How much did electricity cost in the new market? Three versions

It has been 15 days since the launch of a new model of the electricity market. A round table “The launch of the wholesale electricity market: the first results and challenges” was held in the Parliament.

The main players of the market participated in it. In addition to the achievements, problems were identified as well, among which the main is the price of electricity. The Regulator has its own version of the price increase, Ukrenergo has its own, and the Presidential Administration has its own.

A brief summary of the main theses:

The National Energy and Utilities Regulatory Commission

According to the National Energy and Utilities Regulatory Commission, the increase in prices for consumers connected to the the first class of voltage was 15%. For consumers of the 2nd class – 10%.

Why did the price increase: tariff for Ukrenergo increased. It depends on the PSO project and the obligation to compensate renewable energy.

“From August 1, 2019, the final cost of electricity for industrial consumers will already be reduced”, said Oksana Krivenko, head of the National Regulatory Commission, during a speech at a round table.

This will happen due to the fact that in August the new tariff of the transmission system operator enters into force, taking into account the new tariff for electricity distribution and transmission services, the cost of losses, etc.

According to the National Energy and Utilities Regulatory Commission, the reduction in electricity prices for consumers connected in the the first class voltage will be at the level of 4%, for the second class voltage – 6%.  

Gerus = the Presidential Administration

Representative of the President of Ukraine in the Cabinet of Ministers Andriy Gerus announced his own calculations of price growth. The total price increase for the final consumer – on average in the market – 25%:

“Unfortunately, this price increase by 25% is the strongest one-time increase in the price of electricity over the past 25 years... And this happened under conditions when the global price trend energy, oil, gas, fuel oil, coal are getting cheaper”.  

Why did the price increase: the growth of tariffs of Energoatom, Ukrhydroenergo and TPPs, an increase in the number of “green” facilities and the use of the services of a balancing market.

NPC Ukrenergo

“The summary picture is as follows: for the first class consumers directly connected to the transmission system operator network, with   automatic system for commercial accounting of power consumption and a more or less equable consumption profile, the level of price growth in the the first 10 days was 28.3%”, Head of Ukrenergo Vsevolod Kovalchuk said.

Taking into account the reduction in the tariff of the transmission system operator from August 1, “if there are no changes or new parameters”, the price increase for this category of consumers will be 25.9%.

For the first class consumers connected to the transmission system operator network (with automatic system for commercial accounting of power consumption and an equable consumption profile)the  growth was 24.7%, for second class consumers (connected to the transmission system operator network without automatic system) the increase was 21.4%.

Why did the price increase:  Not because of the tariff of Ukrenergo. The tariff has increased from 5.9 kopecks/kWh to 6.3 kopecks/kWh. And 90% of this growth is an increase in allocations to the state. (According to Kovalchuk)

“100% price increase, which is now on display during July, refers to an increase in the price of electricity as a commodity. These are the prices at which electricity producers sell electricity. A certain share is the growth of “green” objects with a high tariff (weighted average by renewables sectors – 4800 UAH/MWh). But, after all, they are also producers”.

 

“The introduction of a competitive market, which, by virtue of its name and purpose, should lead to an improvement in the price parameters of electricity in our country, so far... demonstrates a rise in price of this important energy resource”, said the Head of NPC Ukrenergo.

 

Kosatka.Media

Tags: electricity, NEURC, Ukrenergo, electricity market

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