Beijing, Dec. 27 – The State Development and Reform Commission (SDRC) has basically approved a pricing scheme on the consumption of energy products. After soliciting ideas from various local departments, SDRC will submit the scheme to the State Council for approval. Once the scheme is approved by the State Council, it will mean that prices of energy products will change greatly in 2007.

The scheme, titled “Suggestions on Deepening the Pricing Reform so as to Promote Energy Conservation and Environmental Protection”, was made by SDRC’s Pricing Department.

Based on this scheme, the pricing reform will start in energy products related with water, petrol oil, electricity, natural gas, coal and land resources consumption. Garbage treatment and sewage water disposal fees will also be raised. The biggest point that makes the scheme different from previous ones is that the costs of reducing and controlling environmental pollution and the inevitable costs paid after natural resources are depleted are both calculated in setting the new price. If the scheme is approved, prices of related products will be raised substantially, according to a report in Caijing Magazine published on December 25.

The scheme aims to promote energy conservation and the comprehensive use of energy products, so that the prices can reflect the scarcity of resources that make these products. It also wants to convey the message that those who pollute the environment will need to pay for the pollution. All enterprises, public institutions, or individuals will have to pay the sewage water treatment fees if they dispose it, and those who produce garbage will have to pay garbage treatment fees. Likewise, any people or institutions will need to pay sewage disposal fees once they dispose sewage. Considering the different situations among different groups in society, the scheme will be executed “step by step based on a general principle.”

The new scheme sets the major tone for the pricing reform that will take place in crude oil, natural gas, water, electric power, coal and land resources in the next few years.