Andriy Gerus, a member of the ‘Price of the State’ business board, explained in a column for ‘Biznes.Tsensor’ the way Ukrainian monopolists earn on the sale of electricity to entrepreneurs. Its prices are higher than in neighboring European countries.
The Energoatom atomic power station`s tariff for producing electricity is the lowest in the world. The enterprise asks UAH 0.48 for kWh. At the same time, Energoatom has produced 58.4% of the total electricity in Ukraine in the six months of 2017.
In spite of this, the price of electricity in Ukraine is higher (UAH 1.34) than in the neighboring European countries. Similarly, electricity tariffs for businesses and budget institutions are higher than in Sweden, Norway, Denmark, the USA, and Canada.
Why does this happen?
On its way to the market, the Energoatom`s lowest tariff in the world ‘mixes’ (is averaged) with the highest tariffs in the world for the thermal generation (80% of which is controlled by DTEK of Rinat Akhmetov) and solar/wind expensive green tariffs.
Another way of ‘additional tipping’ is the forecast balance of electricity production. In fact, the tariffs are set with the calculations that Energoatom supposedly had to produce 53% of the electricity (forecast balances from 10.31.2016 and 03.03.2017). Proceeding from this, all consumers pay.
As a lot of cheap electricity (because Energoatom produced 58.4%) appeared on the market, free money arose. According to the rules of the market, all free money is transferred to the thermal generation.
During the last six months, they got additional UAH 3.5 billion tips. It would be possible to believe in a simple mistake, but the error of 5% for the energy market of a large country is a GREAT failure. In addition, these errors, contrary to the laws of statistics and probabilities, repeat in favor of thermal electric power stations (TEPS).
Accordingly, the TEPS tariff became bigger than planned. That is, it covers the price of coal more (about UAH 2500) than planned (UAH 2000).
Nevertheless, Ukrainian miners do not experience well-being. For example, in June (‘Volynvuhillya’ state enterprise) and on 17 June (‘Lysychanskvuhillya’ state enterprise) miners strikes took place due to 2-3 months salary arrears.