Un-accounted For Gas (UFG) is an issue that is related to the metering of gas and management commitment to accurately and completely reconcile system gas inputs-outputs. Internationally UFG is also known as LAUF Gas (Lost and Un-Accounted For Gas) owing to contributing factors provided in Table-1:

 

UFG Contributing Factors

 

Internationally, it is recognized that gas consumers should only pay for unavoidable / justifiable UFG losses that are determined (through measurement based reconciliation) as part of prudent and efficient operations of utility companies. Utility companies are allowed a UFG Rate Rider (in-kind or in gas tariff) by regulators while determining their revenue requirements.

 

In Pakistan a recent UFG Study commissioned by OGRA (July 2017), sheds light on UFG issues related to SNGPL and SSGCL. The study identified[1] as follows:

 

  • Internationally, measurement based mechanisms are used to regulate and control UFG as it is primarily associated with data and meter errors.
  • The existing measurement mechanisms at Sui Companies are not adequate enough to provide UFG details appropriately at contributing factors level.
  • With the existing setup (in SNGPL and SSGCL) it is not possible to identify actual gas losses associated with each contributing factor in UFG.
  • Sui Companies currently exhibit break up of UFG into contributing factors based on assumptions and estimates.

 

The above referred study suggested[2] development of a UFG Control Framework through improvements in four activities in Sui companies. In consultation with Sui companies’ leadership and OGRA, the study devised KPIs and KMIs for monitoring these activities. In the study it is suggested that OGRA should monitor performance of Sui companies and achievements of KPIs vis-à-vis agreed KMIs periodically for:

 

  • Network measurement and visibility;
  • Network rehabilitation;
  • Theft control; and
  • Research & development.

 

The entire gas supply chain is a complicated one as it spreads from gathering lines (wellhead to processing plant) to consumers and includes gas withdrawal from and into wells connected to underground storages.  Irrespective of any UFG benchmarks available from various energy regulators worldwide, it is unprecedented to have UFG in the range of 10 – 15% as reported recently by Sui companies in Pakistan. Data compiled by Energy Engineers Network indicates that UFG benchmarks for transmission & distribution systems (combined) are generally 0.2 – 2.6% worldwide with exception of Australia where it reaches 5.3%.  Figures for UFG allowed by regulators in various countries as part of tariff determination / allowed revenue requirement are given below

 

Country

                                       Allowed UFG

 

                     Transmission

              Distribution

India

                 NIL allowed

               NIL allowed

Ukraine

                             2.34% (combined T&D)

Pennsylvania (USA)[3]

                                3% (combined T&D)

US average[4]

                                 1.02% (combined T&D)

Australia[5]

             0.1 – 0.3%

               4 – 5.3%

 

Actual gas losses in Western Europe[6]

Country

Combined T&D Losses

Denmark

0.2%

Poland

0.4%

Austria

0.5%

Bulgaria

0.5%

Slovakia

0.6%

Germany

0.6%

Spain

0.7%

UK

1.2%

France

1.2%

Romania

1.5%

Hungary

1.7%

Sweden

2.5%

Ukraine

2.6%

 

 

[1] Page-9 of Study conducted by KPMG Taseer Hadi & Co for OGRA under contract Ref.OGRA-93791/201

[2] Page-10 of Study conducted by KPMG Taseer Hadi & Co for OGRA under contract Ref.OGRA-93791/201

[3] PUC website link – http://www.puc.state.pa.us/about_puc/press_releases.aspx?ShowPR=3142

[4] AGA Report – https://www.aga.org/globalassets/news–publications/fois/public/fois-2018–06-eia-lauf-2016-data.pdf

[5] Essential Services Commission, Australia – https://www.esc.vic.gov.au/electricity-and-gas/tariffs-and-benchmarks/unaccounted-gas-benchmarks

[6] Website link – http://zachmann.be/wp-content/uploads/2014/06/TN_02_2015_accounting-for-gas-distribution-losses.pdf

 

 

1 thought on “Unaccounted For Gas – A regulated crime in Pakistan

  1. As the article covers the factors from well head to burner tip therefore provides useful guidelines for downstream companies for transmission and distribution.No doubt measurement errors and leakage play major role in distribution losses .Having involved in UGLD activities in distribution network of SNGPL ,a complete scan through laser detection has revealed an average 2 leaks km till 2016.We have started new cycle as per KMis and up till 2018 we have been successful in reducing it to 1.25leaks/km.Work on meter replacements and vigilance against theft is also in progress as per kMIs.