Gaz de France announces commercial measures at a time of rising natural gas prices

Resumen de Prensa            Enervía, jueves, 20 octubre 2005

FUENTE: GdF


Gaz de France today submitted a proposal to raise the price of natural gas from 1 November 2005. The proposal is on line with the ministerial order of 16 June 2005, setting out the multi-year framework for movements in natural gas prices.
The exceptional increase in prices of petroleum products over the past six months would be passed on according to the agreed formula. Gaz de France buys over 95 per cent of its supplies from international producers, and its purchasing costs are pagged to the prices of these products as elsewhere in Europe.
On this basis, and pending the agreement of France's energy regulator (C.R.E.), prices would rise by €4.4 per MWh, an average 12 per cent increase for residential customers using gas for heating.

Gaz de France underlines the exceptional nature of the current energy situation. The price of petroleum products has risen by more than 60 per cent since the start of the year.
The Group recognises the major consequences of this situation and acknowledges its commercial responsibilities, particularly towards residential customers using gas for heating. It has therefore decided to significantly limit the impact of these price rises for the coming winter. At the same time, the Group is taking steps to protect its most vulnerable customers.

Gaz de France is therefore implementing three key measures:

1. A commercial rebate equivalent to 30 per cent of the subscription price for residential customers with gas heating (B1 tariff) over the entire winter.
This measure, applicable between 1 November and 31 March, represents a total discount of €15 before VAT for the seven million residential customers with natural gas heating. For 3.5 million customers, the increase will amount to less than €2 per month, before VAT. For 1.5 million customers (those consuming less than 8,200 kWh), the increase will be eliminated.

2. Founding of the "Gaz de France energy solidarity fund" with €10 million in resources.
This fund is a new initiative designed for the most vulnerable customers. It will help those who have the most difficulty in paying their bills. Their gas supply will be maintained throughout the winter provided that they take the necessary steps to receive assistance from the housing solidarity fund.

3. New financing to replace boilers and thus to improve energy efficiency.
As part of its customised Dolce Vita package, Gaz de France is offering financing for customers who wish to renew or renovate their individual heating systems, a move that could cut their energy bills by up to 25 per cent. Gaz de France is putting in place improved financing proposals for the replacement of old boilers. Gaz de France also pointed out that current billing mechanisms mean that the impact of price increases are deferred. For instance, customers paying by monthly debit due in May will see the effect of the impact only in June. In the same way, a customer billed every six months with payment due in February will see the impact of the increase only after four months.


These measures will strongly limit the impact of the rise in natural gas prices, or even offset it completely, for residential clients.
Against this exceptional backdrop, and with winter approaching, Gaz de France is demonstrating its efforts to serve customers as part of its public service commitment.
These commercial measures, which will cost close to €120 million over 2005 and 2006, should have no impact on the Group's profit guidance published by the Group.