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Local governments allowed to raise heating prices

(Xinhua)
Updated: 2008-09-17 15:51

Three Chinese ministries on Tuesday issued a joint notice, allowing local governments to raise heating prices in response to high coal prices.

The notice also allows local governments to adopt preferential policies or reduce taxes to help coal-fired heating firms the cost of coal, said the circular, which was published by the National Development and Reform Commission (NDRC), the Ministry of Housing and Urban-Rural Development and the Ministry of Finance.

Chinese coal-fired heating firms were expected to face financial hardships this winter as coal prices doubled while heating prices remain unchanged.

The NDRC said public hearings must be held before heating prices can be raised. It also required local governments to take care of low-income families with subsidies.

According to the joint notice, the Ministry of Finance and the State Administration of Taxation will continue implementing their preferential tax policies to heating firms.

Coal accounts for about 70 percent of the China's energy consumption, industry analysts said. In 2006, China raised heating prices because of the high cost of coal.