FAS: 3 REGIONS HAVE SIGNED REGULATORY AGREEMENTS IN ELECTRIC POWER INDUSTRY
These are the Chechen Republic, Omsk and Novgorod regions
Thus, within the framework of the concluded regulatory agreements, grid organizations of the Omsk and Novgorod regions undertake to reduce the level of losses of electric energy during its transmission over the grid to 6.9 % and 7.8 % of the total volume, respectively, as well as to implement a long-term investment program. It means that organizations should generally optimize the operation of the grid complex: upgrade wires on overloaded lines and a fleet of metering devices, minimize unaccounted and non-contractual consumption, etc.
According to the agreement, the grid organization in the Chechen Republic is obliged to implement an investment program for technological connection of consumers and renewal of lines until 2030.
In turn, regional regulators should calculate the required gross revenue annually, observing the parameters of the agreement, and approve tariffs taking into account the agreed indexation for the entire term of the agreement. In the Chechen Republic, it is 7 years, in the Omsk region – 10 and in Novgorod – 9 years.
It should be reminded that the Government of the Russian Federation adopted a resolution prepared by the Authority* last August. In accordance with it, regulatory agreements are concluded between regional grid organizations (RGO) and regional tariff authorities. They are also subject to mandatory coordination with the FAS Russia to prevent an unjustified increase in electricity prices.
After the conclusion of the agreement, RGO is obliged to supply electricity, achieve the necessary targets, as well as fulfill the established investment program. In turn, the regulatory body approves long-term tariffs for at least 5 years.
The principle of operation of regulatory agreements is "tariff in exchange for investments". It means that the electricity tariff does not increase, but an internal redistribution takes place in the structure of its costs. It increases the transparency and efficiency of tariff regulation, and also allows to encourage grid organizations to reduce the costs that the consumer pays.
Reference:
* Resolution of the Government of the Russian Federation of August 31, 2023 No. 1416 " On Agreements on the conditions for implementation of regulated activities"