VITALY KOROLEV: FAS IS IN FAVOUR OF COMPETITIVE SELECTION OF FACILITIES THAT WILL BE MODERNIZED

It will increase efficiency of generating facilities provided that tariff indexation does not exceed the inflation level

In 2017, following a meeting at the President of the Russian Federation, a new modernization programme was approved in general. The programme is based on capacity supply agreements (CSA), and is known as “CSA-2” or “CSA dash”.

The first SCA programme launched ten years ago during the reform of the electric power industry helped renew a significant portion of the entire installed capacity of electric power generation in Russia.

On 5 October 2018, the Russian Energy Week included a session on “Heating generation modernization”. At the session it was pointed out that in spite of the large-scale successful programme for generating facilities construction under the capacity supply agreements, the overall ageing of the heat generation pool of the Unified Energy System of Russia remains an acute problem.

Deputy Head of FAS Vitaly Korolev informed participants about the main areas of work towards executing the Orders of the President of the Russian Federation.  He outlined the following directions of the efforts: competitive selection of facilities, consumer opinion, tariff regulation, equipment parameters, and investor obligations.

“The Antimonopoly Service believes that facilities selection should be competitive. It will have a positive impact upon competition development on the energy market and enable to select the most efficient projects with the minimum costs for consumers”, pointed out Vitaly Korolev.

Deputy Head of FAS also sated that overall production localization will have a positive effect upon industry sectors; however, CSA parameters should be taken into account and the course to import substitution will be maintained.

“To execute the Orders of the President of the Russian Federation that the inflation level should not be exceeded in the course of modernizing electric power generation facilities, overall all additional factors of the growing prices for eclectic power and capacity on the wholesale markets should be evaluated and taken into account developing the CSA-2 model”, concluded Deputy Head of FAS.