Dmitry Vasiliev: competitive mechanisms are an essential conditions for capacity take-off to modernize generating facilities

Speaking at Russian Energy Week, Head of FAS Department for Regulating the Electric Power Industry Dmitry Vasiliev stated: “Following the results of completing the long-term programme for launching new generating facilities under the capacity providing contracts (CPC) for electric power producers, there is a need to form a financial mechanism for further reproduction, particularly, modernization of generating facilities”.

FAS representative pointed out: “CPC is a mechanism launched earlier to attract investments in the industry. The good thing was that it was based on the reference costs principle.  Absence of competition in CPC is perhaps the most criticized part of this mechanism that must be reviewed when discussing the future modernization model”.

“Another important factor is clear obligations of a potential investor as well as shrewd planning of the future capacity demand”, continued Dmitry Vasiliev.

Summing up, Dmitry Vasiliev said that there should be a balance between the interests of consumers and generators and the level of prices, creating preconditions for consumers leaving the market, should not be exceed.