Deputies from “public Servants” demand that the national Commission to implement RAB-tariff for European methodology

Депутаты от "Слуги народа" требуют от НКРЭКУ внедрить RAB-тариф по европейской методологии

The deputies of the faction “servant of the People” was sent to NKREKU open letter with the requirement to introduce RAB-tariff for operators of electricity distribution according to the European methodology. The proposed controller methodology deputies called Azarovskiy and ineffective. The Chairman of the Subcommittee on the development of competition and equal conditions for business of the Committee of the Verkhovna Rada of Ukraine on issues of economic development Lyudmila Buimister on his Facebook page.

The report stated that the deputies analyzed 8 years of experience in the attempts of the regulator to introduce in Ukraine stimulating tariff and came to the conclusion that 8 years was not proposed that the regulatory environment that would lead the industry distribution of investors.

Short and to the point Telegram

“Of particular concern is the fact that the conditions that the regulator proposes today – suspiciously similar to those offered by Azarov’s government in 2013: the division of all assets of the power companies at relatively “old database” and “new base”, charging different rates of return on those bases. While relatively “old” was offered a very low rate of return of 0-5%. Today, NERC does almost the same thing, at the rate of 1%,” – said buymister.

Buimister emphasizes that investors openly ignored the reform era Azarov and were not interested to invest in the power grid. This has led to the current negative situation – the mains are worn 80% of the country, underinvestment in infrastructure reached 17.5 billion dollars.

Letter to the Governor signed by the deputies of the factions “servant of the people”, “Fatherland” and faction: L. Buimister, V. Rublev, V. Nalivaycheno, M. Volynets, D. Shah, S. Noble, P. Pavlish, G. Tisnek, T. Tarasenko, G. lichman, V. Grib, N. Magomedov, N. Efimov, Boris Prikhodko, V. Lubet, V. Koliukh, V. Wagner, V. Bezgin, A. Dubnov.

In an open letter to the deputies require the national Commission to eliminate inefficient methodology of RAB-tariff of 2013 and to bring it into line with best European practices, which will allow her to focus on attracting investment in the industry and be attractive to investors.

In particular, the deputies propose to abandon the section of the regulatory asset base at the “new” and “old” to count one’s asset base, as is the case in most countries of the European Union. And also, to apply the regulatory rate of return on the regulatory asset base – the value weighted average cost of capital (WACC) and WACC recalculations shall be carried out either once a year or before the start of the regulatory period. This practice is widely used in many countries when the rate of return is applied to a single regulatory asset base.

The current tariffs do not allow to develop the state power companies – the Deputy Chairman of the state property Fund

“In our opinion, these 2 criteria are the key for successful implementation of incentive tariff that will ensure the successful privatization of the state operators of distribution systems, a transparent and acceptable conditions for investors, and will provide the necessary investment in the distribution network, which will significantly improve the Ukrainian figures of losses and SAIDI”, – stated in the letter.

The Verkhovna Rada
The government