DMITRY VASILIEV: BENCHMARKS ARE FAIR TARIFFS THAT ELIMINATE REGIONAL DISCRIMINATION AND UNFAIR DIFFERENTIATION

Special session of All-Russian tariff regulation workshop in Yalta focused on the main aspects of introducing benchmarks in the electric power industry and their prospective developments

Head of FAS Department for Regulating the Electric Power Industry, Dmitry Vasiliev said: “The benchmark principle is a particular parameter stimulating companies to spend funds efficiently”.

In his opinion, this mechanism optimizes all corporate activity and changes its management philosophy.

Dmitry Vasiliev pointed out that many Western regulators use benchmarks to regulate resources suppliers.

The next speaker was Sergey Dudkin, Deputy Head of FAS Department for Regulating the Electric Power Industry.  He presented a concept for transition of the regulation of grid companies with the comparison method.

“The Antimonopoly Service has drafted an order, which soon will be published on the official portal of normative legal documents to be discussed with the expert community and the authorities”, informed Sergey Dudkin.

He also described the specifics and advantages of the comparative method, including duration (5 - 10 years), transparency, absence of tariff discrimination and subjectivism in tariff setting.

The draft order introduces a new concept: “cost benchmark for a grid company”.

“It should be added that FAS differentiates benchmarks by the types of grid equipment and subjects of the Russian Federation. 5 types of equipment and 8 groups of regions in Russia are identified”, explains Sergey Dudkin.

Finally, FAS representatives stated that cost benchmarks of grid companies will be adjusted to the prices of the current year in accord with the parameters of the social-and-economic forecasts decreased by 0.1%.