ANATOLY GOLOMOLZIN: THE GROWTH OF THE ECONOMY AND THE QUALITY OF LIFE CAN BE ACHIEVED ONLY THROUGH COOPERATION

Deputy Head of FAS was a speaker at the Round Table in Tyumen on legislative support of gasification and development of regional gas markets, organized by the Energy Committee of the State Duma

The Round Table covered technological and commercial availability of gas.

Deputy Head of FAS pointed out that No. 618 Order of the President of the Russian Federation “On the main directions of the state policy towards competition development” of 21.12.2017 determined the priorities of improving the state policy in this field and the principles of its development. The same Order approves the National Plan for Developing Competition in the Russian Federation, Clause 8 of which requires that gas supply sector should undergo a “transition to market pricing by establishing on-and off-exchange price indicators for natural gas, ensured, in particular, by increased volume of sales of natural gas at the exchange. Establishing exchange index, establishing off-exchange index”.

As pointed out by the speaker, more than 20 billion m3 of gas were sold in 2017 through the exchange. In some period, exchange prices are higher than regulated gas prices and sometimes lower, depending on the demand.

“Along with exchange quotations, off-exchange indices are developing, when deals are completed under the free pricing conditions with involvement of independent companies.  It covers around 45% of the total gas supplied to the domestic market. Development of on-exchange and off-exchange prices makes the market environment transparent, and creates economic incentives for enhancing efficiency of both gas supply and consumption”, explainedDeputy Head of FAS.

Anatoly Golomolzin said: “To execute the Presidential Order, the Government approved the Road Map, with a section on gas supply. It focuses on such issues as non-discriminatory access to the main and distribution gas pipelines, increasing efficiency of tariff regulation in natural monopolies, how market relations will be formed and developed, fair market pricing. In particular, it concerns further development of exchange trading”.

The Round Table speakers discussed the details of the experience of the Tyumen region in developing efficient gasification. According to the Governor of the Tyumen region, Alexander Moor, the place for such a discussion is not a coincidence: for several years, Tyumen has already been the pilot for testing new approaches to gasification. He said that the first successful stage was completed in 2014 - 2017 under Governor Vladimir Yakushev; and now the second stage is rolling on (2018 – 2022). In his turn, the Ministry of Russia for construction and the Housing and-Utility Sector, Vladimir Yakushev emphasized the contribution of FAS and Deputy Head Anatoly Golomolzin to make efficient gasification project in Tyumen successful. Pavel Zavalny, Chairman of State Duma Energy Committee, said that the experience of the Tyumen region an be used in other regions, which at the same time are at different levels of readiness to it; there are regional and organizational specifics, but meaning-wise, this experience can be broadly extrapolated, particularly, based on regulatory contracts.

“When we come to the region we constantly see that increasing more new villages began receiving gas. The experience of the Tyumen regions shows that the results can be reached only constructive collaboration between the regional authorities, regulated gas distributors and suppliers, and FAS. Each of them should act within the frame of their competences in such a way that improved performance of each party would facilitate achieving common benefit, economic growth and the quality of life”.

“Regional authorities had tools for making decisions on gasification programmes, tariff mark-ups, investment stimulation and social support measures. At the same time they are interested in high-quality, reliable gas supply to the consumers in the region, creating conditions for prompt and affordable connection of new gas consumers, developing business on this basis and improving the quality of life of the population, increasing  tax return”, clarified Deputy Head of FAS.

Anatoly Golomolzin underlined that gas distributors and suppliers as well as “Mezhregiongaz” and “Gazprom” are generally interested in improving business capitalization, and increasing gas sales.

The speaker pointed out: “The contribution is based on implementing an efficient business-model, improving operational performance, applying new efficient approaches in construction of infrastructure facilities, particularly, with use of the resources method, stage-by-stage deregulation of gas prices. FAS encourages development of commercial infrastructure, including on-exchange trading, the rules of the game in the part of non-discriminatory access and tariff regulation, and makes long-term tariff decisions”.

“The Tyumen experience is formalized in the decision of the State Council and the decision of the RF Government on the base construction practices; in the Regional Competition Development Standard. This experience can be extrapolated under the umbrella of system-wide efforts on drafting, signing and executing the relevant trilateral regulator contracts (agreements)”, summed up Anatoly Golomolzin.