Gas Export Pricing & Alternative Gas Export Routes (Central Asia case)
Article from: OGEL 3 (2011), in Pipelines
Pricing for non-renewable energies: economic & legal background
There are three key gas pricing mechanisms on non-renewable energy resources that exist worldwide: (i) cost-plus (net-forward) pricing, (ii) (net-back) replacement-value-based pricing, and (iii) exchange (commodities) pricing. Cost-plus (net-forward) pricing is aimed at extraction by the host-state of Ricardian rent (long-term difference between cost & marginal cost, see Figure 1) and is utilized at the physical energy market where the traded item is a unit of physical energy. The price calculated by this method equals to consecutive sum-totals of all elements of ...