In his post, energy expert Andrian Prokip tries to figure out what exactly is destroying the Ukrainian energy industry: Russian missiles or management mistakes. Let's figure it out together.
ENERGY POLICY WITH A SPIRIT OF COMMUNISM
Ukrainian energy policy has had one chronic disease for decades — the desire to equalize something, to allow someone not to pay, to transfer payments to others. There are constant efforts to patch up debt holes, shifting responsibility from one player to another. The motives for this can be different: whether it is populism and pretended concern for the consumer, or whether it is the desire to improve the position of the company, which is closer to the hearts of those who make decisions.
It was relatively easy to carry out such decisions before the start of a full-scale war. Despite the fact that things in the energy sector were far from ideal, it was still possible to scrape together the financial resources to carry out such a plan. However, the full-scale war and the associated economic decline, reduced energy consumption, and the loss of energy assets due to both occupation and constant shelling significantly reduced liquidity and cash flows in the energy sector. As a result, during the full-scale war, the government twice resorted to raising the electricity tariff for the population. Such a radical increase in tariffs could not be imagined until 2022. And it even seemed that a healthy economic logic would begin to defeat the logic of communism: divide, equalize, do not pay. But "no"...
In mid-July, the energy regulator started talking about equalizing distribution tariff rates, regardless of consumption volumes and connected voltage — this decision confused both energy companies and key consumers of electricity.
I wrote a separate text about this then, explaining why this decision is wrong and even harmful. In particular, this is a return to cross-subsidization, when one category of consumers does not fully cover costs and losses, and compensation occurs at the expense of others. In addition, such an approach contradicts the principles of European energy regulation, and can also significantly affect the incentives for the development of large enterprises that consume significant amounts of electricity, and therefore, it is a direct blow to the country's economy. It is not even worth mentioning here that large industrial consumers already suffer from rising prices, so they want to raise them a little more with a bonus.
At the same time, I wrote that the key beneficiaries will be those companies that subsidize the lower electricity tariff for the population (PSO mechanism) — Ukrhydroenergo, and above all — Energoatom. These companies will have more funds: an average of 38 kopecks. for every 1 kWh. Thus, from the world by a thread - the giant capital. And this is in addition to the fact that these companies will accumulate a larger resource after the tariff increase from UAH 2.64 to UAH 4.32/kWh.
And when, it seemed, the regulator abandoned this idea after a wave of criticism, information appeared in the media that the updated composition of the regulator is going to return to this issue. equalizer But in our collective farm, although everyone is equal, there are some who are more equal than others.
"Energoatom" became the subject of news last week as well. And again about the economy in energy. Thus, a photocopy of the order of the Ministry of Strategic Industries, which will allow the company to default on its debts, has appeared online. I wonder how it is possible to build a normal energy industry, allowing not to pay debts? Which companies will be willing to work with a strategic enterprise of the energy sector, if they understand that they may well be legally not paid for the work performed and the services provided? How will it increase payment discipline in the conditions that debts are one of the biggest threats to the Ukrainian energy industry on the eve of a very difficult winter?
Last week, another idea of the same kind appeared — proposals were made to involve gas companies in the PSO mechanism in the electricity market. In other words, the gas companies have to pay for the electricity, because the energy companies no longer have money. It is clear that the motive is noble: if electric power companies do not have the resources to purchase imported electricity to cover social goals, then there is a desire to find other donors for such operations. But the question still arises: there are companies that received additional financial resources after the tariff increase for the population, why don't they act as a donor? And who will be the final beneficiary of the operations after the gas producers pay for the import of electricity, the consumers receive it and pay for this electricity by paying the electricity companies?
And the icing on the cake is a bribe of half a million dollars, upon receipt of which one of the deputy ministers was arrested. And the bribe, as reported by the media, was given to facilitate the transfer of equipment from one state enterprise to another. Here it is, the efficiency of state ownership in our conditions and of the economic model that has become an integral element of Ukraine's energy policy in recent decades.
