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Looking at the domestic energy market, natural gas is undoubtedly the one that can consistently remain the ‘hot topic’ during winter. Last year, as many regions implemented the shift from coal to gas, numerous companies operating in the LNG sector made substantial profits, yet companies involved in coal-to-gas production did not benefit from this trend. The situation this year, and it seems likely to remain the same, has seen coal-to-gas become a desolate area where the ‘blessings of spring never reach’. The reason for this is that the pricing mechanism for coal-to-gas production in our country is not perfect, and it has become a barrier that coal-to-gas enterprises find difficult to overcome. To the author’s knowledge, **the pricing mechanism initially established by the National Development and Reform Commission for coal-to-gas demonstration projects was the ‘cost-plus’ method. “The “cost-plus” pricing method is a way of setting product prices by adding a certain percentage of profit to the unit cost of the product. This pricing method uses total cost as the basis for pricing. For example, the **National Development and Reform Commission assigned a price of 2.72 yuan per cubic meter to China’s first coal-to-gas demonstration project – the Datang Keqi Coal-to-Natural Gas Project – using the ‘cost-plus’ method. However, not long after Keqi’s coal-to-gas project benefited from this price policy incentive, **this pricing mechanism was abolished, and the \"market net return value\" method was adopted instead to set prices for coal-to-gas. “The “market net return value” method links the selling price of natural gas to the prices of alternative energy sources determined by market competition, such as international oil prices. On this basis, by deducting the costs associated with the logistics of transporting the goods, such as pipeline transportation fees, the prices at various stages of natural gas sales can be determined. With the adoption of the “net market return value” method, the natural gas price in Datang Keqi has been reduced significantly on two occasions, dropping from 2.72 yuan per cubic meter to 1.77 yuan per cubic meter. Logically, **with the new pricing mechanism for coal-to-gas production in place, the price of such gas should adjust according to market conditions and be linked to international crude oil prices; however, this is not the case in reality. International oil prices rose from around $40 per barrel at low levels to nearly $80 per barrel in October, while the price of coal-based gas decreased from 2.72 yuan per cubic meter to 1.77 yuan per cubic meter, and remained stuck at this level without any change; it neither reflected market prices nor the actual value of the commodity. What’s worse, the production costs of coal-to-gas companies are generally higher than their actual selling prices, resulting in a situation where costs exceed revenue. It is understood that the actual total cost of coal-to-gas production for several projects currently in operation is likely to range from 1.5 yuan per cubic meter to 2.5 yuan per cubic meter, while the average price at gas supply stations for non-residential use across the country is 1.6 yuan per cubic meter. Among them, the highest price at the intake station for natural gas in Xinjiang is only 1.05 yuan per cubic meter. According to media reports, the cost of producing gas from coal in Xinjiang’s Qinghua plant is around 1.5 yuan per cubic meter, which means that the company incurs a loss of 0.45 yuan for each cubic meter of gas sold. Based on this calculation, if the Qinghua coal-to-gas project with an annual production capacity of 5.5 billion cubic meters is fully operational, it will incur a loss of 2.475 billion yuan per year. In fact, even using the current highest natural gas prices in various provinces, the costs of all coal-to-gas projects that have been put into operation exceed their selling prices; as a result, it is difficult to sustain these demonstration projects. Many planned projects are showing signs of uncertainty, or even being abandoned outright. Given this situation, it has become a common call within the industry to establish as soon as possible a scientific pricing mechanism to support the development of coal-to-gas production, so that such companies can survive and find a way forward. As is well known, energy prices have fluctuated greatly over the past three years, yet natural gas market prices have not been adjusted at all, which is difficult for domestic coal-to-gas companies to understand and accept. The author believes that China’s pricing mechanism for coal-to-gas production is crucial to the survival of this emerging industry; it must be taken seriously, and plans must be formulated and finalized as soon as possible. Whether the \"cost-plus\" method or the \"market net value\" method is chosen, it should be put into practice as soon as possible. Let’s start with the “cost-plus” method. This approach is often adopted in developing countries; it can prevent producers from obtaining monopoly profits and help maintain relatively low natural gas prices. Although coal-to-gas cannot achieve a monopoly position in the natural gas market, let alone reap monopoly profits, this approach remains applicable to coal-to-gas production; it can at least ensure that such pilot projects do not incur losses, thus serving as a valuable asset for securing **energy security. Now, let’s talk about the “market net return value” method. The intention behind this approach is to link natural gas prices to the market prices of energy sources that compete with it as alternatives, such as oil, LNG, fuel oil, and clean energy sources. This allows for an accurate reflection of the actual market price of natural gas. By linking upstream gas supply prices with downstream market prices, market signals can be conveyed to producers and consumers. If coal-to-gas production were truly left to market forces, with the market determining prices and making choices, companies in this sector might have it easier. In the market and competition, rules are of paramount importance. Regardless of the pricing mechanism adopted, as long as the rules are scientific and clear, it will be a blessing and a boon for the already struggling coal-to-gas industry.