Vitaly Korolev: the index for payment by the population can be exceeded only as exceptions

FAS sent relevant letter to the Heads of top executive bodies of the Russian regions

Speaking at the tariff regulation workshop in Yalta, Deputy Head of FAS Vitaly Korolev highlighted the main areas of the new tariff policy.

“The first item concerns restricting electric power tariffs in the Kurgan region for the population by 19% and in Buryatia - by 25% for industrial consumers at low voltage”, pointed out Vitaly Korolev. “Of special significance is bringing electric power tariffs to the average Russian level in the Far East where there was overrating. The reduction is from 27% to 62% depending on a region”.

“Tariff in exchange for efficiency” is the second area of tariff policy. “FAS is the engine for extrapolating it to various fields, for instance, heat supply. In January 2017 the Government passed a Decree drafted by FAS. It specifies that applying “tariff in exchange for efficiency” will allow companies to maintain saving gained as a result of changing the type of fuel. Further on companies will be able to invest this money in efficiency enhancement”, stressed Vitaly Korolev.

Deputy Head of FAS also mentioned “benchmarking” of economic sectors. Vitaly Korolev said that efforts are being undertaken to introduce the “benchmark costs” for water supply and drainage services.

Next important area of tariff policy is strengthening control over the tariff powers of regional regulators.

“Here our work has three blocks. The first block is absolute abolishing of tariff decisions made in breach of the law. Such unlawful decisions may provoke tariff growth for consumers”, informed Vitaly Korolev. “The second block is observing the unified standard of the pricing law. And the third one – a ban on exceeding the payment index for the population”.

“As for the last block, on 12 October, based on the instructions from the Government,  2017 FAS sent letters to the Heads of top executive bodies of the Russian regions that the index for payment by the population can be exceeded only as exceptions”, said Vitaly Korolev. “Regional authorities should submit information and justification to FAS in advance when the index may be exceeded”.