18:45 13.01.2021

Gas Producers Association asks Energy Community Secretariat to prevent interference with work of energy regulator aimed at canceling gas supply tariffs

3 min read
Gas Producers Association asks Energy Community Secretariat to prevent interference with work of energy regulator aimed at canceling gas supply tariffs

The Association of Gas Producers of Ukraine addressed to Director of Energy Community Secretariat Janez Kopac with a request to give an objective assessment of the situation with tariffs for gas distribution in the country and to prevent interference with the work of the National Energy and Utilities Regulatory Commission (NEURC) as an independent energy regulator aimed at revising and reducing tariffs, the association said in a press release on Wednesday.

According to the press release, for this purpose, since January 2021, an organized political campaign has been carried out in Ukraine with the involvement of some MPs and street actions.

The association said that the impetus for increasing pressure was draft resolution No. 4522, registered in the Verkhovna Rada on December 18, 2020, on the revision and reduction of tariffs for the distribution of natural gas, approved in December of the same year.

At the same time, the Association of Gas Producers of Ukraine drew attention to the fact that the draft resolution was registered even before the final approval of tariffs.

At the same time, the association said that there is no reason to reduce tariffs, noting that even the approved tariffs do not cover all the costs of operators of gas distribution networks.

In particular, it is noted that the gas price approved at the level of EUR 15.934 per MWh to cover technological losses did not give gas distribution networks' operators the opportunity to purchase gas at UEEX on December 30, 2020 for these purposes in January 2021, since the resource price that day reached EUR 18.99 per MWh.

"In the future, market prices for gas have increased: in the second decade of January 2021, they amount to about EUR 20.20 per MWh. Thus, the current tariffs are no longer sufficient to finance all justified costs of gas distribution networks' operators," the press release said.

The Association of Gas Producers said that the tariffs were approved by NEURC in compliance with the procedure for their open public discussions, taking into account the arguments and proposals of all interested parties, and the decision itself was a continuation of the process of improving the gas industry and Ukraine's fulfillment of its obligations to the Energy Community and the IMF.

At the same time, according to the association, calls for non-payments, confiscation of property in favor of other enterprises, unjustified reduction of tariffs are illegal and lead to a deepening of the gas crisis.

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