PAY UP OR LIGHTS OUT

Energy companies to stick it to people instead of deadbeat industries

Electrical energy rates for the population will be raised 20% as of May 1, the National Commission on Energy Regulations decided at its most recent session.

People will have to pay Hr 0.11 per kW/h, compared to the Hr 0.09 they now pay. In the countryside the rate will rise to Hr 0.10 per kW/t vs. 0.08 currently. The rate will rise from Hr 0.06 up to Hr 0.08 for the houses equipped with electric heaters and electric ovens.

Commission chairman Zinovy Botsyo declared in an interview with Interfax-Ukraine that the rate hikes will boost the profitability of energy generating companies to 7% and of energy suppliers to 4%. According to him, this is necessary because 23 out of 27 energy supplying companies are unprofitable.

However, in practice these companies are anything but poor. They delay paying their employees but invest substantial money in buying marble for management dachas. The staff learned a lesson from Italian strikers and protest wage arrears by not turning on repaired energy substations.

I personally find the reasons for the rate increase interesting. Attempts were made to justify the previous one by the need to build additional atomic power units at the Rivne and Khmelnytsky power stations. The Ukrainian people bought it and did not stop paying. According to statistics, the population consumes about 20% of all electricity and has to pay for about 80%. That is probably why National Commission officials decided that people are affluent enough to pay for the industry.

Meanwhile, experts at the Ukrainian Association of Independent Energy Suppliers believe that the rate hike will have positive results only if the additional income is used to replenish the turnover funds of energy companies, and not to pay their debts to budget-supported organizations. Elimination of the current deficit of turnover funds would enable energy companies to quit barter operations, which increase energy costs approximately 35%.

It is rather strange that rates were raised only 20%. I hope the commission’s experts understand that most families will not be able to afford more than that.

However, who can say that there will not soon be yet another rate increase?