing power equal to that of the PPS of 1975 divided by the GDP price index (base year 1975 « 100). There is therefore a relation- ship between the PPS and GDP and this is useful for économie analyses and especially for this study. It is possible to establish for any period under considération the purchasing power parity rates between the currency of each Member State and the current PPS relating to the total flow of goods and services which constitute GDP. The parities hâve been calculated from the basic parities of some 1 000 goods and services, comprising 700 products included under the final consumption of households, 200 under gross fixed capital formation and 100 under collective consumption of gênerai government. The conversion factors between national currencies and PPS for the years (^1973) f 1976, 1977 and 1978 which are covered by this study are given in Table No 30 in the Annex.
Prices in "constant" currency units
The table of conversion factors discussed in the previous chapter gives the chronological price séries in current PPSs.
Thèse current PPSs are comparable spatially but still contain distortions in time because of inflation in the nine member countries of the Community. Ad adjustment or 'deflator^1 must be used in order to ensure the stability of the currency unit in time.
This deflator has the effect of compensating for monetary érosion. The deflator chosen is the implicit price index of gross domestic product (GDP). This index is consistent with the définition of the PPS unit and thereby offers a positive advantage.
1973 has been chosen as the base year for this sur^ey. Using the GDP price index it is therefore possible to calculate a new chronological séries ex- pressed in the fconstantfcurrency units of a base year. The GDP price indices for each country in the Community are given in Table No 30 in the Annex.
The calculâtion is carried out as follows:
(1) The current prices in national currency in the chronological séries are divided by lOOth ôf the GDP implicit price index for each year under considération
(2) This deflated séries is converted into PPSs using the conversion factor for the base year 1973»
In this way, one obtains a chronological price séries in 'constant^1 PPSs using the base year 1973 and adjusted for inflation in each country.
Chronological price séries
On the basis of the description given above, the results of this survey of gas prices in the Community are présented using three chronological séries:
(1) A séries at current prices in the national currency of each country (Tables 1 to 29 in the Annex). This seriesallows régional comparisons within a country and comparisons in time at face value (apparent price). (2) A séries in current PPSs (Tables 31,32,33,34 and 35 in "the Annëx) which allows international comparisons of price levels at a given date.
III* FEDERAL REPOBLIC OF GEHMAHY
a) Organisation There hâve been virtually no changes in the gênerai organization of the gas industry over the past f ew years. It still has a three-level structure (production, importation and transmission, distribution), in which distri- bution is largely decentralized, being handled by a large number of compa- nies (approximately 475). For the most part, thèse companies merely resell gaB bought from transmission companies. However, four trends are emergingi
- the largest companies are increasing their dominance; thus, Ruhrgas AG, for example, accounted in 1977 for approximately 58 f» ot direct and indi- rect supplies of natural gas to the domestic market*
- The proportion of natural gas is continuing to increase, to the détriment of manufactured gases. In 1977. the quantity of natural gas available for the market totalled 1 790 000 TJ, compared with a figure of only 44 500 TJ for works gas. It is for this reason that ail the prices re- corded in this updated study relate solely to natural gas.
- Imports of natural gas are diversifying, with an increase in supplies from the USSR and the Norwegian zone of the North Sea (in 1978 imports of natural gas were broken down as follows t 59 % from t h e^ Netherlands, 24 # from the USSR and 17 % from Norway).
- The interconnection of the natural gas transmission grid has improved still further, thus providing better links between the various sources of supply.
b) Régulations
There hâve been no changes in législation. Tariffs hâve to be drawn up and published for small customers only (standard consumers 1^ and Dg in this survey). For the remainder, the prices are determined by spécial oontracts or by private treaty; this makes it difficult to obtain the relevant data*
PR of Oermany
c) Taxes
Gas sales are subject to only one taxf namely value added taxf the initial rate of 11 % being increased to 12 % with effect from 1 January
- Thèse rates are levied on the price net of tax. Value added tax is déductible in the case of industrial and commercial consumers.
d) Household prices - tariffs
As a resuit of the decentralization of gas companies and the freedom accorded to them to set prices, tariffs vary from city to city.
Two examples will serve to illustrate the tariff System applied to small customers, in accordance with the statutory provisions. Thèse are two- part tariffs*
In Hamburg, three basic tariffs are offered :
prices in force in January I
monthly standing charge commodity rate per kWh
tariff for small customers (Kleinverbraucher- tarif)
IM 2.
Pf 9*
basic tariff 1 (Grundpreis- tarif 1)
m 8.
Pf 5*
basic tariff 2 (Grundpreis- tarif 2 )
IM 13.
m 4.
Basic tariff 1 is the most favourable for standard consumers D and D and has therefore been used in this study.
Above thèse levels of consumption, there are spécial or standard con- tracts (Sondervertrâge) covering both individual and block central heating
