17:25 25.11.2019

Economy Ministry mulling raising electricity tariffs for large individual consumers to level of industrial consumers

2 min read
Economy Ministry mulling raising electricity tariffs for large individual consumers to level of industrial consumers

The Ministry of Economy and Environment Protection of Ukraine intends in the future to abandon preferential electricity tariffs for household consumers (public service obligations, PSO), considering as the first stage a tariff increase for the largest household consumers to the level of class two industrial consumers.

"We are building efficient energy markets. PSO is an instrument that does not improve market efficiency. I don't think we will completely abandon PSO in 2020, but we will move towards reducing the volume of PSO," Energy Minister Oleksiy Orzhel said at a press conference.

"In particular, we are considering the possibility of what it means to bring prices to the real market one, to class two voltage, for those household consumers who consume much more than others," he added.

Orzhel explained that the matter concerns cases when consumers are either very wealthy or hide industrial production behind an individual.

"These are large volumes – over 500 kW or even more," he said.

The minister noted that from January 1, 2020 Ukraine on the gas market abandons the PSO regime.

As reported, in Ukraine electricity tariffs for households at the beginning of 2019 covered its cost (production and distribution) by only 46.2%, which is lower than the indicator a year ago - 51.7%.

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