Gaasivõrk notified customers in late May that residential users will begin paying a fixed monthly charge of €5.90 before tax, or €7.32 including VAT.

Customers will also continue paying a consumption-based charge of €0.008955 per kilowatt-hour (KWh), though that rate will be cut by more than 40 percent.

The new fixed fee will apply even if no gas is used or service is temporarily disconnected.

Business customers, meanwhile, will instead pay a monthly capacity fee ranging from €2.58 to €5.04, plus VAT, depending on connection capacity.

Gaasivõrk CEO Triinu Tamm said the company is moving away from a pricing system based solely on consumption.

"The goal of the new pricing model is to ensure the reliability and sustainability of the gas distribution network and to share network service costs fairly and transparently among consumers," Tamm said.

According to the company, total network service costs for the average household should remain largely unchanged, while heavier gas users could see costs decline.

Costs may rise, however, in apartment buildings where individual apartments hold separate gas contracts and gas consumption is low.

Other utilities use similar models

Tamm said fixed monthly charges are common for infrastructure-based services because they help cover the ongoing costs of maintaining networks.

She noted that similar pricing models are already used by electricity, water, district heating, telecommunications and other gas network operators both in Estonia and in neighboring countries.

The new pricing model was developed in cooperation with the Competition Authority and in consultation with stakeholder groups, including the Estonian Union of Cooperative Housing Associations (EKÜL) and the Central Union of Estonian Property Owners (EOKL).

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