FAS drafted proposals to develop competition on the electric power market

They weaken the monopoly power of the provider of last resort and intensify competition for consumers

Deputy Head of FAS Department for Regulating the Electric Power Industry, Alexei Voronin, was a speaker at the Round Table of the State Duma Electric Power Committee on “Developing Competition in the Electric Power Industry”.  He said that annual analyses of the state of competition characterize retail electric power markets in all regions of the Russian Federation as highly concentrated markets with underdeveloped competition. Power suppliers separated as a result of reorganizing shareholding companies have the dominant position on the retail electric power markets within the administrative boundaries of the subjects of the Russian Federation. Their market shares have increased in some regions over the last years.

The main issues are the same as in many other sectors: a vast state segment, in adequate tariff regulation, dominance of large companies, and underdevelopment of small and medium business. “FAS is drafting the National Competition Development Plan which should enable the Russian economy  to move from the natural monopoly to a competitive business environment”, continued Alexei Voronin.

The FAS representative pointed out: “Under the frame of the National Competition Development Plan it is expected to approve the Action Plan on developing competition in the electric power industry. The main objective is to ensure that electric power consumers can choose freely suppliers, sales companies, including the measures to simplify entry of retail consumers to the wholesale market, providing opportunity for retail consumers to conclude free contracts with wholesale electric power generators and possibility of direct payment by consumers for electric power”.

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Representatives of the key Russian ministries: the Ministry of Energy, the Ministry of Economic Development, the Federal Antimonopoly Service, the leading companies in the sector, including “Rosseti” OJSC, “SO UES” OJSC, “Inter RAO” OJSC  and the main industry organizations including the Market Council” Non-Profit Partnership” Association took part in the discussion.