Tigáz hands over retail gas supply license

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Regional gas supplier Tigáz has requested the withdrawal of its "universal service provider" license to supply gas to households, the company told Hungarian news agency MTI yesterday.

Universal service providers supply gas using a price structure and level controlled by the state.

In line with the regulations in effect, the Hungarian Energy and Utilities Regulatory Office (MEKH) will manage the transfer of customers to the new service provider, Tigáz added.

Tigáz said the decision is part of a process to "coordinate its business activity with the regulatory environment and reduce the unfavorable effects affecting its business activity".

Tigáz served almost 1.2 million customers and had operating losses of HUF 4.9 bln in 2014.

The two other big universal service providers, E.On Energiaszolgáltató and GDF Suez, submitted similar requests in April.

Their retail customers will be taken over by state-owned Főgáz, MEKH said last week.

Főgáz was previously owned by Germanyʼs RWE Gas International and the Budapest city council and was purchased by state-owned Hungarian Electricity Works MVM in December 2013. Since August 1, 2014, Főgáz has been held by the First National Utilities Company (ENKSZ).

The Hungarian government earlier mandated a series of utilities price cuts for households. It also established the First National Utilities Company (ENKSZ) to act as an efficient, predictable and cheap utilities provider. ENKSZ began operating on the gas market in April and will later launch on the electricity and district heating markets.

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