Reform with a human face

“The new tariff policy is oriented towards consumers rather that the interests of natural monopolies”, emphasized Deputy Head of the Federal Antimonopoly Service (FAS Russia), Vitaly Korolev.

At the Round Table on “Changing tariff policy and legal support of the rights of consumers and suppliers of energy resources” organized by the Institute of Modern Applied Law, at Kutafin Moscow State Law University, Deputy Head of FAS discussed the results of  tariff regulation. Specialists on energy law and students of Kutafin Moscow State Law University also took part in the event.

Vitaly Korolev pointed out that after transferring the power in this field, the Antimonopoly Service ensured continuity of the process. All decisions were made in full and within the designated period. An approach towards “below inflation tariff growth” is being implemented. Deputy Head of FAS gave examples of the industries where this approach is already in place:  in 2015 gas tariffs increased by 2% against 12.7% inflation rate, electric power transmission services – 7.5%, and oil transportation services – 5.76%.

“Thus, through its tariff policy the state creates favourable conditions for consumers and enables development of small and medium business”, said Vitaly Korolev.

Talking about further plans, he highlighted robust efforts on improving the methodology of tariff regulation and deregulating some sectors of the economy.

Deputy Head of FAS also listed a package of measures designed to enhance the quality of tariff regulation:

-  Implementing the methods of norm setting and reference (standard) costs

- Improving approaches to the procedure of approving investment programmes and control over their execution

-  Increasing the requirements to regulated organizations

- Creating mechanisms that stimulate efficiency of regulated organizations.

Vitaly Korolev presented to experts and students the results of monitoring the costs for maintaining grid equipment. According to the findings, the difference between service costs for a conventional unit of grid equipment reaches 12 times. To solve the issues, efforts shall be undertaken and a regulatory act shall be drafted.

The Round Table participants thanked Vitaly Korolev for the report and stated that an innovative format of work, when representatives of the authorities and business discuss the pressing economic issues with students, is efficient and productive for future lawyers and economists.